ISLAMABAD: The government has constituted a committee to negotiate and frame a commercial agreement between AD Ports UAE and KPT for outsourcing the operations of bulk and general cargo at East Wharf Karachi Port.

Federal Minister for Finance and Revenue Ishaq Dar chaired the meeting of the Cabinet Committee on Inter-Governmental Commercial Transactions (CCoIGCT) on Thursday.

According to official sources, the government approved 12 bases for price determination mechanism for outsourcing of port, which included terms of the agreement, the life span of the terminal, max capacity to handle cargo, length of quay wall, royalty (per ton or fixed or gross revenue basis), land rent per square metre in bonded area, storage charges, dock labour charges, up-front payment (adjustable), up-front payment (non-adjustable) and quantum and type of investment.

The committee granted approval for the price discovery mechanism in terms of Section-4(2) (b) of IGCT Act, 2022 keeping in view identified 12 variables to be used to carry out the comparisons for the purpose of price discovery by the negotiation committee to be nominated by the CCoIGCT.

A committee may be constituted to frame a commercial agreement, and negotiate the terms, conditions and comparison mechanism for price discovery and place its recommendations in the next meeting of CCoIGCT for consideration and approval.

According to official announcement, made by the Ministry of Finance, the CCoIGCT considered a summary of Ministry of Maritime Affairs regarding a commercial agreement between AD Ports UAE and KPT for outsourcing of the operations of bulk and general cargo at East Wharf Karachi Port. The CCoIGCT, after discussion, approved the price discovery mechanism in the light of discussion and constituted a committee to negotiate and frame a commercial agreement to be signed between the nominated agencies of the UAE and Pakistan for development of bulk and general cargo terminal at West Wharf, Karachi Port.