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Saudi Arabia to invest $25b over next five years, says interim PM Kakar

Kakar says Saudi Arabia's investment would come in the mining, agriculture and information technology sectors
Caretaker Prime Minister Anwaarul Haq Kakar interacts with Islamabad based foreign media journalists September 4, 2023. PID
Caretaker Prime Minister Anwaarul Haq Kakar interacts with Islamabad based foreign media journalists September 4, 2023. PID
Interim Prime Minister Anwaarul Haq Kakar interacts with Islamabad based foreign media journalists (not seen in the picture) on September 4, 2023. PID
Interim Prime Minister Anwaarul Haq Kakar interacts with Islamabad based foreign media journalists (not seen in the picture) on September 4, 2023. PID

Saudi Arabia will invest up to $25 billion in Pakistan over the next two to five years in various sectors, caretaker Prime Minister Anwaarul Haq Kakar said on Monday, adding his government would also revive a stalled privatisation process.

The South Asian nation is embarking on a tricky path to economic recovery under a caretaker government after a $3 billion loan programme, approved by the International Monetary Fund (IMF) in July, averted a sovereign debt default.

Kakar, speaking to journalists at his official residence, said Saudi Arabia’s investment would come in the mining, agriculture and information technology sectors, and was a 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 confirmed, a series of investments worth $25 billion would be the biggest ever by the kingdom in Pakistan.

A longtime ally of Riyadh, Pakistan is dealing with a balance of payments crisis and requires billions of dollars in foreign exchange to finance its trade deficit and repay its international debts in the current financial year.

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Kakar did not specify projects Riyadh was looking at for investment, but last month Barrick Gold Corp (ABX.TO) said it was open to bringing in Saudi Arabia’s wealth fund as one of its partners in Reko Diq gold and copper mine.

Pakistan’s untapped mineral deposits are conservatively valued at about $6 trillion, said Kakar, whose government is meant to be an interim set up to oversee national elections scheduled for November but are expected to be delayed by months.

Barrick considers the Reko Diq mine one of the world’s largest underdeveloped copper-gold areas and it owns a 50% stake, with the remaining 50% owned by the governments of Pakistan and the province of Balochistan.

Kakar also said his government would push to complete two privatisation deals, probably for state-run power sector entities, in the next six months, and would also look to privatise another government owned enterprise outside the energy sector.

Pakistan’s state owned enterprises have long been an area of concern with bleeding financials adding to financial stress. Recently Pakistan added struggling state-run Pakistan International Airlines to the privatisation list again.

The privatisation process has largely stalled in the country with selling of state assets a politically sensitive issue that many elected governments have shied away from.

‘Interim govt has excellent working environment with army’

Caretaker PM Kakar has assured that his government was exploring realistic options to come up with out-of-box solutions to provide relief to electricity consumers, the Associated Press of Pakistan reported.

He said the government would make informed decisions to satisfy the masses on the issue of electricity bills without deviating from the country’s commitments with the international financial institutions.

He assured that the interim government was mandated to facilitate holding the general elections as early as possible while observing the constitutional obligations.

To a question, he said all the registered political parties would be provided a level playing field to contest the general elections without any discrimination. However, he said in certain instances, political behaviour turned into vandalism and the country’s law was already in vogue to deal with such conduct.

Talking about the terror attacks by the banned TTP, the prime minister drew attention to the leftover military equipment by the US and allied forces back in Afghanistan which he viewed were becoming a threat to peace thus necessitating a coordinated approach to deal with the challenge.

He said the foreign forces left Afghanistan after losing interest but “we are here to defend our home, children, mosques and places of worship.”

When asked, the prime minister said the government had an “excellent working environment” with the Pakistan Army and both were working together, also for economic revival.

Kakar went on to add that regardless of any political association, the people of Balochistan welcomed every project under the China-Pakistan Economic Corridor which had entered the second phase. He reiterated the government’s resolve to go to any extent to protect the Chinese workers taking part in the CPEC projects.

The interim prime minister expressed the hope that foreign investment projects “worth $25 billion each from Saudi Arabia and the Middle East” would be realised in a time span of two to five years.

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