BoI brings SEZs under renewed focus
MUSHTAQ GHUMMAN
ISLAMABAD: The Board of Investment (BoI) has decided to push forward the development of Special Economic Zones (SEZs), including one with Iran, that were initiated before the International Monetary Fund (IMF) had imposed restrictions on the creation of new SEZs.
Under the Extended Fund Facility (EFF) approved by the IMF for Pakistan on September 25, 2024, the establishment of new SEZs has been restricted. Exceptions are only allowed for zones falling under international obligations or those with prior approval from the relevant SEZ Authority. In this context, the Board of Approvals (BoA) has been requested to clear the following SEZ applications, which are legally protected under the SEZ Act, 2012, by virtue of prior approvals, and to grant SEZ status in accordance with the prescribed criteria.
Sharing details about the Letters of Intent (LoIs) for SEZs under international commitments (three under CPEC and one with Iran), sources stated that the following four Special Economic Zones remain to be established as part of obligations made by the Government of Pakistan: (i) Mohmand SEZ ;(ii) Karachi Industrial Park ;(iii) Federal SEZ, Islamabad (Model SEZ) – approved in the 6th meeting of the Pak-China Joint Cooperation Committee of CPEC on December 29, 2016; and (iv) SEZ on Gabd-Rimdan Border – under an MoU signed between Pakistan and Iran on April 22, 2024.
The sources further stated that, considering the limited window of opportunity for Pakistan to utilize the SEZ incentive regime to promote investment in industrial infrastructure, Letters of Intent are being issued to enable the identification of development partners under relevant rules. This would allow early submission of zone applications and expedite the establishment of these SEZs.
Gilgit-Baltistan Moqpandas EPZ: The Gilgit-Baltistan Moqpandas Export Processing Zone was presented before the Approvals Committee (AC) in January 2025 and was approved in principle, subject to the completion of certain formalities and information. A Letter of Intent was subsequently issued by the BoI, allowing the GB government to initiate working-level negotiations with prospective investors. The zone application has now been resubmitted for final approval, with a request for formal notification of SEZ status. The BoA is expected to approve the application under the SEZ law and authorize its Secretariat to issue the necessary notifications for the zone and its SEZ Committee, subject to completion of all procedural formalities.
Private Sector EPZs: The cost of infrastructure and facilities within and outside these SEZs will be borne by the respective zone developers, in line with the commitments submitted by them. United Business Park, District Lahore: On June 14, 2024, the BoI received a zone application from SEZA Punjab for the establishment of a multi-industry SEZ named United Business Park in District Lahore. The zone, to be developed by Din Properties Pvt. Ltd. near Raiwind, will cover an area of 258.7 acres and cater to multiple industries.
The application was examined under the SEZ Act 2012 and relevant regulations, with major observations communicated to SEZA Punjab on July 1, 2024. A revised application was later submitted for consideration. The application, along with related documents, was placed before the Approvals Committee (AC) in its 9th meeting on January 7, 2025. However, due to discussions surrounding the land lease policy and proposed per-acre plot price, the AC deferred the application, pending rationalization of costs and resubmission.
In response to the BoI’s request for the BoA’s agenda, SEZA Punjab has now recommended the revised application for placement before the BoA, with the proposed per-acre industrial plot price reduced from Rs 120 million to Rs 99 million.
Capital SEZ, District Chakwal: SEZA Punjab has also recommended placement of the revised application for Capital SEZ before the BoA, following directions from the 9th AC meeting to revise the cost estimate. The per-acre cost for industrial plots has been reduced from Rs 72.14 million to Rs 40 million.
Green Industrial Park, District Lahore: On June 14, 2024, the BoI received an application from SEZA Punjab for the Green Industrial Park, another multi-industry SEZ to be developed by the H.Y Constructions Pvt. Ltd. near Raiwind, covering 63 acres.
After review under the SEZ Act 2012, observations were sent to SEZA on July 1, 2024. A revised application was submitted and discussed in the 9th AC meeting on January 7, 2025. However, due to debates on lease policy and pricing, the AC deferred the application. SEZA Punjab has now resubmitted it with a revised cost estimation of Rs 120 million (down from Rs 150 million per industrial plot).
Oborcon Industrial Zone, Thatta, Sindh: On May 25, 2023, the BoI received a zone application from SEZA Sindh for the establishment of Oborcon Industrial Zone, a 300-acre private-sector SEZ in Mirpur Sakro, District Thatta, to be developed by Oborcon Industrial Zone (Pvt) Ltd. Initial observations were communicated on June 5, 2023. A revised application was submitted on June 20, 2023, but was returned in October 2023 due to deficiencies. After addressing all observations, SEZA Sindh resubmitted the application on July 30, 2025.
It has now been placed before the BoA for consideration, based on recommendations made in SEZA Sindh’s 6th Board meeting on April 13, 2023. The BoA is expected to grant SEZ status under the SEZ Law and authorize its Secretariat to issue required notifications, subject to all procedural requirements being met.
Zone Regulations of Bin Qasim Industrial Park: Bin Qasim Industrial Park (BQIP) in Karachi, developed by the Pakistan Industrial Development Corporation (PIDC), was notified as an SEZ on July 22, 2014, covering 930 acres. Enterprises have been admitted based on standard criteria, with a 60-year lease term. The current lease rate is Rs 70 million per acre, payable over 24 months.
In its 11th meeting on January 2, 2025, the SIFC Apex Committee advised shifting to an annual preferential land lease model at $10,000 per acre per year for up to 50 years, with payments spread over the lease period. This aims to reduce the cost of doing business and attract more investors. As a result, new qualification criteria have been proposed to filter genuine investors eligible for the revised lease model. These criteria, along with an enforcement mechanism, have been formulated with the mutual consent of key stakeholders, including BoI, SIFC, the Ministry of Industries and Production, SEZA Sindh, and PIDC, under the regulatory framework of the SEZ Law.
