ISLAMABAD: Pakistan and the United States agreed on Tuesday to resume negotiations on contentious Bilateral Investment Treaty (BIT) as the latter hinted at about $1 billion investment projects in energy and education sectors.
At a brief joint news conference with visiting President of the US Overseas Private Investment Corporation (OPIC) Elizabeth L. Littlefield, Finance Minister Ishaq Dar said the two sides would soon resume discussions on the BIT. “We want to address the issue with an open mind and start negotiation from where these were left and move forward in a couple of months”, he added.
A senior government official on the sidelines told reporters that the visiting OPIC president told the finance minister that around $1bn projects for investment in energy and education sector in Pakistan are in pipeline by the US companies and desired any early resolution of the issue of BIT to improve comfort level to US companies and to protect their business interests.
The two sides have had a number of rounds of negotiations on BIT but could not sign it because of adverse comments from within Pakistan government that the treaty being pushed forward by the US side was too harsh against Pakistan’s interests as it provided umbrella rights to the US companies to take their business disputes directly to international arbitration by bypassing the country’s judicial system.
Ms Littlefield said the volume of US investment in Pakistan had increased from $80 million to $100m since she took over OPIC three years ago. She is leading a delegation of trade and business persons to Pakistan to hold meetings with business community and government officials to enhance investment in Pakistan.
Ms Littlefield told reporters that the security and governance were major challenges in Pakistan for US companies to take major business initiatives and expressed the hope that the new government would successfully deal with these issues.
Responding to a question about the BIT, she said three issues were pending and needed to be resolved urgently to allow the business community to move forward. She said OPIC was striving to increase US private investment in Pakistan for economic growth and employment generation.
Finance Minister Ishaq Dar said the US delegation was willing to help Pakistan overcome prevailing energy crisis and expressed the desire to invest in bio-energy sector in Pakistan and added that Pakistan was an attractive country for investment.
An official said the finance minister also informed the OPIC chief about recent successful conclusion of talks with the International Monetary Fund on a new programme and measures taken to clear the circular debt in the power sector as well as efforts being made to enhance power generation.
He sought support of the OPIC president to make its own investment and encourage other US firms to invest in Pakistan so that investors from other nations could also resume their interest here.
Separately, responding to media questions at the end of roundtable discussion with selected members of Pakistani business community on Tuesday, Ms Littlefield said security challenges, transparency, governance issues and processing period for doing businesses were among the top issues facing the US businessmen to make investment in Pakistan.
However, with the new government in place, improvements are now anticipated as promised by the government leaders, Ms Littlefield believed.
In this regard, she welcomed the comment of the newly-appointed chairman of Board of Investment, Mohammad Zubair who told Ms Littlefield that the government’s investment policy would be based on ‘red carpet’ instead of ‘red tape’ to maximum facilitate foreign investors in Pakistan.
OPIC President said she came to Pakistan with the concerns of US investors, and now leaving Pakistan with optimism that bottlenecks would be removed to pay way for foreign investors to come to Pakistan. We in OPIC think that by working together, investors and business community of the two countries would be able to create a long-term relationship in the long run.
Issues of trade financing, political risk insurance and support for private equity investment in sectors like information technology, energy sector, construction and infrastructure development were discussed at the roundtable.
Ms Littlefield introduced the products of OPIC and said the corporation being development financing institution, mobilizes private capital to help resolve critical development challenges.