Islamabad  -   Federal government has given nod for establishing ship-breaking yard in Gwadar, sources said. Sources in the government said that a policy board for the project is being finalised.  The board will decide about land allocation and completion of the ship-breaking yard project which is expected to create enormous employment opportunities.

However, sources were not sure about the fate of Gadani ship breaking yard on the Makran coast which came into being soon after independence of Pakistan in 1947, ranked as third largest ship demolition yard in Asia among Alang in India and Chittagong in Bangladesh.

The yard consists of 132 ship-breaking plots[1] located across a 10km long beachfront at Gadani, Pakistan, about 50 kilometres northwest of Karachi.  In the 1980s, Gadani was the largest ship-breaking yard in the world, with more than 30,000 direct employees.

However, competition from newer facilities in Alang, India and Chittagong, Bangladesh resulted in a significant reduction in output, with Gadani today producing less than one fifth of the scrap it produced in the 1980s.

The recent reduction in taxes on scrap metal has led to a modest resurgence of output at Gadani, which now employs around 6,000 workers.

More than one million tons of steel is salvaged per year, and much of it is sold domestically.

In the 2009-2010 fiscal year, a record 107 ships, with a combined light displacement tonnage (LDT) of 852,022 tons, were broken at Gadani, whereas in the previous 2008-2009 fiscal year, 86 ships, with a combined LDT of 778,598 tons, were turned into scrap. No update about working conditions, number of ships scrapped or volume of accumulated tonnage is available.