PAGE Blog Business Weekly Magazine
Bilateral relations between Pakistan and Saudi Arabia have reached it zenith during the last few months. There were high-profile visits from both sides and the two countries have developed relations on a number of fields.
During the recent visit, the government of two sides agreed to take advantage of the opportunities available in the two countries for expanding and improving investment, trade, energy, infrastructure development, agriculture, human resource and exchange of government’s delegations for mutual benefit. A team of technical experts of Saudi Arabia visited Pakistan recently to study health and veterinary standards of the poultry, livestock and dairy industry in Pakistan. The visits are likely to lead to greater cooperation in the areas of food and agriculture.
Pakistanis are playing a vital role in developing the physical and institutional infrastructure of Saudi Arabia. In the field of finance, commerce, medicine, construction or business, Pakistani community members have contributed to this country’s development with zeal, dedication and devotion.
Today, Saudi Arabia has first-class infrastructure. Its economy is sound and is prospering at a time when most countries are going through a recession or slow-down. At a time when the entire region is faced with numerous challenges, the Saudi Arabia is enjoying peace and stability in all fields.
The bilateral relation between the two countries continues to expand without any hindrances. The bilateral cooperation will record further acceleration in the coming years since the relationship between the two brotherly countries of Pakistan and Saudi Arabia is based on the everlasting bonds between the peoples of the two countries.
The presence of large 1.5 million Pakistani workers in Saudi Arabia, serve as a living bond of friendship between the two countries and form yet another strong bond between the two peoples. The Pakistani expatriates are positively contributing in the development of the two countries and that this bridge would continue to expand and bolster to the mutual betterment of two brotherly countries.
Pakistan and Saudi Arabia have a cordial relationship, which is sometimes referred as exceptional relationship. Both countries have developed trust-worthy relations based on mutual respect. Saudi Arabia was one of those first countries, which recognized Pakistan after its independence in 1947. Saudi Arabia has always supported Pakistan in hard times whether it was war, earthquakes or floods. Saudi Arabia always came in advance and helped Pakistan in the war of 1965 and 1971 or sanctions after nuclear tests.
Common faith and culture has been further enhanced by close geographical closeness, memorable trade ties, religious association and the economic cooperation.
Major items of exports from Pakistan are synthetic textiles, and leather garments, furniture, carpets and rugs, footwear, sports goods and surgical goods, rice, fish, fruits, vegetables, spices, biscuits, jams, juices, etc.
Pakistan mainly imports petroleum products from Saudi Arabia. The other items of import, though small in quantity, includes petrochemicals, organic chemical products, plastics and its products, fertilizers, steel products, electrical equipment and materials, raw skins, tanned leather, boilers and heavy equipment, copper and copper products, aluminum and its products, inorganic chemicals, components, precious metals, steel castings, tractors, floor coverings of man made fibers, specialized type of chemical products, rubber and rubber products, paper and hardboard.
Moreover, food imports were 16 percent of import values, and textiles and clothes 8 percent. The scenario of imports has not been changed since 1981 when foodstuffs contributed 11 percent of import values and transport, electrical and mechanical equipment around 40 percent taken together.
Saudi Arabia has loaned $1.5 billion to Pakistan to help Pakistan support its foreign exchange reserves, meet debt-service obligations and undertake large energy and infrastructure projects. The Saudi assistance has contributed to a sharp recovery of the Pakistani rupee, which rose to a nine-month high of 97.40 from 105.40 against the dollar between March 4 and 12, its strongest rally in 30 years.
Prime Minister Nawaz Sharif has long enjoyed close relations with the Saudi royal family. After his second term as prime minister was finished by a military coup in 1999, he was sent into exile in Saudi Arabia. Recently the two sides signed agreements under which the latter will provide a total of around US$183 million for the import of urea fertilizer from Saudi Arabia and the construction of a hydro-power project in Chitral. Under the first agreement, Saudi Arabia will provide a credit facility of US$125 million for the import of urea fertilizer from Saudi Arabia.
According to the Finance Ministry, gross official reserves –including the latest injection of $1.5 billion — stood at $9.52 billion on March 11.
Pakistan launched Eurobonds of $2 billion and plans to raise billions of dollars in privatization revenue by June 2014. Remittances increased by 11 percent to $10.2 billion during the first eight months of this fiscal year.
Saudi Arabia has invested heavily in Pakistan since the early years of its independence. The Federation of Pakistan Chambers of Commerce and Industry (FPCCI) requested Saudi investors to concentrate on Pakistan’s promising energy sector, especially Thar coal, which offers great opportunities and huge profit returns.
Pakistan’s trade with Saudi Arabia constitutes nine percent of our overseas trade. Pakistan need to collaborate in engineering medical equipment services training sectors. Pakistan guarantees equal treatment to local and foreign investors, 100 percent foreign equity and full remittance of capital profit and dividends are allowed.
Pakistan requested Saudi Arabia to enhance direct investment in infrastructure development, commerce, trade, banking, the capital market, ICT and telecommunication in the meeting of the Tenth Session of the Pakistani-Saudi Joint Ministerial Commission held in Riyadh on April 15 and 16.
There are the prospects of forming joint ventures for oil and gas exploration, to boost energy production in Pakistan. Pakistan avail 22 million tons of oil, of which about 13 million tons are imported. More or less from this, oil refineries import 9 million tons of crude oil per annum to meet their processing needs.
Pakistan will examine possible investments in the country’s rice and meat sectors. Lately technical experts from the Saudi Ministry of Agriculture also visited Pakistan to study health and veterinary standards of the poultry, livestock and dairy sectors.
Both will expand bilateral cooperation in the field of defense. They will find a quick solution of the current conflict in Syria according to general resolution in order to restore peace and security in the country and restrain bloodshed of the Syrian people.
The two countries renewed their pledge to fight extremism and terrorism in all its forms and continue to collaborate in the field of exchange of security relevant information. Both the countries highlighted the significance of security cooperation to encounter the crimes of drug trafficking and money laundering.
