CPEC will turn Pakistan into a manufacturing hub, says Khalid Mansoor

ISLAMABAD: Special Assistant to Prime Minister (SAPM) on CPEC Khalid Mansoor has said if the political stability remains intact, the Chinese commitment of $20 to $30 billion investment for establishing a petrochemical complex and relocation of refineries at Gwadar could be materialiaed.

“If we ensure political stability, Chinese companies are going to make huge investments ranging from $20 to $30 billion for establishing the petrochemical complex and relocation of two refineries at Gwadar over next years. We used to talk more and work less but now things are in place to make it a reality,” Khalid Mansoor confirmed to The News after addressing the Pakistan Petrochemical Symposium organized by the Corporate Pakistan Group in collaboration with the OICCI and other partners here on Thursday.

Earlier, in his address, he said that on the way forward, there is a need to formulate a policy framework for the Thar Coal gasification. The Thar Chemical Industrial Zone might be established with Special Economic Zone (SEZ) incentives, development and implementation of infrastructure projects in Thar including Thar rail and water supply, establishing linkages with the relevant countries to bring state-of-the-art technology to Pakistan, conducting road shows and bilateral agreements with China and other countries as well as strengthening coordination among different governments.

He said Pakistan would be made a manufacturing hub in the second phase of the CPEC. The CPEC would not be China-centric as he is telling foreign ambassadors that the upcoming SEZs would be opened for investments from all parts of the globe. He said the investors are vying for placing a long-term policy with appropriate tariff protection, plant and machinery import duty exemptions, 10 years income tax holiday including minimum turnover tax, low-cost local financing and infrastructure facilitation. Thar’s gasification could be utilized for establishing urea fertilizer plants in Pakistan.

Different chief executive officers (CEOs) of private companies including Lotte CEO Humair Ijaz, Tufail Group CEO and others asked the government to come up with a consistent policy framework by ensuring tariff competitive with the region and world and abolishing turnover tax for attracting $4 billion investment over next few years. Chairperson, National Tariff Commission (NTC), Dr Robina Aather said the tariff is crucial for promoting industrialization and tax structure as narrow based and discretionary that compels policy makers to rely upon raising tax rates. With this prescription, she said the government undertook a tariff rationalization programme in 2019 and weighted tariff average was brought down from 7.5 per cent to 5.5 per cent in the last three years. Over 2,000 tariff lines were brought down to zero and they were intended to come up with tariff rationalization for petrochemical sector for establishing world-class plants as this industry should not be over protected.

PM’s Advisor on Commerce Abdul Razak Dawood said he is making efforts for placing a paradigm shift as hundreds of Acres available land alongside ports would be made available to iron, steel and petrochemical sectors instead of the textile sector. If Pakistan wants to fetch $250 billion exports, the reliance on exports could not help achieve this goal as there would be four major sectors including information technology, agriculture, iron and steel and petrochemical. He termed it factually true when one CEO of a giant company declared that there is the need to reverse this policy as the country moved two steps forward and one step back, adding that it should be reversed once and for all.