LAHORE - The Sultan of Brunei has expressed his eagerness to invest in Punjab by establishing health and education cities in the province. The Planning and Development Chairman has already conducted a meeting and directed the concerned departments to come up with proposals to streamline foreign funding.

A follow-up meeting was also held for compliance to the directions of the Chairman, P&D Board on 07.11.2018 regarding Establishment of Health and Education Cities on the name of Sultan of Brunei, Sultan Hail Hassanal Bolkiah. In the said meeting, P&D Board Chairman had tasked the Investment Climate Reform Unit (ICRU), Planning & Development Board, to approach Punjab Board of Investment and Trade (PBIT), Education and Health Departments to develop a concept paper on Health and Education Cities. The papers are meant to submission to Prime Minister’s Office and Federal Board of Investment, as a means to attracting foreign investment.

In this regard, a meeting was held under the chairmanship of ICRU Managing Director on 30th November 2018 regarding developing a concept paper for establishing Health and Education Cities in Punjab. The project of establishing of the two cities would be completed in collaboration with the Health and Education Departments and the PBIT.

In the said meeting, it was decided that the Health and Education Departments and PBIT would send their inputs to the ICRU for developing a concept paper for establishing Health and Education Cities in Punjab. However, the ICRU could not receive any input to proceed further from the departments concerned till the minutes of the meeting were issued.

As per documents, a meeting was also held in November 2018 under the chairmanship of ICRU MD. The agenda of the meeting was to ascertain the terms of reference (TOR) prepared by the ICRU for developing a concept paper on establishing the Health and Education Cities. Types of education to be provided within cities like Primary, Secondary, Technical, Vocational, Tertiary, Specialized Healthcare & Associated Services were also on the agenda. One item was data pertaining to Estimated Economic Rate of Return, commercial viability & legal pre-requisites of facilities established under Education & Health Cities. Moreover, an expected total cost, potential Modes of Investment / Financing were other items.

In that meeting, the ICRU MD Maleeha Bangash had informed the participants that currently Punjab had no “Investment Policy” meant to incentivize Private Sector & Foreign Investments in the education and health sectors. She elaborated that Special Economic Zones (SEZs) were tailored to target the manufacturing sector, which did not conform to the education and health sectors.

The participants of the meeting made deliberations on each TOR.

The Specialized Healthcare & Medical Education Department Additional Secretary suggested that surveys and secondary research were needed to be conducted as a means of assessing the needs and demands for health & education services in the vicinity of the proposed regions and cities. She suggested that the Punjab Economic Report, 2018 may be reviewed to initially identify the regions and areas for establishing Health and Education Cities.

The ICRU MD was of the opinion that a Need Assessment Report would serve as the prerequisite for formulating the Investment Policy for Education & Health Sectors in Punjab.

The representative of Lahore Knowledge Park Company (LKPC) told that the sites (about 800 acres) in Muridke and Sambrial were given to Higher Education Department for the same purpose and may be used for establishing Health and Education Cities.

It was discussed that 200 acres of land would be required for each city. Additionally, it was pointed out that at least 20 acres of land was required for a Tertiary Care Hospital, whereas the required size of land for Educational Institutes (Universities, Colleges, and Schools & Centers) were dependent on the facilities offered.

While discussing the types of Medical and Educational Facilities it was stated that the medical and educational facilities which were essentially required in the region may be provided in health & education cities.

Additionally, it was also discussed that the establishment of Diagnostic Centers & Laboratories may also be taken into consideration for different parts of Punjab. It was pointed out that there was a severe shortage of facilities to undertake procedures such as PET Scan, which would have immense potential in Southern Part of the Province.

Types of Education to be provided within the cities (Primary, Secondary, Technical, Vocational, Tertiary, and Specialized Healthcare & Associated Services) were also discussed.

The Higher Education Department representative was of the view that currently, only 2 Technology Universities were operational in the province. Therefore, there was an incessant need for more Technology Universities to meet the current and future demand in this regard. It was recommended that the Education City must include specific provisions for the establishment of at least one Technology University. At least one Technology University at Divisional Level would also contribute significantly to improving the availability of the human resource in a diverse set of high-value sectors across the province.

In the light of this, the representative of the School Education Department was of the view that an Endowment Fund may be established to ensure the provision of Primary and Secondary Education in Education City. It was informed that Rs. 24 billion had been allocated in Fiscal Year (2018-2019) and this amount was being disbursed by the School Education Department through three partners, namely Punjab Education Initiative Management Authority (PIEMA), Danish Schools Authority and Punjab Education Foundation (PEF).

In response, the ICRU proposed that while the Right to Free Education was a fundamental right of children up to 5 to 16 years of age, the investment may still be welcomed in the sector to work either independently or in a Public Private Partnership Arrangement with the Government of Punjab.

The PBIT deputy manager informed that similar projects and proposals for foreign investment may have previously been developed by the provincial investment agency and may be utilized to provide estimates of Economic Rate of Return.

ICRU MD further stated that the minimum and maximum rates of return for each venture may be determined and provided for foreign investors. She was of the view that the ad-hoc incentives do not ensure sustainability of net inflow of FDI in the long run.

She furthered that every step must be taken to ensure the sustainability and commercial viability of Health and Education Cities. For this purpose, the management/operations of the Health and Education Cities may be handed over to a renowned international company as a means of boosting interest from international investors. This would also ensure the required colonization in the Health and Education Cities. In this regard, international best practices (e.g. Brunei, Malaysia, Singapore and UK) may be reviewed.

The representative of specialized healthcare & Medical Education informed that a cost of Rs 8 billion is required to build a tertiary care hospital of 500 beds.

The representative of LKPC stressed the incentives to be offered in the Investment Policy of health and education cities for both local and foreign investors. One of the likely incentives would be the provision of One Window Services to foreign investors who desire to invest in the Health and Education Cities. ICRU MD also stated that the new investment policy may include the exemption on imports of technology to be installed in the cities from duties and other taxation, the professionals both local and foreign working in the health and education cities may be given income tax rebate like in the Malaysian Model.

It was deliberated that a clear mechanism of “Funds Inflow and Outflow” would require to facilitate the Foreign Direct Investment (FDI). In the meeting, it was discussed that the Investment Policy should include some specific terms to incentivize the foreign investors like social impact Investment, patient Capital, Midway Investment (Donation plus Investment), Diaspora fund and Investment in the form of Investment Funds.

It was also decided in the meeting to arrange an interaction by the ICRU between all the relevant stakeholders and the Brunei Export Development Board of Pak Brunei Investment Company.