BEIJING, Dec 14: Pakistani transporters have been invited to set up business in China. An official of the Chinese Communication Ministry told APP here on Saturday that Pakistani transporters can find Chinese partners to avail the business prospects in the growing Chinese market.

According to the sources, the road has become easier for overseas freight carriers that are seeking to further penetrate the Chinese transportation market.

Foreign logistics firms can take 75 per cent of shares in the road transportation industry from this month, according to a Ministry of Communications document. They can set up holding companies in the road transportation sector in one year’s time — and solely funded companies in three years.

This is in line with China’s commitment to the World Trade Organization and a regulation guiding foreign companies’ investment in road transportation. Overseas firms may take a 75-per cent stake in joint ventures involving cargo transportation, conveying and loading, storage and other auxiliary services, like vehicle repairs.

The share can be even larger than 75 per cent in companies engaged in container transportation, refrigerating wagon transportation, express delivery, logistics delivery, car rental and general quality testing of vehicles.

“That is not to say lots of foreign investors have been standing in a long queue to apply for such joint ventures,” said Wang Huachun, vice-director of the road transportation administration department with the Ministry of Communications. “In fact, they are very cautious in investing, but generally speaking opening the field wider will be good news to foreign investors.”

A bigger proportion is available to firms engaged in constructing the infrastructure of logistic stations, as well as those engaged in cargo transportation. Joint ventures in western China will also benefit.

But the proportion of reinvestment in the western region should not be less than 25 per cent. “The Ministry of Communication has yet to receive applications for licences under the new policy which was enforced on December 1,” Wang said.

“This is because a number of applications had been submitted before the document was released and dealing with them will take some time.”

The regulations state that the business period of transportation joint ventures can be no longer than 12 years. But it can be extended to 20 years for companies with 50 per cent of their capital in infrastructure construction.

Joint ventures that qualify can prolong business period to no more than 20 years with the approval of relevant departments. “Domestic companies should put more emphasis on administration and use the advanced experience of foreign companies when building joint ventures instead of focusing on capital only,” Mr Wang added.—APP