ISLAMABAD, July 24: The government is working on a policy under which millions of acres of state land will be given away and private land will be acquired for allotment to private sector, particularly foreign entrepreneurs, to facilitate foreign direct investment.
Informed sources told Dawn on Monday that the policy, envisaging allotment of state land to investors and acquisition of private land under the Land Acquisition Act for transfer to entrepreneurs would be introduced soon. Its main objective is to relieve prospective bidders from complexities of laws governing pre-emption rights of citizens.
The sources said the private sector faced practical difficulties in purchasing large chunks of land for investment because of multi-owner titles of land and also because in most cases such sales result into litigation under the Land Pre-Emption Act.
In some cases, the sources said, the government had facilitated the investor by acquiring private land under the Land Acquisition Act but came under criticism for doing this on a ‘pick and choose’ basis. “The government now wants to introduce a uniform policy to facilitate all investors in this regard without any discrimination or favour,” an official said.
He said the state land was currently available in almost all major cities, particularly in various parts of Karachi including Port Qasim and about 10,000 acres of Pakistan Steel Mills, but the process of disposing of such land was taking place in a non-professional manner. The state land in all cities would be made part of a ‘land bank’ for utilisation by the private sector for investment.
He said the government planned to develop such state land by providing basic facilities like gas, water and electricity and fix a price depending on its location. The land would then be provided to the investor who would be required to pay 10-15 per cent of the whole price as down payment and the remaining 90 per cent on the basis of deferred payment.
When an investment plan, the official said, was approved by the government, the investor would be required to meet a time-line for implementation of the project and start production in one year.
The 90 per cent of the land cost would either be collected from the investor in five years after the payment of the down payment or in five years after the commercial operation of the plant on a case-to-case basis.
In case of failure of an investor to meet the time-line or the use of land for a purpose other than that approved by the government, his down payment would be forfeited.
The sources said the move to provide land in instalments was to relieve the investor from the extra-burden of the start-up cost and enable him to pay the land cost out from his profit.
This, he said, would not only provide employment opportunities but also offer better utilisation of land currently non-productive for one reason or the other. The new policy would specifically benefit special purpose industrial areas like textile city, leather city, sports city and silk city.
