Pakistan seeks Turkish investment in SEZs

ISLAMABAD: Pakistan on Tuesday urged Turkish companies to invest in the country’s special economic zones (SEZs) that entail attractive tax incentives.

“Pakistan is open for all companies around the world to set up industries in the zones (SEZs) to transfer technology and start manufacturing in Pakistan,” Naeem Zamindar, chairman of Board of Investment (BOI) said in a statement.

Zamindar was meeting with a Turkish delegation led by Atilla Yerlikaya, chairman of Turkey-Pakistan Business Council.

They discussed the possibilities of enhancing the cooperation in the areas of bilateral trade, investment and business development relations between the two countries.

“He (Zamindar) invited Turkish investors to invest in all sectors of Pakistan specifically in agriculture machinery and pharmaceutical, mining and to further boost the investment and trade relations between the two countries,” the statement cited the board’s chief as saying.

The nine SEZs were identified under the China-Pakistan Economic Corridor (CPEC) projects.

“For Pakistan, the development in trade and industry is the main gain from CPEC as a driving force for economic growth and taking the fruits of CPEC to the lesser developed regions of Pakistan,” Zamindar added.

“Industrial cooperation is the component of CPEC in which the sustainability of whole CPEC project is dependent. The role of private sector is very crucial and important in this phase of CPEC.”

The board’s chairman said SEZ law has been formalised to meet the global challenges of competitiveness and upscale the investment and spur industrialisation through creating new industry clusters.

SEZ framework facilitates creation of industrial clusters with liberal incentives, infrastructure and investor facilitation services to enhance productivity and reduce cost of doing business.

“Pakistan offers exemption from custom duties and taxes for all plants and machinery imported into Pakistan as well as an income tax holiday for 10 years for the special economic zones,” Zamindar added.

The board’s chairman said Pakistan needs a shift from resource-based and low technology exports to the adoption and development of medium- and high-technology productions, and technological sophistication.

“Almost 80 percent of Pakistan’s exports are resource-based items.”

The delegation said Turkish Foreign Economic Relations Board extends cooperation to other countries through business councils working in 127 countries and that they would like to introduce the business community of Turkey to Pakistan and vice versa.

Yerlikaya highlighted the importance of free trade agreement between Turkey and Pakistan, which is expected to have a high impact on trade flows as well as bilateral investments.

“Yerlikaya mentioned that a comprehensive free trade agreement covering commodity and services trade as well as investments will definitely deepen bilateral economic cooperation,” the statement said.

“Mutually agreed exceptions for certain industries can be identified within the scope of a comprehensive agreement.”

The delegation head further said both the business communities have to contribute to these

negotiations in order to define the right scope to reduce bilateral trade and investment barriers.

They said they are planning to enhance their investment keeping in view the growth potential in the country.

Meanwhile, Sartaj Aziz, deputy chairman of Planning Commission emphasised an early conclusion of free trade agreement with Turkey to improve bilateral trade volume.

“With the revival of Pakistan’s economy, the opportunities for expanding trade and investment relations are expanding,” Aziz said in a meeting with the Turk Ambassador to Pakistan Mustafa Yurdakul. “In this context, the early conclusion of the free trade agreement would help boost trade.”

Pakistan and Turkey held more than seven rounds of talks to finalise free trade agreement, but the agreement is yet to be finalised.

Business advocacy group Pakistan Business Council, in a report, emphasised the importance of ‘a well-negotiated’ FTA to improve bilateral trade in the near-term to five billion dollars from around $600 million.

Deputy Chairman Planning Commission said several Turkish companies have already invested in many projects in Pakistan.

“There are new opportunities in many fields especially in the field of solar energy.” Turkish envoy hoped that economic and trade relations would further be strengthened.