All Chinese industrial units in Pakistan to get special status

These factories will enjoy the same status as given to companies in SEZs

LAHORE: All Chinese industrial units established in Pakistan will be given the status enjoyed by factories set up in the Special Economic Zones (SEZ) regardless of the part of the country where such units are set up, announced Adviser to Prime Minister on Commerce, Textile, Industries, Production and Investment Abdul Razak Dawood.

He made the announcement while speaking at a seminar titled “Business opportunities under the China-Pakistan Free Trade Agreement” on Saturday. “Projects under the China-Pakistan Economic Corridor were initiated on a government-to-government basis, but they have now transformed into a business-to-business model,” he said. “Although SEZs have not yet been completed in Pakistan, Chinese investors are free to establish their factories anywhere in the country and I will grant the status of SEZ to all these factories.”

He voiced hope that the second phase of the China-Pakistan Free Trade Agreement would be implemented from July 2019. He pointed out that through the FTA, China provided Pakistan access to its markets on the same terms as those offered to the Association of Southeast Asian Nations (Asean) member states and called for reaping maximum benefits.

He requested all the chambers of commerce and industries nationwide to thoroughly examine the FTA and make recommendations to the ministry for further improving it.

“If any Pakistani industry suffers damage due to the FTA, we will utilise the ‘safeguard’ clause under the agreement,” Dawood remarked.

Under the agreement, the additional 313 tariff lines of Pakistan, which have been given duty-free access, have a total value of $64 billion in China. “If we are able to get even 10% share in the $64-billion market, our exports will surge sizably,” Dawood said.

Currently, China’s overall imports amount to $2.1 trillion and according to Chinese President Xi Jinping, the number can swell to $5 trillion by 2023.

The PM adviser was of the view that Pakistan had a great opportunity to enhance exports to China in the areas of textile, leather, seafood, electronics and others. However, he added, in order to capture China’s market, Pakistan had to improve quality of its products, “only then it will be able to enhance export revenues.”



Talking about the upcoming budget, the adviser informed the audience that the government was not considering any import or regulatory duty relief on finished products.

“However, we are working on reducing import duties on raw material, but it is premature to comment how much reduction is on the cards,” he said. “I will meet officials of the Federal Board of Revenue on Tuesday to discuss the issue.”

Dawood regretted that in the past 10 years, the country underwent a de-industrialisation phase and former finance minister Ishaq Dar never took notice of it. “The country has to take care of local industries as it does not want to join the club of import-oriented economies,” he added.

Published in The Express Tribune, May 5^th, 2019.

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