The entities will invest $220 million to develop a new concession at Karachi port and oversee its growth over the first 10 years, AD Ports said in a filing on Thursday to the Abu Dhabi Securities Exchange, where its shares are traded.
Under the terms of the agreement, a joint venture between AD Ports, as majority shareholder, and UAE-based Kaheel Terminals has been formed to manage, operate and develop berths six to nine at the Karachi Gateway Terminal's east wharf.
The joint venture will undertake significant infrastructure and superstructure investment over the next 10 years, with the bulk of it planned for 2026.
The development works will include the deepening of berths, the extension of quay walls and an increase in the container storage area.
Following the development works, the terminal will be able to handle “post panamax” class vessels of up to 8,500 twenty-foot equivalent units (TEUs) while the container capacity will increase to a million TEUs annually, from 750,000.
The agreement “exemplifies AD Ports Group’s strategy of investing in key maritime trade routes for the UAE, replicating our successful integrated business model in regions that offer long-term, sustainable growth prospects”, said Capt Mohamed Al Shamisi, managing director and group chief executive of AD Ports.
“This agreement has the potential to unlock a new chapter of growth and progress for both the UAE and Pakistan, enabling us to strengthen ties with key trading nations and leading to increased economic growth and prosperity.”
The development comes as the UAE and Pakistan continue to strengthen trade ties.
The UAE was Pakistan’s leading regional trading partner in 2021, accounting for more than 40 per cent of Pakistan's trade with Arab countries.
In 2022, UAE's non-oil exports to Pakistan reached about Dh4.8 billion ($1.3 billion), AD Ports said, quoting data from Pakistan’s Ministry of State for Foreign Trade.
Re-exports grew 7.7 per cent annually to Dh10.6 billion.
"The signing of this agreement underscores both our nations' shared vision for the development of port infrastructure," said Faisal Subzwari, Pakistan's Minister for Maritime Affairs.
Established in 2006, AD Ports, which owns and operates 10 ports in the UAE, has been expanding its operations globally.
This week, it signed a 30-year concession agreement with the government of the Republic of Congo to manage and operate a multipurpose New East Mole Terminal in the city of Pointe-Noire.
The company is also teaming up with Egypt's Red Sea Ports Authority to develop and operate a multipurpose terminal at Port Safaga.
AD Ports is also set to work with Angolan organisations to develop and improve maritime connectivity along Africa’s west coast.
In January, the company agreed to a partnership with Kazakhstan's state energy company KazMunayGas and signed a preliminary accord with the country's Ministry of Industry and Infrastructural Development to co-operate in the development of a national marine fleet and coastal infrastructure in the Caspian and Black seas.