Land prices soar at
Pakistan's prize port By Syed Fazl-e-Haider
QUETTA, Pakistan - The value of
real estate in the new Pakistani port city of
Gwadar has already increased substantially and the
launch of the second phase of work on the
much-delayed deepsea port project may send the cost of land
soaring to unprecedented heights.
Islamabad has decided to set up a tax-free
industrial zone of international standard in
Gwadar. Investors and entrepreneurs, particularly
from Central Asia, Afghanistan, China, South
Korea, Japan and Singapore, have shown a keen
interest in establishing
industrial estates in the
port city. The government has allowed China and
South Korea to set up tax-free special industrial
development zones in Gwadar.
Gwadar is set
to make the transition from a small coastal town
to a cosmopolitan port city. The inauguration of
the project this month has driven up the cost of
land, which has increased in value several times
since March 2002, when work on the project was
started. Business people from all over the country and
abroad are showing interest in the area, and
Pakistan is offering more concessions to foreign
investors for the development of the second phase
of the project.
According
to official sources, leading international
investors have shown a keen interest in Gwadar because of its
strategic location and potential for becoming a
major transshipment trade center in the region.
Gwadar has been designed to operate as
a hub port, and it aims to provide better
investment incentive packages than ports such as Hong
Kong, Singapore and the United Arab Emirates'
Jebel Ali. The port project aims to accommodate
facilities that will help to develop Gwadar as an
industrial city - privately owned warehouses and
cold storage, private cargo-handling equipment,
truck yards and corporate infrastructure such as
offices along the same lines as Jebel Ali, Hong
Kong, Malaysia and Singapore.
Gwadar is
currently the focus of a speculative trade in real
estate that has reached almost a frenzy as brokers
book sale and purchase orders for properties that
are still in the planning stage. While buyers seem
anxious to snap up more land in Gwadar, the
brokers are also overzealous.
Rich
investors are being persuaded to buy plots in
industrial estates and residential plots in
housing schemes in and around Gwadar.
Before the inauguration, there had been
some concerns over investing in the area, but
these were allayed once Islamabad signed an
agreement with the Port of Singapore Authority to
operate Gwadar Port.
Moreover, the
government's announcement that it is establishing
a huge industrial estate, a free-trade zone and
other projects, including oil terminals and huge
refineries, again attracted investment in Gwadar
real estate.
The Balochistan government
has allotted land for the construction of
warehouses in Gwadar, while plots have been set
aside in the Gwadar Industrial Zone for the
construction of warehouses to facilitate importing
and exporting. More than 50 private housing and
commercial schemes are currently selling plots in
the new port city.
Pakistan-based Hashoo Group
of Companies,
one of the leading business groups in Pakistan,
has launched "Golden Palms" - a US$70 million
real-estate project in Gwadar. It is targeting non-resident Pakistanis
in the UAE as well as locals. The
project, spread over 400 hecares, offers plots of
1,000 and 2,500 square yards (836 and 2,090
square meters) with fully developed infrastructure at
prices ranging between $40,000 and $100,000. The
first part of the project will create a tourist
resort on prime property near the beach. Hashoo
Group, which is building the five-star Pearl
Continental Hotel in Gwadar, also intends to
establish a Marriott hotel and resort.
The
government plans to spend $7 billion in the next
eight years to improve road infrastructure,
creating a network to link China and South Asian
countries to Gwadar by 2014.
Industrial
estate The government has reserved
1,200 hectares for the development of Gwadar Industrial
Estate (GIE), about 40 kilometers from Gwadar
at Karwat on the Mekran coastal highway. The
GIE is the emerging port city's first industrial
estate and contains more than 1,100 plots.
The GIE will be the
biggest industrial estate in Balochistan province. In
the first phase, a special committee has
allotted 460 hectares to industrialists, while 455 applications
are pending. Development work is under way and
2.8 hectares have been handed over to the Quetta
Electricity Supply Co for construction of a
24-megawatt grid station. It will cost Rs100 million
(US$2.3 million) and it will get its power supply
from Iran.
The GIE is aimed at small and
medium-sized enterprises, with emphasis on the
following: high-tech electronic fabrication and
assembly plants; metal and wood fabrication and
assembly; PVC housing and extrusion; fish
processing and canning; textile and garments; food
and flour mills; and refrigeration and cold
storage.
The
GIE master plan includes setting up factories to
provide services for future small industrial and
commercial enterprise. Housing schemes for workers
and low-income groups have also been planned.
Syed
Fazl-e-Haider,sfazlehaider05@yahoo.com ,
is a Quetta-based development analyst in
Pakistan. He is the author of six books,
including The Economic Development of
Balochistan, published in May 2004.
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