ISLAMABAD: Pakistani Prime Minister Shehbaz Sharif said on Friday billions of dollars would come into Pakistan in the future in the form of investments from Gulf nations as part of a new economic revival plan devised by his government.
Sharif was speaking at a press conference a day after Pakistan and the IMF International Monetary Fund signed an agreement for the provision on $3 billion in bailout funds under a stand-by arrangement (SBA).
Despite the larger than expected IMF bailout, the agreement stressed that Pakistan will have to continue to mobilize multilateral and bilateral financial support. Saudi Arabia and the United Arab Emirates have pledged a combined $3 billion that is expected to come in now that the IMF deal has materialized. Debt rollovers from China, Pakistan’s largest creditor, will also be key.
Ensuring the materialization and building of a spending framework for pledges secured earlier this year in an international donor conference will be key. Over $9 billion in climate-related pledges were made to help Pakistan recover from devastating floods in 2022.
Pakistan needs $22 billion to fund its external payment obligations, including international debt servicing, in the financial year 2024, that starts on Saturday, July 1, and ends on June 30, 2024.
Earlier this month, Sharif announced his government new economic revival plan, including setting up a Special Investment Facilitation Council (SIFC) to attract foreign investment, particularly from Gulf nations.
“Four million jobs will be created under this economic revival plan,” Sharif told reporters. “Billions of dollars in investment will come from Gulf nations.”
He said agriculture, information technology and defense production were key elements of the new plan.
“Today if we want to get rid of these loans, then we must bring investments from Gulf states, billions of dollars … back-to-back agreements,” Sharif said.
“These agricultural resources, lands will be utilized by them [Gulf nations], they will bring their technology and manpower here, millions of jobs will be created, they will take the produce according to their required quality and we will not have to give the profits in dollars … Similarly, they can process our mineral resources and produce the final products and the profits will go but not in terms of dollars but in commodities. Same for IT.”
A notification dated June 17 from the Prime Minister’s Office said SIFC was being set up after a meeting on June 2 to discuss attracting investments in energy, IT, minerals, defense and agriculture from GCC countries.
The military will have a significant role in the new body, with the army chief being a member of its apex committee and the army itself serving as the national coordinator for both the apex and executive committees. An army official will also be the director general of the body’s implementation committee.
At a meeting at the Prime Minister’s Office on SIFC on Tuesday, Army Chief Asim Munir “assured Pakistan Army’s all out support to complement Government’s efforts for Economic Revival Plan, considered fundamental to socio-economic prosperity of Pakistanis and reclaiming Pakistan’s rightful stature among the comity of nations.”