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17 Feb, 2019 21:24

Pakistan gets $20bn investment pledge from Saudi Arabia amid MBS visit

Pakistan gets $20bn investment pledge from Saudi Arabia amid MBS visit

Islamabad has received a hefty investment pledge of $20 billion from Saudi Arabia, which seeks to even further expand its contributions to the economically-embattled country.

Saudi Arabia and Pakistan signed memorandums of understanding on $20 billion of investments on Sunday, when Saudi Crown Prince Mohammed bin Salman arrived in Islamabad.

As broad investments were expected, Pakistan did its best to greet the high-profile guest, plastering the capital city with large welcoming banners and photos of MBS and Pakistani PM Imran Khan. The investments are related to the agriculture and energy sectors, including a $10-billion oil refinery project.

The Saudi investments are not limited to $20 billion, and Pakistan should expect more, MBS hinted while speaking in Islamabad alongside Khan.

“It's big for phase one, and definitely it will grow every month and every year, and it will be beneficial to both countries,” the crown prince said. “We have been a brotherly country, a friendly country to Pakistan. We've walked together in tough and good times, and we [will] continue.”

Bin Salman’s optimism was shared by the Pakistani PM, who lauded their joint efforts in creating “a great future” for the two countries.

“Saudi Arabia has always been a friend in need, which is why we value it so much,” said Khan, while seated next to the prince. “I want to thank you for the way you helped us when we were in a bad situation.”

The situation for Pakistan is not very bright, as the cash-strapped country has had a budget deficit for nearly a decade. Recently, Islamabad has struggled to reach a new bailout deal with the International Monetary Fund (IMF). If the negotiations succeed, it would become the 13th IMF bailout the country has received since the 1980s. As negotiations with the IMF have been dragging on for months now, Saudi Arabia has already come to the rescue, giving Pakistan a US$6 billion loan to replenish the dwindling foreign exchange reserves.

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