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How successful has it been to invest in Gwadar?

Gwadar port is equally attracting the interest of the local and foreign investors. The government has recently decided to set up a tax-free industrial zone of international standard in Gwadar. The government is reportedly offering more concessions to foreign investors for the development of second phase of Gwadar port project. In the past, a number of countries, including those of the region, had expressed their willingness to establish duty-free industrial zones in Gwadar. The investors and entrepreneurs particularly from Central Asia, Afghanistan, China, South Korea, Japan and Singapore showed a keen interest in establishing industrial estates in Gwadar. China and South Korea are supposed to set up their tax-free special industrial development zones (SIDZs) in Gwadar.

In the past, an SIDZ with an area of 4,000 hectare was proposed for setting up various industries. The SIDZ is located on the north of Gwadar town at a distance of about 30km from the port. The SIDZ project would help in increasing import and export of the country. With the functioning of industrial zone, Gwadar would become a hub of industrial and trade activities.

Today, Gwadar is set to transform from a small coastal town to a cosmopolitan port city.

The property purchase in Gwadar is speculated as a good investment. There is a real estate boom and businessmen from all over the country and abroad are showing interest in the area. Gwadar is currently the focus of speculative trade in real estate that has touched almost a frenzy level as brokers are booking sale and purchase orders for the property in Gwadar that does not exist at present but is being planned for future. While the buyers seem anxious to buy more land in Gwadar, the brokers are also over-zealous

The rich investors are being lured into buying industrial plots in industrial estates and residential plots in housing schemes in and around Gwadar on payment under different packages.

A fully operational Gwadar port will boost industrialization process in the province. With the functioning of industrial zone, Gwadar would become a hub of industrial and trade activities. The government has also reserved 3,000 acres of land for the development of Gwadar Industrial Estate (GIE) to meet the demand of industrial plots. The government plans to establish a zone for the promotion of small and medium industries under the auspices of SMEDA in Gwadar. It also plans to open branches of banks and DFIs for making available loan financing to the intending entrepreneurs.

According to the master plan of GIE, 1000 acres of land would be developed in the first phase.

Following industries are planned to be developed in the GIE:

  • Small manufacturing;
  • High-tech electronic fabrication and assembly plants;
  • Metal and wood fabrication and assembly;
  • PVC housing & extrusion;
  • Re-packaging;
  • Fish processing & canning;
  • Life engineering;
  • Textile & garments;
  • Food & flour mills; and
  • Refrigeration & cold storages.

Ware housing, buildings, commercial plots, support services and other facilities have also been planned to promote industrial activity in the port city. The GIE master plan also includes the setting up of flatted factories in order to provide services to the future small industrial and commercial enterprises in Gwadar. The housing schemes for workers and low-income groups of people have also been planned.

Establishment of Free Trade Zone, and Export Processing Zone (EPZ) will open the doors for investment and development of small, medium and large scale industries generating revenue for the government and providing profitable avenues for both the skilled and non-skilled workforce in Balochistan.

There are no two opinions that development of Gwadar port and the China-Pakistan Economic Corridor (CPEC) are going to be a game changer for investment-starved Balochistan. Gwadar free port project promises more development projects in different sectors of Balochistan economy. Commerce, industry, trade and economic activities would receive a boost after the development of two-phased seaport in the province. The CPEC involves construction of highways, railways and energy pipelines connecting western China with Pakistan and the Persian Gulf.

Owing to the development of Gwadar port, a huge investment in infrastructure sector promises a brilliant economic future for the development of industry in the province and it will bring about a revolution in its communication sector. The project would initiate a mega development process with huge investments which could make the province a new economic frontier of the country.

The CPEC and Gwadar port are expected to usher in a new era of industrial development in Balochistan. Balochistan possesses enormous industrial potential in key sectors- agriculture, livestock, fisheries and minerals. There are greater investment opportunities in all sectors of provincial economy for exploiting the industrial potential of the province. A large number of agro-based, livestock-based, fisheries-based and mineral-based industries can be set up in the province.

SECURITY CONCERNS

If CPEC timely completes and Gwadar port becomes fully operational as hub port, it will change the fortune of the most backward and the country’s poorest province. On the other hand, if the terrorist activity to sabotage the mega development process gets boost in the next few years in Balochistan, it will be a disaster for the least developed province.

The deteriorating law and order situation in Balochistan is the main reason for slow progress on port-related projects in Gwadar. Today, the province suffers from a separatist insurgency. It reels from sectarian terrorism and targeted killings on ethnic lines. It is not the ports and pipelines which will bring peace and stability in the country but it is peace which will actually materialize the projects vital to economic progress and prosperity. Balochistan has ever remained on the political periphery of the country. The province has ever been at the receiving end. The long history of neglect and discrimination against the province and the military operations undertaken in the past and the one currently underway has turned it into a mega sensitive province.

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