Wednesday, 8 May 2013

The Facts About Merchant Shipping in Pakistan

Role of Merchant Navy:

Merchant Navy plays a vital role in the economic and Industrial development of a country. History has shown that all the leading maritime nations of today had given great importance to the building up of an efficient fleet of merchant ships in the earlier stages of their progress. In fact it will not be incorrect to say that these very nations owe much of their importance, progress and prosperity to this basic form of sea transport.

Geographically Pakistan is situated at the north eastern corner of Arabian Sea with a vast coast line of about 1100 kilometers. No country with such a long coast line can underestimate the significance of shipping as an important economic activity.

Thus a strong and active merchant marine is essential for our country, not only for commercial reasons also for national defense.


On independence in 1947, Pakistan inherited one deep sea port of Karachi in West Pakistan and a River Port of Chittagong in East Pakistan which was very small and undeveloped. Draft at the river port was very low ranging between 22 - 24 feet at high tide. Also there were 3 ships: one of 7000 tons, the second of 1800 tons and the third an oil tanker of about 16000 tons which belonged to Millwala family as they brought this tanker from India. The smaller one (1800 tons) was handy and served as a carrier of defense cargoes mainly explosives. The tanker was of no immediate use and she remained on charter with oil companies. The bigger vessel was used as a grain carrier. The first demands on shipping was for heavy movement of food grains, salt and defense cargoes. The two cargo ships were quite inadequate and the country leaned heavily on ships of foreign companies which had been operating in this region.

Incidentally just before partition, Quaid-e-Azam Muhammad Ali Jinnah asked Mr. Rustom Cowasjee to assist in the formation of a shipping company. He foresaw the necessity of merchant fleet particularly in view of the great distances separating the two wings.

Mr. Cowasjee, the only shipping man in the new Pakistan arena required both financial and trade backing for the venture. Mr. Jinnah, therefore introduced him to Mr. Muhammad Ali Habib, the owner of first Muslim Bank in India. Between them they gathered the nucleus of Muslim merchants prominent in trade, both in Western India & Bengal.

The Bantwa Memon community was the largest group of Muslim Traders in undivided India. They controlled the grain and other trades from their small towns in Kathiawar. They were also known to Mr. Cowasjee who operated a Stevedoring and Ship-handling company in thirties in five ports of Kathiawar.

The commercial strength of these merchants could be judged by the fact that Sir William Currie, the then Managing Director of British India Steam Navigation Co, the tycoon of British Shipping, used to personally visit them every year in the small towns braving the heat and dusty roads.

Mr. Habib coordinated with these merchants to join in forming Muhammadi Steamship Co. Ltd. Prominent amongst them were:-

Ø                  Mr. Mirza Muhammad Ispahani of M. M. Ispahani Dacca
Ø                  Mr. Valli Muhammad Dada of Hussein Kassim Dada later Dada Ltd
Ø                  Mr. Abdul Rehman Abdul Gani later ARAG Ltd

In August 1947 Mr. Muhammad Ali Habib, Mr. Rustom Cowasjee, and Mr. Kassim Dada went to London, the hub of world shipping, to buy ships. As it was not possible to buy and operate ships overnight, they decided to initially time-charter three ships jointly for a period of one year extendable by another six months. Muhammadi Steamship Co. was yet an unknown entity in the shipping World and ship-owners were reluctant to enter into charter with them. However two ships 'Strymon' and 'Vest' were chartered in the name of East & West Steamship Co and at the behest of London Brokers of the Cowasjee family a third ship "Mount Kyllene" was chartered in the name of Muhammadi.

On the return of the these promoters, Karachi was found to be in post partition turmoil. No office accommodation was readily available and the operations began from a small office of Habib Sons in Laxmi Building, Bolton Market, Karachi.

However dependence on foreign chartered ships could not be reduced immediately. In 1947 alone foreign chartered ships performed 20 voyages.

Seeing heavy drain of foreign exchange and to create public interest in shipping business the Government declared the ports of Karachi & Chittagong as port of Registry for ocean going ships. The Control of shipping Act was invoked to restrict the freedom of foreign shipping operating on the coast and to foster Pakistan under this umbrella. Food grains of course were moving in large quantities but this could have been just a temporary phase. The pattern of future trade was not at all clear. In order to make investors shipping minded, without much risk to their capital, Government decided to throw the doors open, practically, to buy anything that would float for the next four years or so. The idea was to save the immediate drain on foreign exchange and at the same time to let investors gain experience of shipping at little cost to themselves. Ships were cheap in those days, and would have paid for themselves in four year's time. Thereafter, standards could be set, and the old ones replaced by later and better ships. It was in this confusion that the Merchant Navy had to develop.

In August, 1948 the first ship to be registered was "Fatima" (named after Mohtarma Fatima Jinnah) GRT 671. It belonged to Cowasjee Family. It was followed by AI-Ahmadi of GRT 5185 belonging to Muhammadi Steamship Company Ltd. From 1947 to 1951, there was a little tonnage under the Pakistan Flag and the inter-wing trade was significantly run by foreign shipping lines.

The capital for investment was short and the managerial capability shorter still, yet entrepreneurs came forward gradually to built up a merchant fleet, albeit an old one.

In this connection, however, it may be remembered that immediately after the termination of the Second World War, ships of recent built were just not available or if a few were available, the prices demanded were phenomenally high. There were also a great many restrictions on sale and transfer of flags of recent built ships in a large number of countries. Under those circumstances, Pakistan had no alternative but to purchase vessels that were comparatively old. Indeed many countries in the world in the past made a beginning in shipping with old ships. Each and everyone of these vessels, however, were purchased with the blessings and full approval of Pakistani Govt.

Within a decade, the fleet size rose to 21 in 1957 with total Dead Weight Tonnage (DWT) 168932. By 1960 Pakistan had a fleet of 41 ships with total DWT 353945, with all shipping in private sector. Most of the ships of private sector were very old and did not ply on international routes because they were not allowed under Control of Shipping Act. Hence they concentrated on their operation on the lucrative trade between the two wings of the country.

As far as recruitment of crew was concerned it was no problem. Traditionally this area has been providing seafarers to international shipping for some 150 years when ships under its own flag were non-existent. The Pathans from Swat (NWFP) (as engine crew), the Bengali's from East Pakistan, Kutchie's, Kokani's and Balochs from Karachi (as deck ratings) have been going to sea in British, German and other ships since long.
However, there was a dearth of senior officer specially Masters, Chief Engineers & 2nd Engineers. On most of the ships they were of European countries such as Britain, Germany, Norway, Poland and even from Turkey. However, by mid sixties they were all replaced by Pakistanis.

The worth-mentioning Pakistani companies which entered in the shipping arena at that time were:

Ø        Muhammadi Steamship Co.
Ø        East & West Steamship Co.
Ø        The Gulf Steamship Ltd.
Ø        Karachi Steam Navigation Co Ltd.
Ø        Trans Oceanic Steamship Co Ltd.
Ø        United Oriental Steamship Co.
Ø        Pan Islamic Steamship Co.

In 1963 the Government decided to establish National Shipping Corporation (NSC) with a view to provide safe and efficient shipping service in both international and inter provincial routes.

Within a period of about eight years, its fleet expanded to 32 ships in 1971. By then the private shipping companies had a total of 25 ships belonging to various companies which were mostly very old.


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