In a significant announcement, caretaker Prime Minister Anwaarul Haq Kakar revealed that Saudi Arabia plans to invest up to $25 billion in various sectors in Pakistan within two to five years. This substantial investment is expected to bolster the mining, agriculture, and information technology sectors, aiding in elevating Pakistan’s foreign direct investment (FDI). This move comes as a beacon of hope as Pakistan navigates a precarious route to economic recovery, bolstered by a $3 billion loan programme facilitated by the International Monetary Fund (IMF) to prevent a sovereign debt default. Pakistan is grappling with a balance of payments crisis, necessitating significant funds to address its trade deficit and debt repayments. This proposed investment is potentially the largest Saudi investment in Pakistan to date.
Kakar remained discreet regarding the specific projects under consideration for this investment but highlighted potential collaboration involving Saudi Arabia’s wealth fund in the Reko Diq gold and copper mine. The Prime Minister underscored the untapped potential of Pakistan’s mineral wealth, estimated at around $6 trillion, with a keen focus on initiating the Reko Diq project shortly. Kakar urged stakeholders to conceptualize a blueprint to harness these mineral-rich regions, transforming global perceptions of Pakistan. Kakar highlighted the roles of the Special Investment Facilitation Council (SIFC) in this economic resurgence, emphasizing the rearrangement of fiscal and monetary policies to foster economic revitalization without overhauling the existing governmental structure.
Elections and Power Sector Reforms
Addressing the impending general elections, PM Kakar reassured that the caretaker government is geared towards facilitating the elections promptly, adhering to constitutional mandates. He asserted that every registered political entity would have an equal opportunity to compete in the elections. However, he cautioned against political actions escalating to vandalism, which existing laws are in place to mitigate. Kakar condemned the May 9 attacks on military facilities as attempts to incite societal chaos, necessitating a lawful counteraction.
Simultaneously, the government is pioneering innovative solutions to relieve electricity consumers burdened by increasing costs. Kakar disclosed the government’s ambition to implement economic reforms, including the acceleration of power distribution company privatisations and taxation sector improvements. He emphasized the commitment to making informed decisions to appease the populace regarding electricity bill concerns without violating international financial agreements.
Regarding national security, Kakar drew attention to the threats posed by the remnants of military equipment left by the US and its allies in Afghanistan, emphasizing the necessity for a united strategy to address these issues. The prime minister expressed his faith in the ongoing collaboration with the army to foster economic recovery. Kakar acknowledged the widespread support for the China-Pakistan Economic Corridor’s second phase in Balochistan, assuring robust protection for Chinese personnel engaged in the project.
In a separate meeting, Kakar underscored the imperative to prioritize renewable and hydropower sources for affordable and environmentally friendly energy production. He advocated for developing small hydropower projects guided by expert opinion, emphasizing their role in mitigating climate change impacts. Kakar instructed the initiation of 2,400MW solar power projects committed to transparency, setting a positive trajectory for the power sector’s future.