Low Risk Items to be Cleared Manually Under One-Customs System for CPEC

The government has decided that the clearance of “low risk items” from China under CPEC projects is allowed manually through the One-Customs System, under an interim arrangement till the Web Based One Customs (WEBOC) System is in place.

The decision has been taken during the last meeting to review the progress on CPEC projects under the chairmanship of Minister for Planning, Development and Reform (MPD&R) at the Ministry of Planning, Development and Reform.

In his opening remarks, the MPD&R secretary highlighted that the meeting was a significant milestone and is reflective of the strenuous efforts undertaken under the guided leadership of the PD&R minister. He especially thanked ambassador of China for his presence. He further put light on CPEC projects and highlighted that it is an outcome of long term relationship between the two countries. He further said that the cooperation in the shape or long term plan is going to stay and will move forward with full support of both the governments.


CPEC Road Projects Face Delays as Firms Stop Construction Due to Bounced NHA Cheques

The representative from Board of Investment (BoI) gave progress update since 54th CPEC progress review meeting and highlighted several ongoing endeavors which include:

  • preparation for organizing road shows in China,
  • engagement of Professor Justin Lin to identify Chinese industries that need to be relocated,
  • update on BOI’s engagement with the HEC related to consortium of business schools,
  • preparation for Shanghai Expo;
  • status of land acquisition of Federal SEZ at Gwadar, Port Qasim and Islamabad.

The BOI informed that they need a huge chunk of land for a federal SEZ in Gwadar, a move for which budget allocations are required by both the federal government and the GOB.

The GDA director general confirmed that at least 5000 acres land is being considered for allocation under the Gwadar Master Plan for establishment of federal SEZ in Gwadar and assured the MPO&R secretary that all other possibilities will also be explored to further enhance the size of the SEZ. The CPEC project director suggested that a team of BoI’s officers may visit Gwadar to have a better understanding of the Gwadar Industrial Area.

The BoI secretary emphasized to have meeting of stakeholders to discuss the financing mechanism of the proposal.

The minister for planning appreciated the efforts but instructed that more land is needed for the purpose and that GDA should ensure its availability. It was instructed that the BoI officials should follow up and hold a separate meeting in this regard. A visit to Gwadar by the BoI to inspect the proposed site was undertaken.

It has been decided that the Ministry of Industries & Production will provide details of the progress made so far regarding settlement of pricing mechanism and completion of other codal formalities in respect of development of PSEZ on PSM land at Karachi, and to ensure the completion or development work in shortest possible time, sources said.

Due to insufficient land in the Islamabad capital territory, 20,000 acres of land has been identified in Fateh Jang with the help of National Highway Authority as per directions of the 54th progress review meeting. Moreover, BoI submitted that budget allocation is required for its acquisition. The Ministry of Industries and Production has to check the feasibility of the site. The chair instructed the Ministry of Industries and Production to give their input within 15 days.

The minister for planning endorsed the idea to engage Justin Lin,  a leading Chinese economist in the field of new structural economics; and directed that necessary formalities may be completed at the earliest to hire his services.

Sources said that the idea to conduct research relocation for industries from China to Pakistan, through a consortium of business schools formed by HEC seems unviable at this point in time due to the limited capacity in this field. The Ministry may shortlist 5-6 internationally known consultancy firms to conduct feasibility/ research studies to promote industrialization and exports.

The minister for planning suggested that there is no more space for procedural delays as Pakistan is already facing challenges in industrialization. All entities need to provide fixed dates to meet their commitments. BoI will intimate submission dates for the documents and a report will be furnished in this regard.

It has also been decided that the investigative work should be launched for public private partnership for financing of for SEZs. Moreover financial strategy should he developed for land acquisition as it is beyond the finances or Federal and Provincial governments.

Minister for Planning also instructed to establish a committee of secretaries to expedite the industrialization process.

Stakeholders Need to Be On Board

Pakistan Business Council and leading economists of the country need to be made part of discussion on SEZs to unleash the potential of Pakistani industries and open Pakistani market to the world.

There is a need to figure out competitive and comparative advantages of our industry and to revise our bilateral agreement to have reciprocal arrangements.

About the transport infrastructure projects, sources said that the Chairman NHA was briefed regarding the progress on transport infrastructure under CPEC, especially two early harvest projects – Thakot-Havelian (118km) and Sukkur-Multan, 392km. The two projects have achieved 54% and 62% progress respectively. Chairman NHA further highlighted progress on other CPEC projects which included:

  • KKH Phase II: Thakot-Raikot (136km),
  • Yarik-Zhob (210km),
  • Khuzdar-Basima (110 km),
  • Mangla-Mirpur-Mansehra (200km),
  • Naukundi-Mashkel-Panjgur (290km),
  • Gilgit-Shindor-Chitral (359km)
  • and the Western route.

Secretary MPD&R also stressed about reactivating diplomatic channels between Economic Affairs Division CAD (EAD) and Ministry of Commerce of Peoples Republic of China (MOFCOM) where issues of delay of funding still exist.

NHA may review the possible Traffic density study till 2030. The Monographic study of 2015 may be taken as the starting point. The services of National Road Transport Research Center may be utilized for comprehensive work.

A representative from Ministry of Energy briefed the chair about the status of energy projects under CPEC, especially the issue of revolving account for CPEC projects.

Minister for Planning instructed to hold a separate meeting within two days to discuss approval of ECC.

During the meeting, Gwadar Coal Company raised four outstanding issues related with NOC from Environmental department GOB, land acquisition, NTDC grid connectivity and change of sponsor of the project as per approval of 7th JCC as the same is under process at the Ministry of Energy.

GOB intimated that Environmental NOC has been issued and reaffirmed that acquisition of 471 Kanal land would be made soon.

The Chinese enterprise was instructed to furnish all relevant documents/data to NEPRA for award of tariff at the earliest.

On the land issue regarding the Suki Kinari project, a representative from KP has assured to take up the issue with the concerned authorities by Friday.

Sources said that the representative from the Ministry of Maritime Affairs was briefed about the progress of Gwadar related projects and provided updates on Port and Free Zone, construction of Eastbay Expressway (15% progress), Pak China Technical and Vocational Institute at Gwadar, feasibility study for construction of Breakwaters, Capital dredging of berthing areas and channel for additional terminals.

Regarding the setting up of a Vocational Institute, a representative of GPA said that the selection of an EPC contractor by the Chinese side is still pending.

On a question raised by a Navy official regarding the Gwadar Port Master Plan,  representative of GPA intimated that the plan has been received and is under process.

Regarding the Gwadar Smart Port City Master Plan, it was assured that the project will be completed by the end of August. However, a one month delay was requested by the company. Minister for Planning instructed to avoid any delay in this important project.

DCM China intimated that the substantial progress has been made on the two grant projects (Vocational Institute and Gwadar Hospital) as a LoI has been signed. He further informed that the Pakistani side will be part of the bidding process for the said projects.

Representative of CAA informed about bottlenecks regarding the 32KV power grid station and pending input by QESCO due to which the design work had been not been completed by the Chinese side.

During the meeting, Secretary MPD&R reiterated that this project is a grant project by the Chinese government and stressed that NDRC has given high priority to it. The chair directed that all pending issues be resolved and MoE may approach QESCO for necessary input in this regard. A report should be forwarded within 15 days.

The Chinese side needs to fast track the progress for the finalization of preliminary design and to provide the required data so that the Pakistani side could start process of bidding.

Representative of the Government of Sindh also intimated that due to the 18 km shared corridor with the ML-1 phase II, their project “Karachi Circular Railway” is also being affected.

Deputy Head of Mission Embassy of China recommended that Pakistani side may visit Chengdu on priority. China needs expedite the process of design work so that next phase could be initiated. Secretary MoPDR requested the Chinese Embassy to expedite the process.

In the concluding remarks, Minister for Planning highlighted that the success we have achieved in this strategic and very ambitious project, along with being a very inclusive project would not have been possible without the support and contribution of everyone involved. Moreover, she expressed hope that all Gwadar projects including International Airport and water projects be initiated on priority.

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