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How far will Islamabad go to attract US investors?
ISLAMABAD: Pakistan is keen on getting American investment, but how far is Islamabad willing to go for the investment dollar?
Quite far, if the draft of a bilateral investment treaty (BIT), currently under negotiations, is to be believed.
The extraordinary leverages being negotiated under the BIT include foreign investment in all sectors, and that does not exclude defence under the current draft, and foreigners, regardless of their nationality, filling senior management positions in these foreign ventures.
Both Washington and Islamabad have been locked in discussions over the treaty for the last three days and hope that talks will continue, according to senior officials of the American negotiating team.
Foreign senior management
In a background briefing to a select group of journalists, senior visiting US officials said the investors can choose senior management without regard to nationality.
This would be a departure from the existing practice under which intelligence agencies grant a no-objection certificate (NOC) for allowing foreigners to work at senior positions in Pakistan.
Currently, intelligence agencies have denied NOCs to roughly 200 people on security concerns, according to the Board of Investment (BOI) officials.
On the issue of appointment of executives by US firms from countries hostile towards Pakistan, the BOI said the countrys security will not be compromised at any cost.
To another question, the US officials said there will be no restriction on investment in any sector, except government procurements.
US firms can invest in both, manufacturing and services sectors, officials said.
Contents of the treaty
While the US officials largely remained tightlipped over the contents of the treaty, according to a legal document duly signed by both countries and available with The Express Tribune, each party shall accord to investors of the other party treatment no less favorable than that it accords to its own investors with respect to the establishment, acquisition, expansion, management, conduct, operation, and sale or other disposition of investments in its territory.
The treaty will also ensure that no state can expropriate or nationalise the assets and investments covered under the treaty. There will also be no ban on exports, imports and there will be no condition of achieving a given level or percentage of domestic content. The host country also cannot force the investor to transfer the technology.
Nuclear investments
Would the Americans be able to invest in the countrys nuclear industry?
Yes, according to BOI officials, but only in civil nuclear technology including nuclear power production.
The US team had meetings with the officials of Pakistan Atomic Energy Commission and Conventional and Open Programme Directorate of Strategic Planning Division, according to the BOI officials.
The US officials, however, refused to share details of their meetings.
Conclusion of the treaty
While commenting on the likely conclusion of the bilateral treaty, the US officials said the negotiations were at the final stage but nothing can be said about the signing of the treaty.
Pakistan, however, announced on Wednesday that the treaty will be finalised on the sidelines of the United Nations General Assembly session, scheduled for September.
The US officials said both the sides were in the process of finalising non-confirming measures that include non-discriminatory treatment to investors, basic investment protection from minimum standards and access to respective markets.
ISLAMABAD: Pakistan is keen on getting American investment, but how far is Islamabad willing to go for the investment dollar?
Quite far, if the draft of a bilateral investment treaty (BIT), currently under negotiations, is to be believed.
The extraordinary leverages being negotiated under the BIT include foreign investment in all sectors, and that does not exclude defence under the current draft, and foreigners, regardless of their nationality, filling senior management positions in these foreign ventures.
Both Washington and Islamabad have been locked in discussions over the treaty for the last three days and hope that talks will continue, according to senior officials of the American negotiating team.
Foreign senior management
In a background briefing to a select group of journalists, senior visiting US officials said the investors can choose senior management without regard to nationality.
This would be a departure from the existing practice under which intelligence agencies grant a no-objection certificate (NOC) for allowing foreigners to work at senior positions in Pakistan.
Currently, intelligence agencies have denied NOCs to roughly 200 people on security concerns, according to the Board of Investment (BOI) officials.
On the issue of appointment of executives by US firms from countries hostile towards Pakistan, the BOI said the countrys security will not be compromised at any cost.
To another question, the US officials said there will be no restriction on investment in any sector, except government procurements.
US firms can invest in both, manufacturing and services sectors, officials said.
Contents of the treaty
While the US officials largely remained tightlipped over the contents of the treaty, according to a legal document duly signed by both countries and available with The Express Tribune, each party shall accord to investors of the other party treatment no less favorable than that it accords to its own investors with respect to the establishment, acquisition, expansion, management, conduct, operation, and sale or other disposition of investments in its territory.
The treaty will also ensure that no state can expropriate or nationalise the assets and investments covered under the treaty. There will also be no ban on exports, imports and there will be no condition of achieving a given level or percentage of domestic content. The host country also cannot force the investor to transfer the technology.
Nuclear investments
Would the Americans be able to invest in the countrys nuclear industry?
Yes, according to BOI officials, but only in civil nuclear technology including nuclear power production.
The US team had meetings with the officials of Pakistan Atomic Energy Commission and Conventional and Open Programme Directorate of Strategic Planning Division, according to the BOI officials.
The US officials, however, refused to share details of their meetings.
Conclusion of the treaty
While commenting on the likely conclusion of the bilateral treaty, the US officials said the negotiations were at the final stage but nothing can be said about the signing of the treaty.
Pakistan, however, announced on Wednesday that the treaty will be finalised on the sidelines of the United Nations General Assembly session, scheduled for September.
The US officials said both the sides were in the process of finalising non-confirming measures that include non-discriminatory treatment to investors, basic investment protection from minimum standards and access to respective markets.
