Concerns of Chinese envoy, foreign investment and CPEC

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Naveed Aman Khan

 

BUSINESS friendly environment and tax incentives can attract huge investment to Pakistan especially from United Arab Emirates, Saudi Arabia, Turkey and China. On the 10th of January Ambassador of China to Pakistan, Yao Jing, in a meeting with Lahore Chamber of Commerce and Industry said that China has no quota restrictions for Pakistani businessmen. Mutual trade can be enhanced through people-to-people contact. Businessmen of both the countries should play their role to further increase bilateral trade. He said that inconsistent business and trade policies, high ratio of taxes and other non-favourable circumstances are not encouraging Chinese investors to take initiatives and come to Pakistan with investment. Foreign investment needs good trade policies, low rate of taxes, tax incentives and business friendly environment in Pakistan to attract huge foreign investment.

Under Joint Coordination Committee meetings, China is working on several projects of the China-Pakistan Economic Corridor (CPEC) like power plants, railways, metro train, road infrastructure and Gwadar port. Chinese government is also focusing on health, education, agriculture, water, poverty alleviation and socio economic development of less developed areas like Balochistan and Khyber-Pakhtunkhwa. Special Economic Zones are also underway which should be given priority because they would boost joint ventures, private to private cooperation especially in manufacturing and socio-economic sectors of the country. Around 80% priority would be given to Pakistan’s share with main focus to enhance exports of Pakistan. Lahore Chamber of Commerce and Industry delegation is visiting China in March, the Ambassador has ensured full cooperation and support to the delegation. There is a dire need to find ways to develop consistent policies and stable economic relations with each other. Present level of trade seems to be the result of lack of knowledge about the mutual potential of Pakistani and Chinese economies.

Pakistan and China being steady geo-political partners have very cordial relations. China Pakistan Economic Corridor being the part of the Belt and Road Initiative promises even greater fortunes for us. Undoubtedly, it will prove to be a game changer. Be it electricity generation, infrastructure development, technology transfer, knowledge sharing or joint venture projects with Chinese firms, Pakistan knows that tomorrow is bound to get better than today. Bilateral trade figures are following increasing trend from the last four years in particular. From 2014 onwards, the average increase in imports from China is almost US $ 2 billion per year. In contrast to that Pakistan’s exports are constantly dipping for the last three years. Prime Minister of Pakistan Imran Khan visited China in November 2018 and he was given assurance that China would offer special concessions to Pakistan for enhancing exports. China and Pakistan have agreed upon sharing trade-related data to address the issue of disparity in the figures of imports and exports between the two countries. For instance, imports of Pakistan from China in 2017 were shown as US $ 15.4 billion.

Due to mis-declaration, both countries are suffering losses to their national exchequers. Therefore, necessary measures should be taken to stop it. Pakistan has not been able to reap full benefits with China in terms of exports as China has given better tariff rates to ASEAN countries. Since FTA is being renegotiated, we would like to take the aforementioned fact into consideration. Due to the build-up of unfavourable trade scenario for the Chinese companies in USA, many of these companies are relocating to India, Vietnam and Cambodia but not to Pakistan because of political instability, inconsistent economic policies, high ratio of taxes, unfair and unfavourable circumstances and operational complications of our system. We need to address these complaints and complications under one roof to ease procedural matters of the investors in our foreign missions as well as within Pakistan. Our foreign missions in different parts of the world need to pull up their socks and strengthen business friendly relations with high level business class of the respective countries. Our Ambassadors and High Commissioners are liable to cultivate business opportunities for Pakistan from abroad which unluckily they are not doing. The most important factors for foreign investment are political stability, peace and rule of law. Fortunately, after long torrential and destructive phase of terrorism in the country we are now able to control it. Now FATA is part of KP. After controlling terrorism in the region development is in progress. After controlling terrorism and achieving such unprecedented successes, Chinese Ambassador to Pakistan has shown his concerns over unfavourable circumstances which should be a serious matter of immediate concern for Pakistani authorities. China is our time tested great friend. Future of Pakistan is connected with its strong relationship with China. Foreign investment to Pakistan will only move when China is seen comfortable in Pakistan. Business and investment class of the other nations of the world closely and rightly monitor the situation and level of comfortability of China in Pakistan. If China feels comfort in Pakistan, investors of other countries will automatically start moving to Pakistan. We need to convince the rest of the world with our mature conduct. We need to immediately address matters of this serious nature.


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