- Infrastructure, agriculture and technology leading the charge for foreign and local investment
Interview with Mr. Khalid Tawab — Chairman, Tawab Group of Companies
PAGE: Tell me about yourself, please:
Khalid Tawab: I am Chairman of the Tawab Group of Companies, a renowned name in the manufacturing of paper, board, and steel. I have served as the Senior Vice President and Vice President of FPCCI (Federation of Pakistan Chambers of Commerce and Industry) and the Karachi Chamber. I have been the honorary Consul General of Mozambique since 1989.
In recognition of my outstanding public services, I was awarded the Sitara-e-Imtiaz by the President of Pakistan in 2009. My company has received the FPCCI Exports Awards twice and the International Asia Award once for the highest exports. I am also a philanthropist and a trustee of the Aiwan-e-Tijarat-o-Sanat hospital. I have had the privilege of serving as a Minister in the caretaker government. Presently, I am chairman of the Audit and Finance Committee of FPCCI – the most important committee of FPCCI.
PAGE: How would you comment on investment opportunities in Pakistan?
Khalid Tawab: Pakistan offers a range of investment opportunities across various sectors, including:
Infrastructure development: With the China-Pakistan Economic Corridor (CPEC) and other initiatives, Pakistan’s infrastructure sector is growing rapidly.
Textiles and manufacturing: Pakistan has a large textile industry and is exploring opportunities in other manufacturing sectors.
Agriculture and food processing: With its rich agricultural land and favorable climate, Pakistan has the potential for investment in agriculture and food processing.
IT and technology: Pakistan’s IT sector is growing, with a focus on software development, outsourcing, and e-commerce.
Energy and natural resources: Pakistan has significant natural resources, including coal, gas, and renewable energy sources.
Pharmaceuticals: Pharmaceutical companies are running their good business across Pakistan.
Real estate: Pakistan’s real estate sector is growing, driven by demand for housing and commercial spaces.
There are some more sectors attracting foreign investors that include sports goods, hand-knotted carpets, electric and electronic appliances, two- three- and four-wheelers, cold storage, tin-packed foods, etc. However, investors also consider the challenges, such as:
— Political and economic stability
— Security concerns
— Regulatory frameworks
— Infrastructure gaps
Overall, Pakistan offers attractive investment opportunities for those willing to navigate its complexities and challenges.
PAGE: Which sectors of the economy are lucrative in terms of foreign and local investment?
Khalid Tawab: The sectors of Pakistan’s economy that are lucrative in terms of foreign and local investment include:
Services: The services sector, including IT and technology, offers opportunities for investment in software development, outsourcing, and e-commerce.
Agriculture/corporate farming: With a significant contribution to GDP, this sector offers opportunities for investment in corporate farming, crops, livestock, and related industries.
Textiles: As the largest export industry, textiles offer attractive investment opportunities, including cotton production, manufacturing, and exports.
Energy and natural resources: With a focus on renewable energy and natural resources, investment opportunities exist in coal, gas, and
renewable energy sources.
Real estate: The growing demand for housing and commercial spaces makes real estate a lucrative sector for investment.
Manufacturing: With a growing focus on industrialisation, manufacturing sectors like food processing, chemicals, and pharmaceuticals present lucrative investment options.
These sectors offer a range of opportunities for foreign and local investors, with the potential for significant returns.
PAGE: What is your take on the taxation measures when it comes to investment?
Khalid Tawab: Pakistan’s taxation system has undergone reforms to encourage investment, but there is still room for improvement. Some positive measures include:
Tax incentives: Various tax exemptions and concessions are offered to attract foreign investment, such as tax holidays for specific industries.
Reduced corporate tax rates: Corporate tax rates have been reduced to encourage investment and business growth.
Simplified tax procedures: Efforts have been made to simplify tax filing and payment processes. However, challenges still persist.
Complex tax laws: Pakistan’s tax laws can be complex and difficult to navigate.
High tax rates: Personal income tax rates can be high, potentially deterring investment.
Lack of clarity: Tax policies and regulations can change frequently, creating uncertainty for investors.
Tax evasion: Tax evasion remains a significant issue, which can lead to an unfair advantage for non-compliant businesses.
To improve the investment climate, Pakistan should consider:
Streamlining tax laws: Simplify and clarify tax regulations.
Reducing tax rates: Gradually reduce personal income tax rates.
Increasing transparency: Improve communication and consistency in tax policies.
Enhancing tax enforcement: Strengthen tax administration to reduce evasion.
By addressing/overcoming these challenges, Pakistan can create a more investor-friendly tax environment.
PAGE: What is your standpoint on investment opportunities five years down the line?
Khalid Tawab: Overall, Pakistan is likely to offer attractive investment opportunities in various sectors over the next five years, driven by government initiatives, infrastructure development, and emerging industries. However, addressing economic stability, security, and regulatory challenges will be crucial to realising this potential. Based on current trends and initiatives, here’s my standpoint on investment opportunities in Pakistan five years down the line:
Positive outlook
CPEC expansion: The China-Pakistan Economic Corridor (CPEC) is expected to continue driving growth, with new projects and phases emerging.
Infrastructure development: Ongoing investments in infrastructure, such as roads, railways, and energy projects, will enhance connectivity and facilitate trade.
Industrialisation: Pakistan’s industrial sector is likely to grow, driven by government initiatives like Special Economic Zones (SEZs) and incentives for export-oriented industries.
Agricultural modernisation: Efforts to modernise agriculture, including precision farming and value-added processing, will create new investment opportunities.
Renewable energy: Pakistan’s focus on renewable energy sources, like solar and wind power, will attract investments in this sector.
Emerging opportunities
Technology and IT: Pakistan’s growing IT sector, including software development, e-commerce, and fin-tech, will offer attractive investment opportunities.
Tourism and hospitality: With improved security and infrastructure, Pakistan’s tourism industry is expected to grow, creating investment opportunities in hospitality and related services.
Healthcare and education: Increasing demand for quality healthcare and education services will attract investments in these sectors.
Challenges
Economic stability: Pakistan’s economic stability and governance will need to improve to attract and retain investments.
Security: Ongoing security concerns may impact investor confidence.
Regulatory framework: A more business-friendly regulatory environment is necessary to support investment growth.