Pakistan Still Attracts FDIs Despite Security Concerns

From Hafizah Kamaruddin

LAHORE, Nov 8 (Bernama) -- Despite its security concerns, Pakistan's cheap manpower and utilities seem to have the edge in luring foreign direct investments including Malaysian firms especially to its first integrated industrial estate -- the Sundar Industrial Estate here.

More than 20 per cent of the 674 hectare industrial lots have been taken up by multinational companies, especially from Europe, the chief executive officer of the Punjab Industrial Estates Development and Management Company (PIEDMC), Sabir P Chohan, said.

He said Tetra Pak International, the Swedish packaging company which was looking for a site for its regional centre, chose the industrial estate due to the two prevailing competitive factors.

The company is investing 400 million euros in a 20-hectare plot at the industrial estate which means "beautiful" in the Sanskrit language, he told a group of visiting Malaysian journalists on Saturday.

The other MNCs which have established their factories at the industrial estate are Pepsi Cola International Ltd, which set up its food processing and snacks factory for export to Afghanistan, Japan's Kansai Paint, LG manufacturing three wheeler motorcyles, Unilever, Haier and Stiefle -- a GlaxoSmithKline company manufacturing pharamceutical products.

Chohan said that currently, 60 industries in the area had started production including Kansai, Pepsi, LG and Haier, while 195 are under construction and 120 in the stage of approval and designing.

He said the local industries mainly comprise small and medium industries.

The industrial estate has its own security and a commercial area that includes a hotel, a 390 megawatt power plant which will be established along the lines of Malaysia's Independent Power Producers (IPPs)and a combine-effluent treatment plant.

"We hope to achieve a major part of the industralisation of Sundar by 2012 given the rapid pace in which Sundar has attracted investments of approximately 8 billion rupees (about US$96.14 million), created employment opportunities for nearly 15,000 workers and generated exports of between US$25-US$30 million," he said.

Chohan said with the increased demand for lots at the industrial estate, PIEDMC was expanding it with a second phase.

He expressed the hope that Malaysian companies would invest in the country's manufacturing sector which has a big consumer market as well as for export to the Middle East, Central Asia and also to India.

"Pakistan is also looking to the establishment of an industrial park in Punjab through a joint venture between the Government of Punjab and interssted Malaysian entrepreneurs or companies," he said.

He said PIEDMC will also be building three more industrial estates along the Lahore-Salkot Highway as well as upgrade existing industrial estates.

He said many of the Malaysian companies such as the Maxcorp Group of Companies have been investing in Pakistan especially in the province of Punjab in the construction sector.

The company is very actively involved in a number of projects, mostly high end housing projects.

Maxcorp was reported to have entered Pakistan in 1999 and won the contract to develop the US$55 million Royal Palm Golf Course in Lahore, and since then, it has won many other projects such as the development of the DA Country & Golf Club in Karachi, the Jacaranda Club for Defence Housing Islamabad and Mangla View Resort.

"Tenaga National Bhd (TNB) is also involved in the power sector. They own and operate a 235MW power plant," said Sabir.

Bandar Raya Developments Bhd recently completed a mega golf and entertainment complex and is very much involved in housing projects with Defense Housing Authority Lahore including commercial properties, golf resorts and other related projects spread over a 160-hectare area (400 acres).

Arash Venture SDHB, a Malaysian company, is involved in a mega housing project to build 4,500 apartments with DHA Karachi, while Petronas Carigali Pakistan Ltd is involved in oil exploration.

A Malaysian property firm, RENEXUS, has indicated that they will undertake the development of 50,000 low and low medium cost housing projects in the various urban centres.

Chohan said that the Chief Minister of Punjab, Mian Muhammad Shahbaz Sharif has invited them to undertake the construction of housing for the low and middle income groups to meet the shortage of housing.

-- BERNAMA

source http://www.bernama.com/bernama/v5/newsbusiness.php?id=453477