The highly anticipated visit of Saudi Crown Prince Muhammad bin Salman to Pakistan on November 21 is expected to result in significant investment agreements and broad memorandums of understanding (MoUs) worth $10 billion, sources said on Monday.
Some of these about $4 billion projects have already received preliminary approval; however, further projects will be discussed and decided upon today (Tuesday) in a meeting presided over by the finance minister, Ishaq Dar.
If the two nations move forward with the plan to build an oil refinery in the country, a separate $12 billion investment is anticipated.
Similarly, the Saudi de facto leader is also expected to announce an additional bailout package of $4.2 billion for Pakistan, which includes additional reserves of $3 billion and the oil facility on deferred payment.
According to sources, the MBS visit would also signal the beginning of significant Saudi investments in Pakistan and the conclusion of numerous Saudi petroleum agreements. Along with the visit, a deal to build an oil refinery by KSA is anticipated.
At 4 o’clock today, a significant meeting will be presided over by Finance Minister Ishaq Dar. Important Saudi Embassy officials as well as representatives from the relevant Pakistani government departments will attend the meeting.
The Board of Investment (BOI) and the Saudi Ministry of Investment previously met for an hour and a half via video link. According to sources, the deputy Saudi minister for investments also attended the conference.
Oil refinery
More significantly, the sources claimed that the Saudi prince’s visit will also see investment in the construction of a cutting-edge deep conversion refinery and a petrochemical complex in Gwadar, which may be a game-changing move for Pakistan’s economy and its reliance on petroleum imports.
Prime Minister Shehbaz Sharif has also instructed the relevant agencies to finalize the refinery specifications and potential conditions in this regard.
Along with the $12 billion project, Pak-Arab Refinery Company (Parco) and Pakistan State Oil (PSO) would collaborate with Saudi Arabia’s Aramco. The sources claim that all circumstances and technical requirements will be met before to the Saudi prince’s visit.
It is understood that after the construction of the refinery – expected in 2028 – Pakistan will become self-sufficient in the production of petroleum products.
The petroleum refinery project which was stalled in 2019, will be based on state-of-the-art deep-conversion technology to be introduced in Pakistan that operates five main petroleum refineries, generally using obsolete process technologies and currently planning for technological upgradation and capacity expansion.
An investment deal is also anticipated for the $5 million new road project from Nowshera.
The development of Islamabad’s King Salman Hospital is also set to receive a $500 million agreement. According to sources, an agreement with Saudi Arabia to spend $500 million in two hydroelectric projects in Azad Jammu and Kashmir is also anticipated.
Meanwhile, sources said that a deal might be reached over Saudi Arabia’s investment in the desalination project to supply Karachi with clean drinking water. The federal government has also been asked for financial support for this project by the Sindh government.
Moreover, Saudi authorities are also expected to sign an agreement for an investment in the establishment of a science park at the NED University of Engineering and Technology. The project will cost up to $60-70 million.
