Staff Report
ISLAMABAD: The expected Saudi investment of $10 billion in Pakistan could be a major relief for the cash-crunch country which is facing imminent default, experts and business leaders said as Riyadh plans to consider a funding boost in the South Asian nation.
Troubled economy situation
According to the Arab News, as Pakistan’s foreign exchange reserves remain under pressure due to debt repayments, Crown Prince Mohammed bin Salman earlier this week directed the Saudi Fund for Development to look into the possibility of further boosting the Kingdom’s investment to $10 billion in Pakistan.
In the past, Pakistan also looked to Saudi Arabia to shore up the cash whenever its foreign exchange reserves plummeted, and it faced maying payments to maturing debts. In 2021, the SFD deposited $3 billion in the Central Bank of Pakistan after other states withdrew their deposits after maturity.
The Saudi sum remained in the system in 2022 when Pakistan requested an extension in the deposit.
Immediately after the crown prince’s decision, Pakistan’s Prime Minister Shehbaz Sharif said on Wednesday that Pakistan was “immensely grateful,” to the Kingdom.
Pakistan Chamber of Commerce and Industry’s former president Sardar Yasir Ilyas Khan said that the entire Pakistani nation was grateful to the crown prince for issuing the directives. “In the current political and economic uncertainty, this news is a breath of fresh air for all of us,” he said.
“There is a lot of potential and Saudi Arabia’s expertise in this segment about their public investment fund and holding the sovereign wealth fund in the world gives them a huge advantage.”
