A delegation from the International Commercial Bank of China (ICBC) visited the project site and approved the investment plan for the Faisalabad Shandong Ruyi Textile Park, according to Faisalabad Industrial Estate Development and Management Company (FIEDMC) officials.
Shandong Ruyi, largest textile conglomerates in China in order to start construction work for Pakistanâ€™s largest cotton-spinning mills has made their first installment to the FIEDMC.
At present, Chinese are losing competitive edge in their home country because of high wages that is almost six times higher than in Pakistan which gives them more incentive to invest.
With a total investment of $2 billion, the mills would consist of 600,000 spindles, generating thousands of jobs in the textile hub of the country. This is the highest foreign investment in the textile sector of Pakistan.
FIEDMC CEO Aamir Saleemi said that there were rumours that China was planning to reverse the investment plan and was no longer interesting in installing textile units in Faisalabad. He added that there was no truth to this, as procedural work leading to construction activities is already under way.
They are making payments according to the agreement with FIEDMC authorities. The Chinese have to complete the payment in three installments. The first will cover 10% of the total amount, while the second will cover 40% and 50% will be covered in the third.
The 10% was the cost of land as investors will now pay the second instalment next week. This is just the beginning, as they are expecting huge Chinese investments in the industrial estate in the near future.
In the beginning of October, FIEDMC issued the letter to the Chinese group to start their construction work according to the contract. Infrastructural and construction machineries dispatched from China will arrive in Faisalabad in a few days.
According to authorities, Shandong acquired the land and started construction work. They added that the construction of buildings, residential apartments and boundary walls has officially begun.
Two coal-based power plants of 270 megawatts â€“ 135 MW each â€“ are installed in the industrial estate to facilitate the energy requirements of the companies.
The development of the zone is increasing as other Chinese companies are also showing interest to invest in the area. A well-known Chinese dry battery manufacturing company has also purchased 14 acres of land to install a unit there.
The Shandong Ruyi group was directly engaged with the FIEDMC management in all their financial and investment plans. Saleemi said that there is no connection to the agreement the Chinese group has with Masood Textile Mills (MTM).
It might be possible that they have problems with MTM to withdraw agreements of partnership, but Shandong was directly involved with FIEDMC.
FIEDMC has signed has an agreement with the National University of Modern Languages Islamabad to deliver daily Chinese language lectures at the FIEDMC office. They have started teaching the Chinese language to their employees to facilitate the Chinese investors.
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