Transcript Mines and Minerals - the Board of Investment

Punjab – A Destination to Invest
Punjab Board of Investment and Trade
CONTENTS

Pakistan – A Destination to Invest

Introduction to Punjab

Opportunities for Investment


Agriculture

Livestock and Dairy

Poultry and Fisheries

Energy

Roads and Real Estate Infrastructure

Industrial Estates & SEZs

Mines and Minerals
Services Offered by PBIT
PAKISTAN – A DESTINATION TO INVEST

Pakistan as likely to be second choicest place for FDI – JETRO

Pakistan to be world’s 18th largest economy by 2050 from present
44th position – Goldman Sachs

Pakistan’s outlook improved from negative to stable and recently
from stable to positive – Moody’s & S&P

Consumer Confidence rose to 99 in the 1st quarter of 2014 from the
lowest level of 86 in 3rd quarter of 2011 – Nielsen

Pakistan is set to take-off, it is a matter of time – Morgan Stanley

Corporate earnings in Pakistan are soaring – Bloomberg

Pakistan’s economic recovery is in process – Economist

Improving economic performance of Pakistan – IMF and WTO

Pakistan upgraded from its “Grey List” to “White List” – FATF

Pakistan to be considered for classifying as Emerging Market – MSCI
PAKISTAN – A DESTINATION TO INVEST
FAVOURABLE DEMOGRAPHICS

Fifth largest consumer market in the world

55% of population is below the age of 30

Middle class growing at an astonishing rate of 36.5%
Largest Markets by Population
INCREASING CONSUMER SPENDING

Consumer spending increased by an average of 26% in the last
three years
SKILLED WORK FORCE

Tenth largest country in the world by size of the work force

Total work force increased from 50.0 million in 2005-06 to 59.7
million in 2012-13

500,000 highly skilled graduates produced annually by over 200 universities
PAKISTAN – A DESTINATION TO INVEST
RICH NATURAL RESOURCE

Access to abundant agricultural raw materials for industry and manufacturing

Abundant presence of all types of minerals and offering potential for oil, gas and minerals exploration
PAKISTAN – A DESTINATION TO INVEST
STRATEGIC LOCATION

Strategically located to become Asia’s premier trade, energy and transport corridor

Border with prominent countries like India, China, Iran and Afghanistan with sea access to markets of
GCC, EU and North Africa through Arabian Sea

Direct border access to 50% of the world population

Pakistan has GSP Plus status thereby products manufactured in Pakistan have duty free access to EU
ALL NATURAL LAND FEATURES
Land, desert, sea, mountains,
EU
CARs
plains, steppe, rivers & etc
CHINA
MENA
ALL SEASONS OF THE WORLD
Winter, summer, spring and
autumn
INTRODUCTION TO PUNJAB
Punjab has Area of
205,344km²
Making it Second Largest Province
Contributes to
60%
of GDP of Pakistan
Population of Punjab is
55%
of Pakistan’s Population
Punjab Contributes
68%
to Annual Food Grain Production
Small to Medium Scale
11,820
Textile Units
Medium to Large Scale
48,000
Industrial Units
INTRODUCTION TO PUNJAB
Value Proposition of Punjab

Punjab is the largest economy in Pakistan

Punjab’s GDP is greater than many countries in the
GDP in USD Billion
129
104
67
region

Punjab has state-of-the-art infrastructure to cater
142
19
32
33
35
44
to needs of industry and agriculture

Abundant agricultural and mineral raw materials
for industrial use

Offering road and railway connectivity to all part of Pakistan and regional countries

Pro-growth economic policies for creating an enabling environment to do business

Good governance framework ensuring fast-track care in a transparency business conducive
environment

High urbanized province with developing city centers and skilled work force

Strategically located in the largest irrigated basin of the world, 80% of it is in Pakistan and73% of it is
in Punjab
PUNJAB FOCUSING ON INFRASTRUCTURE AND SOCIAL SECTOR
ANNUAL DEVELOPMENT PLANS FY16 TO FY18

Annual Development Plans focus on Social Sector and Infrastructure Development

Total Outlay of USD 16.55 Billion of which 40% is in Infrastructure Development

Break up of Infrastructure Development Spending:
o
o
o
o
o
Roads
Irrigation
Energy
Urban Development
Public Buildings
46%
22%
19%
10%
6%
Breakup of ADPs
2%
11%
30%
10%
7%
40%
Social Sector
Infrastructure Development
Production Sectors
Services
Others
Special Initiatives
SUCCESS STORIES
Currently more than 50 Multinational companies are operating in Pakistan in the sectors of
telecommunication, Financial Services, Construction, Oil & Gas, Home Appliances, Electronics, Energy,
Mining, Ports, IT, Packaging & Engineering
AGRICULTURE & ALLIED SECTORS
AGRICULTURAL PRODUCTION
Pakistan ranks among the top ten producers in the world for
at least 25 agricultural commodities
Commodity
Apricot
3rd
72% of the irrigated land in Pakistan is in Punjab
Buffalo Milk
2nd
Punjab is a dominant producer of major crops like wheat
(80%), cotton (75%), sugarcane (64%) and rice (58%)
Chickpea
3rd
Cotton Lint
4th
Cotton Seed
3rd
Dates
5th
Mango
6th
Onion
4th
Oranges
11th
Rice, paddy
11th
Sugarcane
5th
Tangerines
9th
Wheat
10th
Opportunities in Agricultural Production Sub-Sector
 Corporate Farming: Of the total 16.5 million hectares of
cultivable land in Punjab, 1.7 million hectares is still
vacant and available for corporate farming
 Local Manufacturing of Farm Equipment: About 60% of
the farmed area requires mechanized harvesting to save
approx 15% losses in produce caused by manual
harvesting. Establishing of facilities for manufacturing of
agricultural machinery offers tremendous potential
national needs as well as exports to neighboring
countries
Global Production Rank
AGRICULTURAL PRODUCTION
 Preservation of Fruits and Vegetables for Export: 30 to 35% of the horticulture produce is wasted as
post harvest losses.
Opportunities exist in state of the art supply chain infrastructure like storage capacity, cool chain
infrastructure, processing and preservation of farm produce, marketing and supply of farm produce.
 Hybrid Seed Multiplication: High demand for seed multiplication & hybrid seed production for
cotton, rice, sunflower, maize, vegetables & flowers.
Prospects for investment in modernization and development of irrigation facilities and water
management solutions.
 Inputs Industry: High dependence on agricultural inputs like fertilizer and chemicals due to base in
agrarian economy.
 Increasing demand for farm inputs, especially with micro-nutrients that enhance per acre yield
LIVESTOCK & DAIRY
Opportunities in Meat Sub-Sector
 Large breeding farms of genetically superior animals
 Integrated meat production and processing
 Meat processing for domestic demand and export
markets
 Slaughter houses for tapping Halal meat market
 Frozen foods and dried meat market
Opportunities in Dairy Sub-Sector
 Investment in dairy processing and value chain
infrastructure
 Milk collection centers, chillers & storage in milk clusters
 Diversified dairy products market including pasteurized
milk, flavored milk, condensed milk, milk powder and fat
free milk
 Production of diversified value added dairy products
Meat
 Domestic demand of meat is
growing at 6% per annum while
supply is growing at 4% per annum
 FY14 production of meat was at 3.5
million tonnes
 Middle East, Iran and Central Asia as
premium markets for exports
 Global Halal meat market is around
US$ 600 billion
Livestock
 Pakistan is 4th largest producer of
milk
 Only 4% of milk is being processed
and marketed through formal
channels in Pakistan
 Supply demand gap in milk 6.8
million liters
 Domestic demand of milk is growing
at 20% per annum
FISHERIES & POULTRY
Opportunities in Fisheries Sub-Sector
 Aquaculture/aqua farming
 Biodiversity hatcheries
Fisheries
 Total production of Pakistan is over
725,000 tons a year and 1/7th of it is
exported
 Fresh water fish farms
 Export of salted, dried and smoked fish to neighboring
 There are 37 fish processing plants
with a capacity of 586 metric tons
countries
 Cool chain infrastructure
Opportunities in Poultry Sub-Sector
 Vertical integration of industry by integrated poultry
production and processing
 Environmentally controlled houses for broilers and layers
 Processed and value added products like ready to cook
and frozen foods
 Export of live animals to neighboring markets
Poultry
 Annual growth rate for poultry
industry has been between 10-15%
during last two decades
 Poultry contributed 52% (by weight)
in total meat production of 3.5
million tonnes
ENERGY
ENERGY – SECTOR OVERVIEW
Pakistan

Cumulative Installed Capacity of 23,663MW

Average Generation Capability of 16,823MW

Demand During Peak Hours 21,605MW

Average shortfall of 4,000MW to 6,000MW
Punjab

Average Demand of 8,117MW

Average Supply of 4,774 MW

Short fall of 3,340 MW

Large and rising demand growing at 8% per year

Punjab as the largest power consumer in Pakistan owning
Installed Capacity
Power Consumption
to its industrialization and household usage
State of the Industry Report
National Electric Power Regulatory Authority
ENERGY – INCENTIVES STRUCTURE

Strong & Increasing Demand

GOPs Policy Commitment to Increase Private Sector

Transparent Regulatory Environment

One Window Facility and Investor Friendly Policy

Availability of GoP Guarantees

Predictable Multi Year Long Term Tariff

Standardized Security Package – Implementation and Power
Purchase Agreements

Pass Through of Fuel Cost and Additional Taxation

Risk Coverage for Exchange Rate Variation

Protection Against Change in Duties & Taxes and Political Risks

Income Tax Exemption
Strategic Location
ENERGY - OPPORTUNITIES
Hydel
Coal
Renewable Energy
(Solar and Wind)
Bagasse
Bio Waste to
Energy
LNG
• Punjab has low-head hydel potential of 800MW on canals and barrages
• Potential of 2MW+ at 58 sites, 1-2MW at 41 sites and less than1MW at 555 sites
• Upfront tariff and sites to be available soon
• Coal Power Plants from imported as well as local coal
• Upfront tariff available for 220MW, 350Mw, 660MW & 1,099MW plants
• Tariff calculation at ROE of 17% for imported coal and 20% ROE for local coal
• Solar Power in Southern Punjab with solar irradiation of 5.6 to 6.4 KwH/sqm/day
• Wind Power in Northern Punjab: 10-20 KM wide and 250 Km long wind corridor
• IRR of 17% and above with Govt guarantee of power purchase
• Bagasse based generation potential of 3,000MW in Pakistan from 12 million tons
• Crop residue of around 34 million tons per annum consisting of rice husk, rice straw,
maize stalk and cotton stick, etc
• 35 million livestock producing solid waste
• 2,300 tons/day of solid waste is in urban centers of Punjab
• Pakistan signing long-term LNG supply agreements
• Re-gasification infrastructure is already in place
• Opportunities for development of 3,600 MW of power generation facilities in Punjab
ROADS & REAL ESTATE
INFRASTRUCTURE
INFRASTRUCTURE PROSPECTS AND OPPORTUNITIES
Pakistan offers returns on roads, housing and transport projects (IRR of greater than 25%)
Projects are available in Punjab under all modes (Public Private Partnerships, Joints Ventures or Sole
Investments)
Housing Infrastructure
Real Estate Development
Transport Infrastructure
• LAHORE: Backlog of
nearly 400,000 units
• LAHORE: Annual
demand of 100,000
housing units per year
• Similar situation in
major urban centers
• Apartment buildings,
multi-purpose housing
• Lucrative real estate
investment
opportunities exist in
the construction of
large-scale
multipurpose buildings
in Lahore and other
major cities of Punjab
• High rises, Amusement
Parks, Entertainment,
LKPC & etc
• Many large projects are
being undertaken at
various zones and
industries that provide
for opportunities from
construction to
management.
• Roads, bridges, metro
links, railways and etc
Public Private
Partnerships
• One of the most
effective vehicle to
enhance private sector
participation in public
services delivery
• All PPP arrangements
available
• Project Development
Facility
• Viability Gap Fund
INFRASTRUCTURE OPPORTUNITIES – REAL ESTATE PROJECTS
Project
River Ravi Zone
Development Project
LDA Tower
Rehabilitation of Old
P&D Building
Shahi Bagh
Amusement Park
Est. Project/
Investment Size
Opportunity
Mode
USD 17 billion
Developing high quality residential
and commercial areas over
102,271 acres in three phases
Public Private
Partnership
USD 50 million
47 floor building to cater to
growing need for corporate office
and retail
Any
USD 91 million
State of the art mixed use building
with 16 floors. Utilization of prime
real estate.
Any
USD 276 million
Mughal themed amusement park
over 878 acres. Cater to high
demand of tourism and
recreational services.
Public Private
Partnership with
Foreign Technical
Partner
INFRASTRUCTURE OPPORTUNITIES – ROAD PROJECTS
Est. Project/
Investment Size
Opportunity
Mode
USD 80 million
Signal free tolled corridor between
Shahdara and Kala Shah Kaku
(5.8km). Recovery through toll
collection.
Any
Southern Bypass Road
USD 64 million
Signal free corridor between
Ameer Chowk and Attari Saroba
(7.8km). Recovery through toll
collection.
Any
Sharaqpur Bypass
USD 53 million
Signal free corridor over 12.9km.
Recovery through toll collection.
Any
Project
Grand Trunk Road
Expressway
Khadim-e-Punjab Rural
Road Program
USD 1.5 billion
Phase-wise construction and
rehabilitation of roads in rural
areas of the province
Phase I: 255 Road of 2100km
Any
INDUSTRIAL ESTATES & SEZS
OPPORTUNITIES IN DEVELOPMENT OF INDUSTRIAL ESTATES
Name of Project & Cost
in Million
Rahim Yar Khan
Industrial Estate by
2015
(Rs. 3000)
Size (acres)
400
Bhalwal Industrial
Estate by 2015
(Rs. 2800)
450
Vehari Industrial
Estate by 2016
(Rs. 1800)
277
Chunian Industrial
Estate by 2017
(Rs. 2200)
Quaid-e-Azam Apparel
Park (QAAP)
(Rs. 11,625)
Development
of
Infrastructure Phase
1-A&B
of
M-3
Industrial City
(Rs. 1400)
200
1,562
450
Nature of Industries
Food processing,
Pharmaceuticals, Dairy,
Cotton Ginning, Livestock
Food processing,
Pharmaceuticals,
Engineering, Textile,
Packaging, Cold Storage
Textile, Cotton Ginning , Food
Processing, Pharmaceuticals,
Pesticides
Paper and Packaging, Light
Engineering, Printing, Foot
Wear, Pharmaceuticals, Food
Processing
Readymade Garments,
Textile & Allied Products
Chemicals, Textiles
Processing, Pharmaceuticals,
Packaging, Steel Industries
Plots
Available
Expected Outcome
157
Rs. 5 billion activity and
1,50,000 employment
opportunities
260
Rs. 4.5 billion activity and
1,20,000 employment
opportunities
202
Rs. 2 billion activity and 50,000
employment opportunities
200
Rs. 2.5 billion activity and
60,000 employment
opportunities
Under
Process
82*
Rs. 15 billion activity
Rs. 5 billion activity and 50,000
employment opportunities
123 plots sold
OPPORTUNITIES IN DEVELOPMENT OF INDUSTRIAL ESTATES
Size
(acres)
Development
Cost
Funding
10,000
Rs. 10000
Million
Govt &
PIEDMC
Rs. 20 billion activity and 200,000
employment opportunities
Gujrat Industrial Estate by 2018
290
Rs. 2000
Million
Govt &
PIEDMC
Rs. 2.5 billion activity and 30,000
employment opportunities
Rawalpindi Industrial Estate by
2018
140
Rs. 1500
Million
Self Finance
Rs. 2 billion activity and 25,000
employment opportunities
Jhang Industrial Estate by 2018
100
Rs. 1200
Million
Self Finance
Rs. 1.5 billion activity and 20,000
employment opportunities
1000
Rs. 1600
Million
Name of Project
Pind Dadan Khan Special
Economic Zone by 2017
Development of Infrastructure
Phase-II of M-3 Industrial City
Expected outcome
Rs. 2.5 billion activity and 25,000
Under Process employment opportunities
DEVELOPMENT OF SPECIAL ECONOMIC ZONES
SEZ

SEZ Act promulgated in 2012

SEZs to be set up by the Federal or
Provincial Governments

All modes available for zone
0%
Duty on Imports of Capital Goods
0%
Corporate Income Tax Rate
10 Years
Corporate Income Tax Holiday
developers, zone enterprises and
investors

Public Private Partnership option also
available

No restriction on sectors
50 Acres
Minimum Land Required for SEZ
100%
Private Ownership Allowed
FTZ, FEZ, EPZ & Etc
All Options Available
MINES & MINERALS
MINES AND MINERALS

Minerals of Punjab provide the resource base of its industrial sector

35 minerals under excavation including; coal, limestone, gypsum and rock salt by 2300 entrepreneurs

56 industrial leases under large corporations and multinationals for industrial production of cement,
soda ash, caustic soda, fertilizer, glass, ceramics and marble
OPPORTUNITIES IN MINES AND MINERALS

Key projects for investment are as follows:
Project Name
Estimated Cost (USD Million)
Iron & Copper Mining & Establishment of Steel Mills
662.5
150-300 MW Local Coal Fired Power Plants on Mine
Mouth Model
800
Establishment of Plants for Soda Ash & Caustic Soda
at Salt Range
200
Establishment of Cement Plants at Salt Range
300
No Of Projects (4)
2,800
SERVICES OFFERED BY PBIT
INVESTOR FACILITATION
PBIT eases the way for foreign investors looking to harness opportunities presented by Punjab’s fastgrowing domestic economy and robust competitive advantages as an export hub
One Window Facilitation
Assisting in obtaining all necessary national and provincial approvals/requirements to
facilitate a fast-track market entry and also offering post-investment aftercare
Information & Advisory Services
Providing information to investors and businesses in relation to industry & market
research, entry strategy, location selection, incentives structure, financing and legal issues
Policy Reform Support
Ensuring inclusive policy reform with feedback from private sector stakeholder and
creating business enabling environment
THANK YOU
Contact Us
[email protected]