Pakistan National Shipping Corporation (PNSC) has signed a non-binding Memorandum of Understanding (MoU) with China’s Shangdong Xinxu Group Corporation to explore investment and business opportunities in the maritime and international shipping sectors.
The company disclosed the development in its notice to the Pakistan Stock Exchange (PSX) on Thursday.
“PNSC signed a non-committal MoU with Shangdong Xinxu Group Corporation Company, (a company formed and existing under the laws of China) for 12 calendar months.
“This MoU establishes a relationship of mutual cooperation and trust between the parties for the objective of commercial benefits to each party and to create favourable conditions for investments primarily in the maritime sector of Pakistan and to explore business opportunities of mutual interest in international shipping sectors,” read the notice.
Meanwhile, in an official statement released following the MoU signing, Federal Minister for Maritime Affairs, Muhammad Junaid Anwar Chaudhry said that the Pakistani shipping sector is set for a major transformation.
“The signing of this MoU symbolises a growing partnership between Pakistan and China in the maritime domain, paving the way for future cooperation, investment, and development in Pakistan’s shipping industry”, he added.
The maritime minister emphasised that the collaboration will boost regional trade, enhance connectivity, and strengthen Pakistan’s role in the global maritime industry through mutual cooperation and shared economic goals.
He said this MoU establishes a framework of mutual trust and cooperation between the two entities, aimed at pursuing commercial benefits and creating favourable conditions for investment in Pakistan’s maritime sector.
The understanding primarily focuses on collaborative efforts in several key areas. These include the sale and purchase of merchant cargo vessels such as liquid bulk tankers, dry bulk carriers, and containerised ships under joint or individual ownership, as well as through profit and loss sharing arrangements.
The MoU also encompasses the leasing of such vessels by Xinxu to PNSC through various charter mechanisms, including time, spot, and bare boat charters.
Another major component of the MoU involves PNSC offering commercial, technical, and administrative management services for vessels as mutually agreed, covering areas such as chartering, marketing, revenue optimisation, maintenance, dry-docking, crewing, and regulatory compliance.
Furthermore, the MoU includes provisions for financing arrangements by Xinxu to PNSC for investments in ships and other floating platforms. These arrangements will be governed by commercially competitive terms, ensuring mutual benefit and financial viability.
Shandong Xinxu Group, located in Shandong Province, China, is a leading Chinese enterprise engaged in international trade and shipping.
Meanwhile, PNSC is Pakistan’s national flag carrier, primarily engaged in the transportation of dry bulk and liquid cargoes globally.
It was established in 1979 by merging the National Shipping Corporation (NSC) and the Pakistan Shipping Corporation. PNSC operates under the Ministry of Maritime Affairs, Government of Pakistan.
Last month, a high-level meeting chaired by Federal Minister for Maritime Affairs, Muhammad Junaid Anwar Chaudhry, announced that PNSC is expected to generate an estimated $700 million in freight earnings by expanding its cargo fleet to 34 vessels over the next three years.
The PNSC currently manages approximately 11% of the country’s cargo by volume and 4% by value. However, the national carrier is now targeting to increase its cargo handling to 52% by volume and 43% by value (excluding containerised cargo) within three years.
