Saudi trade delegation arrives in cash-strapped Pakistan to discuss investments worth $5 billion
Pakistan has been seeking investments to the tune of $25 billion from Saudi Arabia to shore up its bankrupt economy
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A high-level delegation from Saudi Arabia has arrived in cash-strapped Pakistan to discuss investment to the tune of $5 billion.
Amid long-running financial crisis, Pakistan has been trying to woo Saudi Arabia to invest in the country to shore up its fledgling economy.
The Saudi delegation is being led by Deputy Investment Minister Ibrahim Almubarak. He is accompanied by around 50 representatives from 30 Saudi companies. They will take part in a two-day Saudi-Pakistan investment conference in which Pakistani companies across several sectors like aviation, chemicals, information technology (IT), etc, will also be involved.
The visit of the Saudi delegation to Pakistan comes within a month of Pakistan Prime Minister Shehbaz Sharif’s maiden visit to the kingdom. During the visit, he met Mohammed bin Salman, the Crown Prince and the Prime Minister of Saudi Arabia, and discussed the expediting the $5 billion investment that Saudis had pledged.
Business-to-business meeting lined up to woo Saudi investors
During the two-day Saudi-Pakistan investors conference, the Pakistani government has arranged a series of business-to-business (B2B) meetings between Saudi investors and Pakistani companies. During these meetings, the Pakistani companies will pitch their business and investment proposals to the Saudis.
The Saudi companies part of the conference cover sectors such as agriculture, mining, energy, telecom, chemicals, IT, tourism, aviation, and power generation, according to Dawn newspaper.
While Pakistan is looking for Saudi investments to shore up its crisis-ridden economy, the Saudis are also looking for overseas investments as part of a long-term strategy to diversify their economy that has traditionally been dependent on petroleum. In recent years, the Saudis have made a slew of investments within the kingdom and overseas in diversified areas, including hi-tech sectors, to be future-ready.
Commerce Minister Jam Kamal Khan, who received the Saudi delegation at the airport, was quote as saying that the meetings are aimed “to identify investment opportunities that will generate employment and boost exports between the two countries”.
Pakistan initially sought $25 billion investment from Saudi Arabia
While Pakistan and Saudis are now discussing investments to the tune of $5 billion, the bankrupt country had initially sought $25 billion investments from the Gulf monarchy. Separately, Pakistan had sought $25 billion in investments from the United Arab Emirates (UAE).
Last month, Sharif went to Saudi Arabia and met Mohammed bin Salman, the Crown Prince and the de-facto ruler of the country, and the two countries agreed to expediate investment.
“Emphasis was placed on the kingdom’s supportive role in Pakistan’s economy and the mutual desire to strengthen trade and investment ties. Both parties affirmed their commitment to expediting the first wave of [an] investment package worth $5bn which was discussed previously,” said the Saudi-Pakistan joint statement released after the meeting.
While reports in Pakistani media at the time said that the $5 billion investment would be the first tranche of the $25 billion that Pakistan had sought in investments, reports have now said that the two sides are currently discussing the first tranche of the $5 billion investments.
Pakistan has repeatedly turned to the Saudis amid its spiralling financial crisis. In 2021, when Pakistan was facing a foreign exchange crisis, the Saudis had extended $3 billion in financial support to Pakistan. As Pakistan’s bankruptcy continued, the Saudis last November extended the terms of the $3 billion support for one more year.