PTI planning: New industrial policy promises to be investor-friendly

Cynics say draft will never get notified and be forgotten

PESHAWAR: The Pakistan Tehreek-e-Insaf-led provincial government recently formulated its first-ever draft on the new industrial policy, aiming to create a conducive environment for entrepreneurs to operate and set up new industrial units.

Though the provincial government took two and half years to formulate the policy, it proposes initiatives to attract new investors and motivate the current ones.

A matter of policy

Adviser to the Chief Minister on Industries Abdul Kareem Khan said, “We expect Rs100 billion worth of investments in the province with these steps and it would create more employment opportunities in the province.”

In an attempt to reduce bureaucratic hurdles, the policy document promises one-window facilitation centres. The aim is to ensure investors get operational support and industrial plots, while any problems related to such properties would be resolved. The policy also promises software to track applications.

It calls for urgent development of the four new industrial estates, including Hattar Phase VII, Jalozai, Ghazi and Rashakai/M-1. The policy also urged the establishment of an industrial estate in Malakand. It suggested the estates be built in close proximity with hydropower stations which would provide direct transmission lines.

The industrial policy called for the establishment of an industrial sector in Karak. The area would be spread over 1,000 acres and a 1,000 megawatt (mW), gas-operated power generation plant would be established.

All the new industrial estates would be declared special economic zones (SEZ) under the Special Economic Zones Authority (SEZA) Act. Under the legislation, industrial estates would be exempt from custom duties and tax on import of plant machinery and capital goods as well as income tax for 10 years.

To help industries recover from losses because of the province’s landlocked location, the K-P government would finance 25% of the cost of industrial plots till December 2016. It would also subsidise 25% of the transportation cost of plant machinery and capital goods from Karachi Port to the industrial site up until till June 30, 2017. It would also bear 25% of the electricity bills for five years of the labour-intensive industry.

To encourage women entrepreneurs, the K-P government would reserve Rs500 million to finance 25% of investments made by them which would measure up to Rs3 million per investor. The policy also suggested the K-P government establish trucking stations of 100 acres each. The stations would provide basic facilities, parking, workshops as well as driver and technical training centres. The new industrial set-up would require 200 MW of energy for smooth operation and the K-P government would arrange for uninterrupted power supply.

Just paper

However, industrialist Ilyas Bilour was of the view that the policy was only a document and it would soon be forgotten by the government. “These are just political statements and will last as long as the previous promises of this government,” he said.

He added the policy, if it gets notified, would be more focused on “infrastructural developments rather than easing ways for industrialists to run factories”. He said the real issue was the moratorium on gas connections from the federal government.

“Khattak should take up the issue in the Council of Common Interest to end the moratorium if the government was serious in bringing industry to the province,” Bilour said.

To Bilour’s objections, Abdul Kareem Khan said the policy had been approved by the cabinet and would be officially inaugurated on December 30 in Islamabad. “Our chief minister has been assured by the federal government that it will provide 50mmcfd gas for industrial use and it would cater to the needs of the sector.

Moreover, 70% of K-P is rich in minerals. The province’s share in the energy sector of the country is increasing every day which is the reasons the federal government will not turn down our request,” he asserted. “Those objecting to the policy have also played the same negative role in any positive step of the government in the industrial sector.”

Published in The Express Tribune, December 25^th, 2015.