He said that intelligent, trained and hard-working people, coupled with vast reserves of natural resources and liberal incentive packages, make the country an ideal destination for investment.
Addressing representatives of the Japanese business community here at the Presidency, the president said that due to its location at the crossroads of Central and South Asia, Pakistan offers a huge market for products and services.
According to the text of his speech, the president said that Pakistan’s investment policies are investor-friendly and that investment in the country will fetch rich dividends.
Under the recently enacted Special Economic Zones Bill 2012, all capital goods, machinery and equipment will be given one-time exemption from customs duties, while entrepreneurs will be exempted from income tax for 10 years.
He said that Pakistan can serve a market of over three billion consumers in neighbouring countries and called upon Japanese investors to benefit from these advantages.
Highlighting some of the facilities available to foreign investors, the president said that foreign investors can invest without any restrictions, can hold complete ownership of businesses, are entitled to equal treatment and are allowed to freely repatriate profits and capital.
He told the delegation that generous tax and customs incentives are available for bringing raw materials, plant and machinery into Pakistan. In addition to these, interest rates have been slashed twice in the past two months and large-scale manufacturing has increased this year, as compared with last year.
The president said that Japan is Pakistan’s development partner and a world leader in innovation and technology. He said Japanese goods enjoy consumers’ preference all over the world.
Calling for greater linkages, he said: “We can do much more, particularly in business, trade and investment,” adding that current bilateral trade is far below potential and there is a need to increase it.
Referring to regional developments, the president said Pakistan is working with India to ensure peace in the region. “We have liberalised the visa regime to improve trade relations. These developments will contribute to stability in the region.”
Discussing the energy crisis, he said the government is making sincere efforts to resolve issues and hoped that problems will soon be resolved. “We are not deficient in energy resources, but these resources need to be exploited.”
The president observed that solar and wind energy have great potential in helping mitigate the energy crisis.
“Our coal reserves, totalling 186 billion tons, are ready to be converted into electricity and diesel. Pakistan looks towards Japan and Japanese technologies to assist it in meeting energy challenges,” he said, adding that it will be a mutually profitable venture.
Referring to progress made by the Japanese automobile sector, the president said Japan’s share in the car and truck market is almost 100% and it has almost 50% share in the motorcycle market.
He said there is a need to increase the share of local contents, as Pakistan still imports almost 50% of the automotive parts. Japanese investors can fill the remaining half of demand, which he said will cut manufacturing costs and enhance profitability.
The president said there is also a need to expand cooperation in the field of textiles, as Japanese investors can benefit by using their textile technology in Pakistan.
He also urged Japanese companies to invest in the agriculture sector by introducing new technologies in water conservation, increasing per acre yields of major crops, introducing new varieties and converting waste products into value-added items.
The president said the Pakistan-Japan Business Forum needs to strengthen bilateral economic ties and that work on a Free Trade Agreement between the two countries should be expedited. He hoped that the holding of the meeting in the Presidency would be taken as a demonstration of close relations between the two countries.
Published in The Express Tribune, October 10th, 2012.
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Pakistan definitely needs to conclude Investment Treaties with the major donors.