Apart from attending the Future Investment Initiative Summit in Riyadh, Prime Minister Shehbaz Sharif stayed over to witness the signing of seven Memoranda of Understanding between Saudi Arabia and Pakistan worth $600 million, adding to the 27 other MoUs signed recently, worth $2.2 billion. This brings the total amount of investment up to $2.8 billion. Though Saudi Investment Minister Khalid ibn Abdulaziz Al-Falih sid that Saudi Arabia was interested in importing Pakistan’s skilled workforce, which tends to return relations to the old footing, it should be recognized that the relationship is being transformed. The government’s slogan of ‘trade, not aid’ changes the nature of the relationship.
As the home of the two holiest shrines of Islam, the Harmain Sharifain, Saudi Arabia has a special place in the hearts of the population, which is 96.3 percent Muslim. As an expression of its commitment to Saudi security, it has long posted troops there. Pakistanis have played a role in the development of Saudi Arabia, and have sent home remittances. Has there been a realization that instead of unskilled and semiskilled labour, Pakistan can now provide the educated and trained professionals, that Saudi Arabia has imported from other countries, mostly European. Saudi Arabia has long helped whenever Pakistan has needed help, mostly with the $3 billion deposit with the State Bank of Pakistan, which helps keep Pakistan from default. The rollover of this deposit was crucial to Pakistan obtaining the IMF package it so earnestly desired. Instead of such financial transactions, Pakistan will now seek Saudi investment. That suits the Saudis better, for it means that there is a safe place to invest its oil proceeds, an outlet it needs now for its capital, piling up from its sale of oil. Also, the return will be in the form of profits, rather than interest.
Mr Al Fatih has said that this is just the beginning. This is not just a burst of enthusiasm. Despite the religious and cultural ties uniting them, this kind of interaction has been limited. However, if Pakistani officialdom can be persuaded not to seek a cut, if investors are allowed to repatriate profits, if suitable opportunities are identified, it might well work. Among the positives has been that previous MoUs have yielded results, according to Mr Al Falih. This should indicate that things are changing.
