ISLAMABAD: The Competition Commission of Pakistan (CCP) recently approved a pre-merger application to establish a joint venture between the state-owned National Logistics Corporation (NLC) and the United Arab Emirates’ DP World to enhance and modernize the South Asian country’s logistics sector, state-run media reported. 

DP World, which operates in over 75 countries and specializes in port operations, terminal management and logistics services, is involved heavily in improving Pakistan’s logistics sector. As per an agreement signed in January 2024, DP World will carry out infrastructure improvement at Qasim International Container Terminal, Pakistan’s leading trade gateway.

It is also involved in the Karachi Freight Corridor, an infrastructure project in Pakistan aimed at improving the movement of freight from the port city to various parts of the country.

“The Competition Commission of Pakistan (CCP) has approved the pre-merger application for the establishment of a joint venture between National Logistics Corporation (NLC) and DP World Logistics FZE (DWLF),” state-run Associated Press of Pakistan (APP) reported on Sunday. 

It said that the investment, facilitated by Pakistan’s top investment body Special Investment Facilitation Council (SIFC), aims to enhance the country’s logistics and freight industry while ensuring fair competition in the market.

The state-run media said the transaction involves NLC acquiring a 60 percent equity stake in the joint venture and DWLF holding the remaining 40 percent.

“The venture aims to enhance Pakistan’s road freight logistics sector by leveraging NLC’s domestic expertise and DP World’s global supply chain solutions,” APP said. 

The CCP determined that the transaction does not result in a “substantial lessening of competition” or the creation of a dominant market position, adding that its analysis concluded that the market remains competitive with multiple players ensuring continued competition despite the merger.

“The joint venture highlights Pakistan’s growing appeal for foreign investment in logistics,” APP said. “It is expected to improve infrastructure, lower transport costs, and boost Pakistan’s trade competitiveness in the region.”

The UAE is Pakistan’s third-largest trading partner after China and the United States, and a major source of foreign investment, valued at over $10 billion in the last 20 years, according to the UAE foreign ministry. It is also home to more than a million Pakistani expatriates.

In January last year, Pakistan and the UAE signed multiple agreements worth more than $3 billion for cooperation in railways, economic zones and infrastructure.