Contents
AUTHORS’ INFORMATION – SECTION WISE.. x
IMPORTANT TERMINOLOGIES FOR SHIP RECYCLING SECTOR.. xvi
SECTION 1: THE CONTEXT OF THE REPORT. 2
1.7 Classification of Key Contents for the Report 8
SECTION 2: ROLE OF SHIP RECYCLING IN PAKISTAN.. 10
2 ROLE OF SHIP RECYCLING TOWARDS SOCIO-ECONOMIC AND INDUSTRIAL DEVELOPMENT IN PAKISTAN.. 10
2.2 Historical Trends of Ship Recycling at Gadani 11
2.3 Employment Generation by Gadani Ship Recycling Activity. 13
2.3.1 Data sources and types. 13
2.3.2 Datasets for the study. 13
2.3.3 Calculation of Direct Employment in Gadani Ship Recycling Industry. 13
2.3.3.1 Breakdown of direct employment at Gadani Yard. 14
2.3.3.2 Breakdown of total employees in the hotels at Gadani Yard. 14
2.3.4.2 Breakdown of indirect employment in construction and transportation industry. 24
2.3.4.3 Breakdown of indirect employment in smelting and melting mills. 28
2.3.4.4 Breakdown of indirect employment in machinery parts and industrial nits in Pakistan 31
2.3.4.5 Breakdown of employment in wood and agree items. 34
2.4 The Value Chain Analysis. 42
2.4.1 Overall Summary of Employment and Socio-economic Contribution. 42
2.4.1.1 Overall Summary of Employment 42
2.4.1.2 Overall Summary of Socio-economic Contribution. 46
- Breakdown of Direct Employment 51
- Gadani Shipbreaking Direct Employees Dependent Population. 52
- Breakdown of Indirect Employment 54
- Pakistan Re-rolling Mills Indirect Employment 54
- Pakistan Re-rolling Mills Indirect Employment Dependent Population. 55
iii. Construction Industry Indirect Employment 57
- Dependent Population on Construction Industry. 58
- Smelting and Melting Industry Indirect Employment 59
- Dependent Population on Smelting and Melting Industry. 59
vii. Employment in Machinery Parts and Other Industrial Units. 60
- Wood and Agree Items – Indirect Employment 61
- Wood and Agree Items Indirect Employment Dependent Population. 62
2.4.2 Tax Revenue Generation by Gadani Ship Recycling Industry. 62
2.4.4 Consumption Wise Breakdown of Gadani Ship Steel 65
2.5 Conclusions and Recommendations. 68
SECTION 3: SHIP RECYCLING SITE ANALYSIS.. 71
3 ANALYSIS OF GADANI SHIP RECYCLING SITE.. 71
3.1 Ship Recycling Procedure. 71
3.2 Beaching Method – A Business as Usual case at Gadani 75
3.3 Characteristics of Gadani Beach. 77
3.4 Comparison of Gadani Ship Beaching Method with Practices at Regional and International Yards 78
3.5 Existing Ship Recycling Plots, Ownership and Land Rights at Gadani Yard. 80
3.6 Analysis of Alternatives. 80
3.6.1 Alternative Parking Methods. 80
3.6.2 Comparison of Gadani Beach with other Locations inside Pakistan. 83
3.7 Conclusion and Recommendations. 84
SECTION 4: SHIP RECYCLING PROCESS.. 87
4 SHIP RECYCLING PROCESS AT GADANI YARD.. 87
4.1 Ship Recycling Process at Gadani Yard. 87
4.2.1 Removal of movable articles. 91
4.2.2 Removal of oils and other liquids. 91
4.2.3 Removal of Equipment (reusable) 91
4.2.4 Disposition of Asbestos and PCBs. 91
4.2.7 Recycling of Materials. 92
4.3 Requirement of Social, Environmental and Workplace Safety. 93
4.4 Safety & Health Practices and Environmental Measures at Gadani Yard. 93
4.5 Comparison of Existing Practices at Regional and International Yards. 95
4.6 State of Best Practices for Green Ship Recycling at Gadani Yard. 98
4.7 Relevant Stakeholders. 100
4.7.1 Concerns of Stakeholders. 100
4.8 Conclusion and Recommendations. 102
SECTION 5: DECLINING TRENDS FOR SHIP RECYCLING.. 105
5 DRIVERS OF DECLINING TRENDS FOR SHIP RECYCLING AT GADANI 105
5.2 Concerns of the Stakeholders. 106
5.3 Impact of Re-rollable Scrap on Value Chain of Ship Plates. 108
5.4 Impact of Various Taxation Regimes. 108
5.5 Impact of Dollar Exchange Rate. 110
5.6 Impact of International Obligations. 111
5.7 Overview of Existing Infrastructure and Facilities at Gadani Yard. 112
5.8 Conclusion and Recommendations. 112
SECTION 6: GOVERNANCE OF GADANI SHIP RECYCLING.. 115
6 GOVERNANCE OF SHIP RECYCLING IN PAKISTAN.. 115
6.2 Review of Existing Policy, Legal and Institutional Mechanism.. 115
6.2.1 The Baluchistan Ship Breaking Industry Rules, 1979. 115
6.2.2 Occupational Safety and Health in Ship Recycling. 116
6.2.3 Hazardous Waste and Environmental Protection. 117
6.4 Institutional Procedures and SOPs in Vogue. 119
6.4.1 Responsible Institutions. 119
6.4.2 Purchase and import of end of life ship. 119
6.4.3 Information to JMICC by Ship’s Agents. 119
6.4.4 Stay at Gadani Anchorage. 120
6.4.5 Beaching at Gadani Yard facility area. 120
6.4.7 Bow (Nall/Nose) Cutting. 120
6.4.8 Initial Environmental Examination (IEE) Report 121
6.4.9 Removal of Hazardous Material, Wood and Agree items. 121
6.4.10 Inspection of Tankers by Explosive Department 121
6.4.11 Cutting Operations. 121
6.6 Government’s support towards promotion of ship recycling in Pakistan. 123
6.7 Rationalizing Public Private Partnership for infrastructure facilities. 124
6.8 Conclusion and Recommendations. 126
SECTION 7: INTERNATIONAL OBLIGATIONS.. 129
7 ANALYSIS OF INTERNATIONAL OBLIGATIONS FOR GREEN PRACTICES.. 129
7.2 International Obligations. 130
7.2.1 Hong Kong Convention (HKC) for the Safe and Environmentally Sound Ships Recycling. 130
7.2.4 EU Waste Shipment Regulation. 132
7.2.5 EU Ship Recycling Regulation (EU SRR) 132
7.2.6 Inclusion in EU List 133
7.3 Requirements under HKC.. 134
7.3.1 Requirements for Ship Owner 135
7.3.2 General Obligations under Article 1. 135
7.3.3 Control Related to Ship Recycling Under Article 4. 135
7.3.4 Surveys and Certification of Ships under Article 5. 135
7.3.5 Exchange of Information Under Article 7. 135
7.3.6 Inventory of Hazardous Materials under Regulation 5. 135
7.3.7 Controls on Ship Recycling Facilities under Regulation 15 of HKC.. 135
7.3.8 Authorization of ship Recycling Facilities under regulation 16 of HKC.. 136
7.3.9 Requirements for Ship Recycling Facility under Regulation 17. 136
7.3.10 Ship Recycling Facility Management Plan under regulation 18. 136
7.3.13 Requirement for Emergency Preparedness and Response Plan Under Regulation 21 136
7.3.14 Requirement for Work Safety and Training under Regulation 22. 136
7.3.15 Reporting on Incidents, Accidents, Occupational Diseases and Chronic Effects. 137
7.3.16 Requirement for Initial Notification and Reporting Requirements under Regulations 24 137
7.3.17 Status of ratification. 137
7.3.18 Views of Stakeholders regarding HKC Ratification and application at Gadani 138
7.4 Requirements under EU Regulations. 139
7.4.2 Requirements for Ship Owners under Article 6. 140
7.4.3 General Requirements. 140
7.4.4 Ship Recycling Facility Management Plan. 141
7.4.5 Infrastructure Requirements. 141
7.4.6 Control of Hazardous material under Article 4. 141
7.4.7 Inventory of Hazardous Material Under Article 5. 141
7.4.8 Requirements for Health Risks and Environment under Article 13(1)(f) 141
7.4.13 Requirement for Prevention of Adverse Effect On Human Health under Article 13(1)(f). 143
7.4.15 Requirement for Obligations with Respect to Training under Article 13(1)(i). 143
7.4.16 Requirement for Emergency preparedness and Response plan under Article 13(1)(h) 144
7.4.17 Issuance and Endorsement of Certification under Article 9. 144
7.4.18 Duration and Validity of Certification under Article 10. 144
7.4.20 Surveys under Article 8. 144
7.4.21 Port State Control under Article 11. 144
7.4.22 Requirement for Management and Monitoring System Article 13(1)(d) 145
7.5.2 Status of National, Regional and International Yards in EU Listing. 146
7.5.3 Plans / Views of PSBA Members for EU Listing. 146
7.7 FOC and Ship Recycling. 153
7.8 ILO and its Requirements for Ship Recycling. 155
7.8.1 General Requirements. 155
7.8.2 Requirements for Model plan. 156
7.8.3 Safety requirements for tools, machines and equipment 156
7.9 Conclusions and Recommendations. 157
8 CONCLUSIONS AND THE WAY FORWARD.. 159
8.1 Findings and Conclusions. 159
8.2 The way forward to Green Ship Recycling in Pakistan. 162
Annex-A: Questionnaire for Ship Breaking Workers. 169
Annex-B: Questionnaire for Green Ship Recycling in Pakistan. 172
Annex-C: Questionnaire for Value Chain Analysis. 174
Annex D: Activity wise Process Flow Matrix of in Vogue for Ship Recycling at Gadani 175
Annex E: Legal and Other Requirement Matrix. 179
Annex F: List of PSBA Members. 196
Annex G: List of Re-rolling Mills in Pakistan. 200