Saudi Arabia will invest up to 25 billion US dollars in Pakistan over the next two to five years in various sectors, interim Pakistani Prime Minister Anwaar-ul-Haq Kakar said on Monday (4/9/2023), adding that his government would also revive stalled privatization processes.
The South Asian country is embarking on a difficult road to economic recovery under an interim government after a three billion US dollar loan program, approved by the International Monetary Fund (IMF) in July, managed to avoid a sovereign debt default .
Kakar, speaking to reporters at his official residence, said Saudi Arabia’s investment would be in the mining, agriculture and information technology sectors, and was part of a push to increase foreign direct investment in Pakistan.
There was no immediate response to a Reuters request to the Saudi Arabian government for comment on Kakar’s remarks.
If this is true, the series of investments worth US$25 billion would be the largest the kingdom has ever made in Pakistan.
A longtime ally of Riyadh, Pakistan is facing a balance of payments crisis and needs billions of dollars in foreign exchange to finance its trade deficit and service its international debt in the current financial year.
Kakar did not detail the projects Riyadh is eyeing for investment, but last month Barrick Gold said it was open to bringing in the Saudi Arabian wealth fund as one of its partners in Pakistan’s Reko Diq gold and copper mine.
Pakistan’s untapped mineral reserves are conservatively worth about US$6 trillion, said Kakar, whose government was meant to oversee national elections scheduled for November but are expected to be delayed for several months.
Barrick considers the Reko Diq mine to be one of the world’s largest underdeveloped copper-gold areas and owns a 50 percent stake, with the remaining 50 percent owned by the Government of Pakistan and Balochistan Province.
Kakar also said his government would seek to complete two privatization deals, possibly for state-run power sector entities, in the next six months, and would also privatize other state-owned enterprises outside the energy sector.
Pakistan’s state-owned companies have long been a concern because of the financial hemorrhaging that adds to the financial strain. Pakistan recently added the struggling state-owned Pakistan International Airlines to its privatization list again.
The privatization process has largely stalled in the country because the sale of state assets is a politically sensitive issue that many elected governments have avoided.
Source : Antara