Page 71 - CMA Journal (Sep-Oct 2025)

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Sectoral Focus of Pakistan’s SEZs

O
SECTOR OVVERVIEW
g
P Priority sector: garment and textile clusters (e.gg. Rashakai SEZ, Allama Iqbal Industrial City (Faaisalabad);
x
Textiles & Garments
a
s strong export focus.
o
m
E Electronics assembly and IT/ITES (Rashakai, Islamabad ICT zonee); SEZs plannedd for technologyy
Electronics & IT
e enterprises.
i
Automotive & A Auto and machinery (Rashakai targets auto parrts); industrial gooods clusters in several zones.
t
Engineering
r
o
P Processing of local crops and food products (Khhairpur SEZ focuused on dates/aggro; other zones may
c
AAgro-processing & Food
n
o
include food processing).
n
Steel, Metals & Heavy industry clusters (Dhabeji SEZ includes oiil/Petrochem coomplexes; Bostaan and Port Qasiim SEZs
a
m
e
Petrochemicals target steel, cement, chemicals, etc.).
e
a
M Mineral-based industries: e.g. Mohmand Marblee City (KP) for marble processingg; other zones (e.g.
o
i
Mining & Minerals
h
m
proposed Balochistan SEZs) for mining.
Construction/Building Cement and construction materials (notably in RRashakai and otther zones), leveeraging local ressources.
s
a
Materials
o
a
Emerging focus on renewables and services (UAAE-Pakistan MoUU mentions reneewables, AI, butt formal SEZ
m
Renewables & Misc.
u
projects are still focused on industry).
f

Revitalizing SEZs for Sustainable Growth SEZs in Pakistan: The Way Forward
The Special Economic Zones (SEZs), established under The success of Pakistan’s Special Economic Zones (SEZs)
the SEZ Act of 2012 and revised in 2016, offer tax breaks depends on transparency, good governance, and
and duty-free imports under the oversight of the Board consistent policies. Public disclosure of foreign
of Investment and the Board of Approvals. Under CPEC investment, debt, and guarantees, supported by audits
Phase II, SEZs target priority sectors such as textiles, and open contracting, is vital for accountability.
information technology, and agriculture to raise GDP by Oversight of state-owned enterprises, integration of SEZ
2–3% through investment and exports. finances into national budgets, and parliamentary review
Pakistan’s FDI trends remain volatile, reflecting investor can prevent hidden liabilities.
sensitivity to economic and political conditions.
Reforms should simplify approvals through a one-stop
However, no regular dataset reports actual FDI inflows for
services framework, strengthen the Board of Approvals,
each SEZ, with available data limited to national
and ensure fair incentives for both local and foreign
aggregates or project commitments, hindering
investors. To align with CPEC, Pakistan must
assessment of their role in investment, industrialization,
operationalize the Exim Bank and Land Port Authority,
and exports.
improve regulation, and enhance inter-ministerial
In December 2024, the government introduced reforms coordination.
to accelerate progress toward a modern, export-oriented
economy. Despite infrastructure and policy consistency Clear criteria for SEZ developers such as transparent
challenges, SEZs are expected to attract USD 10–12 billion standards, minimum land requirements, and federal
in investment and create 0.7–0.8 million jobs by 2030. participation are essential. Expansion should prioritize IT,
tourism, and services, promote women entrepreneur-
FDI Trends in Pakistan ship, and create independent tribunals for dispute
resolution.
2500 2234 2147
2057
2000 1737 1818 Industrial policy must drive exports, import substitution,
1462
technology transfer, and jobs while protecting local
1500
1157
industries. Short-term tax reliefs and financing incentives
1000
will boost competitiveness, while better infrastructure,
242
500 85
21 45 32 customs, and bonded warehousing will enhance trade
0 efficiency. Learning from China’s SEZ model, Pakistan can
2017 2018 2019 2020 2021 2022 2023 2024
ensure policy stability, strong infrastructure, and
sustainable partnerships to achieve a plug-and-play SEZ
FDI Inflows (in Millions of dollars) FDI Outflows (in Millions of dollars)
framework that drives industrial and economic growth.
Source: World Investment Report 2024:
https://unctad.org/system/files/official-document/wir2024_en.pdf
ICMA’s Chartered Management Accountant, Sep-Oct 2025 69