Investments in Karachi Require Resolving City’s Key Challenges: Qaiser Ahmed Sheikh

By Muhammad Shahzad | Lahore, Pakistan

KARACHI: Federal Minister for the Board of Investment (BOI), Qaiser Ahmed Sheikh, has said that attracting investment to Karachi and strengthening Pakistan’s exports will only be possible if the government’s longstanding challenges facing industry—including high energy tariffs, delayed tax refunds, regulatory hurdles and inadequate infrastructure—are addressed.

Speaking at the Korangi Association of Trade and Industry (KATI), the minister described Pakistan’s business community as dynamic and resilient but stressed that investor confidence depends on a more business-friendly environment.

“The government’s foremost priority is to increase exports, and if Pakistan wants to achieve sustainable export growth, special attention must be given to Karachi,” Sheikh said.

He announced that a 6,000-acre Special Economic Zone (SEZ) will be established on land belonging to Pakistan Steel Mills. Investors in the zone will receive incentives, including a 10-year zero-duty regime to encourage industrial investment.

The minister also revealed that the Special Investment Facilitation Council (SIFC) will be merged with the Board of Investment (BOI) to streamline investment promotion efforts. He added that the government had abolished the Super Tax on exporters in the current federal budget, while acknowledging that high energy tariffs remain a major concern for industry.

Sheikh said approval for the Special Economic Zone had been secured after consultations with the International Monetary Fund (IMF). He further disclosed that investment agreements signed in Beijing six months ago are progressing, alongside memorandums of understanding with Maersk Line and partners in Abu Dhabi.

Encouraging greater foreign collaboration, the minister urged Pakistani companies to pursue joint ventures with international firms to enhance technology transfer, exports and industrial competitiveness.

Earlier, KATI President Muhammad Ikram Rajput said restoring investor confidence has become one of Pakistan’s biggest economic challenges. He warned that soaring energy costs, policy uncertainty, rising production expenses, delayed tax refunds, an overly complex tax system and deteriorating infrastructure are forcing industries to scale back operations and discouraging new investment.

Rajput called on the government to implement a genuine one-window operation for investors, reduce electricity tariffs to levels comparable with regional competitors, introduce stable long-term industrial policies, ensure timely payment of tax refunds and allocate dedicated funds to improve infrastructure in the Korangi Industrial Area.

He also criticized policymaking by individuals with limited practical understanding of industry and business.

KATI Deputy Patron-in-Chief Zubair Chhaya highlighted broader national challenges, including rapid population growth, unemployment, illiteracy and water scarcity. While many young Pakistanis are leaving the country in search of better opportunities, he said local investors remain willing to invest if provided with a supportive business environment.

Describing Karachi as Pakistan’s economic engine, Chhaya said the city continues to contribute the largest share of national revenue despite suffering from chronic infrastructure deficiencies.

During an interactive session, industry leaders—including Mian Zahid Hussain, Masood Naqi, Zahid Saeed, Dr. Zahid Ansari, Ghazanfar Ali Khan, Rehan Javed and Zahid Hameed—called on the government to urgently resolve issues related to energy prices, taxation, refunds and regulatory procedures to accelerate investment and boost exports.

In a separate discussion with Lahore-based trader and importer Jamshaid Butt (JB), the minister assured participants that concerns regarding imported goods, particularly shipments from China, would be reviewed and addressed.

At the conclusion of the event, KATI President Muhammad Ikram Rajput and Deputy Patron-in-Chief Zubair Chhaya presented a commemorative shield to Federal Minister Qaiser Ahmed Sheikh in recognition of his participation.