Pakistan has lost every single option to keep its economy afloat. The US has stopped helping Pakistan and after its withdrawal from Afghanistan, the US is unlikely to even get blackmailed by Islamabad. China keeps looting it anyway, so asking for financial help from Beijing isn’t a great idea. Turkey is in too much trouble itself and can’t help Pakistan.
So, Islamabad is left with Arabs. Pakistan Prime Minister Imran Khan has often approached Saudi Arabia with a begging bowl. And Riyadh often helps Pakistan for old times’ sake. But now Riyadh has had enough of it. It has thrown Pakistan’s begging bowl in the garbage can now.
Saudi investments in Pakistan unlikely to materialise
Pakistan’s economy is debt-ridden and unimpressive. No one wants to invest in the country because of its bleak prospects.
Therefore, Pakistan had tried to rope in Saudi Arabia. Imran was pinning his hopes on Riyadh to ramp up Foreign Direct Investments (FDI).
Saudi Crown Prince Mohammed bin Salman (MBS) had even signed a proposed $20 billion investment deal with Pakistan during his visit to Islamabad.
A $10 billion Saudi Aramco oil refinery was also supposed to come up in Pakistan, as a part of Saudi Arabia’s long-term investments in the country. This would have been a huge relief for Islamabad which is facing a constant decline in foreign investments. However, neither Aramco nor the other investments have materialised.
Saudi companies reluctant to step into Pakistan
Imran Khan has been desperately begging Saudi Arabia to make investments in Pakistan. During the Saudi-Pakistan Investment Forum in October last year, he had again urged Saudi companies and entrepreneurs to invest in Pakistan.
Saudi companies have however complained that Pakistan doesn’t offer appropriate business conditions. They claim that the country doesn’t have adequate infrastructures such as water, gas/power, and connectivity. They are also concerned about red tape in Pakistan and say that the inefficient institutional setup in the country leads to corruption.
And then there are several other issues too like delayed departmental approvals and clearances and lack of local financing options.
Additionally, Saudi entrepreneurs are concerned about the lack of quality compliance by Pakistani companies. All foreign companies need high-quality subcontractors in the host country, which Pakistan is simply incapable of offering.
The lack of skilled labour in Pakistan too is a reason why Saudi investors don’t want to step into Pakistan. At the end of the day, Saudi investors understand that Pakistan with all its corruption, outdated infrastructure, social strife, violence, and substandard local businesses is no place to do business. This is why Saudi investments have failed to materialise in the country.
MBS settling scores with Imran Khan
Even MBS isn’t willing to intervene and help Pakistan. He is irked by Pakistan’s tantrums.
Pakistan has repeatedly nudged Saudi Arabia to take an anti-India stance on Kashmir. But Riyadh has been sternly refusing to do so. And this is creating friction between Islamabad and Riyadh.
In diplomacy, Pakistan often backstabs the UAE and Saudi Arabia. It has repeatedly got into bed with Turkey, a regional rival of the Arabs. Pakistan finds more in common with Ankara when it comes to propagating radicalism.
In 2020, a miffed Saudi Arabia had even ended a loan and associated oil facility to Pakistan. Islamabad had to repay a Saudi loan of 1 billion US dollars due to Pakistan’s constant threats of forming a new alliance with Turkey and threatening the Arab leadership of the Muslim world.
A desperate Pakistan often threatens to move away from the Arabs and find a new godfather for itself. So, MBS sent across a loud and clear message- enough of your tantrums, I am throwing your begging bowl in the trash can and you are now free to beg at the doorsteps of your new godfather.