Tuesday May 21, 2024

Investment boost

By Mansoor Ahmad
May 15, 2024
A foreign currency dealer counts US dollar notes at a currency market in Karachi on July 19, 2022. — AFP
A foreign currency dealer counts US dollar notes at a currency market in Karachi on July 19, 2022. — AFP

LAHORE: Vibes coming from the economic front are highly encouraging; the capital market is breaking records every day, relations with China have been mended, and the Kingdom of Saudi Arabia, which has always ensured our well-being, has renewed its commitment to Pakistan in clear terms.

Unfortunately, we neglected our two staunchest supporters in the past five years. Our friends were provoked many times during this period, forcing them to the sidelines. It required a lot of patience to win back their confidence. With investment from developed economies not forthcoming, Prime Minister Shehbaz Sharif deserves credit for rejuvenating bilateral relations with the two countries, particularly with the KSA, which sent a high-level trade delegation to explore investment opportunities in Pakistan. This was accomplished after a series of high-level meetings held in Riyadh, where both nations signed agreements worth over $4 billion.

These agreements span multiple sectors, including energy, infrastructure, and technology. The Saudi investment is expected to significantly boost Pakistan's economy, creating thousands of jobs and fostering technological advancement. A landmark deal in the renewable energy sector has been finalized, with the Saudis committing $1.2 billion to develop solar and wind energy projects in Pakistan. These projects are expected to generate 3,000 MW of clean energy by 2026, reducing the power sector’s carbon footprint. Most investments will come from the Saudi private sector.

New trade agreements signed in Riyadh aim to increase exports from Pakistan to Saudi Arabia. Bilateral trade has received a substantial boost with the signing of new trade agreements aimed at increasing exports from Pakistan to Saudi Arabia.

The target is to enhance bilateral trade from the current $3.7 billion to over $5 billion by 2025. Key export items include textiles, agricultural products, and pharmaceuticals. This seems a small beginning, but there is a paradigm shift in policy; instead of loans that are to be returned, the Saudi government is now investing in commercially viable projects that will bring prosperity to the people of Pakistan. The other Gulf countries are expected to follow suit if similar confidence is provided to them.

Some misunderstandings were created by vested interests when the Saudi government started improving its relations with India. The Saudi government has long been looking the other way on our relations with its adversary, Iran. We should have shown the same tolerance. We are committed to defending the holy land from any outside force. In the same way, Saudi Arabia staunchly supports our sovereignty.

Pakistan was already providing training to Saudi cadets, and now both countries have launched youth exchange programs that facilitate educational and cultural exchanges to improve people-to-people ties. Moreover, universities and research institutions from both nations have agreed to collaborate on various research projects, particularly in the fields of technology, medicine, and engineering.

Enhanced cooperation in defense and security has been a key focus, with both nations agreeing to conduct joint military exercises and training programs.Moreover, regular strategic dialogues have been institutionalized to ensure continuous engagement on key regional and global issues.

The Kingdom has pledged substantial aid for various development projects in Pakistan, including healthcare, education, and infrastructure. This aid is aimed at improving the quality of life for the Pakistani populace and promoting sustainable development. In response to recent natural disasters in Pakistan, Saudi Arabia has provided emergency humanitarian assistance, demonstrating solidarity and support during times of need.

The strengthened relationship between Pakistan and Saudi Arabia is not only beneficial for the two nations but also holds significant implications for regional stability. The collaboration serves as a model for inter-regional cooperation, promoting peace and prosperity in the Middle East and South Asia.