More business on the way….

Amongst all this hullabaloo about things not being right, it seems that a majority of Pakistan’s long term investors are mostly unnerved by the situation.

Yes, the stock market keeps moving up or down, but thats just a short term investment that does not make any long term impact on the country’s economics.

The government has yesterday signed an agreement with the IPIC, a unit of the Government of Abu Dhabi, to build an oil refinery near Karachi with an investment of 5 billion USD. The unit will handle betwee 200 – 300 thousand barrels of oil per day and will operate under a joint arrangement between the IPIC and the Pak Arab Refinery Company (PARCO).

PARCO already owns and operates oil pipelines that carry fuel from Karachi to Mahmud Kot near Multan, and then to other areas. PARCO also owns Pakistan’s largest oil refinery in Mahmud Kot.

This project also takes the lead as Pakistan’s largest ever single investment project in the country’s history.

49 Comments so far

  1. JAY (unregistered) on November 14th, 2007 @ 4:42 pm

    InshAllah we will overcome the current situation and keep on progressing, stronger than before.

  2. Zee (unregistered) on November 14th, 2007 @ 4:51 pm

    Good going!

    Do you know that SHELL has been given the authorization to conduct deep sea oil exploration? They say that there is oil a bit beyond Karachi’s sea limits, kind of luck a no man’s land BUT, it’s pretty damn close to Karachi.

    Shell has been authorized by not only government of Pakistan but also by the governments of all those countries that are close to the exploration point. This is great news! If we can find more oil in our lands, that’ll be too good to be true!

    On a side note, isn’t Parco Oil Refinary already owned by TOTAL?

  3. Sameer (unregistered) on November 14th, 2007 @ 5:11 pm

    Alhamdulillah we still havelots of Natural Resources we just lack one thing i.e The Leader

  4. IRFAN (unregistered) on November 14th, 2007 @ 5:24 pm

    another reason for PUNJABISTAN to remove musharaf

  5. Imran (unregistered) on November 14th, 2007 @ 5:43 pm

    Yes i saw this news in DAWN yesterday, both with a sense of pride for all of Pakistan, and gratitude for the efforts of the entire Establishment.

    1. IPIC is a (1 billion USD) foreign investment, being vested for constructing Karachi New Port Container Terminals.

    2. Hutchison is a (5 billion USD) foreign investment, being vested for constructing a mega oil refinery near Karachi.

    2 of the BIGGEST foreign investments being made in the history of Pakistan — And both made under Musharraf.

    And we say Musharraf has done (nothing) for the COUNTRY :)
    How ungrateful of us, but ofcourse for those of us who think the Country belongs to one province, it’s time for Musharraf to go.

    So before we join some agenda and before we start to ‘protest’ … just THINK! What are we protesting? A lack of democracy? Where is the democracy?
    Pakistan does not belong to Sindh, Punjab, Balochistan, NWFP … Pakistan belongs to all. It does not belong to a few ‘individuals’ who speak for the collective conscience of entire tribes and villages … Pakistan belongs to all her sons and daughters, irregardless of who they are or where they come from. Sab Se (Pehle) Pakistan.

  6. Sarah (unregistered) on November 14th, 2007 @ 6:09 pm

    This investment is for the Khalifa Coastal Refinery which is going to be set up at Khalifa Point in the coastal area near Hub, in Balochistan.
    The oil refinery at Bi Qasim, Karachi is being set up by investors from Kuwait, I believe, and that refinery’s going to be smaller, probably around 100,000 barrels per day.
    You’re sort of mixing up between the two. :)

  7. Obi Wan Kenobi (unregistered) on November 14th, 2007 @ 6:15 pm

    Fcuk Mushharaf, we don’t need any investment from foreign countries. We just need Nawaz Sharif and Altaf Hussain from them.

  8. Imran (unregistered) on November 14th, 2007 @ 6:29 pm


    Thanks for clarifying that. Doesn’t really matter though, because Foreign investment in any part of Pakistan is a victry for all of Pakistan.

  9. Balma (unregistered) on November 14th, 2007 @ 7:28 pm

    This is all great, but I will prefer these heavy duty pollution emitting industries far away from Karachi. Any heavy industry or refineries should be discouraged within 100 miles of Saddar in Karachi. Other areas of Pakistan should be developed to stop populaton migration to Karachi. There are just toooooo many people in Karachi. You can’t walk or drive in Empress Market area any more. And, Karachi is extremely polluted. Therefore, while I encourage foreign investment in Pakistan and setting up of all kinds of industries in Pakistan, but Karachi should stick to high tech and service industry, which employs the educated of Karachi and attracts the educated from other cities of Pakistan, but mass employment type industries should be set up far away from Karachi.

  10. ALIVEPAKISTAN.COM (unregistered) on November 14th, 2007 @ 7:45 pm

    At this time, agreement of foreign investment is really great news.

  11. ALIVEPAKISTAN.COM (unregistered) on November 14th, 2007 @ 7:46 pm

    At this time, agreement of foreign investment is really great news.

  12. sid (unregistered) on November 14th, 2007 @ 7:48 pm

    Imran: my dear friend, i understand ur patriotism and your immense love for Pakistan, but ur recent comments have been very worrisome. Please refrain from trying to incite provincial hatred on this forum and take this agenda elsewhere.

    For all the others with little knowledge of economics and who consider Foreign Direct Investment under Musharraf’s regime a blessing for Pakistan, you are thoroughly mistaken. All of this FDI, does not benefit Pakistan. A cursory glance through the investment policies of our government on BoI’s website will show why foreign companies are going head over heels to come to Pakistan. The government allows 100% profit repatriation to host countries, 100% tax exemption to foreign companies for almost 40 years in some sectors and 100% foreign ownership.

    The balance of Payments may be rising in the short term with the capital inflows but over the long term, we’re going to be worse off than we are now. But have policymakers in Pakistan ever considered the long term? As long as they get the credit for these FDIs during their term in office, they’re happy.

  13. Da-Man (unregistered) on November 14th, 2007 @ 8:08 pm

    Dubai, Singapore, Hong Kong have similar 100% repatriation laws. See how they have progressed. In the US, there is fierce competition among states to give foreign companies tax credits to bring in investments.

    This is certainly good news for Pakistan. Good post Inspirex.

  14. PatExpat (unregistered) on November 14th, 2007 @ 8:15 pm

    Investment in Telecom and Oil is no indication of confidence in a country. Even Afghanistan, Ethopia and Somalia have received investments in Telecom. Its the IN thing.

    Similary, with oil nearing $100 per barrel, companies like Shell are going into volatile countries like Nigeria etc. so having a refinery in Pakistan is no big feat.

    Though I am ardent opponent of BB, but if you want to see FDI, the real inflow was in BB tenure when she launched her power policy. All the private power plants in the country are from that time. This is regardless of the fact that power couple made billions in those deals but this does not take away the fact that FDI was real.

    My two cents – not that anybody asked for them. :)

  15. Altaf Hussain (unregistered) on November 14th, 2007 @ 8:54 pm


    Pakistanis have lots of sunlight these days All because of Musharraf

    Pakistanis get to drink water all because of Musharraf

    Pakistanis can breath air all because of Musharraf

    keep trolling, just like Peer Saab. I am sick and tired of his and his parties rhetoric…

    …agencies, agencies, agencies
    …jageerdar, jageerdar, jageerdar
    ..wadera, waadera, wadera

    he and his clan, has just become a jageerdar of Muhajirs.

  16. paki (unregistered) on November 14th, 2007 @ 9:04 pm


    so right, I woner why the PEER SAAB didn’t blame his divorce on the agencies or Jamatis. I guess he can call his ex-wife a JAMATEE now, because she didn’t give-in to his MAFIA-BOSS-ATTITUDE.

  17. Da-Man (unregistered) on November 14th, 2007 @ 9:06 pm


    Agreed, BB had good policies that brought in Private Power Producers. In fact, India was soliciting similar business, but its policies were not as well written as Pakistan’s.

    On the other hand, Musharraf’s Privitization policies, and incentives to solicit foreign investments have also been successful. Unfortunately the privitization of the Karachi Steel Mill was thwarted by the courts.

  18. poor guy (unregistered) on November 14th, 2007 @ 9:08 pm

    yes, good for that lady. If she was in Karachi, she would have endedup in a boreee.

  19. Imran (unregistered) on November 14th, 2007 @ 11:17 pm


    Thanks for the insight. I respect your opinion and your concerns.

    The day KMB says i cannot speak my mind, thats when you won’t hear from me at all. Till then i can only speak my mind & thats the only way i know how.

    If you dont agree with my point-of-view, you can always ignore me (completely). right? :)

  20. Adnan Siddiqi (unregistered) on November 14th, 2007 @ 11:48 pm

    @patExpat: telecom busiiness going fine in Pakistan? really?

    Seems you didn’t check today’s paper.


  21. Adnan Siddiqi (unregistered) on November 14th, 2007 @ 11:54 pm

    and btw this is an agreement not a Nikahnama which one has to follow. Infact Nikahnama is not obeyed. :-)

    By the way, this is not the first “agrement” in history of Pakistan. So many agreements were made by past govts as well but nothing happened. Either agreement got canceled due to any given reason or if project was every completed, it got failed due to corruption of govt or lack of managment.

    “Gree Buses” with Swedish company was also an “agreement” if you remember. :-)

    Otherwise, “Dil ko kush rakhne ko Ghalib ye Khyal acha hay” :-)

  22. Balma (unregistered) on November 15th, 2007 @ 12:29 am

    I know what you mean, Adnan. There were MOUs being signed during Budnazir time left, almost one every day. In the end nothing happened, Budnazir and Zardari pocketed billion plus fromtheir rishvat khori, and the rest is history.
    Couple of years ago, I met a Xenel guy who was literally kaan pakaR raha tha, after their experience with Hubco during Budnazir (aka Benazir) and NoSharif time. He didn’t think his firm would ever invest in Pakistan again.
    Note: no, kaan nahi’n pakaR rahaa thaa, yeh to sirf mae nay muhavarah istimaal kyaa hae:-)

  23. mack (unregistered) on November 15th, 2007 @ 1:22 am

    Quick reality check – are you still moderating comments?

  24. (w)hole LOTA love (unregistered) on November 15th, 2007 @ 4:38 am


    very well said.

    wish people would get their FACTS straight.

  25. wakeup (unregistered) on November 15th, 2007 @ 5:09 am






  26. Reality_Check (unregistered) on November 15th, 2007 @ 6:32 am

    And then there was CDC (Common Wealth Development Corp) who had a major stake in many projects including Port Qasim in Pakistan. Mr. Potter the head of its operations in Bahria II also got fed up with 10% of Zardari. It was the first time that I heard the word 10% directly from a Gora Sahib. CDC stopped undertaking any more projects in Pakistan. I dont know whats their status now.

    WAKEUP The way you are shouting, no one will ever sleep. All these companies that you have mentioned are also operating in Malaysia, South Korea, Kazakhistan, India, Brazil, Argentina and the list goes on…The fact remains if you are bikao then there will always be a price and a buyer.

    Pakistanis have always been the greatest threat to their own country, why blame anybody else.

  27. darthvader (unregistered) on November 15th, 2007 @ 8:57 am

    thanks for a good positive post.


  28. S.I. (unregistered) on November 15th, 2007 @ 9:19 am

    Irfan, please stop dividing PAKISTAN into things like Punjabistan and what not…we don’t need such things. Please dont fall for the ‘divide and conquer’ theory. We have enough crap going on as it is, dont make it more worse by this sillyness.

  29. Tamed~. (unregistered) on November 15th, 2007 @ 9:41 am

    Hi KMB Readers,

    Just to let you know Tamed~ is back to KMB.

    Take care

  30. llama (unregistered) on November 15th, 2007 @ 12:57 pm

    Thank you inspirex for a positive post finally regarding the situation. KMB authors really need to start presenting the “other side of the coin” story, esp for all the expats out there who only get to read/hear/see geo’s (distorted, panic-ridden) version of events!

  31. Syed Johny (unregistered) on November 15th, 2007 @ 1:46 pm

    you guys have become pathetic!!!!

    U guys dont bother to cover the real events and happening most omportant to Karachi !
    I submited story of Supreme Courts order against DHA and other cantonement boards to Vacate Civilian Areas and handover to CDGK ! but the news that was more important to u guys was that Imran Khan escaped from under the nose of Police!

    Yesterday I suggested the story of the Pollution in Karachi being at its maximum which has effected the the weather pattern ! (Winter in Karachi will be off fews days only a/c to the report) but what was more important to u THAT a Karachi based photographer wining award!!!

    U guys need to get ur priorities straightened!

  32. Jamal Shamsi (unregistered) on November 15th, 2007 @ 3:28 pm
  33. Adnan Siddiqi (unregistered) on November 15th, 2007 @ 4:07 pm

    Syed Jhony can you please share the url of your story with me?

  34. Angel_Boy (unregistered) on November 15th, 2007 @ 4:56 pm

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  35. Zee (unregistered) on November 15th, 2007 @ 6:16 pm

    Yes SYED JOHNY! Adnan is an inside man. He’ll get the story up for you.

    Oh btw, I have also suggested stories in the past. Only ONE was put up and that too with NO credit what so ever!

  36. d0ct0r (unregistered) on November 15th, 2007 @ 6:17 pm

    Foreigners withdraw $88m equity investment in 3 days

  37. d0ct0r (unregistered) on November 15th, 2007 @ 6:23 pm

    Japanese car assemblers to curtail production in view of crisis-like situation in the country after the imposition of emergency

  38. d0ct0r (unregistered) on November 15th, 2007 @ 6:25 pm

    Talks with Russia on import ban delayed apparently as a reaction to the state of emergency in the country

  39. d0ct0r (unregistered) on November 15th, 2007 @ 6:34 pm

    kse 100 index almost 200 points down.. almost 1000 since imposition of emergency..

  40. Adnan Siddiqi (unregistered) on November 16th, 2007 @ 12:19 am

    @Doctor: you are naive. It was a “financial strategy” of former Pakistani Minister Shaukat Aziz.

  41. Syed Johny (unregistered) on November 16th, 2007 @ 1:33 am
  42. Balma (unregistered) on November 16th, 2007 @ 2:14 am

    In light of the recent decision on military areas of Karachi, they should also change the name for DHA. What kind of stupid name is this? Defence Housing Authority? First step will be to change this crappy name. I propose Gizri, or Gulshan-e-Gizri. The other possible choices could be West Korangi, or perhaps West Qayyumabad, which are right next door; or perhaps Kala Pul Extension. Also these stupid road names like Khyaban this and Khyaban that should be changed. Khyaban my ass!
    Why not Urdu words like saRak or English word like road which has been adopted by Urdu. And, the whole area needs to be cleaned up, roads fixed, and drainage laid. Esp, the slummy commercial areas with ghaTyaa looking 5 story buildings, having chaDDees and bra’s hanging from multi colored balconies, puncture vaalaas and tandoors galore. Zamzama should be demolished completely, but only after showing people as an example of lack of planning skills with army. Whole Zamzama needs to be rebuilt.
    Go mustafa go! clean up every part of Karachi. DHA (oops, I meant Gulshan-e-Gizri) residents have suffered a lot.

  43. Red_Munk!! (unregistered) on November 16th, 2007 @ 3:23 am

    Balma :).

    Pehle apna ghar sambhalo, phir dusroun ko nashiyatein dena.

    The area’s under the great Mayor, namely Landhi, Liyari, Saddar town etc etc ETC!, are those in great shape?

    Broken roads, overflowing gutter lines, lack of water, no services like garbage collection, Bhatta wasuli are just very few examples of the acheivements by the man of the…..well, since earth was created really!.

    DHA is the only place where there are systems in place and accountibility. Kabsa’s and illeagle encroachement rates are the lowest and there is security for the owners.

    Every person in town with 1/10000000 working brain knows that all this shor sharaba is so that more bhatta can be collected for the ruling party’s coffers.

    Onto the topic. Any kind of invesment in ANY part of the country is good news, but as a few have pointed out before, this is nothing but an MOU.

    Globally that would be an official leagle understanding and even if the project derails/does not take off, some sort of compensation is garunteed.

    No such thing in Pak. Just look at all the MOU’s worth billions of dollars signed over the past 10 years. Less than 10% would have materialized.

    Most prominent examples are the ones in relation to Power generation plants. The gov has signed close to 30 licences/mou’s just for alt energy in the past 5 years. How many of those have gone past preliminary talks?

    The gov in all these years, despite garuntees, has not been able to provide the investors with the required land & more importantly have been low-balling them in the PPA offer (12 cents while the going rate is 17 cents with talks of increasing it to 21 cents).

    So yeah, Kudo’s to ya, but please shout from the roofs when you have something in hand :).

  44. Kashif (unregistered) on November 16th, 2007 @ 1:11 pm

    @Da-Man: We can’t compare ourselves with dubai, hong kong etc. The major and most striking difference is absence of law & order in Pakistan. Do you know why Dubai is successful? They have strict laws which are imposed by force and everyone has to obey them, whether you like it or not. But here, people work there way through the laws and regulations by bribes and exortion.

    First remove this difference, then think of progress.

    @Adnan: Scania (the company who brought those buses in Khi) is still operting in Europe and Middle East. It was the middle man (a pakistani, ofcourse) who did the corruption. He made billions by selling overpriced vehicles, rented his own villa as company office and got princely salaries for himself and wife. They trapped a dubai based investor and that poor guy lost millions of dollars before bakcing out.

  45. Kashif (unregistered) on November 16th, 2007 @ 1:12 pm

    @Da-Man: We can’t compare ourselves with dubai, hong kong etc. The major and most striking difference is absence of law & order in Pakistan. Do you know why Dubai is successful? They have strict laws which are imposed by force and everyone has to obey them, whether you like it or not. But here, people work there way through the laws and regulations by bribes and exortion.

    First remove this difference, then think of progress.

    @Adnan: Scania (the company who brought those buses in Khi) is still operting in Europe and Middle East. It was the middle man (a pakistani, ofcourse) who did the corruption. He made billions by selling overpriced vehicles, rented his own villa as company office and got princely salaries for himself and wife. They trapped a dubai based investor and that poor guy lost millions of dollars before bakcing out.

  46. Da-Man (unregistered) on November 16th, 2007 @ 7:56 pm

    @ Kashif

    Agreed. Law and order is fundemental to progress. It must go hand in hand with good business policies and good governance.

    If the power outages in Karachi are frustrating, imagine what they would be without the private power producers providing their share of the power. If the high price of petrol is debilitating, think what the conditions would be 10 years from now without the additional refineries being built by foreign investment.

  47. Syed Johny (unregistered) on November 17th, 2007 @ 1:16 pm

    @ Red Monks !

    Go and ask the residents of DHA what they want!

  48. misanthrope (unregistered) on November 17th, 2007 @ 3:39 pm

    By the way, the investors are getting a 30 year tax holiday. So this will be making alot of money for the investors for the next 30 years, not for Pakistan.

    Why are investors falling head over heels to invest in Pakistan? Seimens announced yesterday a 600% dividend on its shares. Their actual profit was well over this. In one year Seimens have made up the investment they brought and have turned a handsome profit which they take right out of the country.

    And our new caretaker finance minister, Salman Shah announced he wants to reduce corporate taxes by the way.

  49. Red_Munk!! (unregistered) on November 17th, 2007 @ 11:44 pm

    Already did. Asked the 20 houses on my street + most of the ppl I know.

    The standard response was either “Why the hell would we want that?”

    The polite ones said “Why dont they improve the areas already under them, then we will see”.

    The other responses were pg 18, so ill refrain.

    And no. The ppl I asked were not all Punjabi’s, Sindhi’s,Pathans or Balochi’s or the aliens who have a grudge against mqm.

    Most of the ppl on my street are urdu speaking and a couple of them have strong links to mqm (they being the one’s giving the polite reply).

    Now, time for you to get your facts straight & not follow the party line :).

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