– Country’s shipping industry tangled up in cumbersome regulations and a massive oversupply of vessels
– Gwadar is an all weather port and can helps Pakistan connect with four important and resource rich regions of the world
Interview with Mr Abdullah Farrukh – Director, Pak Shaheen Freighters Pvt Ltd
Mr. Abdullah Farrukh graduated from Royal Holloway and New Bedford College, University of London where he studied from 2005 to 2008. He also joined London School of Economics in July-August 2007 for a course in Managerial Accounting, Financial Control and Management and Entrepreneurship. Thereafter he did his Master’s in International Political Economy from University of Warwick, UK in 2009.
After completing his education, Mr. Abdullah Farrukh joined as Director in his family business in Pak Shaheen Group, which is a logistical supply chain management group working actively in and out of Pakistan. The core competencies include ocean and air freight, with bulk chartering, project handling and facilitating Afghan Transit Trade and Central Asian Trade. His area of specialization is Transport and Logistics, especially with respect to the current security and political challenges and the ongoing conflict in Pakistan and Afghanistan. Having an insight of the socio-political and economic problems and situations facing the country and the region, along with exposures into the real world through travel and interaction, he equipped himself to skillfully analyze and deliver.
He is currently the Chairman of All Pakistan Shipping Association, a post to which he was first elected in 2017. Prior to that, he also remained as Chairman in 2015 and Vice Chairman of All Pakistan Shipping Association from 2013 to 2015.
He is also currently the Convener of FPCCI Standing Committee on Shipping Affairs.
He was also a visiting lecturer at the Shaheed Zulfiqar Ali Bhutto Institute of Science and Technology in 2010-2011. He has also remained a Guest Speaker in the Institute of Strategic Studies, London, England.
He is member of several prestigious clubs in Pakistan and abroad including the Boat Club and Rotary Club of Pakistan and King Hussain Club, Jordan.
He is an avid reader and frequent traveler and is interested in following the game of cricket.
PAGE: Tell about yourself and an overview of the vision and scope of Pak Shaheen Freighters Private Limited?
Abdullah Farrukh: Improving air freight standards in the country has been the sole objective of Pak Shaheen Freighters (Private) Limited. The Company has laid down stringent quality standards in the level of service it offers to clientele. With such high standards, it is natural that the company be accredited to both IATA and FIATA.
Since a nationwide presence is crucial to the business, Pak Shaheen Freighters has offices located strategically at Karachi, Faisalabad, Lahore, Rawalpindi and Islamabad. Efficient and trained staff ensures that up-country shippers and exporters get an excellent level of service that matches the most discerning needs in air freight and consolidation services. The Company is fully equipped to offer services for all kinds of cargoes be it special cargoes, dangerous goods or perishables, with special L.C.L. traffic representing Seacon Antwerp. The Company’s excellent track record of growth is testimony to a sound business approach being followed. The growth rate at all company locations nationwide continues to grow at a steady pace.
As Pakistan’s exports are poised to register an increase, Pak Shaheen Freighters is ready to meet the challenge in air freight and consolidation services.
Our Vision: “Recognition in international and local market as leader of transportation; having entire product range functioning at utmost efficiency, producing highest turnover, creating impression as the only choice to the customer, and all ultimately leading towards expansion globally”.
PAGE: Briefly tell our readers about the Company’s history and its success and what are your plans to expand business?
Abdullah Farrukh: In 1990 the management of Pak Shaheen Group decided to establish a logistical arm to create synergy of the entire skill base of the group. Pak Shaheen Freighters started off as a high class traditional freight forwarder and over the years experienced decent growth and stretched its services to provide supply chain solutions. Our customers perceive us as a consultative organization capable to provide solution to any need regardless of the size and business scope. We plan to expand as per our mission to be the most respected company with technology integrated methods, providing customized transportation solutions to any individual customer need.
PAGE: Give us a bit background of your Company and group, how it started and carried its work forward?
Abdullah Farrukh: Since its inception in 1981, the Pak Shaheen Group has attained a vanguard position as Pakistan’s leading integrated multi-service business conglomerate. Successors to H. Bird & Company, UK., the Group can trace its origins as ship agent from Karachi a little after Pakistan’s independence (1947). The successive years saw the Group sail on a successful voyage through sheer dint of hard work and dedicated efforts.
In a journey that has spanned over 70 years; the Group finds a nationwide presence with locations at Karachi, Lahore, Faisalabad, Rawalpindi, Islamabad, Sialkot and Multan. As a dynamic Group and charged with the vision to always move ahead, we strongly believe in maintaining a high level of discipline, consistency, quality and technological advancement. Our vision entails looking at new emerging trends in international maritime operations and all related services with a very specific focus – to render the fruits of breakthrough technology to a wider spectrum of clients.
As a Group, our operations are through Karachi Port, Port Bin Qasim, Lahore Dry Port, Faisalabad Dry Port and every sea port and airport in Pakistan. Thus, our area of operations touches every mode of transportation with every kind of haulage. Be it air, sea or land, we find a dynamic presence in the country’s maritime operations and related activities.
As a Group we lay vital importance to human resources. Professional Directors combine their business vision and acumen with the strength of an able and dynamic team of a skilled and experienced workforce.
PAGE: Pakistan has a population of over 200 million people and its foreign trade (import and export) is around US$40 billion per annum, how you review the potential market size?
Abdullah Farrukh: Pakistan had an untapped export potential of several billion dollars, as there is lot of potential in home textile products, apparels, leather products and cereals to double the exports within a year. Despite having best quality, Pakistani merchandisers’ are not finding their way to the most parts of the world just because of lack of aggressive marketing strategy. The regional trade is another neglected area where we have to do a lot of work through public-private partnership. There is a need to devise a comprehensive strategy to promote the industry on commercial basis, which would not only support the manufactures but also increase exports. Good working environment would enhance the capacity of workers enabling them to compete internationally. There is also a need to diversify the range of value-added traditional industrial goods, such as consumer textile and leather products, as well as of non-traditional industrial goods.
PAGE: As the Chairman of the all Pakistan Shipping Association, what is your outlook on the shipping industry of Pakistan?
Abdullah Farrukh: There is lack of growth in the shipping industry in Pakistan due to the fact that global maritime industry has gotten tangled up in cumbersome regulations and a massive oversupply of vessels. Costs of compliance with regulations are inevitably increasing the cost of doing business. Shipping companies are strained by plummeting market conditions and are always looking out to the horizon for new opportunities and for better, more efficient ships. The situation gets further exacerbated by the fact that governments of certain Asian countries keep subsidizing both builders and buyers as an artificial means to keep their maritime economies chugging. All these conditions manifest themselves as an unintended oversupply of vessels, which ensures that freight rates remain low and the cycle continues unabated.
PAGE: The country has three ports, two in Karachi and one at Gwadar. How do you compare facilities and charges of Pakistani ports with other ports operating in the region?
Abdullah Farrukh: The underlying assumption for tariff comparisons is that the charges being compared are for the same services and ports being compared are competing for the same traffic, which is, in fact, not realistic. Services that are provided for the same tariff item may differ from one port to another. The quality of service may not be comparable and the cost of providing services may be different among ports because the mix of labour and capital employed in providing the services may not be the same. The traffic that will bear port charges may also differ among ports, and the ability to pay the charges may be different depending on competitiveness. It is therefore difficult to compare port tariffs among ports accurately because of diversity in their systems and regulations, the existence of pricing by long-standing agreements and the influence of the exchange rate. Furthermore, in some cases port charges, tariff levels and data are confidential and difficult to obtain.
PAGE: Do you believe that Gwadar face tough competition from UAE ports and Chabahar Port of Iran?
Abdullah Farrukh: Gwadar is a deep-sea port, unlike Chabahar it has more capacity for dealing with dry-cargo and serves as an ideal location for trans-shipment facilities as it is located close to Sea Lines of Communications (SLOC). Secondly, Gwadar is an all weather port. On the other hand, Chabahar has less potential compared to Gwadar in dealing with cargo and is close to the Port of Bandar Abbas, which is already functional. Gwadar port is more suitable for transporting energy to and from the Gulf countries and its outreach is much more than Chabahar. Gwadar port has more capacity to dock larger ships. The infrastructure available in Gwadar is more advance to handle liquid and container cargo. It helps Pakistan to connect with four important and resource rich regions of the world — South Asia, China, Central Asia and Iran. Another distinguishing feature of these ports is the policy framework under which they are to function. Gwadar port is leased to China Overseas Port Holding Corporation (COPHC) for 40 years, whereas Chabahar is only developed with the Indian assistance but its control and operational reins will remain in the hands of Iran.
PAGE: Out of Gwadar and Chabahar, which port offers more efficient and cost effective access to Afghanistan and Central Asian countries?
Abdullah Farrukh: Pakistani ports, including Karachi, Muhammad Bin Qasim and Gwadar are becoming attractive for Central Asian countries including Afghanistan with respect to their potential function as new gateways, enabling the sustainable development of CA countries, since Pakistan joined the CAREC programme in 2010. However, the hinterland of these ports currently covers only Pakistan and some areas of Afghanistan because of the underdeveloped infrastructure, as well as security issues when crossing Afghanistan. The major advantage of Pakistani ports is that they provide shorter distances from most cities in CA, than other competing ports. If the infrastructure in and around the country was developed, and the barriers at the cross-borders were significantly reduced, the market potential of Gwadar would be realized. Gwadar port has the potential to compete with regional as well as domestic ports and act as a regional hub. The other three states, Uzbekistan, Tajikistan and Turkmenistan, due to close geographical proximity, will be the potential users of the Gwadar port.
PAGE: Can Gwadar be used for transportation of crude oil/POL projects to China?
Abdullah Farrukh: Yes it will be used to transport POL products to China as Pakistan has decided to construct a mega oil city at Gwadar on 80,000 acres under China Pakistan Economic Corridor (CPEC). This mega oil city will be used for transportation of imported oil through the Gwadar Port to China. The oil will be imported from Gulf and will be stored at this proposed mega Gwadar oil city. Under the China Pakistan Economic Corridor (CPEC), the fuel transportation to China via Pakistan would take just seven days as import through western China takes almost 40 days. The mega oil facility would also help refine and store imported oil for onward transportation to China and develop fuel supply chain for the landlocked Central Asian states.
PAGE: If no, what other facilities have to be constructed to make this dream come true?
Abdullah Farrukh: After completion of new Gwadar International Airport, it will become a landmark building for the modernization of the Gwadar region. It will have important strategic significance for the development of Gwadar city and will be an important transportation infrastructure that benefits Gwadar and connects other cities.