ISLAMABAD: Balochistan government is working on a plan to declare Special Economic Zone (SEZ) at Gwadar as a tax-free zone under the China-Pakistan Economic Corridor (CPEC) and a one-window system is also being introduced to facilitate the local and foreign investors.
An official source told Pakistan Today that the development projects in Gwadar are being completed under the CPEC framework and the Balochistan government is undertaking numerous projects worth Rs20 billion for the uplift of the people of Gwadar.
The official said that the Balochistan government is inviting investors to Gwadar for the generation of revenue which can help Gwadar transform into an economic hub of the region.
The official said that a 250-km-long road network has been laid in Gwadar to facilitate smooth traffic. The official added that Gwadar industrial zone would comprise of three parts while an education city and a diplomatic zone would also be established in the port city.
The official explained that the provincial government has formulated rules for allotment of land in industrial zones in the province and land will now be allotted in industrial zones only to those industrialists who will set them up to the decided industry within the stipulated timeframe.
The official said that the provincial government will soon allocate 20,000 acres of land for the SEZ and special security arrangements have been made in and around Gwadar. The official said that the security apparatus in place has led to maintaining peace and development in Balochistan.
The official informed that under the 2050 Master Plan, the issues of water and electricity for the people of Gwadar would be resolved by the end of next year (2022). They added that work is in full swing on a desalination plant, which will convert five million gallons of seawater into drinking water and a 300 megawatts coal-fired power plant. Both the projects will be functional by January 2023, the official added.
The official said that over 40 Chinese companies have pledged to invest in the first phase of SEZ under CPEC at Gwadar Port while another 200 companies have registered with the China Overseas Ports Holding Company (COPHC) for further investments in the first SEZ.
With this investment, the first phase of the SEZ has been completed,
The official explained that future investments in Gwadar Industrial Zone would include new industrial units, including textiles, chemicals, automobiles and mobile phones, which will create more employment opportunities for the local people.
The official, when asked, rejected the notion of delays in the CPEC, saying that work on CPEC is in full swing and there are no impediments as the government of Pakistan is extending full cooperation.
The official further stated that, despite the coronavirus pandemic, the pace of work has not slowed down on CPEC projects and many such projects have been completed ahead of time. The official added that after the completion of CPEC, Gwadar will become the largest port in the region and an important economic hub in the world, which would benefit various countries.
The official said that Gwadar Port is fully operational and cargo ships have started arriving and added that a liquefied natural gas terminal will also be established at the port soon.
The official concluded that CPEC is a great economic project and it is a symbol of the cohesive relationship between Pakistan and China and a testament to our friendship.
It seems as if the government and army of Pakistan together will sell Pakistan to China. Already under the CPEC, companies and common people of Pakistan are not getting any benefit. In all projects, only Chinese companies and laborers are working. Even construction material is being purchased from companies in China. Then what is the benefit of CPEC to Pakistan and people here. Till now, tax was the only thing that could be said that it is getting Pakistan from China under CPEC. But now after this decision, CPEC will be tax free and Pakistan will not get it either. But the pockets of generals and corrupt officers will surely be filled with time. Together these people have sold Pakistan to China and now the day is not far when the whole of Pakistan will become the colony of China. If this is the action of Pakistan’s officers and army generals, then CPEC is going to prove to be the next East India Company for Pakistan.
China had begun FDI projects around the mid-90s, which are primarily designed to allow expansion for the initiating country’s private sector companies. They experimented with several different regions, including Pakistan in the 90s, and there was also the TEDA SEZ in Egypt. This all happened before they reshaped the initiatives under ‘BRI’.
These became successful for China and allowed it to establish itself as a growing industrial power. The reward for a host-country is in terms of skills and labour opportunities, as mentioned in the article above, via facilitation of jobs through the industrial activities promoted within the SEZs. However, at the end of the day, it is initiated for the commercial gain of the initiating country’s private sector entities, which should be clear to anyone who understands the background of SEZs and FDI frameworks in the historical context.
The main thing for a host-country is to screen the FDI proposals in relation to skills transfer, which is usually the main desirable outcome of SEZs- this was done by Singapore, which allowed FDIs based on the type of industrial development they wanted. If the host government itself is dysfunctional or corrupt, then it is quite likely that the major benefit of an SEZ goes to the host government only, or perhaps just the ruling party.