From international relations perspective, alliances and coalitions between nations play a direct role in shaping up global politics and relationship between Pakistan and Saudi Arabia is no different. Saudi Arabia has always held an influential position in the Muslim world. But since Crown Prince and Prime Minister, Mohammad bin Salman Al Saud took over the Kingdom, the country’s prominence in the international domain has increased many folds because of his vision and ambition. He has introduced many structural reforms to meet his Vision 2030 and is revolutionising Saudi Arabia’s socioeconomic landscape. The International Monetary Fund (IMF) has stated that Saudi Arabia was the fastest-growing economy among G20 countries with an overall growth rate of 8.7 per cent. Under his leadership, Kingdom of Saudi Arabia (KSA) has joined regional organisations like the Shanghai Cooperation Organisation and BRICS, which shows its acknowledgement for the multipolar facet of the world.
The shaping of relationship between KSA and Pakistan depends on a series of global events that have happened in the recent past. Apparently, it seems that Pakistani administration is again oscillating between the US-China camps. This could be evidenced by the slowdown in CPEC projects and the recent visit of US ambassador to Gwadar which may have sent wrong signals to China. While mending of KSA ties with Iran through Chinese intervention was welcomed by Pakistan, it remains to be seen how KSA plays with the Biden administration vis-à-vis the issue of recognition of Israel. KSA’s inclination towards India’s recently proposed ambitious Middle East-Europe corridor during last G20 meeting could help develop our understanding in this regard to some extent.
As Saudi Arabia is on its way to become a major global power in the very near future, it needs strategic partnerships to cement its position as a major power. In this regard, Pakistan can play a constructive role because the two countries have strong cultural, defence and economic ties, deeply rooted in history and religion. The Kingdom is home to over two million Pakistanis, making it the largest contributor to remittance inflows into Pakistan. The Pakistani diaspora have played a significant role in the development of the Kingdom over the decades and presently Pakistani engineers are engaged in the planning and development of the futuristic linear city Neom. Historically, KSA has always offered Pakistan both support and cooperation in its time of need. In April 2023, KSA helped Pakistan secure an IMF bailout package by depositing $2 billion in the country’s central bank.
Pakistan is presently facing multidimensional economic crises and unsurprisingly has turned to friendly countries including Saudi Arabia for much-needed foreign direct investment in order to breathe life into the economy. For this purpose, a Special Investment Facilitation Council (SIFC) has been set up which aims to attract $25 billion from Saudi Arabia in the areas of IT, oil and gas, agriculture and mining.
Saudi interest to invest in Pakistan especially in these financially troubled times is a breath of fresh air for Pakistan. In August 2023, a Saudi delegation led by Deputy Minister for Mining, Industries and Minerals visited Pakistan and expressed keen interest in the investment potential of Pakistan’s mining, energy, agriculture, and information technology sectors. This was in continuation to a memorandum of understanding (MoU) signed with Saudi giant ARAMCO to facilitate a $10 billion Saudi investment in a new oil refinery in Gwadar. Four Pakistani state-owned petroleum companies signed a MoU in April 2023 to join hands and provide confidence to the Saudi firm to enter Pakistan with a major investment. Reportedly, it will have a production capacity of 300,000 barrels per day – the first in more than a decade and the largest in the country. Negotiations are said to be in the last stages and we will hopefully see some positive developments in the coming months.
Pakistan and Saudi Arabia possess substantial untapped potential for expanding their collaboration in infrastructure development, including the exploration of opportunities through public -private sector partnerships. But it needs to be planned and executed properly if we want to see positive results.
Policymakers in Pakistan need to focus on formulating workable proposals which can be achieved before presenting them diplomatically. In this regard, proper homework should be done as sustainable investments depend on establishing a reliable, stable, and secure investment and business environment. The future of both Pakistan and KSA is linked together. To achieve peace and prosperity, both countries need to work together. Through their unified efforts, Pakistan and Saudi Arabia can serve as an inspiring model for relations within the Muslim world and the global community.
For availing above-mentioned opportunities to Pakistan’s diplomatic and economic benefit, apart from global factors, it is also important for Pakistan’s major political parties to develop a culture of mutual tolerance and agree on a comprehensive charter of domestic politics to be followed by all. The major political parties should also agree on a consensus based minimum 15 years long economic development charter to be followed by all successive governments to make Pakistan economically a self-reliant country. All the major political parties should also agree on a legal framework for holding transparent elections and arresting corruption in the country.