Pak approves projects worth billions of dollars to Gulf countries for investment
The approved schemes are in the food, agriculture, information technology, mines and minerals, petroleum and power sectors
In a major development, cash-strapped Pakistan has in principle approved 28 projects worth billions of dollars that would be offered to Gulf countries for investment with the long-term objective to reduce reliance on loans and imports.
The newly established Special Investment Facilitation Council (SIFC) — a hybrid civil-military forum is leading the drive to fast-track economic development to address the financial woes of the country.
The list of the approved projects suggests that if all the schemes are picked up by countries, including Qatar, Saudi Arabia, the UAE and Bahrain, the quantum of investment under the SIFC banner can be greater than the $28 billion under the China-Pakistan Economic Corridor (CPEC), The Express Tribune reported.
The approved schemes are in the food, agriculture, information technology, mines and minerals, petroleum and power sectors. They include cattle farms; the $10 billion Saudi Aramco refinery; explorations of copper and gold in Chagai; and the Thar Coal Rail connectivity scheme.
The initial project also includes the Diamer-Bhasha dam which has also been offered to China for investment under CPEC. The CPEC is a collection of infrastructure and other projects under construction throughout Pakistan since 2013.
In order to give legal cover to the SIFC working, parliament already approved a host of amendments to the Pakistan Army Act and the Board of Investment (BOI) Ordinance.
Amendments to the Election Act have also been introduced to ensure the continuity of work on these schemes during the tenure of the caretaker government. These laws will provide fast-track execution of the initially approved 28 multi-billion dollar investment projects, besides ensuring immunity to the decision-makers from any kind of investigation by various anti-graft bodies. Another law, the Pakistan Sovereign Wealth Fund, is also in the pipeline that will provide equity to the SIFC-approved projects for both joint ventures with foreign nations or single ownership schemes.
The assets of seven profitable state-owned entities, including blue-chip companies, are being transferred in the wealth fund for utilisation on the projects approved by the SIFC.
Pakistan has set up the SIFC for what Prime Minister Shehbaz Sharif described as a move to “foster synergy between the federal and provincial governments to facilitate timely decision making; avoid duplication of efforts; enhance investor confidence, and ensure swift project implementation”. The Express Tribune quoted sources as saying that the government had identified 23 countries for pitching these projects but the main focus would be on Saudi Arabia, the UAE, Qatar and Bahrain.
Pakistan will issue priority visas to the citizens of these countries in an attempt to achieve swift execution of the schemes.
However, the challenge will be at the execution stage, as even the strategic projects, including the CPEC, could not fully materialise because of a host of issues including bureaucratic snags, Pakistan’s backtracking on its sovereign commitments to China, and its indecisiveness about geopolitical alignments.
Islamabad and Beijing had planned a total $62 billion investment under CPEC but so far, less than a sum of $28 billion has been materialised.
Pakistan narrowly avoided a sovereign default last month after the prime minister as well as the military establishment took economic decisions in their own hands and reached a new $3 billion deal with the IMF. The civil-military leadership has now planned to jointly run the economy aimed at attracting investment from the Gulf countries to enhance Pakistan’s non-debt inflows and reduce reliance on imports.
The sources said the majority of these projects would be executed on a government-to-government basis. Some of them could be offered for international competitive bidding, they added.