ISLAMABAD: The Board of Investment (BoI) is all set to sign treaties with foreign countries in line with the new Bilateral Investment Treaty (BIT) template, which was approved by Prime Minister Imran Khan last week, sources said.
The new BIT template was developed in consultation with all the stakeholders and vetted by the Law and Justice Division and the Attorney General of Pakistan.
All the new BITs would be negotiated in accordance with the new template in order to minimise the risk of international arbitration and to provide a policy space to government to enforce economic policies.
In the past, the federal government had been facing difficulties in finalising investment treaties with some countries due to the Reko Diq case.
The BoI’s main priority is to attract investment in various sectors from developed countries including the United States and China, and also to encourage overseas Pakistanis to invest in the country, so that they can take advantage of these large investment opportunities.
The investment opportunities are already created in various sectors including textile, Personal Protective Equipment (PPE), agriculture, agro-industry, automobile sector, logistics, and sports.
A detailed study of Pakistani BITs has been carried out – out of 53 BITs signed with 48 countries, the BIT with Indonesia was unilaterally terminated by Indonesia in 2016, 16 BITs are signed only, and are ineffective due to non-ratification, 23 are ratified BITs, which have completed the initial duration of 10, 15 or 20 years and can be terminated by giving notice of prescribed duration and the remaining nine ratified BITs cannot be unilaterally terminated at present.
However, nine BITs can be terminated or reformed by engaging the respective countries bilaterally.
Chinese companies have brought so far $260 million of investment in Rashakai, Special Economic Zone (SEZ) within the steel sector to enhance the productivity and growth in the local industrial sector.
The Chinese and local companies are ready to go for Joint Ventures and 60 local 13 Chinese companies in various sectors are registered and ready to sign the JVs agreement.
For achieving the agenda of bringing more Chinese investment in Pakistan, the BOI has appointed eight honorary investment counsellors in various potential regions of China.
Four SEZs, including Rashakai Nowshera, Dhaba, Bostan, and Allama Iqbal Industrial City, Faisalabad had also been approved, and are on the top priority of the government to develop these zones for creating better business opportunity for foreign investment.
The government says that all of these SEZs would have far-reaching socio-economic impact in the region by attracting more investment, spurring industrialisation, creating employment in the industry, and ensuring export led-growth, she said.
Pakistan’s proximity with China will allow these SEZs to foster economic interdependence for mutual economic advantage to enhance bilateral trade and economic connectivity in the coming years.
The BoI promoted establishment of all these SEZs with the goals of capitalising on investment inflow under the CPEC, inclusive economic development in the provinces, creation of job opportunities, industrial development, and export generation in Pakistan.
The government had set a target to complete the reforms in the BoI, through Pakistan Regulatory Modernization Initiative (PRMI) in district, provincial and at the country level.
The reform process will be completed in three tiers including mapping, and analysis.
In BoI’s new Investment Promotion Strategy 2021-23, the Foreign Direct Investment target of Rs3.7 billion by 2021-22 and $4 billion for 2022-23.