Pakistan seeks relocation of Chinese industries to Gwadar amid US-China tariff dispute

In light of the ongoing trade conflict between China and the United States, Pakistan is working on a strategy to attract Chinese industries looking to relocate due to the high tariffs imposed by the US, according to a news report.  

Since the onset of the trade war under President Donald Trump’s administration, which saw a series of tariff increases on Chinese goods, Pakistan has viewed this as an opportunity to present itself as a favorable alternative destination for Chinese companies.

To support this initiative, the government is developing a strategic framework aimed at offering incentives to Chinese businesses, particularly in Gwadar, a key city within the China-Pakistan Economic Corridor (CPEC). 

The Cabinet Committee on Chinese Investment Projects (CCoCIP) has tasked the Board of Investment (BOI) and the Ministry of Industries & Production with creating a detailed roadmap within five days. This roadmap will focus on attracting Chinese industries to relocate to Pakistan amidst the ongoing tariff dispute.

In a recent meeting, the CCoCIP reviewed a report from the Ministry of Maritime Affairs and issued several key directives aimed at boosting Pakistan’s position as a relocation hub. 

One of the major decisions was for the Ministry of Commerce to immediately issue a Statutory Regulatory Order (SRO) allowing the export of Potassium Sulphate fertilizer from Gwadar Port, bypassing existing restrictions under the Export Policy Order. 

This move had already been approved by the Economic Coordination Committee (ECC) and the federal cabinet, but formal notification was pending.

The committee also instructed the Ministry of Planning, Development and Special Initiatives to organize a high-level meeting with representatives from various government departments to discuss the implementation of Foreign Currency Facilitation as a pilot project in the Gwadar Free Zone. This initiative aims to streamline financial transactions and further attract foreign investments.

Additionally, the committee emphasized the need for the Ministry of Maritime Affairs to engage with local fishermen to facilitate international seafood transshipment through Gwadar Port. A report on these discussions is expected at the next meeting.

Regarding infrastructure development, the committee directed the Power Division to collaborate with Naval Authorities to ensure electricity supply to the Gwadar Desalination Plant, which is currently impacted by the suspension of power imports from Iran. 

A proposal to connect the plant to the National Grid through an extension of the power distribution line from Panjgur will be presented in the next meeting.

The committee also urged the Power Division and the National Electric Power Regulatory Authority (NEPRA) to expedite efforts to implement the electricity supply plan for the Rashakai Special Economic Zone (SEZ). A progress report on this initiative will be discussed in the upcoming session.

Finally, the Board of Investment has been tasked with addressing pending decisions and providing a detailed progress report for the next meeting of the CCoCIP.