NA panel approves SEZ land giveaway

The National Assembly Standing Committee on Finance on Thursday approved a bill to give state land on lease free of cost to private developers for the development of special economic zones (SEZs) and barred courts from taking cognisance of commercial legal disputes related to these zones.

The committee approved the Special Economic Zones Amendment Act 2026 in haste, without discussing it clause by clause. The bill was introduced in the National Assembly on April 8 and moved at supersonic speed. Pakistan Peoples Party (PPP)'s Syed Naveed Qamar chaired the meeting.

The government will give 6,000 acres of land in Karachi on lease to developers without charging any money, said Qaiser Sheikh, the Federal Minister for Investment after the meeting. He said any developer can get up to 1,000 acres of land on lease, but the terms of the lease have not yet been finalised.

The law states that more than one developer shall only be selected where the area of the zone is at least 1,000 acres, and each developer is allotted at least 500 acres.

Under the $7 billion International Monetary Fund (IMF) programme, Pakistan has conceded its right to give concessions and tax incentives to SEZs, which ended the purpose of setting up these zones. The IMF condition to end tax incentives by 2035 is impacting SEZs, special technology zones and export processing zones, said Atiq ur Rehman, joint secretary (projects) of the Special Investment Facilitation Council (SIFC), while speaking during the committee meeting.

Atiq said the government has apprised the IMF about the difficulties that investors may face by ending these concessions. The IMF has allowed the launch of a pilot project from 2028 to see what kinds of difficulties can arise, he said.

According to the new bill, the federal government will establish a federal SEZ Authority for the Islamabad Capital Territory and SEZs established by the federal government across the country on federal territories. Bilal Kayani, Minister of State for Finance, said the new law is also aimed at setting up the federal SEZ Authority and will not impact provincial rights in any manner.

The committee approved "exemption from all taxes on income for enterprises commencing commercial production for the next 10 years or until June 30, 2035, whichever is earlier".

Sheikh said the commitment to end tax incentives by 2035 does not stop the government from availing and giving these incentives until that date.

To address investors' complaints about judicial delays in deciding commercial matters, the committee approved the establishment of a Special Economic Appellate Tribunal, and no court shall take cognisance of any legal dispute under this Act or the rules or regulations made thereunder to which the tribunal's jurisdiction extends. The tribunal will have exclusive jurisdiction to determine all matters pertaining to SEZs. The newly approved law, which still requires National Assembly approval, states that the tribunal shall decide a matter expeditiously but no later than three months of its filing.

According to the bill, any person aggrieved by an order, judgment or decree of the tribunal may prefer an appeal to the Supreme Court within 60 days. This means the aggrieved party cannot file an appeal in a high court, which should ensure expeditious settlement of disputes.

The chairman of the tribunal will be an advocate of known integrity and competence with at least 20 years' experience in commercial matters. Members will have at least 10 years' professional experience in law, economics, technology or finance, coupled with experience in industrial matters.

The board of investment's powers to process all zone applications submitted by SEZ authorities for consideration of Board of Approvals have been withdrawn and given to the federal SEZ Authority. Zone development will be the responsibility of private developers, but roads and utilities will be provided by federal and provincial governments.

The governments must ensure, at government expense for SEZs established on public land or by public sector entities, the provision of road access and all utilities including electricity, gas, telecommunication services and other essential facilities up to the designated zero point within one year of the zone's notification.

Pakistan has been trying to find a middle way to its earlier commitment to give up tax incentives and is trying to convince the IMF to allow relaxations. The government is also cognisant that it does not want to antagonise the IMF.

According to a new IMF report released on Thursday, the lender said its engagement with Pakistan remains critical. The IMF-supported programme under the Extended Fund Facility (EFF) in Pakistan, amounting to about $7.2 billion, focuses on restoring macroeconomic stability, rebuilding external buffers, and advancing reforms in fiscal management, energy pricing and governance.

The report underlined that the war in the Middle East, which began on February 28, 2026, has inflicted profound human suffering and significantly affected the outlook for the Middle East, North Africa, Afghanistan and Pakistan region.