Speed is of the essence after one year of SIFC
30 May 2024
Published in: Arab News
The Special Investment Facilitation Council (SIFC) was launched a year ago as a one window operation to boost foreign direct investment (FDI) in Pakistan. It was tailored to attract investments from the Gulf countries, Turkiye and China. The aim was to unlock Pakistan’s development potential with investments from friendly countries. Corporate farming, minerals and metals, information technology, defense production and dairy farming were identified as major areas of collaboration. A meeting of its apex committee was recently chaired by PM Shehbaz Sharif and attended by the army chief. The committee expressed its satisfaction over the targets achieved. However, a dispassionate and closer look at the SIFC performance shows a mixed bag, and the pace of work, on 20 projects identified, must be accelerated.
While lands for agricultural purpose, dairy farming and livestock have been acquired, their water requirements are yet not optimal. This requires the paving of existing canals and digging new ones. Presentations for the privatization of state-owned enterprises are under way. Copper mining in Reko Diq is on but has to be expanded to accommodate fresh investments. They say FDI is like birds which flock to a promising land gradually but fly out in droves if there is turbulence. Pakistan has been politically unstable during the last two years and this was a lean period for foreign investment. However, a significant improvement is palpable now.
SIFC follows the “whole of government” model, tested and tried successfully by a number of developing countries. The idea is to bring the civil and military establishments together to fast track projects. Provincial governments have to be taken on board to move matters on the ground. Fields like agriculture and mining fall under the preview of provincial governments while defense production is the domain of the federal government. Hence, this mega project demands extensive coordination.
Despite slow progress on some of the projects, the interests of friendly countries in investing in Pakistan has not waned.
Javed Hafeez
It is essential to take local stakeholders on board in order to make a project feasible. Security challenges in Balochistan, where the bulk of the fallow land is located and the risk averse attitude of local investors are some of the hurdles that have to be crossed. Pakistan has no shortage of talent and skills. However, many skilled hands are now employed abroad. Efforts, therefore, have to be redoubled to develop additional local expertise of international standard. The armed forces have the capacity and experience of tackling security challenges.
Despite slow progress on some of the projects, the interests of friendly countries in investing in Pakistan has not waned. China is the largest investor here and PM Sharif is visiting China shortly. During his recent visit to Abu Dhabi, the UAE leadership stated that they are ready to invest $10 billion into Pakistan. A large investment delegation led by the Kingdom’s Foreign Minister Prince Faisal bin Farhan visited Pakistan last month and held fruitful meetings with Pakistani officials and businessmen.
Pakistan is the third largest rice producer in the world. It also exports large quantities of Halal meat and the bulk of it goes to the GCC countries. The quantity of meat exports to the Gulf can be increased by following corporate animal farming on modern lines. Pakistani Balochistan has a population of roughly six million and the number of livestock is roughly equal. Because of large tracts of fallow land in this province, the number of livestock can be increased many times through local and foreign investments. And in terms of geographic distance, Balochistan is nearest to the Gulf countries. Hence, the transportation costs are reasonable.
Joint defense production by Turkiye, GCC countries, and Pakistan would be a fruitful proposition for all. Turkiye possesses advanced technology by virtue of its NATO membership, Pakistan has the factories and skilled labor. The GCC nations have investable funds. Arms imported from the West have become prohibitively expensive. The above triangular arrangement has been discussed and it suits all three parties.
SIFC is a vehicle for Pakistan’s inclusive development. Along with the China Pakistan Economic Corridor (CPEC) it promises to ensure that the less developed regions of Pakistan benefit more from fresh foreign investments. These investments would not only improve the financial status of vulnerable segments of society but also mainstream the smaller provinces. However, time is of the essence and various bodies linked to projects under the SIFC should get their act together by preparation of quality feasibility studies for their investors. It should be a win-win situation for all stakeholders.
