Pakistan and China sign $10 billion investment deals across key sectors

Pakistan and China have signed multiple memoranda of understanding (MoUs) totaling $10 billion in investment in four major sectors including textiles, agriculture, food, and car spare parts manufacturing.

The MoUs were formally signed between the private sectors of Pakistan and China, signifying a robust commitment to fostering economic growth in Pakistan.

Caretaker Commerce Minister Gohar Ejaz said the joint ventures will establish industries in these export-oriented sectors. The planned joint ventures will involve full Chinese investment. Investors in the textile, food, agriculture, and automobile parts sectors aim to enhance the value of exports to China and other global markets.

Additionally, these investors can leverage preferential market access provided by the Generalised System of Preferences Plus scheme for the European market. This offers a substantial opportunity for exporters to access European markets without incurring duties.

Chilli Exports

As part of the efforts to boost exports to China, Pakistan will dispatch its inaugural shipment of fresh chilies from Karachi on coming Tuesday, according to the minister. The planned shipment follows a protocol established last October in response to China’s chili import bill of $10 billion per year. Pakistan plans to export chilies in three forms: fresh, paste, and powder.

Halal Meat

Another protocol has been established to export halal meat to China. The commerce minister revealed that shipments of boiled meat to China are expected to start in the coming weeks.

Peanut cultivation

Pakistan has also signed a protocol with a Chinese investor to cultivate peanuts over 10,000 acres in the Cholistan desert. These peanuts will be cultivated solely for export. Earlier, the commerce minister, after a recent visit to China, revealed that the Chinese government has agreed to give preferential access to agricultural products of Pakistan.

A list of products subject to reduced duties under the China free trade agreement is under formulation and will be finalized in collaboration with stakeholders’ input. The China Chamber of Commerce for Import and Export of Textiles (CCCT) has supported the idea of boosting textile imports from Pakistan. The commerce ministry aims to redirect 10% of CCCT’s imports, which could significantly raise Pakistan’s overall textile exports to China. Currently, CCCT’s total textile exports amount to $320 billion.

Salma Khan
Salma writes on topics ranging from education to technology to business. She can be reached at Twitter and Facebook.

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