ISLAMABAD – Pakistan, and China to sign development agreement of the First China Pakistan Economic Corridor’s (CPEC) Rashakai Special Economic Zone (SEZ) on Monday at the Prime Minister House, Islamabad to provide a conducive business environment for bringing Foreign Direct Investment (FDI) in the country.
The Signing of Rashakai, SEZ agreement to realize the Vision of SEZs’ development in Pakistan: Chairman Board of Investment (BOI), Atif R. Bokhari said in a press release issued here on Sunday.
The Minister of State/Chairman Board of Investment (BOI), Atif R. Bokhari, in a statement, said that signing of the Development Agreement of Rashakai, SEZ under CPEC would realize the vision of special economic zones’ development, ultimately leading to a prosperous and industrial Pakistan.
He highlighted the progress on SEZs under CPEC, saying that sufficient headway has been made on this front and the zones are now becoming ready for business.
He said that Pakistan’s proximity to China will allow these SEZs to foster economic interdependence for mutual economic advantage.
He said the Special Economic Zones Act 2012, under Section-13 binds together the Federation (Board of Investment), the Province, and the SEZ Developer through an agreement for the successful establishment and development of an SEZ aptly termed as the Development Agreement.
The chairman BOI said that this agreement provides the road map for the establishment of an SEZ while holding the Federal and provincial government and the developer jointly responsible for the development and successful operations of an SEZ.
The Rashakai SEZ is to be developed under the Public-Private Partnership model, by Khyber Pakhtunkhwa Economic Zone Development and Management Company (KPEZDMC) (a Section-42 company of the Government of Khyber Pakhtunkhwa) in collaboration with China Road & Bridge Corporation (a state-owned Chinese enterprise), he said.
Atif said that an SPV Company of these two firms named Rashakai Special Economic Zone Development and Operations Company (RSEZDOC) has been created for the implementation of this Agreement, which is the first of its kind with the Chinese counterpart being one of the parties.
A project of USD 128 Million, spanning over 1,000 acres of land was awarded SEZ status on August 6, 2019, and its Concession Agreement was signed in April 2019, he added.
He said the Board of Investment promoted the establishment of this SEZ with the goals of capitalizing on investment inflow under CPEC, inclusive economic development of KP Province, creation of job opportunities, industrial development, and export generation in Pakistan.
Rashakai SEZ holds a unique competitive advantage due to its proximity to the first juncture of the CPEC route, and significant resource and manufacturing base in the region, he said.
Due to such factors, it has the potential to become one of the primary investment destinations for foreign investors – particularly Chinese Investors who are looking to find new and cheaper markets to relocate their industrial base.
The Chairman BOI, Atif R. Bokhari said that the Board of Investment has successfully expedited the process of provision of promised utilities, facilitated the allocation of fiscal incentives, and concession to the co-developer of the SEZ.
To enable successful operations of this SEZ, the federal government has committed 1.8 bn PKR for the provision of 210 MWs of electricity, and 1.2 bn PKR for the provision of 30 mmcfd gas from the Federal PSDP. Provision of required utilities at the doorstep of the SEZ as per the required timelines of the project will allow for on-time construction and development of the SEZ, he added.