Credit By: Dawn
In a significant development at the World Economic Forum in Davos, Pakistan, Dubai has solidified a more than $3-billion investment pact. The agreement, encapsulated in two Inter-Governmental Framework Agreements, aims to bolster collaboration in railways, economic zones, and infrastructure. The marine and logistics sectors are focal points, with discussions on a dedicated freight corridor and economic zone near Karachi taking precedence.
Key Signatories and Entities Involved
The agreements, formalized on January 17, 2024, were signed by Shahid Ashraf Tarar, the Federal Minister of Communication, Railways, and Maritime Affairs for Pakistan, and Sultan Ahmed bin Sulayem, Chairman of Ports, Customs, and Free Zone Corporation (PCFC) representing the Government of Dubai. The project’s development will see the involvement of DP World, Dubai’s state-owned port giant, along with Pakistan Railways and Port Qasim Authority representing the Pakistani Government.
Rail-Based Freight Corridor for Enhanced Efficiency
One of the pivotal projects outlined in the agreement is a rail-based dedicated freight corridor, slated to extend from Karachi Port on the Arabian Sea, traversing Karachi to the Pipri Marshalling Yard. This corridor is expected to alleviate congestion in Karachi, enhance road safety, and bring about improvements in efficiency, transport times, and overall logistics cost reduction.
Navigation Channel Dredging and Economic Zone Development
A second framework agreement focuses on dredging a navigation channel, with DP World undertaking capital dredging on behalf of the Government of Dubai. Simultaneously, this agreement paves the way for the development of an economic zone at Port Qasim, with an ambitious target of attracting over $3 billion in foreign direct investment.
Strategic Significance and Future Prospects
The signing of Investment Framework Agreements underscores Pakistan’s strategic importance as a gateway to Asia. The nation’s pivotal location and its role as a trade corridor to Central Asia are highlighted as key elements of the collaboration. Sultan Ahmed bin Sulayem emphasizes Pakistan’s growth potential and its significance in trade, expressing pride in contributing to trading capabilities and pledging commitment to fostering new freight systems and enhancing port connectivity and investment through collaboration with Port Qasim Authority.
Continued Collaboration and Exploration of Opportunities
This landmark pact follows DP World’s Memorandum of Understanding (MoU) signing with JW Holdings, a prominent Pakistani conglomerate, earlier in the week on the sidelines of the World Economic Forum. The MoU focuses on exploring new Special Economic Zones (SEZs) and logistics development opportunities in Pakistan, reflecting the commitment to ongoing collaboration and investment exploration between the two entities.
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