Pakistan, Dubai sign over $3 billion investment pact to develop railways and ports

• The partnership covers development work at Qasim Int’l Terminal.
• Rail freight corridor from Karachi Port to Pipri Marshalling Yard.
  
• Development of Port Qasim Economic Zone to attract $3 billion FDI.

Pakistan and Dubai have signed an investment pact of over $3 billion in various sectors, including cooperation in railways, economic zones and infrastructure development.

The agreement was signed on the sidelines of the World Economic Forum in Davos by Minister of Communications, Railways and Maritime Affairs Shahid Ashraf Tarar and Chairman Ports, Customs and Free Zone Corporation (PCFC) of Dubai Sultan Ahmed bin Sulayem.

The collaboration covered the development of dedicated freight corridor, multimodal logistics park and freight terminals, the Ministry of Railways said in an official statement.

Dubai Port (DP) World will work to develop infrastructure at Qasim International Container Terminal which is Pakistan’s leading commercial gateway and plans to develop an economic zone near the terminal.

Both governments have signed two intergovernmental framework agreements to strengthen their relations in the shipping and logistics sectors, including the possible creation of an “Exclusive Freight Corridor” and “Economic Zone” near Karachi.

DP World will act on behalf of the Government of Dubai, while Pakistan Railways and the Port Qasim Authority will act on behalf of the Government of Pakistan to develop the projects.

The rail-only freight corridor is planned to run from the Arabian Sea port of Karachi, passing through Pakistan’s most populous city, to the Pipri Marshalling Yard, about 50 kilometers away.

This would decongest Karachi apart from improving road safety. It will significantly improve efficiency and transport times and reduce the overall cost of logistics.

Pakistan Railways is the national, state-owned railway company, which owns and operates nearly 8,000 track-km of railways across the country, from Peshawar in the northwest to Karachi in the south.

Qasim International Container Terminal, a second framework agreement was signed with the Ministry of Maritime Affairs of Pakistan for the dredging of the navigation channel.

DP World would carry out the capital dredging on behalf of the Government of Dubai.

This framework agreement will also include the development of an economic zone at Port Qasim, which aims to attract more than $3 billion in foreign direct investment.

DP World will carry out the development of the economic zone, to maximize economic activity in Pakistan.

Speaking at the signing ceremony, Ashraf said, “DP World has a long-standing proud presence in Pakistan, which is assured by a mutually rewarding commitment. Building on unwavering trust and partnership, the two sister countries have decided to further consolidate their economic cooperation through landmark projects.”

He added that the signing of investment framework agreements underscores the importance of Pakistan as a gateway to Asia and the trade dividends associated with its strategic location.

Sulayem, meanwhile, said Pakistan is a growing market and an important trade corridor to Central Asia.

“We are proud to have contributed to its commercial capacity through our operations at Qasim International Container Terminal and are honored to work with various Pakistani government agencies to develop new freight systems and with the Port Qasim Authority to improve connectivity and investment of ports”.

“These will help serve Pakistan’s growing population, projected to approach 300 million in the next decade, and further integrate it into the wider region,” he concluded.