Gwadar Free Zone: Government to provide land for export oriented units |
23.09.2007 |
By Sajid Chaudhry
ISLAMABAD: As a measure to promote export-led industrialisation the government will provide investors with land on 99-year lease for setting up of export oriented industries in Gwadar Free Zone, a government official informed Daily times on Saturday.
The free zone area will be measuring 923 hectares and shall be acquired by Gwadar Port Authority (GPA) with a clear title and with full authority to lease the same to the Free Zone Company for establishment of free zone, the official added.
Availability of prime land on lease would help local as well as foreign investors to set up their export oriented units and would also help them reduce their cost of business. The government has already agreed in principle to allow import of plant, machinery and equipments duty-free for the units to be set up in the export processing zones or special economic zones, the official said.
The free zone area would be customs free and protected by a security fence, however, all imports taken out of the free zone are shall be subjected to all applicable duties and charges. The free zone area would be used exclusively for port related business and will supplement the port related business. A 20-year tax holiday has been announced for the businesses to the established in the free zone area.
The concession holder has already constituted a free zone company to manage free zone business. Currently the concession holder, Port of Singapore Authority, holds 9 percent of the paid up capital in the Free Zone Company but would have the right to increase its shareholding in this company or disinvest its entire shareholding. The Free Zone Company would be controlled by the AKD Group with 91 percent shares.
The Free Zone Company shall be given leasehold rights in respect of the free zone area for a period of 40 years. The investors in the free zone area shall be given sub-leases for a period of 99 years from the free zone effective date. All sub-leases would be signed by the Free Zone Company, GPA and the sub-lessee.
The government has fixed targets for the GPA to make land available for free zone and hand it over to the company within specified deadlines. GPA has been directed to make available approximately 261 hectares of the land presently in the ownership of the Pakistan Navy and Coast Guards on the date of commercial operation.
The remaining 662 hectares are to be made available by December 31, 2007 with a grace period until 30th June 2008. If the GPA fails to acquire sufficient land under the said two options, it would be required to acquire remaining land within the port area to the reasonable satisfaction of the Free Zone Company.
The Free Zone Company would not be required to pay land lease fees to GPA but will be allowed to charge sub-lease fee from free zone users at fair market value. Limited residential development, housing in the free zone area would be allowed for use by the staff employed in the port related business.
The Free Zone Company would be entitled to earn income from leases, rental charges, development charges, maintenance charges and utility charges. However, the Free Zone Company would be required to pay 15 percent of its gross revenue from the free zone area.
http://www.dailytimes.com.pk/default.asp?page=2007 923story_23-9-2007_pg5_1 |
