ISLAMABAD/BEIJING – Pakistan and China signed a Framework Agreement on Industrial Cooperation under the China Pakistan Economic Corridor on Friday (CPEC).
The prime minister arrived in Beijing on Thursday to attend the Winter Olympics opening ceremony and meet with Chinese authorities.
Muhammad Azfar Ahsan, State Minister and Chairman of the Board of Investment (BOI), and He Lifeng, Chairman of the National Development and Reform Commission (NRDC), signed the agreement.
The Joint Working Group (JWG) on Industrial Cooperation seeks to attract Foreign Direct Investment (FDI), promote industrialisation and economic zone development, and start, organise, execute, and monitor initiatives in both the public and private sectors.
The JWG interaction with China is intended to promote labour productivity in Pakistan, improve industrial competitiveness, increase exports, and maintain export basket diversity.
During the 8th Joint Cooperation Committee (JCC) meeting of CPEC in 2018, both parties signed a Memorandum of Understanding that served as the foundation for future engagements between the parties under the umbrella of Industrial Cooperation.
As CPEC reaches its second phase, which largely focuses on the development and industrialization of Special Economic Zones (SEZs), the need for a comprehensive Framework Agreement becomes critical.
Similar agreements have been made for the Early Harvest CPEC energy and infrastructure projects.
BOI’s ongoing efforts resulted in both parties reaching an agreement to convert the existing MoU into a Framework Agreement in 2020.
Following extensive stakeholder engagements and Prime Minister’s clearance, BOI presented the Draft Framework to NDRC in November 2020, which was developed with the demands of CPEC Phase II in mind.
The framework agreement signing ceremony is an important consequence of the prime minister’s visit and a priority agenda item for the Chinese side as evidence of their involvement in CPEC.
