ISLAMABAD: Pakistan’s Prime Minister Shehbaz Sharif, after facing key challenges, inheriting a country on the verge of financial default, has been able to successfully steer this complex landscape by engaging coalition political party leaders, the country’s security establishment and key foreign partners, Arab News reported on Wednesday.
Islamabad-GCC Partnership
According to an article published by “Arab News,” as a result, the South Asian country is now stable enough to transition smoothly toward a caretaker government, which will hold the next elections.
It added the political chaos has receded since the appointment of General Asim Munir as the country’s Chief of the Army Staff (COAS) in November.
According to Arab News, “A new staff-level deal with the IMF, worth $3 billion, was concluded in June…. and the China-Pakistan Economic Corridor (CPEC) stands revived, while ties with Washington are also back on track,”. It added most notably, the civil-military collaboration has also expanded to the economic sphere, giving renewed momentum to Islamabad’s economic partnership with the leading GCC countries.
Since 2019, the Kingdom of Saudi Arabia, the UAE, and China have offered concessional loans to shore up Pakistan’s foreign reserves. The loans have then been rolled over to meet the IMF demand. The latest IMF agreement became possible after Riyadh deposited an additional loan of $2 billion in Pakistan’s Central Bank, the newspaper maintained.
Special Investment Facilitation Council
Riyadh has always stood by Islamabad through thin and thick. But Islamabad must stand on its own two feet. The Special Investment Facilitation Council offers a feasible path in this respect. Its formation also indicates that Pakistan’s civilian and military leadership understands the risk of dependency on foreign debts. And they are also preparing to lay down a firm economic base via attracting investment from friendly nations, the daily maintained.
The article said that political instability often results in a change of government and the resulting lack of continuity in economic policies. These issues have inundated major investment commitments by KSA, the UAE, and Qatar in the recent past. While visiting Pakistan in 2019, Saudi Crown Prince Mohammed bin Salman promised $20 billion of investment in the minerals, energy, and mining sectors. Likewise, Qatar and the UAE have pledged $9 billion. But these pledges are yet to arrive due to cumbersome structural and procedures impediments.
Comprehensive Economic Partnership Agreement
Going advancing, the Comprehensive Economic Partnership Agreement with the UAE requires to be emulated in Pakistan’s trade links with Riyadh and the other GCC nations. Pakistan’s skilled manpower in the Information Technology and services fields is a perfect match for the economic transformations taking place in the Gulf, especially in the Kingdom of Saudi Arabia.
“Pakistan’s Prime Minister Shehbaz Sharif is nearing the end of a challenging yet fruitful tenure, marked by key policy decisions. One of his strategic steps was to deepen trade and investment ties with the Kingdom of Saudi Arabia, Qatar, and the UAE,” Arab News said, saying these leading economies of the Gulf Cooperation Council (GCC) have also shown a willingness to contribute to South Asia’s economic revival and stability.
Islamabad has always prioritized defense, economic, and cultural ties with Saudi Arabia and other Gulf countries. This historically rooted association is based on the common bonds of culture, religion and mutually beneficial economic needs, and shared strategic interests in regional stability and international peace.
GCC Region Plays Key Role in Pakistan’s Economy
The GCC region also plays a key role in Pakistan’s economy, serving as the main source of energy imports and foreign remittances. It is also household to the largest number of Pakistani expatriate workers, Arab News reported.
The current economic diversification and regional reconciliation in the Gulf, especially under the Saudi Vision 2030, offer plenty of opportunities for Pakistan to attract GCC investments in the development sector, as well as to export tradable commodities and skilled manpower to the Gulf region.
Pakistan’s civilian and military leaders understand the key role GCC investments can play in putting the crisis-ridden economy on a steady course toward sustainable development and progress, Arab News added.
Among the key policy initiatives to this end is the formation of the Special Investment Facilitation Council, which is tasked with attracting foreign direct investment from GCC nations in the fields of minerals, agriculture, defense production and IT.
This significant step is being complemented by the launch of the Pakistan Sovereign Wealth Fund and the conclusion of the Comprehensive Economic Partnership Agreement with the UAE, Arab News added.
