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Sunday, June 30, 2024

Rachna Industrial Park not developed in 14 years

Due to the lack of interest shown by the respective governments, Rachna Industrial Park could not be developed even 14 years after its launch

Envisioned to be a modern SME Park for the auto parts industry by then Minister of Industries Jehangir Tareen and located at a distance of 7km on an access road along Khanpur canal, off main Lahore-Sheikhupura road, Rachna Industrial Park was thought to be first of its kind. It was to be set up in an area of over 174 acres to accommodate scale and medium industries, scattered in and around Lahore and adjoining cities like Sialkot, Gunjranwala, Wazirabad and Sheikhupura. It was established to cater to the auto vending industries in the area as it focused on light engineering.

Rachna Industrial Park was a project by NIPDC, a Ministry of Industries and Production (MoI&P) company which was assigned with the task of assisting rapid industrialization in Pakistan by erecting industrial estates all over. Though it was launched in 2007, none of the governments that came into power were able to complete its development and it would now be witnessing the 4th Minister in power since its inception- Hammad Azhar. It is believed that the private board sitting in Karachi that runs NIPDC has neglected Rachna Industrial Estate and is instead focusing on the estates in Karachi.

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This modern SME park-to-be also witnessed Pervaiz Elahi, Ghulam Mustafa Jatoi and Razak Dawood as Ministers of industries but none of them could get this mega project completed during their tenures. After it’s formation, around thirty companies booked plots in this park and also gave booking advances of up to 40%, all of which were used to develop Korangi Industrial Parks and Port Qasim. The stakeholders believe that the only real development that took place in this industrial estate was in the last two years of the PTI government when CEO PIDC Rizwan Bhatt was given additional charge of NIPDC.

NIPDC’s Incompetence

In the past 14 years, however, Rachna Park has fallen prey to the corruption of the board that runs NIPDC. The board has been serving Karachi’s industries with funds that were allocated for projects in the other provinces. Moreover, a loan granted by a commercial bank for the development of Rachna Industrial Park was spent on projects in Sindh. The mission assigned to NIPDC by the government was to create an environment which allows the customers to flourish. NIPDC, on the other hand, has done completely the opposite as investors are now losing their interest in this industrial estate. The company has been in complete disarray and has failed to work for the development of what could be one of the most prosperous industrial zones. Due to the incompetence of the board running NIPDC and their lack of ability to make correct decisions, Rachna Industrial Park’s development has faced a delay of over a decade.

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It is a shame that due to its inefficiency, NIPDC could not make use of the million of dollars that this estate could have attracted in the form of FDI. Unlawful fines are being levied on the allottees which the legal experts feel can be challenged in court. Stakeholders feel that the development company should instead compensate them for the damage it has caused. This 14-year long delay has cost the investors their time and money.

This delay has led to cost escalations and the entire burden of these cost escalations has been transferred to the plot prices which have surged. The plots that were sold to thirty or so companies in the 2014-2018 period are now extremely overpriced. The customers are disappointed in NIPDC as they were told fictious stories and given false hopes regarding the development of Rachna Industrial Estate. A large multinational paint manufacturer who had paid in full, also decided to exit the park for superior options like Quaid e Azam Business Park (QABP) that is being developed by PIEDMC and Allama Iqbal Industrial Park that is FIEDMC’s latest project. Both these industrial parks have gained prominence in the recent times for being well developed with top tier infrastructure, customer convenience and top-notch facilities.

Read More: BOI awards SEZ status to Allama Iqbal Industrial City!

QABP and Allama Iqbal Industrial Park- Investors top choice

QBP, located near Sheikhupura is a landmark project by the Punjab Industrial Estate Development and Management Company (PIEDMC) which has launched about nine industrial zones including the much talked about Sundar Industrial Estate (100% colonized). This large industrial state, spread over 1536 acres of land once completed as per its envisaged master plan and business concept, can attract investments of around Rs 250 billion. This modern industrial state enjoys the status of a special economic zone (SEZ) and is said to have the capacity to generate two hundred and fifty thousand new jobs for skilled and unskilled workers. The Industries Department of the Punjab Government is especially keen on getting QBP completed as soon as possible to stimulate business and investments across Pakistan’s largest province.

Read More: PIEDMC to create a unique multipurpose complex at QBP

Allama Iqbal Industrial City, which is one of the nine SEZ’s to be built in Pakistan under CPEC is being developed by Faisalabad Industrial Estate Development & Management Company (FIEDMC). The SEZ’s are referred to as the lifelines of Pakistan’s industrial development as once operational, they would be able to create around 2 million jobs. They would also enhance exports and would help in uplifting several other sectors of the economy. Allama Iqbal City is spread over 3217 acres of land and strategically located just opposite M-3 Industrial City. Both M3 Industrial City and Allama Iqbal Industrial City are connected to M4 Motorway Sahianwala Interchange.

The Future of Rachna Industrial Park

While NIPDC is levying unlawful taxes and issuing fines, the investors have started gathering support from within and outside the Lahore Business and SME fraternity. The stakeholders believe that it is now time for the minister to take control of the situation and try to rectify it. They feel that is the only way that the confidence of the small and medium enterprises industry can be regained.