ISLAMABAD: President Asif Ali Zardari on Thursday accorded assent to a law aimed at reassuring foreign investors about security of their investments in Pakistan.
The Arbitration (International Investment Disputes) Bill, 2011 was passed by National Assembly on November 5 last year while the Senate passed it on April 1. The President made the bill into a law, with his signatures at a special ceremony, here at the Aiwan-e-Sadr.
President Zardari termed the signing as "a giant leap forward" to create confidence amongst foreign investors and bring transparency in the settlement of investment disputes.
The President congratulated the Parliament for passing this important legislation and said that the government has already announced a liberal incentives package for foreign & local investors.
He expressed the hope that the current legislation would prove instrumental in attracting FDI and further promote investment climate in the country.
Spokesperson to the President Farhatullah Babar said that the government has already signed and ratified the international convention on settlement of investment disputes between the states and nationals of other countries.
He said domestic legislation was a pre-requisite to benefit from the provisions of the convention and pointed that it envisages establishment of an international centre for settlement of investment disputes under the World Bank, besides constitution of conciliation commission and arbitral tribunal.
The International Convention on Settlement of Investment Disputes (ICSID) facilitates conciliation and arbitration on investment disputes between the contracting states and nationals of other contracting states.
The seat of the centre at the principal office for International Bank for Reconstruction and Development (IBRD) having an administrative council and a secretariat maintains a panel of conciliators and arbitrators.
Any contracting state may renounce the convention by written notice to the depositary of this convention which, will take effect six months after the receipt of such notice.
The jurisdiction of the centre extends to any legal dispute arising directly out of an investment between a contracting state and a national of another contracting state.
The spokesperson said that with this new legislation a major disincentive for foreign investors had been removed who will now feel reassured to invest in Pakistan.
He said the enactment of the law was part of President's plan to offer new incentives to address country's economic and investment problem. The plan has increased foreign remittances from a little over 6 billion US dollars in 2007 to an expected almost 11 billion US dollars this year, he said.
The event was attended among others by federal ministers, members of Parliament, federal Secretaries, Presidents Chambers of Commerce & Industry, President Overseas Chamber of Commerce, President Women Chambers of commerce & industry, representatives of business community, foreign & local investors and other officials.