ISLAMABAD: Top Federal Government's Ministers have reportedly expressed concerns at the slow progress of projects falling under the umbrella of China Pakistan Economic Corridor (CPEC), sources close to Minister for Planning, Development and Special Initiatives told Business Recorder.
On January 26, 2021, Cabinet Committee on CPEC( CCoCPEC) presided over by Asad Umar, issued a stern warning to Chairman Federal Board of Revenue (FBR) Javed Ghani for not expediting required tax exemptions for Gwadar Free Zone.
According to sources, Chairman CPEC Authority, Lt. General Asim Saleem Bajwa (retired) gave a briefing on the progress of CPEC projects and issues; and noted that under CPEC programme, 17 different projects related to infrastructure, energy and socio-economic development of Gwadar worth $ 13.00 billion had been completed, whereas 21 projects costing $ 12.00 billion were under process and 26 projects of $ 28.00 billion were in pipeline.
The meeting was apprised that Gwadar Free Zone policy, custom procedures and rules & regulation were required to be defined in order to enable the investors to establish businesses in Gwadar. It was pointed out that although 42 licences had been issued to potential investors however, business activities could not start due to absence of Free Zone policy.
Other important issues highlighted were: (i) non-availability of power; (ii) evacuation of land for Free Zone phase-Il from Pakistan Coast Guards & Pakistan Navy; (iii) exemption of Gwadar port from provincial taxes as per Concession Agreement; (iv) delay in construction of breakwater & capital dredging of berthing area; (v) diversion of Afghan Transit trade, import of LNG and other commodities through port, warehousing /commercialization in Free Zone etc; and (vi) non issuance of different NOCs from GDA/Environmental Protection Agency/GoB.
During the ensuing discussion, the Minister for foreign Affairs, Shah Mehmood Qureshi emphasized the strategic importance of the CPEC programme for Pakistan. He stated that this programme should be viewed not only from a financial/economic angle but also as part of overall strategic scenario given bilateral relationship of Pakistan with China. He stressed that proceedings on various fronts of the programme should be made on a fast-track basis as slow pace in this respect will demonstrate lack of resolve to implement the CPEC and that would not be in the national Interest of Pakistan. Minister for Railways, Senator Azam Swati supported the comments of the Minister for Foreign Affairs.
Minister for Planning Development and Special Initiatives, Asad Umar, who is also Chairman of CCoCPEC [Cabinet Committee on CPEC] asked Federal Board of Revenue (FBR) regarding progress on grant of exemptions in respect of Income Tax, Sales Tax and Custom Duties for the Gwadar Free Zone. The Member, Policy FBR, replied that presently, FBR was tackling all exemptions within existing framework of rules on this issue. However, status of progress would be ascertained from related quarters in the FBR.
The Chairman CCoCPEC expressed his displeasure on non-attendance of Chairman, FBR. He directed that in future, the Chairman FBR must attend meetings of the Cabinet Committees. Noticing slow progress on different CPEC projects, Asad Umar was of the view that the forum of Cabinet Committee on CPEC was underutilized. Therefore, all concerned Ministries/Divisions must submit summaries to the CCoCPEC in respect of projects related to CPEC, where proceedings were pending either for InterMinisterial consultation or otherwise.
After a detailed discussion, the CCoCPEC noted the position presented by Ministry of Planning, Development and Special Initiatives/Chairman CPEC Authority" on the review of CPEC projects/issues and progress" and directed that all concerned Ministries/Divisions “shall” immediately submit proposals to the CCoCPEC, in the form of formal summaries, for resolution of inter-ministerial, or other significant issues confronting their respective projects. The Committee will meet again next week to consider the proposals/summaries.
The Cabinet Committee on CPEC also directed FBR to brief the Federal Cabinet in its next meet regarding framework of rules/ regulations on exemption (income tax, sales tax and custom duties) required for Gwadar Free Zone Policy.
Copyright Business Recorder, 2021
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