Special Economic Zones under CPEC: A Critical Study of Rashakai Economic Zone

Abstract

China Pakistan Economic Corridor (CPEC) is considered to be a game changer for Pakistan because it aims at the establishment of Special Economic Zones (SEZs) under its ambit. The SEZs are special delimited areas, usually located in the border areas, wherein special and relax rules of bushiness are adopted to attract FDI as well as local investment. For many economists, the concept and implementation of SEZ work as vehicle for rapid industrial growth that leads to sustainable economic development in developing countries like Pakistan. The paper aims to provide a brief account of already work done on nine planned SEZs and type of industries that will be established with special focus on Rashakai Economic zone being a test case. The lesson learnt from the earlier work indicates that conducive environment, FDI attraction, use of advanced methods of production and ease of joint ventures are success factors. The success of these economic zones will help to revive the economy of Pakistan and will generate thousands of jobs especially Rashakai Economic Zone will help to reduce unemployment in KP. The paper explores that the concept of SEZs in Pakistan is not following any specific theoretical frame work as followed in the contemporary world but is following a mixed approach with focus on additional factor of Public Private Partnership (PPP) model. The paper suggests that Chinese model of SEZs may be adopted in letter and spirit; energy and power requirement may be fulfilled; fibre optic network be initiated and an expo for local businessmen may also be arranged for early harvest of the interventions.