Govt orders Rashakai SEZ grid link in 3 days

ISLAMABAD: The federal government on Saturday directed the Peshawar Electric Supply Company (Pesco) to make the grid connection of Rashakai Special Economic Zone (SEZ) in Khyber Pakhtunkhwa functional within three days, emphasizing swift resolution of pending issues.

Additionally, the governor of the State Bank of Pakistan was tasked with appointing a focal person to address investor concerns and streamline operations in SEZs.

The Rashakai SEZ, a flagship project under the China-Pakistan Economic Corridor (CPEC), is the second SEZ in the province approved under the SEZ Act of 2012. The law mandates the federal and provincial governments to ensure utilities, such as electricity and gas, to SEZs’ designated zero points.

Chairing a high-level meeting, Federal Minister for Board of Investment, Privatization, and Communications Abdul Aleem Khan directed authorities to prioritise longstanding issues in SEZs, particularly in Khyber Pakhtunkhwa. He urged immediate activation of the grid connection at Rashakai and stressed expediting solutions to concerns faced by industrial units.

“Ensuring electricity supply to investors is a top priority, and delays must be addressed without further excuses,” Khan stated, adding that the problems of Century Steel Group in the SEZ should be resolved urgently, following Prime Minister’s directives.

The first phase of Rashakai SEZ, encompassing 247 acres, was completed in mid-2023. Plots were allocated to 18 industrial units, seven of which are nearing operational readiness. Most units are export-oriented, while some focus on import substitution. However, the delay in electricity supply has raised concerns over potential disruptions to operations and negative implications for investor confidence.

While a 132kV grid station and transmission lines capable of supplying 160MW of power have been completed, the China Road and Bridge Corporation (CRBC), the Rashakai SEZ’s co-developer, has awaited a power distribution licence from the National Electric Power Regulatory Authority (Nepra) since mid of last year. The licence is critical for purchasing and distributing power through the Rashakai Special Economic Zone Development and Management Company (RSEZDOC).

To resolve these challenges, Khan directed the Board of Investment (BoI) to collaborate with the Khyber Pakhtunkhwa government, Pesco, and other stakeholders. He also instructed the inclusion of Chinese diplomatic officials in future meetings to enhance coordination and facilitate Chinese investors.

The minister assured investors that the BoI would expedite the transfer and sale of land in SEZs and resolve complaints from CRBC. He emphasized the importance of maintaining investor confidence by rectifying past missteps and leveraging tax holidays and duty exemptions offered under the Economic Zone Policy.