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June 19, 2019

SEZ under CPEC to make Punjab centre of trade

Business

June 19, 2019

LAHORE: Faisalabad that has the largest industrial estate of almost 11 kilometres along the Lahore-Islamabad Motorway is getting a specialised economic zone named M-3 Allama Iqbal Industrial City under China-Pakistan Economic Corridor (CPEC) project.

Mian Kashif, a renowned businessman of Faisalabad, who was recently appointed as Chairman Faisalabad Industrial Estate Development and Management Company (FIEDMC) by the Prime Minister Imran Khan, discussed the future prospects of industrial development in the area.

Q. What Faisalabad gets from CPEC?

A. CPEC has provided Punjab a unique opportunity in promoting trade and investment in the region. Punjab has had four major CPEC projects; M-3 AII City is one of those. Geographical location of Punjab is vital for any future trade and economic activities across the region as it has been connecting all arteries in Pakistan as well CPEC routes.

Thus, future trade will cross Punjab, irrespective of China or India. Further, M-3 AII City known as Faisalabad Industrial Estate is already established along Lahore-Islamabad Motorway, while 250 acre Value Addition City (VAC) is also connected with the motorway.

Work on the SEZ has already started. Response on the project from both domestic and Chinese investors is overwhelming, as three Chinese ceramic companies have already booked their plots here with estimated foreign investment of $900 million. Additionally, one Chinese company Hunan Yatai Ceramics also signed an agreement with FIEDMC to establish ceramics plant worth $70 million. This will be a game changer for Pakistan's economy.

Q. What facilities would be offered at the M-3 AII City?

A. The M-3 AII City will be the largest SEZ of Pakistan with total area of 3,300 acre connected with two motorway links - Lahore-Islamabad and Karachi-Sukkur-Multan-Jarwanwala links. To attract investors, 10 years income tax holidays, besides duty free import of plant and machinery facility will be provided to the investors.

The land has been acquired, while ground work will start in August. PM Imran Khan will officially launch it in October this year. The SEZ is being established on public private partnership and joint ventures of company to company agreements on flexible plot sizes ranges from 1 acre to 50 acres as per the specific need of the industry.

Furthermore, the SEZ is socially compliant already approved by environment protection department along with centralized security system on the pattern of Lahore Safe City like surveillance mechanism. The M3-City will have warehouse and dry ports facilities, other than an Expo Centre, commercial areas, hotels, banks, restaurants, coffee shops, modern hospital equipped with trauma centre, labour colonies and aerodrome/helipad.

Q. How many new industries and employment will directly initiate from it?

A. Around 400 industries will establish in the M-3 AII City which will generate over 0.3 million direct jobs other than establishing allied industries and supply chain for the SME sector. Approximately Rs400 billion foreign and local investments pumped into this project.

Furthermore, to benefit the locals of the area, who are seeking employment opportunities, a 25 percent quota for employment will be allocated there. They will be trained in vocational institutions with the support of Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ), Fouji Foundation, TEVTA, PVTC, and other institutions of international standards.

Q. What is role of the FIDEMC in development of the M-3 AII City?

A. The FIDEMC provides one window operation facility to the investors besides state of the art required industrial facilities ranging from power, gas, water and sanitation on priority basis. The FIEDMC SEZ is taking lead in Pakistan by attracting local as well as foreign direct investment (FDI) as more than 20 Chinese companies have already invested here with the efforts of the FIDMEC. Additionally, big local groups are also keen to invest here and are getting information about the project prospects and investment feasibility.

Q. How much government investment is required for infrastructure development in the M-3 AII City?

A. The federal government is financing the cost of provision of gas and electricity to all the SEZs of FIEDMC. Faisalabad Electric Supply Company (FESCO) will require Rs200 million for provision of 80MW uninterrupted electricity supply.

This will include conducting of transmission lines and ancillary arrangements. The Board of Investment committed ensuring required funds for all required infrastructure. Around Rs1.4 billion have initially been allocated under the Public Sector Development Program (PSDP) of the budget for fiscal year 2019-20 for the provision of utilities.

The development work on power station has already been initiated, and NOC for 40MW power station was issued. Further, 40MW additional transformer can be placed in the existing power station as stop gap arrangement.

Meanwhile, the construction and erection of second power station will be completed. The FIEDMC will also require 20MW by December 2019 for M-3 AII City as the sales have already started. The new M-3 AII City will improve the trade balance, and create the employment and investment through service provision, and effective administration, in accordance with the PM’s vision.

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