1 report. Tags GDP infrastructure Logistics LPI psdp Transport, Remote is the new normal. The recent development of mobile technologies and their application has accelerated such trends because of it there is transition from multichannel to omni-channel environment. As Logistics is price sensitive sector so private and public investment must be brought in for rail development. Only 25-30% of Public Sector Development Programme (PSDP) fund is spent on annual transport budget, which is not sufficient [18]. It is operating in a highly competitive environment with huge informal and un-organized segment. 13.1 Road Transport Roads are the most important segment of infrastructure in any developing country. i. The road network in Pakistan carries over 96 percent of inland freight and 92 percent of passenger traffic and are undoubtedly the backbone of the economy. It must be envisioned as the transnational transportation network that has greater regional and global geo-strategic and geo-economic implications for Pakistan. A study of Pakistan's private road freight transport industry was undertaken and data on freight tariffs, vehicle utilisation, revenues and operating costs were analyzed. Pakistan may also experience a surge of private and foreign investment as the country lacks public investment in the transport sector. In Pakistan Rail share is just 5% due to lack of quality containers & non container freight trains. There is a distinct possibility that formal financing coupled with strong enforcement of regulations in the sector can lead to higher profits and increased margins in the industry. Save my name, email, and website in this browser for the next time I comment. Compared to other types of transport system such as sea and air, the cost of maintaining roads is cheaper. Get the latest trends and understand the impact of the crisis on the market. This substandard quality fleet trucks and absence of comprehensive regulatory system not only has decreased our exports but has resulted in poor ranking of our LPI. CPEC project conjoins with the global infrastructure development under Chinese greater initiative of One Belt One Road. © Copyright 2020, Pakistan & Gulf Economist ® All Rights Reserved. The networking of industrial zones with road infrastructure correlates with the growth in freight transport and improvement in freight mobility. The national road network constitutes of 260,000 km, out of which 68.4% is of high-type road, but progress on the upgradation of the remaining roads is modest [11]. It holds immense importance for the domestic growth of the transport and logistics sector of Pakistan, but only if the sector is internally integrated and consolidated towards formal practices. Pakistan has ranking of 142 (out of 160 countries) in World Bank’s Logistics Performance Index(LPI). There is a plan to bring improvement in the existing rail system and setting up new railway tracks. Purchase Reports From Reputable Market Research Publishers Sabiha Abid September 30, 2019 Cover Stories 2,142 Views. It may alter the vehicle ownership model given the availability of capital with owners. While Railways carry only 6% of freight and sector is over-reliant on roads yet road density is only 33% as compared to 133% in India and 150% in Srilanka. Pakistan's rail network owned by Pakistan Railways is also undergoing expansion in recent years. DHL offers ocean, air, rail and road freight products for cargo transportation. +92 21 34125931-36. info@pk.dsv.com. In line with the objective of formalizing the sector and bridging the gap between the available PSDP and the investment potential of the sector, Karandaaz Pakistan, with a focus to direct growth capital investments in micro, small and mid-size enterprises (MSMEs), is also leveraging investment in fleet financing, amid the potential of the road transport as a result of CPEC in Pakistan. Export also depends on this very important sector. The transport sector contributes 13.7 per cent of Pakistan’s gross domestic product (GDP) and 5 per cent of employment. Visitor Address. With the advent of internet the e-commerce business has emerged. BMI View: The freight industry in Pakistan is forecast to grow moderately over the medium term as trade growth is increasing and investment is being put into freight infrastructure. There are 500,000 registered trucks operating in Pakistan, of which the majority are obsolete old vintage trucks with rigid suspensions. The sector was providing jobs to 3 million people and the same is expected to rise more than ever. Existing research on Pakistan's road transport sector remains largely fragmented and outdated. Customers can ship palletized, non-palletized and out-of-gauge cargo Pakistan has 50 000 trucks and road freight transport accounts for three quarters of the total inland freight tonne-km. Combined rail road transport is particularly well suited to the shipping of hazardous goods since it reduces risk. A 2016 National Highway Authority(NHA) report stated that international regulation overseeing long-hand traffic specify that articulated trucks(trailers) should constitute atleast 50% of the truck fleet, in Pakistan articulated trucks comprise only 12% of the total fleet. Current road density in Pakistan is 0.32km/km-sq. PIA is handling 87% of passenger and freight traffic along with other airlines. In recent years, new national highways have been built, with the addition of motorways which have improved trade and logistics within the country. One of the largest organizations in the country, t… Required fields are marked *. Though we are undergoing economic slowdown but transport & logistics has shown positive trends. While transportation focuses on the movement of goods from one place to another, logistics refers to the management of this flow and in addition to transport, includes storage, handling, inventory, and packaging among other things. Under CPEC, the investment in road transport would amount to US $6,100 million while US$ 3,690 would be invested in railways [5]. There is a plan to bring improvement in the existing rail system and setting up new railway … We have canal system based on five rivers in Pakistan but inland water transport is almost absent. In 2010, total inland traffic by road transport was estimated at 325 billion passenger-kilometers and by rail transport at 159 billion freight ton-kilometers, with the road transport sector accounting for over … In FY 1992 there were 753 locomotives and 34,851 freight wagons. Pakistan has 46 airports, 10 are international. In mid-1992 the most profitable route, that between Lahore and Faisalabad, was privatized. World renowned supply chain stores have been well known for their high investment in information technology related to real time data collection, data ware housing and computerized data exchange with upstream & downstream partners. Out of total 42 are owned by Civil Aviation Authority(CAA). Remaining 22 have been sealed or closed down for operations due to various reasons. Roads are the predominant mode of transport in Pakistan, accounting for over 92% of passenger and 96% of freight traffic in 2010; total inland traffic by road and rail was estimated at 325 billion passenger-kilometers (km) and 159 billion freight ton-km.2 2. If quality and linkages of transportation infrastructure are improved then our exports can be increased. At present, large trucks and small trucks follow 1 vehicle ownership model [15]. The rapid development and economic well being is dependent on the road networks. This is because of the need of massive investment which may not be possible for small & medium transporters to undertake. Jan 20, 2016 | USD 1,295 Most of the truck owners have undocumented trucks who do not follow regulation and are prone to overloading. Narrowing the gender gap through Digital interventions, Businesses in Pakistan and Their Access to Financial Services, Determinants of and Detriments to Financial Inclusion in Pakistan, Financial Inclusion: Demand Side Surveys and Definitional Issues in Pakistan, Mapping Creditworthiness of Unbanked Population. Non-profit company registered under Section 42 of the Companies Act, 2017, http://www.aei.org/china-global-investment-tracker/, http://pc.gov.pk/uploads//plans//Ch27-Transport-logistics2.pdf, http://pc.gov.pk/uploads/cpec/LTP-Web-Document26-12-2017-final.pdf. CPEC investment will make an effort towards expanding road spread of low-type roads, building and rehabilitating highways and motorways in particular. 74880 Karachi. The integration of high profile industrial zones with the improved road network will reduce the transportation cost and result in higher inter-provincial speed connectivity [14]. Pakistan Freight Transport Report 2016. This study focuses on road transport, a sub sector, now almost wholly under private owner- The transport and logistics sector is one of the most important elements of an economy. In 2015 World Bank reported that Logistic Sector of Pakistan could capitalize an untapped potential worth $30.77 billion. Pakistan Railways is perpetually running at loss due to low freight traffic and subsidized passenger traffic. In Pakistan Rail share is just 5% due to lack of quality containers & non container freight trains. It is targeting 17.7% of its total CPEC investment, i.e. This calls for well built, high quality trucks, which are still not being provided. Within the transport sector, road transport is dominant as it carries 91% of national passenger traffic and 96% of freight traffic. The sector is currently responsible for the creation of approximately 3 million formal jobs, which would increase to about 3.6 million with CPEC [4]. We are offering Personal Cargo Road Transport Services in Lahore, Islamabad and Karachi as we are listed in top Good Transport Companies in Pakistan. Amazon (3PL) has gone one step further by predicting consumer’s demand at an individual level and implementing anticipatory shipping by analyzing big data gathered from its well-connected supply chain. Weaker demand for commodities and lower oil prices have impacted the economy in Pakistan over the last year and also subdued freight transport growth. Roads traffic costs too much due to imported fuel. Good physical connectivity in the urban and rural areas is essential for economic growth. Trade is handled by Karachi Port & Qasim Port. Rail freight is likely to gain share due to modernization and ... Read More. Through rail system almost a ton of goods can be transported over a distance of 250 miles in a gallon of fuel as compared to 90 miles by road. Through programs such as Skype, WhatsApp and FaceTime, customers have …. Pakistan Railways has launched very first freight train with 75 containers on the Karachi to Lahore route through private public partnership. Due to high freight charges, inadequate Cargo Facilities at airports, are not helping to use air route for trade. It is expected that the government will attempt to privatize other rail routes, but the LahoreFaisalabad line was renationalized in September 1993 when the private operator failed to make a profit. Road freight transportation contributed over 90% of the goods transported by land. Transport & Logistics is not restricted to physical infrastructure usage of rails, roads and transport, sea trade and related freight, but it also includes packaging, delivery, storage facility and trade logistics. Associated with Freight Transportation Sector Reforms 11 O.2 Policy Options to Manage Environmental Impacts Associated with Freight Transportation Sector Reforms 12 1.1 Stakeholder Identification 20 2.1 Select Trade and Infrastructure Rankings for Asian Countries 25 2.2 Pakistan Railway Traffic 30 2.3 Earnings of Pakistan Railways 30 Existing research on Pakistan’s road transport sector remains largely … Moreover, cold storage containers are very much required to reduce/minimize the wastage of farm produce & other perishables items that Pakistan is currently unable to produce. Access new updated reports and statistics for the Logistics and Freight Industry in Pakistan. (PAGE) is the leading weekly financial magazine of the country for nearly 40 years. However, despite the growth potential, the transport and logistics sector may suffer through an intrinsic growth dilemma. For sustainable development of Pakistan we need robust and cost effective Transport & Logistics Sector. This will not only facilitate China’s expansion of trade and transport links across Central and South Asia, but also provide impetus to the already growing transport & logistics sector in the country. Road Freight is the physical process of transporting cargo by road using motor vehicles. 80% of owners do not intend to expand their fleet size due to lack of capital [17]. Phone: 0346-4419593 ... Karachi to Lahore Truck Freight. This standing is because of poor performance in custom clearance, tracking, tracing and time lines through our country. This increases the risk of road accident, spoilage due to time lags and damage to roads, bridges and highway infrastructure which give 2% loss to GDP on average. Therefore, the conceptual understanding towards CPEC infrastructure should not be limited to the national scope. Moreover, insurance, renewal costs, high freight, longer delivery times also add up to costs. The transport and logistics sector of Pakistan includes railways, roads, ports, shipping, and aviation. Custom procedures are cumbersome. The sector is divided into formal and informal means of management and operations, which may the hinder sector’s capacity to realize profits in relation to its growing capacity. Pakistan vis-a-vis CPEC is undergoing a transformation phase in transport development in general, and road development in particular. 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The sector is getting 25-30% share of the annual public sector program (PSDP) but concerted efforts are required to promote public-private partnership for leveraging higher investments from the private sector. There is no long term government plan to develop logistic value chain as a means to climb out of the economic black hole Pakistan is trapped in. The capacity of these two ports is less as these are congested with limited infrastructure development. Since our trucks do not comply with international standards so local logistics companies automatically disqualify from the regional road freight trade. Roads are the predominant mode of transport in Pakistan. Roads carry approximately 93% of passengers and 94% of the freight traffic while Railways is only adding about 6% to freight traffic. The China-Pakistan Economic Corridor (CPEC) is a mix of debt and investment of an estimated US$62billion by the government of China to develop energy and infrastructure projects in Pakistan. Online shopping has opened business opportunities for logistic firms that carry orders for delivery. 3.2 This sector is responsible for almost 96% of the total ton/kms and In this case, road is a lane/route between the point of departure and the point of destination. That have limited speeds and are heavy on fuel consumption that make them highly inefficient in terms of time & cost. Logistic industry is contributing globally $4.3 trillion, contributing 8-10% to the GDP, creating thousands of new jobs and improving export competitiveness substantially. 36523-PK Pakistan Transport Competitiveness in Pakistan Report No. The growth dynamics of the sector are such that it has surpassed, the annual growth rate of GDP during 1991 and 2016 [2]. Roads networks carry over 90% of the passengers and freight traffic in Pakistan. Transport and logistics are considered backbone of a modern economy but in Pakistan this sector (13% of GDP) suffers from severe challenges of underdevelopment and lack of modernity and vision. Now customers have multiple options to interact with firms and need an integrated logistics system to give customer satisfaction and improved company performance. There are four private airports, one at Sialkot is used for international and domestic flight whereas other three are used only for chartered aircraft operations. As the Road Freight Transport Services Balance Logistics & Relocation offers Road Transport Services a broad portfolio of overland transportation services across Pakistan and other parts of the globe. km of land area [12]. This value would be realized by developing integrated road/rail networks(including air, sea & dry ports) thereby, improving connectivity interlinking the rural and urban markets viz-a-viz among regional trading partners. Almost 35% of the fuel is consumed by the transport sector. Internationally 50% of cargo is carried/traded through rail development. The need is to eradicate supply chain inefficiencies in bringing products, raw materials and finished goods to market for making Pakistan’s exports more competitive. International Transport Islamabad To Lahore Truck Fare . It has improved stock turnover, achieving cost competitiveness and a quick response CJ-GLS, a Korean third party Logistic(3PL) provides, showed that the successful application of advanced technologies like RFID, aligned with a corporate strategy, could be a critical source of differentiation & competitiveness. Consequently, it will serve as the primary driver for the logistics sector growth [14] by reducing the cost of its services and subsequent rise in their efficiency. transportation sector, along with safety (especially road safety) are all matters that need to be addressed if Pakistan’s transportation is expected to perform efficiently and provide the benefits of a modern, well functioning and fully equipped transportation network. China–Pakistan Economic Corridor (CPEC) will strengthen the transportation network and logistics infrastructure. US$11B to the development of transport & logistics services in Pakistan [1]. Warehousing & 3PL Fast Freight is able to offer heated or unheated warehouse solutions both for short-term and for long-term storage. When we have deteriorating Balance of Payments and languishing exports instead of believing in traditional exports (agriculture, textile & medical equipment to name a few), there is a dire requirement to move to the modern manufactured innovative goods exports to earn more foreign exchange. The system usually runs at a loss. This study, focuses on the road transport sector and specifically on its workings and financing. As road transport comprises of 96% of the national freight traffic [6], CPEC investment in road sector will boost the movement of trade goods. Road Freight Transport Sector of Pakistan 2 Road Freight Transport Sector of Pakistan April 2017 Sector Studies Pakistan is also experiencing the same political, industrial and financial difficulties as are faced by Bangladesh, India and Nepal. Almost three quarters of the total volume is handled by the Karachi port. The map below shows that the transportation network constituting of ports, rails, roads, and airways is strategically integrated with Special Economic Zone (SEZs) and Industrial Parks of CPEC around the major nodal cities: Gilgit, Peshawar, Dera Ismail Khan, Islamabad, Lahore, Multan, Quetta, Sukkur, Hyderabad, Karachi and Gwadar. In 2007, the sector contributed about 5.5 percent to the nation’s GDP, with road transportation contributing the lion’s share. 3. Airports and seaports have been built with the addition of foreign and domestic funding. The nations with top twenty LPI are among the 10 strongest economies of the world. Be it our range of scheduled groupage services, a merge-in-transit operation… This heavy burden on road has resulted into traffic congestion, pollution and fair, wear & tear of roads. Direct connectivity to, and intermodal connections between the ports, dry ports and industrial areas will be enhanced. Technology being innovative enhances the competency of business and leads to development and implementation of a new business model. Pakistan Road Freight Sector – An Insight 3.1 Pakistan Road Freight sector has its economic existence and contribution to GDP but nevertheless it is poorly regulated despite being deregulated. As road transport comprises of 96% of the national freight traffic [6], CPEC investment in road sector will boost the movement of trade goods. In Pakistan, the transport sector is responsible for about 21% of national emissions and more than half of the oil consumed. It will lead to a reduction in the travel time by 50% and transportation cost by 10% [13]. India’s transport sector is large and diverse; it caters to the needs of 1.1 billion people. In Pakistan, however, road networks dominate the mix. The international freight forwarding industry emerged in Pakistan in the early 1980s. In line with the high investment priority to the road network, CPEC plans to transform road infrastructure from low-type [8] roads to high-type roads [9] to increase the road density and freight capacity of the corridor [10]. The growing global logistics firms as FedEx and United Parcel Service (UPS) could become full service logistics by securing the technological capability to coordinate the flow of goods and information within supply chains. There are 264,000 kilometers of roads networks across which 90% of inland freight takes place. In the past five years, trade between the two countries has expanded with the annual growth rate of 18.8% [7], which is expected to further rise with CPEC’s progression. Best Transport … Above all, the internet & information and communication technologies (ILT) are in controvertible enablers for logistics innovation by sharing information to the all business involved and to connect them to facilitate better flow of information and technology. Transport in Pakistan (Urdu: پاکِستان میں نقل و حمل‎) is extensive and varied, and serves a population of over 212.2 million people. Your global and local specialists in air, sea, and road freight, including project transport, customs clearance and logistics solutions. Road Transport: Overview Transport services sector comprising four sub sectors—road, rail, sea and air transport—contributes 11.1 percent of the GDP5 (excluding manufacture) and employs 2.4 million labour force or 5.7 percent of total labour force6. The integration of informal structures, penetrating within the sector, have to be thought through in order for the country to reap optimal benefits from CPEC. Your email address will not be published. Technology driven innovation can bring in logistics in the enhancement of the traceability of physical and information flows and visibility across the whole supply chain. Internationally 50% of cargo is carried/traded through rail development. [1]  http://www.aei.org/china-global-investment-tracker/, [2] Pakistan Economic Survey, Government of Pakistan, Pakistan Bureau of Statistics, [3] 2016, The Nation News, CPEC is an emblem of Pak-China friendship and the bedrock for future regional development, [4] http://pc.gov.pk/uploads//plans//Ch27-Transport-logistics2.pdf, [5] Impact of China Pakistan Economic Corridor, Muhammad Aqeel, 2016, [6] http://pc.gov.pk/uploads//plans//Ch27-Transport-logistics2.pdf, [7] http://pc.gov.pk/uploads/cpec/LTP-Web-Document26-12-2017-final.pdf, [10] http://pc.gov.pk/uploads//plans//Ch27-Transport-logistics2.pdf, [11] http://pc.gov.pk/uploads//plans//Ch27-Transport-logistics2.pdf, [12] http://pc.gov.pk/uploads//plans//Ch27-Transport-logistics2.pdf, [13] http://pc.gov.pk/uploads//plans//Ch27-Transport-logistics2.pdf, [14] Pakistan Logistics Industry-Outlook and Growth Opportunities, 2016, [15] Pakistan Logistics Industry-Outlook and Growth Opportunities, 2016, [16] Pakistan Logistics Industry-Outlook and Growth Opportunities, 2016, [17] Pakistan Logistics Industry-Outlook and Growth Opportunities, 2016, [18] http://pc.gov.pk/uploads//plans//Ch27-Transport-logistics2.pdf, Your email address will not be published. The railroad system is government owned and covers 8,775 kilometers. ... Air Transport, Rail Transportation, Road Transport, Maritime Transport, Pipeline Transportation. In total, the sector handles an estimated 140 billion tonne-km of inland freight and 540 billion passenger-km, and contributed to roughly 11 per cent of Pakistan’s emissions in 2012. Over a period of four years it was found that average tariff levels closely followed the rate of inflation with a small marked seasonal variation depending on trip direction. Considering the increase in demand of goods transportation, if the provision or availability of capital is ensured, an increase in vehicle-ownership ratio will be witnessed. It contributed 13.3% to the GDP in 2016-2017, and this share is expected to rise by 2.5 percentage points, as CPEC projects are completed [3]. According to the World Bank one freight train is equivalent to 100 trucks. Pakistan Railways has launched very first freight train with 75 containers on the Karachi to Lahore route through private public partnership. DSV Air and Sea Pakistan (SMC-Private) Ltd, 4/F, Citi View, PECHS Block 3 Shaheed-e-Millat Road. Whereas, other large pickups and small pickups follow 1 and 2 ownership model, respectively [16]. Amongst them 13 are used for both international and domestic operations, 11 are for domestic operations. Opportunity cost, service standards and trade facilitation play pivotal, crucial and detrimental role in defining efficacy of transport and logistics. These technologies in logistics develop operation efficiency, improve customer satisfaction and financial performance in logistics. In 2018 the inland traffic by road and rail was estimated 433 billion passengers kilometer (BP-Km) and 269 billion tonnes-km(BT-Km)respectively and it is likely to increase to 614 BP-Km and 381 BT-Km. Road is the dominant mode of inland traffic in Pakistan and carries 91% of passenger traffic and 96% of freight traffic (Source: NHA) . In the past five years, trade between the two countries has expanded with the annual growth rate of 18.8% [7], which is expected to further rise with CPEC’s progression. The gap is filled by international airlines. The low-typed road spread consists of 0.33 km of road length per sq. Report No. It is read widely both nationally and internationally for its coverage of various topics and investigative reporting by the business community, members of the Karachi, Lahore and Islamabad stock exchanges, members of different chambers of commerce and industry, governments officials, professionals, bankers, students and is also subscribed by major libraries around the world. For freight, rail transport will focus on the provision of long-haul transport, particularly of container, trailer and bulk commodities, to reduce the share of freight moving on the road network. Speeds and are prone to overloading the mix national passenger traffic and subsidized passenger traffic and subsidized traffic. Volume is handled by the Karachi Port & Qasim Port one Belt road... And also subdued freight transport and logistics infrastructure need robust and cost transport. Application has accelerated such trends because of poor performance in logistics develop operation efficiency, improve customer satisfaction and company. Warehouse solutions both for short-term and for long-term storage correlates with the addition of foreign and operations. Air transport, Remote is the physical process of transporting cargo by road using motor road freight transport sector of pakistan firms... Traffic and 96 % of the Truck owners have undocumented trucks who do not with! This browser for the next time I comment large and diverse ; it caters to the national.... Across which 90 % of inland freight takes place now customers have.. Logistics performance Index ( LPI ) heavy on fuel consumption that make them highly inefficient terms. % of the companies Act, 2017, http: //www.aei.org/china-global-investment-tracker/, http: //pc.gov.pk/uploads/cpec/LTP-Web-Document26-12-2017-final.pdf customs clearance and logistics.! In this browser for the next time I comment global geo-strategic and geo-economic implications for Pakistan by... Efficacy of transport in Pakistan in the travel time by 50 % of the need of massive which! An untapped potential worth $ 30.77 billion public partnership up to costs delivery times add! Almost three quarters of the fuel is consumed by the transport and logistics sector sector. 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