Pakistan’s top business body says Saudi investors want local entrepreneurs to establish industries in Kingdom

This picture shows Aramco tower (3rd-R) at the King Abdullah Financial District (KAFD) in Riyadh, Saudi Arabia, on April 16, 2023. (AFP/File)
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Updated 29 February 2024
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Pakistan’s top business body says Saudi investors want local entrepreneurs to establish industries in Kingdom

  • A delegation led by Pakistan’s commerce minister met Saudi officials, investors in Kingdom last week to discuss business opportunities
  • Top official of Pakistan’s leading business forum says Saudi investors expressed “great interest” in Pakistan’s five key economic sectors

KARACHI: Saudi investors offered land and equity to Pakistani businesspersons to set up export-oriented industries in the Kingdom, a top official of the South Asian country’s apex business forum who was part of a prominent business delegation that went to Saudi Arabia last week, said on Wednesday. 

A delegation of 20 Pakistani industrialists last week visited Saudi Arabia with Caretaker Commerce Minister Dr. Gohar Ejaz. The delegation held meetings with Saudi officials and trade representatives to promote bilateral trade and industrial cooperation in various sectors.

Pakistan constituted the Special Investment Facilitation Council (SIFC), a hybrid civil-military forum, in June 2023 to fast-track decision-making and promote investment from foreign nations, particularly Gulf states. The SIFC has identified five key sectors for investment, which include agriculture and livestock, IT and Telecom, mines and minerals, energy, and industry, among others. 

Atif Ikram, president of the Federation of Pakistan Chambers of Commerce & Industry (FPCCI) said the delegation’s visit to the Kingdom was a “very productive one” as Saudi investors had taken “great interest” in investing in five key sectors identified by the SIFC. 

“The Saudi investors were more interested in Pakistan’s agriculture to ensure future food security,” Ikram told Arab News, adding that they offered Pakistani businesspersons land and equity to set up industries in the Kingdom. 

“The Saudis are also welcoming Pakistani businessmen to set up export-oriented industries in the Kingdom,” Ikram said. “They are very much focusing on industrialization.”

With 9.1 million hectares of land available for agriculture and 22.4 million hectares for livestock, Pakistan is set to transform its agriculture landscape by transitioning from the traditional micro-farming culture to high-tech, high-yield and low-cost community-based Modernized Corporate Farming, the SIFC has said. 

The FPCCI official said Pakistani businessperson see Saudi Arabia as a significant market for investment and are prepared to play a larger role in the mutual growth of industries and economies in the two nations.

“Saudis are open for every industry that produces exportable goods be it textile, steel or any other product that could be exported from the Kingdom,” Ikram noted.

Arif Habib, founder and chairman of the Arif Habib Group— a leading Pakistani conglomerate in the services, real estate, and manufacturing sectors— ​said Saudi officials also expressed interest in establishing a cricket stadium in the Kingdom.

He said the group offered to develop the stadium as it has constructed one in Karachi’s Naya Nazimabad area.

“The Saudis were excited about the cricket facility because they think that it would interest Pakistanis, Bangladeshis and Sri Lankans living in the Kingdom and it would also help in creating interest for cricket among Saudis,” Habib explained. He added that the Saudi officials also expressed interest in setting up football clubs, gyms, and family clubs.

Habib said the visit was a “good start” but cautioned that Pakistan needed a strong follow-up with Saudi authorities to avail investment opportunities in both countries. 

“Future outcome depends on how strongly the Pakistani sides follows, how they effectively share our economic research and future direction,” he said. “What we can offer to them and similarly what opportunities are available in the Kingdom.” 


Pakistan’s PSO proposes swapping debt for stake in public sector companies

Updated 09 May 2024
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Pakistan’s PSO proposes swapping debt for stake in public sector companies

  • Stopping the pile-up of unresolved debt across Pakistan’s power sector and settling it is a top IMF concern
  • PSO’s aggregate receivables from government agencies and autonomous bodies stands at about $1.8 billion

KARACHI: Pakistan State Oil, the country’s largest oil marketer, says it is in talks with the government on a plan to acquire stakes in public sector energy companies and offset mounting debt it is owed by firms such as the national airline.
Stopping the pile-up of unresolved debt across Pakistan’s power sector, and ultimately settling it, is a top concern of the International Monetary Fund (IMF), with which Islamabad begin talks this month for a new long-term loan deal.
“Everything will be done through competitive bidding and we will participate and if we win, the stakes will be offset against (PSO’s receivables),” said Syed Muhammad Taha, the managing director and chief executive of state-backed PSO.
“That is our proposal and this is under consideration, so we are working with the government,” Taha said in an interview on Wednesday with Reuters, which is the first to report the plan.
Pakistan’s government, with a stake of about 25 percent, is the biggest shareholder of PSO, but private shareholders own the rest.
Government officials, including the petroleum minister and the information minister, did not reply to a Reuters request for comment.
Total circular debt in Pakistan’s power and gas sectors stood at 4.6 trillion rupees ($17 billion), or about 5 percent of GDP by June 2023, the IMF says.
Circular debt is a form of public debt that stems in part from failure to pay dues along the power sector chain, starting with consumers and moving to distribution companies, which owe power plants, which then have to pay fuel supplier PSO.
The government is either the biggest shareholder, or outright owner of most these companies, making it tough to resolve debt as fiscal tightening leaves it strapped for cash.
Among other steps sought by the IMF, Pakistan has raised energy prices to stop the build-up of debt. But the accumulated amount still has to be resolved.
Taha said the IMF reforms helped the sector by boosting creditors’ ability to pay, which will continue to improve.
PSO’s aggregate receivables from government agencies and autonomous bodies stood at 499 billion rupees ($1.8 billion), the largest share owed by gas provider Sui Northern Gas, whose largest shareholder is the government.
PSO’s annual report last year said the crisis of owed debt was a serious issue for it.
Taha said PSO had initially floated the idea of acquiring stakes or complete ownership of assets such as power plants in Nandipur in the northern Punjab province and Guddu in southern Sindh, as well as the government-owned holding entity for power generation companies.
It also discussed equity stakes in profitable public sector companies such as the Oil and Gas Development Co, he added.
PIA DEAL
Taha said PSO was also a part of the broader settlement framework for the privatization of Pakistan International Airlines, which would potentially include a “clean asset swap” and a stake in the airline’s non-core assets, such as property.
The government is putting on the block a stake ranging from 51 percent to 100 percent in debt-ridden PIA as part of the public-sector reforms sought by the IMF.
In March, media said the principal alone that PIA owed PSO for fuel supply amounted to roughly 15.8 billion rupees ($57 million).
Taha added that he expected modest growth in demand for petroleum products as the economy opens up, thanks to lower interest rates and higher disposable income.
As economic conditions improve, he added, PSO is working with big strategic investors from China and the Middle East to upgrade and expand its refinery arm, Pakistan Refinery Ltd.
PSO has a network of 3,528 retail outlets in addition to 19 depots, 14 airport refueling facilities, operations at two seaports, and Pakistan’s largest storage capacity of 1.14 million tons.


Gunmen kills seven laborers from Punjab province in Pakistan’s coastal Gwadar district

Updated 09 May 2024
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Gunmen kills seven laborers from Punjab province in Pakistan’s coastal Gwadar district

  • The assailants targeted the seven hair-salon workers while they were sleeping in a residential quarter
  • No group have claimed the attack, though Baloch separatists have targeted Punjabi workers in the past

QUETTA: A group of unidentified gunmen attacked a residential quarter in Gwadar, a coastal town in Pakistan, in the early hours of Thursday, killing seven laborers from Punjab province, confirmed a local administration official.
The attack, which occurred about 24 kilometers from central Gwadar city, targeted hair-salon workers from Khanewal district in Punjab while they were sleeping.
Speaking to Arab News, Deputy Commissioner of Gwadar Hamood-ur-Rehman said the assailants stormed the quarter around 4 AM and opened fire on the occupants.
“The attackers killed seven laborers belonging to Punjab province before escaping from the area,” he said. “One worker was injured in the attack and has been transferred to District Headquarter Hospital Gwadar for medical treatment.”
Rehman also mentioned the district administration and law enforcement agencies had started investigating the incident. So far, no group has claimed responsibility for the attack.
This is the third attack against laborers from Punjab within a month in Pakistan’s restive southwestern Balochistan province, which shares porous borders with Iran and Afghanistan and has experienced a low-scale insurgency by Baloch separatist groups against the Pakistani state.
In April, the proscribed Baloch Liberation Army (BLA) claimed responsibility for the killings of nine Punjab residents traveling to Iran from Quetta, the capital of Balochistan. In another incident last month, two Punjabi garage workers were targeted.
Baloch nationalists have long accused the Pakistani government and Punjab province of monopolizing profits from Balochistan’s abundant natural resources, saying it has led to political marginalization and economic exploitation.
However, Pakistani administrations have denied these allegations, citing several development initiatives launched in the province to improve local living conditions.
Gwadar, located on the Arabian Sea coast, plays a pivotal role in the multibillion-dollar China Pakistan Economic Corridor (CPEC) that is envisaged to enhance regional connectivity.
Despite being resource-rich, Balochistan remains Pakistan’s most sparsely populated and impoverished province.
“The slain laborers were shot multiple times,” Dr. Hafeez Baloch, the medical superintendent at DHQ Gwadar, told Arab News. “We found bullet injuries on their heads and bodies.”
“One injured individual, who was in stable condition, has been referred to Karachi for better treatment,” he added. “The bodies of the slain laborers have been returned to their native village in Punjab.”
Prime Minister Shahbaz Sharif condemned the killings, describing the incident as “a cowardly attack on the country by its enemies.”
“We will eradicate terrorism from the country and stand with the families who lost their loved ones in Gwadar,” he declared in a statement.
Meer Sarfaraz Bugti, the provincial chief minister, vowed to pursue the attackers, saying: “We will use all our might against these terrorists and establish the writ of the state.”


Gunmen kill seven barbers in Pakistan’s volatile Balochistan province

Updated 09 May 2024
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Gunmen kill seven barbers in Pakistan’s volatile Balochistan province

  • No group has claimed responsibility, though Baloch separatists have targeted people from Punjab in the past
  • The Pakistan government says it has quelled separatist insurgency, but violence in Balochistan has persisted

QUETTA: Attackers fatally shot seven barbers before dawn Thursday in a home in a volatile province in southwestern Pakistan, police and a government official said.
The killings occurred near the port city of Gwadar in Balochistan province, police official Mohsin Ali said. All of the barbers were from Punjab province and lived and worked together.
Provincial Interior Minister Ziaullah Langau condemned the killings and said police were investigating who was behind the attack.
There was no immediate claim of responsibility. Separatists in Balochistan have often killed workers and others from Punjab as part of a campaign to force them to leave the province, which for years has experienced a low-level insurgency by the Balochistan Liberation Army and other groups demanding independence from the central government in Islamabad. Islamist militants also have a presence in the province.
The government says it has quelled the separatist insurgency, but violence in the province has persisted.
Police said they believe the attack on the barbers was not related to their jobs. Last month, the Balochistan Liberation Army claimed responsibility for killing nine people from Punjab province who were abducted from a bus on a highway in Balochistan, saying it had information that spies were on the bus.
Separatists have also targeted people from Punjab working on coal-mine projects in Balochistan.
In January, gunmen killed six barbers in a former stronghold of the Pakistani Taliban in the country’s northwest near the Afghanistan border. Pakistani militants years ago banned the trimming of beards and haircuts in Western styles.


Pakistani aviation authority says Hajj flights on schedule after ‘quick control’ of fire at Lahore airport

Updated 43 min 41 sec ago
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Pakistani aviation authority says Hajj flights on schedule after ‘quick control’ of fire at Lahore airport

  • CAA says the fire was caused by short-circuiting at the record room of the airport’s immigration department
  • Airport authorities evacuated passengers to domestic departure lounge to continue Hajj flight operation

ISLAMABAD: The Pakistan Civil Aviation Authority (CAA) said on Thursday four Hajj flights scheduled to fly in the morning departed following a fire caused by short-circuiting at an airport in the eastern city of Lahore which was “quickly brought under control.”
The incident took place hours after the country launched a special flight operation for Hajj pilgrims traveling to Saudi Arabia from the southern port city of Karachi.
“All four Hajj flights operated by Pakistan International Airlines, Airblue and Air Sial departed on time from the domestic departure,” CAA Spokesperson Saif Ullah told Arab News. “Passengers were shifted immediately from international to domestic terminal.”
“This happened after a fire broke out due to a short circuit in the record room of the immigration department at the airport, but it was quickly brought under control with the combined efforts of relevant authorities,” he continued. “Due to the smoke, which spread after the fire, immediate evacuation measures were taken to ensure the safety of the people and prevent any harm.”
He informed a Notice to Air Missions (NOTAM) had been issued to manage international flights until 3:30 PM, resulting in some disruptions in the flight operations. However, the airport remained operational for domestic flights, cargo and air traffic control.
“Only a few international flights will be affected during the five-hour NOTAM period,” he added.
Earlier, a CAA statement said the situation at the airport was gradually returning to normal and no casualties had been reported.
Several Pakistani media outlets reported that the fire damaged the immigration system partially, after which the immigration process was halted.
Airport authorities also evacuated several passengers from the international terminal due to heavy smoke.


Qatari minister arrives in Islamabad today amid Pakistan’s active investment outreach

Updated 09 May 2024
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Qatari minister arrives in Islamabad today amid Pakistan’s active investment outreach

  • Dr. Mohammed bin Abdulaziz Al-Khulaifi is expected to meet Prime Minister Shehbaz Sharif, other officials
  • Pakistan previously showed interest in Qatar’s IT sector and sent its a delegation to the Arab state in December

ISLAMABAD: Qatar’s Minister of State for Foreign Affairs Dr. Mohammed bin Abdulaziz Al-Khulaifi will arrive in Pakistan today to meet with Prime Minister Shehbaz Sharif and other officials, as the government actively seeks foreign investment to tackle financial challenges.
Pakistan has welcomed numerous foreign officials and business delegations in recent weeks, encouraging local partnerships and asking them to explore investment opportunities across various economic sectors.
A Saudi business delegation, consisting of senior representatives from nearly 35 companies, recently concluded their visit to Pakistan, during which they held several business-to-business meetings.
Additionally, Prime Minister Shehbaz Sharif met with a group of Japanese industrialists, urging them to invest in Pakistan’s nascent electric car industry.
The country is also expecting the visit of Saudi Crown Prince Mohammed bin Salman later this month, hoping it would bring several billion dollars in investments.
“The Minister of State for Foreign Affairs of the State of Qatar, Dr. Mohammed bin Abdulaziz Al-Khulaifi will visit Pakistan on 9 May 2024, as a special envoy of the Prime Minister and Foreign Minister of the State of Qatar Sheikh Mohammed bin Abdulrehman bin Jassim Al Thani,” the foreign office said in a statement.
“In Islamabad, the Minister of State will call on Prime Minister Muhammad Shehbaz Sharif and on Deputy Prime Minister and the Foreign Minister Mohammad Ishaq Dar,” it continued. “Pakistan and Qatar have longstanding and multifaceted bilateral relations characterized by high-level exchanges and visits.”
The foreign office did not divulge specific details about the agenda of the visit. However, Pakistan has expressed interest in Qatar’s information technology sector and sent the first delegation of IT professionals to Qatar last December.
Many countries in the Gulf region are diversifying their economies beyond oil and gas by investing in technology sectors, creating innovation hubs and developing digital infrastructure to boost various industries.
The strategic shift includes a significant emphasis on adopting advanced digital technologies, such as AI, cloud computing and cybersecurity, with the goal of transforming these nations into knowledge-based economies.
Qatar has also moved in this direction by investing in tech startups and committing to host technologically advanced events such as the FIFA World Cup 2022.
Qatar has also been working actively to promote peace in regions like Afghanistan and, more recently, Gaza.
These issues have been central to Pakistan’s diplomatic engagements, and the two countries have discussed them in past meetings.