Contrary to Imran’s claims: Saudi royal company refuses investment in KP

PESHAWAR: Contrary to Imran Khan’s claims, Saudi Royal family’s international firm, Himmah Capital Company, has refused to make investment of billions of rupees due to legal complications and non-cooperation of Tehreek-e-Insaf led Khyber-Pakhtunkhwa government. The company has given its local partner, Alman group, April-15 deadline for ending the investment agreement.

The Alman group fears losing its Rs3 billion due to provincial government’s lack of interest, and the delay in framing a policy on sugar mills installation. The construction work on a sugar mill and a power plant in Dera Ismail Khan has also been suspended. Despite the court orders, the provincial government has failed to frame a policy in two months about setting up a sugar mills.

The Alman group had decided to invest in a sugar mills and a power plant in DI Khan. The group had signed an agreement with Himmah Capital Limited, an international firm owned by Saudi royal family members Abunayyan and Al Muhaidib. Under the agreement, the firm was to invest in establishment of a sugar mills in DI Khan. The agreement was signed by Himmah Capital Limited managing partner Syed Asim Zafar and Sajid Riaz and Alman group’s Syed Mahmood, honorary consular general in Tajikistan and Sheikh Yaqoob.

The group signed an agreement with Khyber-Pakhtunkhwa Economic Zones Development and Management Company (KPEZDMC) on July 5, 2016. Under the agreement, KP secretary industries issued an NOC (no objection certificate) on July 11, 2016 for establishment of the mills. On Dec 19, 2016, the Environmental Protection Agency also gave the permission for setting up the sugar mills. The Alman group also decided to install a power plant, along with the sugar mills for production of 35-megawatt electricity.

The Environmental Protection Agency also issued a letter of support for the plant on Jan 31, 2017, while Alternative Energy Development Board (AEDB) also allowed installation of the mills. On Aug 22, 2017, Peshawar Electric Supply Company (PESCO) endorsed installing the plant. However, on Feb 13, 2018, the federal cabinet called a meeting to discuss China-Pakistan Economic Corridor (CPEC) project and imposed a ban on establishment of new power plants in the country.

In DI Khan division, four sugar mills are already working, and there was no space for setting up another mills in the division. No new sugar mill could be established in 35-kilometre radius of any old mills under the law.

However, the KP government acted hastily and issued NOCs for two more sugar mills in DI Khan division, in violation of the law. One of the new mills is Alman Sugar Mills, on which 60 per cent work has been completed.

However, Al Moiz Industries Limited Darya Khan, Sugar Mills Limited and Chashma Sugar Mills filed a writ petition in the Peshawar High Court against concentration of sugar mills in the same division.

The petitioners stated that four sugar mills were already operational in DI Khan, and issuance of NOCs for two new mills was illegal. Taking up the petition, PHC two-member bench comprising Justice Waqar Ahmad Sheikh and Justice Ms Musarrat Hilali stopped Alman Seyyam Sugar Mill (Pvt) Ltd from carrying on construction work. The court also directed the provincial government to frame a policy on setting up new sugar mills in the province.

However, the KP government has failed to comply with the court orders, and the Alman group fears its Rs3 billion going down the drain. On the other hand, sensing lack of interest on the part of KP government and legal complications, the Himmah Capital Limited Dubai office decided on April 1, 2018, to quash its agreement with Alman group and informed it through a letter.

Himmah Capital Managing Partner Syed Asim Zafar wrote a letter to the managing director of Alman group, Syed Mehmood, stating that the company wanted to end the agreement with the group.

The stakeholders of Himmah Capital are not willing to invest in Alman Seyyam Sugar Mill (Pvt) Ltd. Alman group has been given two weeks time, starting from April 1, to remove legal complications and ensure government’s support for continuing with the agreement.

President Sarhad Chamber of Commerce and Industry Zahidullah Shinwari wrote a letter (SC/PDM/904) to KP Chief Minister Pervaiz Khattak on March 22, 2018. He demanded making arrangements for installing Alman Seyyam Sugar Mills, as the group was facing monthly loss of millions of rupees. The letter warned of Rs3 billion going down the drain if the project was abandoned.

When contacted, KP CM told the reporter that the province offered favourable conditions for investment. “We are providing conducive environment and facilities to foreign and local investors. Installation of Alman Seyyam Sugar Mills was delayed due to Peshawar High Court verdict.

“But, we will devise a new policy after removing all legal complications. Neither the investors will lose their investment nor foreign investors would be disappointed,” he added. Alman Seyyam Group MD Syed Mehmood said the PTI government claimed to have brought foreign investment, but it is not providing facilities to them.

Despite the PHC orders, the provincial government failed to devise any policy, which forced the Saudi company to cancel its investment plan. “I have invested three billion rupees so far and facing losses worth millions of rupees,” Mahmood added.

He said his factory was supposed to provide jobs to 4,000 people and 35-MW power had to be produced. But the provincial government was fending off investors instead of facilitating them. KPEZDMC Chief Executive Officer Saeed Ahmed said he took the charge of the office a month ago and he would hold a meeting with the authorities concerned to settle the issue. He said the government was sincere in providing facilities to investors. “We are facing delay on account of the court decision, but now in the light of the PHC verdict, we will devise a new policy to settle the matters pertaining to sugar mills,” he added.