Islamabad, Riyadh ink $20B in trade, investment deals

Islamabad, Riyadh ink $20B in trade, investment deals

Agreements signed during Saudi Crown Prince Mohammad bin Salman’s seminal 2-day visit to Pakistan

By Aamir Latif

KARACHI, Pakistan (AA) – Pakistan on Monday conferred its highest civil award on Saudi Crown Prince Mohammad bin Salman after the two allies inked $20 billion worth of trade and investment deals during the crown prince’s two-day visit to Islamabad.

At a ceremony held in the capital, President Arif Alvi conferred the Nishan-e-Pakistan award on bin Salman for the latter’s "outstanding support for reinvigorating the Pakistani-Saudi bilateral relationship".

In return, the crown prince conferred Saudi Arabia’s King Abdel Aziz medal on Farman Ali, a Pakistani national who saved the lives of 14 Saudis during a spate of floods in Jeddah in 2009.

The award was granted posthumously, as Ali lost his life while attempting to save a 15th person.

Bin Salman also met Pakistan’s powerful army chief, Gen. Qamar Javed Bajwa, seen by many to be the driving force behind the Saudi investment drive in Pakistan.

The two men reportedly discussed “matters of mutual concern and the regional situation”.

A delegation from both houses of Pakistan’s bicameral parliament, including members of both the treasury and opposition, also met with the crown prince during his two-day visit.

Prime Minister Imran Khan, along with members of his cabinet and the army chief, later saw bin Salman off from Islamabad’s Noor Khan airbase after holding a joint press conference.

“The combination of Pakistan’s geostrategic position and Saudi Arabia’s advantages in certain areas will benefit both countries,” Khan told reporters.

Bin Salman, for his part, said: “We believe Pakistan has huge economic potential. We truly believe Pakistan has a bright future ahead.”

He added: “What we did today is the beginning. Our cooperation with Pakistan will continue in future as well.”


-Deals

During bin Salman’s much publicized visit, the two sides inked a string of trade and investment deals in the fields of energy, petrochemicals, agriculture and renewable energy.

The lion’s share of proposed Saudi investment is expected to go towards the establishment of a major oil refinery in Pakistan’s strategic port city of Gwadar.

This follows a $6-billion package unveiled by Riyadh last October to assist cash-strapped Islamabad.

What’s more, Saudi Arabia's ACWA Power International plans to invest up to $4 billion in Pakistan's energy sector, Saudi Energy Minister Khalid al-Falih said at a Sunday meeting with Pakistani Finance Minister Asad Umar, according to an official statement.

“This $20 billion investment is a beginning. Saudi Arabia will further invest in Pakistan in the future,” bin Salman said while addressing a reception in Islamabad.

This is the second major investment package within recent years after China’s $64-billion China-Pakistan Economic Corridor (CPEC) project, signed in 2014.

The twin mega-investment projects have been described by observers as a “lifeline” for Pakistan’s faltering economy.

On Sunday, bin Salman and the Pakistani PM jointly chaired a meeting of the Supreme Coordination Council, tasked with monitoring the implementation of multibillion-dollar projects signed between the two countries.


-The India factor

Notably, bin Salman's Asia tour will also take him to India, Pakistan's arch-rival. Tensions between the two nuclear-armed neighbors mounted earlier this week after a deadly suicide attack on an Indian military convoy.

New Delhi blames Pakistan for the attack, for which Islamabad denies any responsibility.

Riyadh has long been an economic and strategic partner of Islamabad, but has avoided involving itself in the Pakistan-India row because of its huge investments in both countries.

Last year, Saudi state oil company Aramco signed a $44-billion deal with India to build a mega-refinery on India's west coast.

And last September, Pakistan formally invited Saudi Arabia to join CPEC, part of China's ambitious Belt and Road Initiative project, although differences with Beijing reportedly derailed the arrangement.

Riyadh has nevertheless agreed to invest in CPEC-related projects, recently announcing plans to finance three CPEC schemes in the northwestern Khyber Pakhtunkhwa province and Pakistan-administered Kashmir.

Signed in 2014, CPEC will link China's strategically important northwestern Xinxiang province to the Port of Gwadar through a network of roads, railways and pipelines for the transport of cargo, oil and gas.

In a joint statement released upon bin Salman’s departure, the two sides reaffirmed the “historic relations” between the two “brotherly countries”, commending the “growing momentum in bilateral ties in all areas”.

The Saudi side, for its part, praised the Pakistani prime minister’s offer to hold dialogue with India, including an offer to open the Kartarpur Corridor.

“Both sides [i.e., Saudi Arabia and Pakistan] stressed that dialogue is the only way to ensure peace and stability in the region and to resolve outstanding issues,” the joint statement read.

It added: “Both sides strongly condemn atrocities and human rights violations committed against Muslims around the world.”

The statement went on to articulate the two countries’ common positions on a range of regional and international issues, especially those related to interfaith harmony and the fight against terrorism.

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