Pakistan-China industrial cooperation should focus on technology transfer, textiles, agriculture, and Information Technology (IT) sectors, said Haroon Sharif, former Minister of State and Chairman of Board of Investment.

“These sectors are important for Pakistan. What we need to do is to fast track implementation. Both Pakistani and Chinese governments should work on facilitating the cooperation between the two nations’ private enterprises,” he said while attending the Beijing Forum held here between November 1-3, China Economic Net reported.

When talking about Pakistani enterprises’ advantages, he said they could make better products for exports via the technology transfer as China has invested a lot in modern and high technologies.

He said “Pakistan has lower labor costs to benefit China. As a large agriculture country, Pakistan can produce many food items for export to China and other countries.”

He said :”The most important one is the development of Gwadar Port. As its unique geographical location, it can provide a cost-effective short route for trades to benefit both China and Pakistan.”

Haroon Sharif stressed that for Pakistan, this partnership will be helpful, if the investment could create more job opportunities and improve its exports.

Introducing government’s incentives for foreign investors, he said, if a Chinese company and a Pakistani company make a joint venture (JV) in Pakistan, the JV is entitled to a ten-year tax holiday, including the imports of machinery from China. If 80 percent of JV’s products could be exported,
the JV’s tax exemption period will be extended to 20 years, he added.

He said Pakistan is also establishing special economic zones, where cheaper electricity and other kinds of facilities will be available for all investors. Pakistan’s labor costs will be comparatively low, he added.

Haroon Sharif is also very optimistic about Pak-China’s cooperation in the third-party market. As Pakistan has abundant raw materials and cheap labor and China has technologies, Chinese enterprises could set up plants and produce in Pakistan. For example, Chinese textiles companies could
make produce in Pakistan and then exports to European countries as Pakistan has signed GSP Plus favorable contract with them on textile products.

Besides the EU market, Pakistan and China will also take the benefits of Gwadar Port as it is very close to the Gulf countries, like Saudi Arabia, Qatar and the United Arab Emirates. Thus, products to be sold to these countries will be more competitive due to the short distance and lower freight charge, he added.

He advised foreign investors to form joint ventures with local partners and added, there is no limit to shareholdings for foreign investors in joint ventures.

He said investors should take advantage of Pakistan’s abundant labor force and create more employment. Foreign investors are also expected to transfer technology to Pakistan, he added.