Investment loopholes: Apparel Park all set for ‘hasty’ start

NHA says project can’t be launched within 1km radius of motorway.


Anwer Hussain Sumra May 18, 2014
According to the NHA Act 1991, no construction could be carried out within one kilometre of motorway. PHOTO: nhmp.gov.pk

LAHORE:


The government is scheduled to proceed with the groundbreaking of Apparel Park in Sheikhupura later this month without addressing concerns of the National Highway Authority (NHA) and amid alleged conflict of interest related to a public sector investment, The Express Tribune has learnt.


The government plans to establish the park over 1,562 acres of agricultural land in Sheikhupura near the motorway interchange.

During a meeting held earlier this month to finalise arrangements for the groundbreaking, an NHA representative had raised concerns regarding the project. He had said that according to the NHA Act 1991, no construction could be carried out within one kilometre of motorway; the park was being established only 100 feet from the highway.

The chief minister is likely to inaugurate the project in the last week of May, said an official of the Industries, Commerce and Investment Department.

The department is an administrative wing of the Punjab Industrial Development and Management Company (PIDMC), which will execute the project.

The government had acquired the land at a cost of Rs3.3 billion, accounting for 49 per cent of the total investment, the official told The Express Tribune on condition of anonymity.

He said that Shandong Ruyi Group, a Chinese company, would be responsible for the remaining 51 per cent investment in the form of infrastructure development and provision of services at the park. He said the PIDMC had prepared a master plan with the help of National Engineering Services Pakistan (NESPAK) and the group was now finalising the feasibility report.

He said a company preparing the feasibility report/master plan of a development project could not participate in the bidding to get a contract for that project. Therefore, he said, the PIDMC could not task Shandong Ruyi with making the master plan because it created a conflict of interest and was a violation of rules.

He said the company was filing an unsolicited proposal to make 51 percent of the total investment.

He said the government was also showing “haste” to engage the group under the public-private partnership (PPP) and avoiding the formal process that usually took seven months.

According to rules, he said, a company should file a proposal of investment accompanied by a feasibility study, environmental impact assessment, a draft PPP agreement and determination of modalities.

A committee will then approve the proposal in four months. This is followed by the competitive bidding process, which takes another three months.

“The chief minister is likely to announce the agreement at the groundbreaking ceremony,” the official said.

PIDMC General Manager Naveed Mushtaq Gill confirmed the master plan had been handed over to the Chinese group which was also filing unsolicited bids for the investment. He said the PIDMC had applied to the NHA for a no-objection certificate.

“An environmental impact assessment report has been prepared and it will be sent to the Environment Department for approval,” Gill said.

He said the park would generate 250,000 jobs. The company would also set up a 100-megawatt coal-fired power station at the park, to be completed in 15 months.

Industries, Commerce and Investment Department Secretary Ali Sarfarz said the NHA’s objections created no bar to the establishment of the park. About a possible agreement with the Shandong Ruyi Group, he said it would be signed in line with the Punjab Public-Private Partnership Ordinance, 2014.

“The company has filed unsolicited proposal but the provision of allied documents is in process and the process will not invite any conflict of interest,” Sarfarz said.

Published in The Express Tribune, May 19th, 2014.

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