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Saudis Strengthen Pakistan ties with $20bn in new deals

Saudi Arabia has described Pakistan as a ‘friend in need’ but, following Crown Prince Mohammed Bin Salman’s tour of this part of Asia, both parties look set to benefit. Pakistan’s Prime Minister, Imran Khan, has been involved in strategic talks with his eminent Saudi visitor and it’s now clear that those discussions have proved fruitful.

There are a number of aspects to the new deals but with a total investment of some $20bn, the news will be met with a mixture of delight and relief by the Pakistan government.

Beneficial Deal for Pakistan

In commenting on the new agreement, Prince Bin Salman said:

“It’s big for phase one and definitely will grow every month and every year, and it will be beneficial to both parties.”

In reply, Prime Minister Imran Khan simply added:

“We are extremely grateful to the Saudi Crown Prince for coming forward and bringing huge investment in Pakistan.”

The news follows an extended campaign by Imran Khan to get Saudi Arabia officially signed up to CPEC. The China Pakistan Economic Corridor runs a number of significant projects to the mutual benefit of the respective countries and while the Saudis have yet to fully commit to CPEC, this latest announcement confirms a serious interest in the alliance and those individual projects.

Areas where CPEC will be Strengthened

Many of the fine details of the investment have yet to be fully disclosed but it’s widely understood that the Saudis will be getting behind projects in the petrochemicals, energy and mining sectors. One of the deals that has reportedly been rubber stamped is the construction of a $8 billion oil city within Gwadar, a port location that carries great significance in the overall aims of CPEC.

It was widely expected that the oil city project would begin in earnest in 2019 but the latest announcement between Pakistan and Saudi Arabia merely confirms it. The Crown Prince’s comments that hint towards an ongoing set of investments is also interesting and it will be fascinating to see further details emerge. As far as CPEC is concerned, both Pakistan and China will remain eager to seek a confirmed commitment from Saudi Arabia but the latest news is encouraging for the region and for the wider economic good of Pakistan.

 

 

 

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