The second phase of the China-Pakistan Economic Corridor (CPEC) places a strong emphasis on industrial development through the establishment of Special Economic Zones (SEZs). In an interview Jamshed Ahmed, an Investment and Industrial Specialist at the CPEC Authority, outlined the initial phase of SEZ development was initiated in 2016. Chinese experts were commissioned to conduct feasibility studies on potential locations for SEZs. “Their evaluation identified 34 to 39 sites as potentially suitable for industrial development.Following consultations with provincial governments to determine their preferences, nine zones and areas were shortlisted for further development as SEZs.
Prioritizing Development: Four Key SEZs
The CPEC Authority prioritized four zones, one in each Pakistani province, for initial development with plans for future expansion into other regions.
- Allama Iqbal Industrial City (AIIC): Located in Faisalabad, this 3,217-acre SEZ enjoys close proximity to the M-3 Industrial City, offering established infrastructure for textile, pharmaceutical, information technology, chemical, automotive, and service industries. Construction began in November 2019, and currently, 20 to 25 Chinese companies are setting up operations within the zone.
- Rashakai SEZ: Situated in Khyber Pakhtunkhwa, this 247-acre SEZ has already allocated plots to 24 enterprises, including a Chinese steel manufacturer. Some units are nearing completion and expected to commence production in the coming months. The strategic location at the gateway to international markets positions Rashakai SEZ to become a major trade and connectivity hub.
- Dhabeji SEZ: Located near Thatta district in Sindh, this 1,530-acre SEZ is strategically close to Port Qasim and Karachi Port, attracting significant interest from Chinese investors. This proximity offers substantial cost advantages in terms of inland transportation and facilitates direct export operations.
- Bostan Industrial Zone: Covering 1,000 acres on the border between Pishin and Quetta in Balochistan, this zone boasts diverse connectivity options (airport, seaport, dry port, railways, and roads). This accessibility makes Bostan Industrial Zone a viable location for businesses and ensures mobility for the workforce. The zone is conveniently situated just 23 kilometers from Quetta Airport.
The CPEC Authority closely monitors the progress of SEZs undertaken by Chinese contractors, ensuring projects adhere to established timelines and quality standards. This focus on industrial development through SEZs signifies a significant shift in the second phase of CPEC, aiming to stimulate long-term economic growth and job creation in Pakistan.
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