Pakistan’s textile industry wants Chinese investment. The hope is to enter into successful joint ventures to benefit from each others’ entrepreneurial potential. The two countries are planning to enter into joint ventures for 1,00,000 spindles, 500 airjet looms and fabric dyeing and printing plants in Pakistan.
Chinese companies are looking mainly at the cement, steel, energy and textile sectors, the backbone of Pakistan’s economy. Chinese firms are eager to expand abroad at a time when growth has slowed at home. Pakistan has offered a package to the exporting industry with an added attraction of 12 to 15 per cent for producing and manufacturing in Pakistan.
To ease the cost of doing business, the country has announced an export-led growth package encompassing provision of drawback of local taxes and levies at four per cent on yarn and greig fabric, five per cent on processed fabric, six per cent on textile made ups, seven per cent on textile garments against realisation of exports.
The foreign investment policy offers zero per cent duty on imports of capital goods, zero per cent corporate income tax rate, 10 years’ corporate income tax holiday, 50 acres minimum land required for special economic zones and permission of 100 per cent private ownership.