Cabinet approves tax exemption for Saudi-funded projects

ISLAMABAD: In a major development, the federal cabinet on Friday approved tax exemption for Saudi-funded projects in Pakistan, ARY News reported quoting sources.

Pakistan and Saudi Arabia have settled their loan concerns, under which Islamabad has accepted Saudi conditions of exempting taxes on Riyadh-backed projects in Pakistan.

According to the sources, both countries will sign the agreements with the signing ceremony likely to take place during the Saudi crown prince’s visit to Pakistan.

Saudi Arabia has decided to grant Pakistan $382 million for four projects in exchange for tax exemption.

The projects include $3.5 million for Jagran-IV hydropower project in scenic Neelum Valley; $240 million for Mohmand Dam project; gravity flow water Mansehra project and others.

Last month, Finance Minister Ishaq Dar and Saudi Minister for Energy Prince Abdulaziz bin Salman co-chaired a meeting on the proposed agreements during the visit of Saudi Crown Prince to Pakistan.

The sources said, envisaged agreements included Mohmand dam, Neelum-Jehlum hydropower project, Jamshoro power project, Abbottabad–Muzaffarabad road project, construction of two tunnels at Kohori/ Kamer (3.7 km) and ChellaPani (0.6 km), section of Neelum Valley road AJK (ongoing), Jagran-IV hydropower project (pipeline project), Shounter hydropower project, gravity flow water Mansehra project, construction of infrastructure for Malakand Region (ongoing) equipping Hayaseri hospital with medical equipment and furniture, earthquake reconstruction & rehabilitation projects in AJK, Abbottabad (ongoing), grant projects in Balochistan, reconstruction of permanent houses in Awaran, construction of government building Awaran, livelihood restoration in Balochistan, construction of King Salman Hospital Tarlai and construction of F.G Home Economics College (on projects).