Introduction
Sost Dry Port, situated near the Pakistan-China border, is a vital hub for trade and transit between Pakistan, Central Asia, and Europe. Originally designed to foster local and regional commerce, the port’s operations have reportedly been commandeered by military-run entities, particularly the National Logistics Cell (NLC). This report explores these allegations, highlighting their implications for local businesses, regional trade, and revenue generation.
Background
Sost Dry Port serves as the first land port of entry for goods entering Pakistan from China, playing a crucial role in the China-Pakistan Economic Corridor (CPEC). Envisioned as a platform for local entrepreneurs to facilitate trade, the port has instead become a focal point of monopolization and exclusion, severely impacting its intended objectives.
Hijacking by the Army
1. Exclusive NLC Control
- The National Logistics Cell (NLC), a military-operated organization, has monopolized all operations at Sost Dry Port. Over 300 new NLC container trucks dominate the port’s logistics, sidelining local transporters and businesses.
- During the harsh winter months, local businessmen have been entirely barred from operations, further cementing NLC’s control over import and export activities.
An AI-generated image illustrating the scenic Sost Dry Port in Gilgit-Baltistan, a pivotal hub in Pakistan’s China-Pakistan Economic Corridor (CPEC), complementing the details discussed in this article.
2. Restricted Access for Local Businesses
- The port is operational exclusively for NLC-managed consignments, effectively barring local traders from meaningful participation in trade activities.
- Allegations have surfaced that the military authorities have persuaded Chinese officials to restrict local businessmen, systematically excluding them from utilizing the port.
- A previous agreement between Pakistan and China exempting up to 200 kg of luggage from taxation has been revoked by port authorities, further burdening local traders. Prolonged protests by local businesses led to temporary relief, but many traders have since faced FIRs (Police Inquiries) for attempting to transport goods in small vehicles, with over 200 individuals targeted.
3. Revenue Concerns
The NLC is alleged to evade import duties on goods transported through its channels, depriving the national exchequer of substantial revenue.
This practice creates an unfair competitive environment, as local traders are required to pay standard duties and taxes, further disadvantaging them.
Impact on Local Economy and Trade
1. Displacement of Local Businesses
The exclusion of local traders has caused severe economic marginalization, leaving many unable to compete against NLC’s preferential treatment. This has directly affected the livelihoods of those reliant on cross-border trade.
2. Erosion of Trust in State Institutions
The military’s monopolization of Sost Dry Port, further undermines the dwindling trust in state institutions, fueling perceptions of unfairness and lack of transparency in trade policies.
The Pakistani military is under immense criticism for its role in running legitimate and illegitimate businesses to have created a black economy in the country to benefit themselves:
— Adil Raja (@soldierspeaks) December 29, 2024
3. Revenue Loss
The alleged non-payment of duties by NLC results in significant revenue losses, further straining Pakistan’s fiscal resources during an already precarious economic period.
Conclusion
The monopolization of Sost Dry Port by the military and its operational arm, the NLC, contradicts the principles of fair trade and economic inclusivity. The systematic exclusion of local businessmen, evasion of import duties, and alleged misuse of authority have eroded trust in state institutions and hindered economic growth.
Immediate steps are essential to:
- Restore local traders’ access to port operations.
- Ensure transparency in port management and trade policies.
- Address revenue leakages by enforcing duty payment on all consignments.
Addressing these concerns is critical to fostering a competitive, transparent, and inclusive trade environment that benefits Pakistan’s economy and its people.
