Comment by Riaz Haq on August 6, 2023 at 7:19am

UAE, Saudi Arabia race for investment in Pakistan

https://www.al-monitor.com/originals/2023/08/uae-saudi-arabia-race-...


Sabena Siddiqui


Both Riyadh and Abu Dhabi are prepared to develop closer business ties with less red tape, but experts caution that the Gulf nations stand to benefit most.

The UAE and Saudi Arabia have accelerated the pace of investments in Pakistan. If Abu Dhabi decides to invest further in Pakistan, it is quite likely that Riyadh will follow suit as part of their unspoken rivalry.

Since 2021, the kingdom has been giving incentives to multinational companies to headquarter at Riyadh. Therefore, even though Dubai is an established regional business hub, Riyadh is becoming its top competitor as a leading logistics center.

If a UAE-Saudi business race starts off in Pakistan, Islamabad will have to balance both of its close allies.

In search of a viable long-term solution to prop up its ailing economy, cash-strapped Islamabad has created a Special Investment Facilitation Council (SIFC), which has offered 28 high-value projects worth billions of dollars to friendly countries. The main focus is on Saudi Arabia, UAE, Qatar and Bahrain.

First to avail the opportunity, the UAE-based AD Ports group leased four berths at Karachi Port for 50 years and around $220 million in June. Just weeks later, Abu Dhabi inked a second major seaport terminal deal. As a result, around 85% of East Wharf would be controlled by the UAE company.

Zeeshan Shah, a financial analyst at FINRA in Washington, “The increasing rivalry between the Saudis and Emiratis should not be overlooked as both countries will probably try to one-up the other. ... Pakistan will have to be prudent in being even-handed between both countries if they happen to compete for various investment opportunities.”

Not lagging far behind, Saudi Arabia’s Aramco has signed a memorandum of understanding with four Pakistani state-owned oil companies to build a $12 billion greenfield oil refinery at Gwadar in the province of Baluchistan. The local companies would contribute 70% equity while Aramco would initialize the project with 30% equity.

Meanwhile, Pakistan has also offered its major airports for investment, and Saudi companies are interested in airports outsourcing.

Zubair Faisal Abbasi, a development policy and management specialist based in Islamabad, told Al Monitor, “Pakistan requires foreign investment to expand and further diversify its economy. It envisions scaled-up IT sector contribution in the exports-based economy, and also seeks modernizing investments in agriculture sector to increase productivity. In addition, the country has huge potential in the mining sector.”

Ranging from copper and gold mines in Chagai, the Thar Coal Rail Connectivity scheme to the Diamer-Bhasha dam and agricultural farms, the investment from these projects could go even higher than the $28 billion invested under the China-Pakistan Economic Corridor up till now, if all the projects get picked up by the Arab states.

In the past, the absence of a swift, one-window operation for foreign investors used to be an impediment. But now, the SIFC mechanism has made things easier, especially as adequate legal cover has been provided.

Abbasi noted, “One of the binding constraints on Pakistan’s economic growth has been bureaucratic inertia and problematic economic governance due to 'sludge' in the economic policy implementation.” The SIFC, he said, can “reduce red tape, bring in efficiency, and create synchronization in decision-making processes. Therefore, the investments may not only change sector growth, but also alter the institutional arrangements of economic governance.”

Comment by Riaz Haq on August 6, 2023 at 7:21am

UAE, Saudi Arabia race for investment in Pakistan

https://www.al-monitor.com/originals/2023/08/uae-saudi-arabia-race-...


Sabena Siddiqui


Providing equity for SIFC-approved projects for joint ventures, a Pakistan Sovereign Wealth Fund has also been created. In due course, seven profitable state-owned entities worth up to $8 billion are to be transferred to this fund.

However, Shah cautioned that the Saudis and Emiratis' interest stems from "the removal of red tape, the ability to purchase potentially lucrative assets, and security of their investments, rather than being attracted to invest in Pakistan by structural economic reforms which would strengthen the Pakistani economy in the long term as well as Pakistani bargaining power as well.”

For now, in reaction to the Gulf investments, the Pakistan stock market remains positive, reaching a two-year high.

From the GCC, Qatar is also considering the investment offer, and Doha is having talks with Pakistan to jointly run the terminals of its three main airports, Karachi, Lahore and Islamabad. If this comes through, Doha would invest around $3 billion in cargo handling as well as providing five-star accommodation and modern facilities at the airports.

In order to improve its food security, Doha is also considering a 10,000-acre corporate farming project in the Cholistan desert in Punjab province.

Comment by Riaz Haq on August 6, 2023 at 5:16pm

FROM CRISIS TO HOPE: WHAT CPEC PHASE-II CAN OFFER PAKISTAN

https://tribune.com.pk/story/2429531/from-crisis-to-hope-what-cpec-...

At a time when Pakistan faces severe economic challenges, the renewal of CPEC's second phase comes as a timely opportunity to address the country's immediate needs while paving the way for long-term development. As BRI's flagship project, CPEC has already demonstrated its transformative impact on Pakistan's infrastructure, energy, and regional connectivity. Now, with the initiation of Phase-II, the partnership between China and Pakistan is set to deepen further, solidifying their strategic relationship.

The expansion of cooperation into rural revitalisation and agricultural development holds immense potential to uplift Pakistan's rural communities and boost the agriculture sector—a crucial backbone of the country's economy. Additionally, the focus on industrialisation and green development aligns with Pakistan's aspirations for sustainable growth and environmental conservation. Through the transfer of technology and expertise, CPEC's second phase promises to enhance Pakistan's capabilities in these critical areas.

Vice Premier He Lifeng's visit to Pakistan and the signing of six MoUs demonstrate China's continued commitment to the success of CPEC. Despite global economic challenges and geopolitical complexities, China's unwavering support signals a firm belief in the project's potential to bring mutual benefits to both nations.

As CPEC enters its second phase, President Xi Jinping's statement takes on heightened significance. By emphasising high standards, sustainability, and livelihood enhancement, Xi underscores the importance of inclusive growth and the well-being of the people at the heart of CPEC's objectives. This reaffirms the project's commitment to fostering shared prosperity and a closer China-Pakistan community with a shared future.

Moreover, President Xi's statement of standing firmly with Pakistan, regardless of changing international landscapes, further solidifies the all-weather friendship between the two nations. In a time of global uncertainties, China's steadfast partnership provides much-needed reassurance for Pakistan's economic revival efforts.

Despite criticism from Western analysts, with accusations of 'debt-trap diplomacy', CPEC has not solely relied on bilateral governmental investments; it has attracted private Chinese investments across various sectors, stimulating employment and economic opportunities in Pakistan. Moreover, China's foreign policy, emphasising non-interference in the internal affairs of other sovereign states, has led to limited meddling in Pakistan's politics or economic policies, unlike some Western multilateral financial institutions.

To fully capitalise on the opportunities presented by CPEC's second phase, Pakistan must prioritise political stability, policy continuity, and broad-based economic reforms. The government's focus on fiscal discipline and economic growth aligns with the goals of CPEC, making it essential to overcome internal challenges and create an enabling environment for investment and development.

As President Xi's upcoming visit to Pakistan approaches, anticipation builds for further high-level discussions and agreements that will reinforce the trajectory of CPEC's success. It is a momentous occasion that will not only deepen China-Pakistan ties but also set the stage for accelerated progress in the second phase of this transformative economic corridor.

Comment by Riaz Haq on August 11, 2023 at 11:17am

The Special Investment Facilitation Council’s Role in Pakistan’s Economic Resurgence


https://thediplomat.com/2023/08/the-special-investment-facilitation...

The SFIC has to strike a balance between including military decision-makers to raise investor confidence and upholding democratic governance.

By Shabbir Ahmed

The inception of the Special Investment Facilitation Council (SIFC) represents a pivotal juncture in Pakistan’s economic evolution. Intended to attract foreign investments and invigorate economic growth, this pioneering initiative has captured national attention. Nevertheless, as the SIFC emerges as a distinctive amalgamation of civil and military entities, it ignites discussions surrounding the nuanced equilibrium between safeguarding policy coherence, upholding the principles of democratic governance, and managing the military’s active role in shaping economic decisions.

This convergence of interests and authority prompts an exploration of how this “hybrid” forum can effectively navigate its responsibilities, engender investor confidence, and ensure that the military’s involvement aligns harmoniously with the broader democratic fabric of the nation.

The SIFC’s creation is rooted in a dire need for economic rejuvenation, particularly in the face of bureaucratic hurdles and regulatory complexities that deter foreign direct investment (FDI). By providing a platform to streamline cooperation with Gulf Cooperation Council (GCC) nations, the SIFC aims to unlock investment opportunities across sectors ranging from agriculture to information technology. Nonetheless, the inclusion of military officials in key roles raises questions about the balance between civilian and military authority, reflecting both opportunities and challenges.

Prime Minister Shehbaz Sharif’s proclamation of the SIFC as a “unified approach” toward economic challenges underscores the value of collective insight. Undoubtedly, cooperative endeavors that engage both civilian and military leadership hold the promise of establishing policy steadiness and instilling confidence among foreign investors. Yet, the crux of the matter resides in harmonizing the military’s role with, rather than eclipsing, civilian authority. This equilibrium is essential to safeguarding the tenets of democracy, upholding accountability, and preventing the erosion of democratic values. The success of this collaborative venture hinges on the delicate choreography between these two distinct spheres, facilitating an environment wherein policy predictability is fortified without compromising the essence of democratic governance

The decision to entrust the SIFC with a substantial military presence emerges from a broader context of geopolitical considerations and the desire to instill investor confidence. The involvement of Saudi Arabia, Qatar, and the United Arab Emirates in pressing for military-backed guarantees highlights a lack of confidence in Pakistan’s political stability and its ability to honor business agreements across government transitions. The army’s engagement in the SIFC could offer a sense of continuity, but it also underscores the need for comprehensive, long-term policy reforms to address underlying structural challenges.

Comment by Riaz Haq on August 11, 2023 at 11:18am

The Special Investment Facilitation Council’s Role in Pakistan’s Economic Resurgence


https://thediplomat.com/2023/08/the-special-investment-facilitation...

The SIFC’s mandate is far-reaching, extending from agriculture and energy to telecommunications and infrastructure. Its “single window” approach to cooperation with GCC countries signals a proactive stance toward attracting FDI. Notably, the SIFC holds the authority to summon regulatory bodies and government representatives when bureaucratic bottlenecks hinder investment operations. Moreover, the council can recommend regulatory relaxations or exemptions, ensuring they align with existing legal provisions. This flexibility could expedite investment procedures, enhancing Pakistan’s appeal to potential investors.

The inclusion of military officers in the SIFC’s apex and implementation committees sparks concerns about potential overreach and diminishing civilian oversight. While an “institutionalized” army role in economic decision-making can offer stability, it also poses challenges to democratic governance. The delicate interplay between civilian and military spheres demands meticulous management to prevent undue military influence over crucial economic policies.

While the military’s involvement in the SIFC might alleviate immediate investor concerns, it is not a panacea for Pakistan’s economic challenges. The council’s focus on Gulf investments and its goal of achieving high FDI targets could offer short-term relief, but sustained economic stability demands comprehensive policy reforms. A closer look at India’s 1990s reforms provides valuable lessons in addressing deep-rooted economic issues and driving long-term growth.

The Special Investment Facilitation Council’s establishment signifies Pakistan’s commitment to economic resurgence and foreign investment attraction. However, as the nation treads this uncharted territory, it must strike a delicate balance between ensuring policy predictability and safeguarding democratic governance. While the military’s involvement can potentially bolster investor confidence, the long-term stability of Pakistan’s economy hinges on holistic policy reforms that address structural challenges. The SIFC can serve as a stepping stone toward economic growth, but the ultimate key lies in Pakistan’s ability to cultivate a business-friendly environment, foster sustainable growth, and uphold democratic principles in its pursuit of prosperity.

Comment by Riaz Haq on August 16, 2023 at 4:37pm

https://www.globaltimes.cn/page/202308/1296267.shtml

However, despite the official reports of no casualties among Chinese personnel, the VOA deliberately only cited the terrorist BLA statement in its Chinese language coverage of the accident, saying that at least four Chinese nationals and nine Pakistan security troops were killed. 

In the VOA English report of the same event, no exact number of casualties was mentioned, and it even slammed the outlawed group, saying that it often releases inflated claims. 

Moreover, the VOA Chinese report stuffed in a paragraph saying that the construction of the China-Pakistan Economic Corridor project has faced opposition from the local population in Balochistan, where Gwadar Port is located, as they feel they do not benefit much from it. 

"Radical groups like the BLA have continuously attacked Chinese personnel and facilities to express their opposition and protest against the China-Pakistan Economic Corridor project," the VOA stated, as it seeks to link the tragedy with so-called local opposition against the CPEC with the Sunday attack. 

Spreading such false information that smears the BRI flagship project is a pure distortion of facts, Chinese analysts pointed out, saying that the extreme actions by terrorist militants by no way represent the will of local people. 

It is a stubborn internal illness in Pakistan, said Wang Yiwei, director of the Institute of International Affairs at the Renmin University of China, commenting on the latest terror attack. 

It shows differences between the local provincial government and the Pakistani central government stemming from the imbalance of development. Therefore, such attacks should not be interpreted as opposition against the BRI flagship CPEC, Wang told the Global Times on Monday.

The US hyping of the so-called opposition against the BRI just proves that projects have attained major progress, Wang said.

Launched in 2013, the CPEC is a corridor linking Gwadar Port in southwestern Pakistan with Kashi in Northwest China's Xinjiang Uygur Autonomous Region, which highlights energy, transport and industrial cooperation

The CPEC, which is marking its 10th anniversary this year, has played an important role in bilateral cooperation between China and Pakistan and created over 155,000 local jobs for Pakistani people, China's National Development and Reform Commission (NDRC) said in May. 

Comment by Riaz Haq on August 16, 2023 at 4:40pm

China says bond with Pakistan strong


https://tribune.com.pk/story/2430791/china-says-bond-with-pakistan-...


China reaffirmed its unwavering commitment to its strong friendship with Pakistan and the China-Pakistan Economic Corridor (CPEC), declaring that any attempt to disrupt these bonds would be unsuccessful.

The Chinese Foreign Ministry's spokesperson, Wang Wenbin, delivered this resolute message during a routine media briefing. “No attempt to sabotage the friendship between China and Pakistan and the China-Pakistan Economic Corridor will succeed.”

This statement comes a day after terrorists targeted a military convoy safeguarding Chinese workers on their way to a port project in Gwadar. Despite the attack, no civilian or military casualties were reported, and the swift response led to the elimination of two assailants.

“Due to the efficient and swift response, two terrorists were sent to hell with no harm to any military or civil persons,” the army’s media wing had said in a statement, without mentioning the presence of Chinese nationals.

The Chinese consulate in Karachi had said at the time that a Chinese convoy from the Gwadar port project “was hit by roadside bombs and gunfire on its way back to the port area from the Gwadar Airport”.

The consulate had confirmed that no Chinese citizens were killed or injured in the attack. It had also asked Pakistan to “severely punish the perpetrators and take concrete and effective measures to ensure the safety of Chinese citizens, institutions and projects”.

The Majid Brigade, a wing of the banned Baloch Liberation Army, had claimed responsibility for the attack.

In the statement today, the Chinese spokesperson reiterated that “no Chinese citizens were killed or injured”.

While strongly condemning the attack, Wenbin asked Pakistani authorities to “bring the perpetrators to justice and take actions to keep Chinese nationals safe”.

He added that the Chinese embassy and consulate in Pakistan “immediately activated the emergency response mechanism”, reminding Chinese nationals, companies and project construction teams in Pakistan to stay alert.

It also asked them to “upgrade security measures, closely follow the security situation on the ground, guard against security risks and keep themselves safe”, the spokesperson said.

Wenbin went on to assert: “China will continue to work with Pakistan to jointly guard against and counter the threats of terrorism and effectively protect the safety of Chinese personnel, institutions and projects in Pakistan.”

When asked about China’s response to recently sworn-in Anwaarul Haq Kakar assuming the role of Pakistan’s caretaker premier, Wenbin said China congratulated Kakar on the appointment.

He added, “No matter how the international landscape and the domestic situation in Pakistan may change, the ironclad friendship between China and Pakistan will always remain rock-firm and unbreakable.”

Wenbin asserted, “China stands ready to work with Pakistan to advance our all-weather strategic cooperative partnership, build an even closer China-Pakistan community with a shared future in the new era and bring more benefits to the two countries and two peoples.”

Comment by Riaz Haq on August 19, 2023 at 11:00am

SIFC to continue working for fast-track foreign investment: PM

https://www.pakistantoday.com.pk/2023/08/16/sifc-to-continue-workin...

Lauds vision of Saudi leadership, saying KSA can always count on Pakistan as trusted partner
Says looking forward to working with UAE on advancing cooperation in various fields
ISLAMABAD: Caretaker Prime Minister Anwaarul Haq Kakar on Wednesday said that the recently-instituted Special Investment Facilitation Council (SIFC) would continue to work as before to lay the foundations to fast-track foreign investments, particularly from Saudi Arabia.

The prime minister, in a meeting with Saudi Ambassador Nawaf bin Saeed Ahmad Al-Malkiy, who called on him, highlighted energy, infrastructure, agriculture, IT and manpower as potential sectors of cooperation.

The Saudi ambassador congratulated the prime minister on assuming office and conveyed the best wishes and greetings on behalf of the Custodian of Two Holy Mosques, as well as Crown Prince Mohammed Bin Salman, and the people of Saudi Arabia.

The prime minister said that Pakistan and Saudi Arabia enjoyed historic and deep-rooted ties.

He thanked the Saudi government for its consistent support for Pakistan’s economic stability and development.

He particularly mentioned the large number of Pakistanis working in Saudi Arabia and requested the Saudi side to continue to extend all possible facilitation to them.

Prime Minister Kakar lauded the vision of the Saudi leadership and said that Saudi Arabia could always count on Pakistan as its trusted and reliable partner.

Ambassador Nawaf reiterated that Saudi Arabia and Pakistan were bound together in a fraternal relationship, which was characterized by mutual trust and understanding, and close cooperation on all bilateral and regional issues of common interest.

Looking forward to advancing trade, investment ties with UAE

Meanwhile, Caretaker Prime Minister Anwaar-ul-Haq Kakar on Wednesday said that he looked forward to working with the United Arab Emirates (UAE) on advancing bilateral cooperation in various fields, especially trade, investment and energy.

The prime minister, in a meeting with the UAE Ambassador Hamad Obaid Ibrahim Salem Al-Zaabi, who called on him here, expressed gratitude for the UAE’s support for Pakistan’s economic and financial stability.

The ambassador conveyed the greetings of the UAE leadership to the prime minister on his assumption of office.

Prime Minister Kakar thanked the UAE government for the warm congratulatory messages and said that Pakistan and UAE enjoyed historic and deep-rooted fraternal ties.

He also wished the UAE success in hosting the COP28 Summit later this year.

The prime minister also emphasized the important role played by the Pakistani diaspora in the UAE and sought the UAE government’s continued support to them.

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