A lease agreement is being processed to hand over 2,281 acres of land to the China Overseas Port Holding Company for the establishment of a ‘free trade zone’ in Gwadar.
According to a senior official of the ministry of ports and shipping, the lease agreement is currently being reviewed by the law division. After the government’s formal approval, the land will be leased out to the Chinese company for 40 years. The ministry has paid over Rs6.69bn to acquire the land through the deputy commissioner of Gwadar.
The free trade zone is seen indispensable for the success of the Gwadar port, as they are an integral part of all modern ports. The zone is expected to ensure optimal use of the deep sea port. In Gwadar port’s master plan, prepared by foreign consultants, the mouza Dor Gatti area had been earmarked for the free trade zone.
A free trade zone is a designated area that eliminates traditional trade barriers such as tariffs, and minimises bureaucratic regulations. Its goal is to enhance global market presence by attracting new businesses and foreign investment.
The Chinese company has been incorporated as the ‘Gwadar Free Zone Company’. It will finance infrastructure development of the zone area, with the exception of access roads, which will be financed by the Gwadar Port Authority. The company will bring local and foreign investment to establish the manufacturing assembly and processing plants.