Pakistan plans special economic zone for Malaysian firms

21 October 2009 , By Balan Moses, Business Times

MALAYSIAN investors will soon be a step closer to establishing a "home away from home" in the Sindh province of Pakistan where they can operate on special terms that meet their needs.

They are expected to be frontrunners after the Japanese in terms of international trade profile in Pakistan where an exclusive economic zone (EEZ) is being planned for them.

The province, home to a variety of small and heavy industries, has allocated land for the project which is expected to fast-track trade ties to new heights.

Pakistan High Commissioner to Malaysia, Lt Gen (R) Tahir Mahmud Qazi said Pakistan Investment Ministry joint secretary Tariq Puri would be in Kuala Lumpur on a three-day visit from November 11 to discuss details of the proposed project.
He said Tariq would boost the idea of a tailor-made EEZ to meet the needs of Malaysian investors in talks being planned with, among others, Malaysian Industrial Development Authority officials.

"We are a step closer to realising an EEZ for Malaysians, only the second after the one set by the Pakistan government for Japanese investors in Karachi," he told journalists yesterday.

Tahir said the Malaysian EEZ would be modelled after the Japanese EEZ which had proven successful in drawing investors.

"I cannot talk of a timeline now as the proposal is still on the drawing board. It will have its own dynamics as to implementation,' he said to question on when the EEZ would be ready.

He said Tariq would also meet representatives of companies already having a presence in Pakistan on efforts to remedy teething problems besides prospective investors on what to expect in terms of business potential.

On the cards are financial incentives, tax exemption in certain areas and a possible subsidy on electricity tariffs.

The Pakistan Board of Investment was working on a comprehensive package of incentives that would attract Malaysian investors, especially in the housing and infrastructural fields.

On Malaysian construction firm, Renexus's foray into housing in Pakistan, he said the company was sending a team to meet Pakistani officials on November 21.

It had submitted a proposal to the Pakistan government for the construction of 20,000 low-cost houses in Lahore, Rawalpindi, Multan, Bahawalpur, Faisalabad, Sargodha, Gujaranwala and Sialkot.

The company is proposing quality houses through private sector and local financial institution participation.

Tahir said Punjab, with a population of 82 million, was facing a shortage of between 10,000 and 50,000 houses.

"The Punjab government is prepared to provide land free of cost to potential developers who would only need to come up with capital for material, labour costs and other incidental costs," he said