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Friday, September 30, 2022
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EditorialSaudi investment in Pakistan

Saudi investment in Pakistan

There is good news for our ailing economy as the Kingdom of Saudi Arabia (KSA) intends to make a whooping US$ one billion investment in Pakistan. The development was inevitable given the history of strong ties between Pakistan and KSA as both states enjoy brotherly relations. The KSA has always been generous in extending financial support to Pakistan during any crisis. However, the materialisation of the news is the actual area of interest as well as the proper utilisation of finances. Currently, Pakistan has been in need of US$ 30 billion for meeting its economic needs and making repayments of debts while the estimated collection could reach the US $37 billion for the financial year 2023. Doubts are being raised over the implementation of Saudi investment plans because the Saudi government had made a similar announcement of pouring in US$ 10 billion for building an oil refinery in Pakistan in the past, which has not happened yet. So the government needs to follow up on the latest Saudi proposal and settle all modalities in a cordial manner. The offer has also prompted many minds to figure out an estimate of the total collection Pakistan will likely receive from the Gulf region. Reportedly, Islamabad will receive US$ one billion investment from the UAE, US $2 billion from Qatar in bilateral support to help ease its funding crunch and a US$ 3 billion investment from Qatar Investment Authority while the addition of US$
one billion investment from Saudi Arabia is the current development. Moreover, a deal for
disbursement of a US$ 1.7 billion loan from the IMF is also in the final stage. These figures have renewed hopes for a quick economic recovery. Now the responsibility lies on the government of Pakistan to maximise benefit from the generosity of Gulf states and tap the vast potential it offers to these oil-rich countries that prompt them to continue their support for Islamabad. Pakistan offers an ideal climate as it has all four seasons, rich natural resources with tourism attractions and vast industrial scope as well as it has a strategically important geographical location. However, this amalgam of resources has not been fully exploited yet. The government needs to fully take benefit of this potential and earn much-needed foreign exchange. There is a need to create an atmosphere where no one feels hesitant to come and make an investment in the land of pure.
Work needs to be done at a larger scale at the government level for formulating such policies that facilitate the business community in Pakistan and overseas. Hopefully, the renewed relationship between the KSA and Pakistan will yield some positive results and open new avenues of investment. While Saudi Arabia has been helpful in abating Pakistan’s economic woes, the latter has also been instrumental in providing military support to the former. The Kingdom is entangled in various regional issues like the Yemen conflict, a proxy war with Iran and the threat of militants. These issues prompt Saudi Arabia to garner regional support and Islamabad is one of its key allies of Riyadh. Although, a spirit of friendship, alliance and mutual cooperation do exist between the two brotherly states, yet the relations are also based on mutual interests. Arguably, the Saudi offer will help strengthen ties between both states.


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