September 13, 2003	Saturday	Rajab 15, 1424

ISLAMABAD, Sept 12: Islamabad expects Beijing to pledge substantial investment in Pakistan when President Pervez Musharraf visits China in early November this year, official sources told Dawn on Friday.

They said the investment, in response to Pakistan’s efforts for adequate foreign direct investment (FDI), would be made in nine sectors ranging from automobiles to fisheries.

A number of agreements were expected to be signed between the tow countries during the President’s five-day visit to China.

Pakistan has identified nine major sectors for Chinese investment which include automobiles (cars, motorcycles, tractors and trucks), textile machinery, manufacturing, leather, chemicals, mining, food processing, marble and fisheries.

The sources said the government had agreed in principle to allow China to manufacture small cars and motorcycles in Pakistan, although there existed a strong lobby against the idea.

Those who are already assembling cars and motorcycles in Pakistan are reportedly using their influence to keep China from entering into Pakistan market. “But we would support the Chinese as it would help our people to buy relatively cheaper cars and motorcycles,” a source said.

Board of Investment (BoI) chairman Waseem Haqqie when approached confirmed to Dawn that sectoral identification had been made for proposed Chinese investment in the country.

“We are expecting greater cooperation between the two countries as a result of the President’s visit to China in early November 2003,” he added.

He said the private sector would be the real engine of growth and would be provided all necessary patronage for undertaking joint ventures with the Chinese businessmen. “The government will play its due role as a facilitator but the real task will have to be undertaken by our investors and entrepreneurs,” he said.

Responding to a question, Mr Haqqie said in a deregulated environment, the government had to ensure level-playing field for local and foreign investors. “If you are seeking investment promotion then there cannot be different laws and rules for different people and you have to treat them as equals in all respects to lure investment,” he asserted.

In reply to a question, the BoI chairman said that China had acquired modern technology and developed large-scale manufacturing skills that could greatly help Pakistan in various fields.

China, he said, had attracted $800 billion FDI in the past 25 years and was lately attracting investment worth $40 to $50 billion annually. “And now one should not be surprised to see an increased Chinese investment in this part of the world where there is fair competition and the cost of doing business is coming down gradually,” he said, adding that increased electricity tariffs were perhaps the only hurdle but that too was being addressed by the government on priority basis to help both the local and foreign investors.

Asked about the number of cars currently being manufactured, Mr Haqqie said the country had produced 100,000 cars in 2002-03 compared to 65,000 in the previous year. “But by June 2004, Pakistan would be producing 300,000 cars and this is something really commendable,” he said.