Special Economic Zone Framework in Pakistan
The SEZ Act was promulgated on September 13, 2012 and later this year the SEZ Rules were notified. The law provides SEZs to be set up by the Federal or Provincial Governments themselves or in collaboration with the private sector under different modes of public-private partnership or exclusively through the private sector. The fiscal benefits under the SEZ law include a one-time exemption from custom duties and taxes for all capital goods imported into Pakistan for the development, operations and maintenance of a SEZ (both for the developer as well as for the zone enterprise) and exemption from all taxes on income for a period of ten years. The provincial SEZ authorities, set up under the law, are required to move the applications received from developers to the Federal Board of Investment which is to act as the secretariat to the Board of Approval and the Approval committee.
There shall be an Approvals Committee that shall be chaired by the Chairman of the BoI. The Approvals Committee shall exercise all such powers and responsibilities as are delegated to it by the BOA, subject to such conditions as it may deem fit. The BOA may delegate all or any of its remaining powers and responsibilities to the Approvals Committee. A decision taken by the Approvals Committee shall be submitted to BOA at its meetings or by circulation for approval. The BOA may, at any time, exercise any responsibility or any power which it has delegated to the Approvals Committee.
Board of Approval (BoA)
The Board of Approval (BOA), the highest approving forum is headed by the Prime Minister with membership from Economic Ministries, Provincial Governments, Public and Private Sectors. Approvals Committee is headed by the Chairman BOI and membership from Economic Ministries, Provincial Governments, Public and Private Sectors and SEZ Authorities (at provincial level including Gilgit- Baltistan) work under the leadership of the Chief Ministers. The Provincial Governments have received many applications for various potential zones in their respective provinces and are in the process of preparing documents to further process the applications. They are also engaged with potential local and foreign investors to finalize arrangements for infrastructure development of the areas identified for Zones.