Saudi Crown Prince Muhammad bin Salman (popularly known as MBS) made a two-day royal visit to Pakistan, at a time when this region is witnessing a significant upheaval in geo-politics. Facing a host of both internal and external problems, particularly economic woes and despite receiving $2 billion each from Saudi Arabia and the United Arab Emirates (UAE) only last month, Pakistan’s foreign exchange reserves are still down to about $8.2 billion, sufficient only for less than two months of imports; our predicament can be imagined, it beggars description (pun intended). However, when the very credible Governor SBP Tariq Bajwa states we have stabilized the situation and gone over the financial crisis, one believes this to be true. We presently are engaged with the International Monetary Fund (IMF) to work out an agreement for a three-year financial programme, something the Prime Minister, (PM) Imran Khan, was loathe to do unless it was the last resort.
Appointed Crown Prince in June 2017 when only 31, MBS surprised the world with his dynamism and originality, undertaking several reforms aiming to change the radical conservatism in the Saudi system of governance hitherto considered unprecedented. He was soon making headlines with his creative ideas to introduce a better way of life for his people and the future of his country. Under his guidance Saudi Arabia is moving away from an oil-based economy to a more diversified one. The Saudi Vision 2030 is a roadmap that seeks to reduce the Kingdom’s dependence on oil and develop public service sectors – education, infrastructure, health, tourism – and reinforce economic and investment activities, increase non-oil industry trade between countries through goods and consumer products, etc.
Despite the skepticism generally prevailing about Memoranda of Understanding (MoUs), the signing of several investment agreements with Pakistan worth over US$20 billion is bound to boost and re-energize bilateral ties to newer levels. Pakistan is one of the strategic economic partners chosen by the Saudis. Investments in the short-term, mid-term and long term included US$10 billion by Aramco for an oil refinery in Gwadar, RLNG plants worth US$4 billion, ACWA Power to invest in renewable energy worth $ 2 billion, petro-chemical, food and agriculture projects with investment amounting to $1 billion each, mineral development sector US$2 billion. The Kingdom will invest US$21bn within the next five years, etc, etc. With Pakistan having to import about 70% of its oil requirement presently, these are all extremely significant developments for Pakistan particularly the establishment of a new oil refinery. Given that Pakistan imports 69% of its oil, this will allow saving a huge amount of funds in importing crude oil, that is far more cheaper than the more expensive refined petroleum products. Investment in plants powered by alternate energy will go a long way in helping Pakistan diversify its energy model thereby reducing dependence on imported fossil fuels that are also a danger to the environment. There is also reported interest in our indigenous defence production facilities, the force-multiplier effect on our production of combat aircraft, tanks, etc would not only upgrade the quality of the products but institute economy of scale in numbers.
At PM Imran Khan’s request the royal visitor not only ordered the release of more than 2100 Pakistani prisoners languishing in Saudi prisons for petty crimes but also promised sympathetic review of those remaining. When Imran Khan asked him to help the 2 million plus of blue collar Pakistani workers undergoing hardships working in the Kingdom the Crown Prince not only won but melted the hearts of millions in Pakistan and abroad by saying, “We cannot say ‘No’ to Pakistan”. The body language said everything, “Consider me Pakistan’s ambassador to Saudi Arabia. What we did today is the beginning and we hope in the close future we do more and more partnering with Pakistan in projects.” These few lines that came from the heart are a manifestation of the powerful diplomatic ties and the brotherly love between the two countries. These initiatives are only the beginning of a new chapter in the history of this region. Incidentally Imran Khan regained a lot of ground that he had lost in popularity over the months because of some thoroughly incompetent aides.
Major credit should go for the outstanding effort delivered by Saudi Ambassador to Pakistan Nawaf bin Said Al-Maliki for this great success. Given the large number of dignitaries accompanying MBS and the relevant security issues, it was a tremendous logistical feat achieved by this gracious and amiable person. The very epitome of a consummate diplomat, he has done much to force-multiply our emotional bonds. Relations between Pakistan and Saudi Arabia are unique and special, the MBS royal visit will take our historical relationship to a new level.
(The writer is a defence and security analyst)
Copyright Business Recorder, 2019Ikram Sehgal, "The royal visit," Business Recorder. 2019-02-22.
Keywords: Economics , Financial crisis , Geo-politics , Investment , Agriculture , Imports , Pakistan , IMF