NEW YORK: Highlighting Pakistan's growing electricity needs, Pakistan's Ambassador to the United States Hussain Haqqani told American and Pakistani businessmen that his government was planning further structural reforms in the economy to attract investments both foreign and domestic.
"The power sector offers a preferred area for investment," Haqqani said at a gathering billed as this year's biggest investment road shop, "Pakistan Day Conference 2011".
"Pakistan is looking for investments in power production," he said, while pointing that the country was short by about 5,000 MW in peak seasons. Citing facts and figures, Ambassador Haqqani said Pakistan's economy remained resilient in the face of multiple challenges posed by rising food prices, oil prices, the catastrophic floods in 2011, global financial crisis and the cost of fighting war against terror.
"All foreign investment in Pakistan is fully protected by law and in addition to this; Pakistan has signed bilateral agreements for protection of investment with 47 countries and Avoidance of Double Taxation with 52 countries, including the US," Ambassador Haqqani told the well-attended conference. He said new incentives and further liberalization measures include: (1): The capital markets are being developed along modern lines with the assistance of Asian Development Bank. (2): The establishment of the Securities and Exchange Commission has improved the regulatory environment for stock exchanges, corporate bond market and the leasing sector. (3): Pakistan is home to over 600 foreign companies, which means Pakistan facilitates liberal investment policy. (4): There has been stabilization in policies which is extremely vital for investors. (5) Pakistan has a liberal foreign exchange regime with few restrictions on holding foreign exchange and bringing it in or out of the country. (6): There are no limits on the inflow or outflow of funds for remittances of profits, debt service, capital, capital gains, returns on intellectual property, or payments for imported inputs. (7): The facility for contracting foreign private loans is available to all those foreign investors who make investment in the approved sectors. (8): Foreign controlled manufacturing concerns are allowed to borrow on the domestic market according to their requirement. (9): There is a greater degree of transparency in procurement practices. International tenders are properly advertised. (10): There is no restriction on payment of royalty / technical fee etc. in the manufacturing sector. (11): Zero import duties on capital goods. The import tariff on agriculture machinery (not manufactured locally) for registered corporate agricultural projects will be zero-rated. (12): The investors who invest in the newly opened sectors can import plant, machinery & equipment (not manufactured locally) at discounted rate of customs duty which is 5% and also avail first year allowance @ of 50% of the cost of plant, machinery & equipment. (13): Zero import duties on raw materials used in the production of exports;(13)Foreign investors are allowed participation in industrial projects, on the basis of 100% foreign equity, without any permission from the Government. (14): The manufacturing sector is open to foreign investment. (15): Oil and gas is another sector in which investor can have offshore and onshore exploration. They can invest in refinement, pipelines and storage facility. (16): Full repatriation of capital gains, dividends and profits. (17): There is no requirement to obtain a No Objection Certificate (NOC) from the Provincial Governments for the establishment of projects, and, (18): Regulatory reforms have led to the establishment of a legal framework for licensing and regulating private housing lenders.
"The financial sector of Pakistan is regarded as one of the best performing sectors in our region," Ambassador Haqqani said. "The banking sector has shown robust performance. Other sectors with untapped potential like horticulture dairy, construction, infrastructure development, manufacturing and tourism can also prove highly profitable for any prospective investor. The initiative taken to set-up Special Economic zones (SEZs) and other industrial Zones will further harness the investment potential in the country."
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