Asif Khurshid
The recent visit of Saudi Arabia’s Foreign Minister Prince Faisal bin Farhan, accompanied by a high-level delegation to Pakistan underscored the deepening bilateral ties and shared commitment to development between the two nations. The delegation’s engagement with various Pakistani ministers reflected the breadth of Saudi interest in fostering mutually beneficial partnerships. Notably, the visit coincided with recent high-level military exchanges, further underlining the enduring strategic cooperation and mutual warmth defining the relationship between Pakistan and Saudi Arabia at both regional and global levels, promising tangible economic and diplomatic outcomes for both nations. During the meeting with the Army Chief, Saudi Arabia’s Foreign Minister highlighted the enduring and strategic nature of Riyadh’s relationship with Islamabad, and emphasized the need to explore diverse avenues for strengthening bilateral ties. The COAS also reaffirmed Pakistan’s deep fraternal bond with Saudi Arabia and expressed full support for the delegation’s visit, anticipating mutually beneficial outcomes from the interaction. Prime Minister Shahbaz Sharif’s strategic Ramadan visit to Makkah, as his first foreign destination, aimed at solidifying investment discussions with longstanding allies, seems to be yielding positive results. Following Crown Prince Mohammed bin Salman’s commitment to accelerate investments, the recent two-day visit by Saudi Foreign Minister Prince Faisal bin Farhan has injected new energy into economic deliberations. During a joint press conference with Foreign Minister Ishaq Dar Saudi Foreign Minister Faisal bin Farhan Al Saud highlighted recent high-level meetings between leaders of both countries and praised Pakistan’s Special Investment Facilitation Council (SIFC) for its efforts in attracting unprecedented investment from Saudi Arabia. Discussions focused on elevating bilateral cooperation to a strategic partnership, aiming to expand investment opportunities in sectors such as aviation, hospitality, and infrastructure. The issuance of a joint statement underlines Saudi Arabia’s serious intent, possibly leading to larger-scale investments of up to $25 billion channeled through SIFC into sectors like agriculture and mining. This reflects a restoration of confidence in Pakistan’s investment climate, essential for sustained economic growth amid existing financial support from the IMF. Going forward, Pakistan must maintain a conducive environment for investment and address economic challenges to optimize the impact of this funding on economic stability and growth.The Sharif government is poised to celebrate this “very positive” development, though transparency and political goodwill must be established rigorously to ensure success during the Crown Prince’s upcoming visit and subsequent investment phase. Over the past decade, Saudi Arabia has significantly contributed to Pakistan’s economic development through various channels of aid and cooperation. This support includes providing oil and energy products to address Pakistan’s energy crisis, as well as bilateral agreements such as a $6.2 billion support package in 2019 comprising $3 billion in loans and a $3.2 billion oil credit facility. Saudi Arabia has also invested in Pakistan’s infrastructure and telecommunications sectors, fostering economic growth and job creation. These efforts underscore the growing economic and strategic partnership between Saudi Arabia and Pakistan. “A relationship where it will now be investment between the two countries which will mutually benefit from it.” These are the words of Mohammad bin Salman when he visited during the last government regime. These words also highlighted Saudi Arabia’s intent to engage in mutually beneficial investments with Pakistan, reflecting a strategic approach to their bilateral relationship. This vision implies a partnership that goes beyond mere financial transactions, aiming to foster economic growth and development that will be advantageous to both nations. This approach mirrors the broader trend of countries forming economic partnerships to achieve shared goals, such as job creation, technology transfer, and overall economic advancement. By emphasizing dual benefits, Saudi Arabia underscores the significance of symbiotic cooperation in realizing mutual prosperity and progress. To enhance economic cooperation between Pakistan and Saudi Arabia, strategic steps must be taken across various sectors. This includes fostering trade relations through bilateral agreements to reduce tariffs and barriers, promoting investment by offering incentives and favorable conditions, and focusing on key sectors like energy, infrastructure, and technology for joint ventures. Collaboration in energy projects, infrastructure development, and human resource capacity building are crucial. Establishing joint economic councils or forums to address issues and promote innovation exchanges will also be beneficial. Simplifying visa processes and promoting cultural diplomacy will encourage business travel and cultural understanding. Pakistan also needs to prioritize political stability, streamline regulatory processes, and offer attractive investment incentives such as tax breaks and subsidies. Developing critical infrastructure, investing in education to build a skilled workforce, and implementing sector-specific policies will enhance the country’s competitiveness. Effective promotion of investment opportunities, participation in trade agreements, and ensuring investor protection through legal frameworks and transparency measures are essential. Maintaining a stable macroeconomic environment is also crucial to instill confidence among foreign investors. By implementing these measures, both countries can deepen their economic collaboration and create a more robust and sustainable strategic partnership. The success of SIFC in addressing financial challenges bodes well, and Pakistan’s future economic path rests on sustained reform efforts and strategic partnerships.
