This week has been proving extraordinarily good for Pakistan as far as securing finances is concerned. Year-long looming dollar scarcity crisis seemingly fading away.
It kicked off with the successful conduct of the International Conference on Climate Resilient Pakistan in Geneva, where the international partners and multilateral lenders made commitments of about $ 10.7 billion for the reconstruction and rehabilitation of flood-affected people.
On Tuesday, the news flashed in the media about the Kingdom of Saudi Arabia (KSA) considering an investment of $ 10 billion in Pakistan and increasing its foreign exchange deposits to $ 5 billion in its central bank. It already has $ 3 billion as of here.
Saudi Arabia has always proved to be Pakistan’s reliable and trustworthy partner. It won’t be wrong to call it a friend of difficult times. There are only a few countries in the comity of nations with which Pakistan enjoys such a special and unbreakable bond.
From the annals of history, one may quote innumerable instances where the KSA withstood Pakistan in the hour of trial and vice versa.
Brotherly ties between Pakistan and Kingdom of Saudi Arabia
This indicates the relationship is deeply rooted in the hearts of the people of the two countries. The latest direction by Saudi Crown Prince and Prime Minister Mohammad bin Salman to the Saudi Development Fund is to study increasing the investment portfolio and foreign exchange deposits.
This came a day after he met with Chief of Army Staff General Syed Asim Munir really indicates the love and compassion that the top Saudi leadership has for Pakistan.
It, in fact, also reminds us of the words: “Consider me your Ambassador in Saudi Arabia,” made by the Saudi Crown Prince during his visit to Islamabad back in 2019. It was such a remarkable gesture lauded here locally for months in all quarters.
Indeed Mohammad Bin Salman has proven himself true to his words as his latest announcement has come at a very critical time when Pakistan is faced with a serious financial crunch as its foreign exchange reserves have dwindled below five billion dollars which is not sufficient to meet the imports of even one month.
The Saudi announcement will help our authorities convince the IMF to complete its ninth review without tough conditions, which will also open inflows of dollars from other financial institutions such as the World Bank and the Asian Development Bank.
This will help us pay back the external liabilities and avert the threat of default in the short term. The Saudi investment portfolio will help the country to take the course of standing on its own feet. Though it is not clear yet which sectors the Kingdom would invest in, this will give the much-needed impetus to our productive sectors.
Certainly, there is immense potential for cooperation between the two countries in multiple sectors, including petrochemical, mining, agriculture, and so on, and these can be exploited for mutual benefits.
It is now up to the economics managers in Pakistan to better utilize both the Geneva pledges and Saudi support to change the country’s economic landscape, which has become a must to come out of the debt trap. Maximum facilitation should be extended to the Saudi authorities to realize their investment portfolio at the earliest.
This will prove to be a pull factor and encourage more investments from the Gulf region, which can really help us put the economy on a positive trajectory, which is vital to provide job opportunities to the massive youth bulge.
