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Why Pakistan should not take Saudi money

43 184 128
16.02.2019

This weekend, Saudi Crown Prince Mohammed bin Salman is visiting Pakistan with his entourage of over 1,000 people, including investors, government officials and security personnel. It is expected that the trip will result in investments in Pakistan worth up to $20bn.

According to Haroon Sharif, who chairs Pakistan's Board of Investment, the Saudis will be investing mainly in the energy sector and opening up an oil refinery in the southwestern coastal city of Gwadar.

This comes less than four months after the Saudis announced a $6bn aid package following Pakistani Prime Minister Imran Khan's October trip to to the country. Significantly, Khan chose to visit at a time when Prince Mohammed was embroiled in the fallout of Saudi journalist Jamal Khashoggi's murder and the boycott by many Western investors of the Future Investment Initiative, a high-profile investment conference.

The Pakistani prime minister attended the conference and was duly rewarded for standing with Saudi Arabia. But even that billion-dollar aid package was not enough to end Pakistan's debt crisis.

The Saudis are now promising another multi-billion investment, which may just bail out the country from the financial crisis it is in, but these funds are unlikely to be granted unconditionally.

Saudi Arabia has strategic interests in Pakistan given its proximity to Iran, Riyadh's archrival in the region. The Saudis are using aid packages and investment promises to buy the economically embattled Pakistani government's loyalty and convince........

© Al Jazeera