Saudi Arabia commits $1 billion investment in Pakistan

CAIRO: Saudi Arabia plans to invest $1 billion in Pakistan, Saudi state TV reported on Thursday.

Saudi King Salman bin Abdulaziz had given the directive for the kingdom to support the Pakistani economy, state TV added. 

According to Al-Arabiya News, Saudi Arabia’s Foreign Minister Prince Faisal bin Farhan informed his Pakistani counterpart, Bilawal Bhutto-Zardari, of the decision during a phone call.

“King Salman bin Abdulaziz ordered investing $1 billion in the brotherly [country] of Pakistan [in line with] the Kingdom’s stance in support of the country’s economy and its people,” SPA reported.

The foreign ministers also discussed bilateral ties and means to improve them as well as regional and international affairs of mutual interest, the report added.

Pakistan is in economic turmoil and faces a balance of payments crisis, with foreign reserves having dropped as low as $7.8 billion, barely enough for more than a month of imports. It is also contending with a widening current account deficit, weakening rupee currency, and inflation that exceeded 24% in July.

The International Monetary Fund (IMF) had asked Pakistan to bridge a $4 billion financing gap and Pakistan was able to get friendly countries — Saudi Arabia, UAE, and Qatar — to help meet the requirement.

Saudia Arabia will also provide $1 billion in oil financing to the South Asian nation and the UAE will give a similar amount to the country.

While a day earlier, Qatar Investment Authority shared its plan to invest $3 billion in Pakistan, the Qatari ruler's office said.

"The Qatar Investment Authority announced its aspiration to invest $3 billion in various commercial and investment sectors in the Islamic Republic of Pakistan," the Emiri Diwan said, without giving details.

SOURCE: REUTERS