The Shandong Ruyi Group, a joint venture between Chinese and foreign investors headed by Qiu Yafu, is a hi-tech enterprise, who were planning to invest immensely in the Quaid-e-Azam Apparel Park, a project of the Punjab government is losing interest in the project.
Despite several meetings held by its Director Arie Qiu, daughter of the owner with the Punjab chief minister to discuss investment, the company has not yet come up with proposals to demonstrate its interest in the project.
The park would be generating 250,000 jobs after becoming fully operational and will have about 600 industrial plots from half acre to 25 acres for an industrial unit. A 100-megawatt coal-fired power station will also be developed for electricity production.
The Apparel Park would be set up over an area of 1,562 acres of farmland near Sheikhupura motorway interchange. It acquired land at a cost of Rs3.3 billion, which constituted about 49% of total investment in the project.
The remaining 51% (estimated at around Rs4 billion) was promised by Shandong Ruyi Group for infrastructure development and providing all services to the factories under the public-private partnership model and later as a joint venture.
The Punjab government will own 49% of the project and the Chinese group will have 51% shareholding.
Earlier, Ruyi was planning to submit unsolicited bids accompanied by a feasibility study, environment impact assessment, draft of public-private partnership agreement, need of government support and modalities.
Later, the idea of joint venture was floated to cut the time period. In this arrangement, both the government agency and private investor make equity investments for project development and establish a new company or take joint ownership of an existing one through purchase of shares.
After the company is set up, board of directors will be appointed for supervision. The company will deal with the Apparel Park on the model of Punjab Industrial Estates Development and Management Company (PIEDMC) and will be registered under the Companies Act.
In a joint venture, the process is streamlined and the private company joins hands with others in order to start work without any delay.
Separately, Ruyi has tied up with a private sector concern, Masood Textile, in Faisalabad M3 Industrial Estate spread over 4,415 acres, which was inaugurated in the last week of May by the Punjab chief minister.
As Ruyi does not submit its proposals, the Punjab government has decided to execute the project with managerial support of PIEDMC. At present, PIEDMC is handling four projects – Sundar Industrial Estate, near Lahore, Multan Industrial Estate, Bhalwal Industrial Estate and Rahimyar Khan Industrial Estate.
Ruyi and the new company have failed to agree on the modalities of the joint venture in the Apparel Park and this could be the cause for lack of interest.
In the meantime, PIEDMC has gone ahead and hired National Engineering Services of Pakistan (Nespak) as a consultant that would prepare a master plan and standard documents for the establishment of the park. Following this, they would be inviting expressions of interest from financially sound investors.
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