Pakistan seeks $6bn for corporate farming from Saudi Arabia, other Gulf nations by 2028

Short Url
Updated 22 September 2023
Follow

Pakistan seeks $6bn for corporate farming from Saudi Arabia, other Gulf nations by 2028

  • Arab News speaks exclusively to CEO of FonGrow, spearheading agriculture projects under new investment body
  • Pakistan in talks with Saudi companies like Al-Dahara, Saleh and Al-Khorayef for investment in corporate farming

ISLAMABAD: Pakistan is seeking up to $6 billion investment from Saudi Arabia, the United Arab Emirates (UAE), Qatar and Bahrain over the next three to five years for corporate farming, with the aim of cultivating 1.5 million acres of previously unfarmed land and mechanizing existing 50 million acres of agricultural lands across the country, the CEO of the company spearheading the initiative has said.

The development comes months after Pakistan set up a Special Investment Facilitation Council (SIFC) — a civil-military hybrid forum — to attract foreign funding in agriculture, mining, information technology, defense production and energy as the South Asian country deals with a balance of payments crisis and requires billions of dollars in foreign exchange to finance its trade deficit and repay its international debts in the current financial year.

Earlier this month, caretaker Prime Minister Anwaar-ul-Haq Kakar said Saudi Arabia and the UAE would invest up to $25 billion each in Pakistan over the next five years in the mining, agriculture and information technology sectors.

Initiatives in the agriculture sector under SIFC are being administered by FonGrow, which is part of the Fauji Foundation investment group run by former Pakistani military officers.

“We have estimated about $5-6 billion [investment from Gulf nations] for initial three to five years,” Major General (retired) Tahir Aslam, FonGrow’s managing-director and chief executive officer, told Arab News in an interview. 

He declined to share details about the breakdown of the investment from each individual country.

The CEO said the company was engaging with several Saudi companies like Al-Dahara, Saleh and Al-Khorayef to attract investment in the corporate farming sector. He did on elaborate on progress made so far in the discussions. 

Aslam said his company was also working on different investment models with the Saudi and UAE companies for corporate farming, including joint ventures.

“If they want to make direct investment, it is a corporate model. So, they will take an equal number of stakes in the company, and they get an equal number of positions in the governance [of the company]. So, it is going to be a joint company.”

About strategy and targets to mechanize farming, Aslam said FonGrow was working on a two-pronged approach to bring up to 1.5 million acres of new arable land under cultivation and modernize 50 plus million acres of land already being farmed.

This, he said, would require about “$25 million per each thousand acres and other for machinery, and setting up of infrastructure for value addition.”

FonGrow is aiming to set up corporate farms on over 100,000 acres in the next 5-7 years. The first such farm had already been established on over 5,000 acres of land in Khanewal, he said. 

“Next year, we will be starting our second farm on over 10,000 acres and we hope to develop the capacity to be able to develop 20 to 25 thousand acres every year,” Aslam said. “Mainly, we are starting in Punjab and then we are looking for lands. Wherever we get suitable lands, we will go to all the provinces.”

To a question about the source of capital to develop the land, the official said: “We have no issue of rupee capital availability for our project because ultimately it will bring returns to Fauji Foundation.”

“There is a small challenge that we are facing basically, which is of foreign exchange because the irrigation systems and the tractors and harvesters that we have to import, they need foreign exchange.”

Aslam said Pakistan’s corporate farming model envisioned that sixty percent of the crops would contribute to the country’s food security, and the remaining 40 percent would be exported mainly to Gulf countries to earn foreign exchange. 

He said Pakistan had received a first export order of Fauji cereal products from a Gulf nation, though he declined to name the country:

“It is a starting quantum [that] is about $25 million worth of products in one year. But I think as we break more grounds this will continue to increase in the coming years.” 

Responding to concerns about the army’s involvement in economic projects in Pakistan, he said the military was only contributing where requested by the civilian government.

“They [foreign countries] wanted an organization which provides continuity or security of their investment, that was the reason the army joined in and then the army also said we have such a large [investment] potential available,” the FonGrow CEO said.

“In the past also, the army has very willingly contributed to projects of nation-building and national importance … Army is playing its part, but no soldiers are involved.”


Saudia adds 11 new global destinations

Updated 9 sec ago
Follow

Saudia adds 11 new global destinations

JEDDAH: Saudia airline is adding 11 new destinations to its network this year — including Vienna, Bali, and El-Alamein — as part of its global expansion strategy, the company announced. 

The new routes also include Venice in Italy, Larnaca in Cyprus, and the Greek destinations of  Athens and Heraklion.

Nice in France and Malaga in Spain have also been added to the list.

The expansion follows a 16 percent rise in international passenger numbers last year, with the newly added destinations offering travelers more options across Europe, the Middle East, and Asia, further strengthening Saudia’s position in the aviation industry. 

The move aligns with Saudi Arabia’s National Tourism Strategy, which aims to attract 150 million tourists by 2030, create 1.6 million jobs, and boost tourism’s contribution to gross domestic product. 

Ibrahim Al-Omar, director general of Saudia Group, said: “Following last year’s operational success, we've implemented a strategic plan for 2025 to ensure continued excellence and meet rising international travel demand.”  

He added: “Our destination selection is based on comprehensive feasibility studies and guest preferences. We are committed to providing our international guests with exceptional travel experiences that combine comfort, efficiency, and authentic Saudi hospitality.” 

Also joining the network are Antalya in Turkiye, Salalah in Oman, and Bali in Indonesia, expanding Saudia’s reach to over 100 destinations across four continents. 

By growing its global network, Saudia is supporting the Air Connectivity Program, which has introduced over 60 new direct routes since its launch in 2021. 

This development strengthens the Kingdom’s position as a key travel hub under Vision 2030 and aligns with Saudi Arabia’s aviation strategy, which includes multi-billion-dollar investments to diversify the economy and support the private sector. 

Saudia said the expansion is supported by its fleet of 147 Boeing and Airbus aircraft, with plans to receive 118 new aircraft in the coming years to further enhance operational capacity. 

With more than 530 daily flights, Saudia’s ongoing international development plan aims to increase its global market share and strengthen connectivity between the Kingdom and the world. 


Egypt’s inflation eases slightly in January, driven by lower vegetable prices

Updated 1 min 45 sec ago
Follow

Egypt’s inflation eases slightly in January, driven by lower vegetable prices

RIYADH: Egypt’s headline consumer price index recorded 243.5 points in January, reflecting an annual inflation rate of 23.2 percent, down slightly from 23.4 percent in December, according to official data.

Figures from the nation’s Central Agency for Public Mobilization and Statistics show that Egypt’s inflation slowdown was primarily driven by a 2.6 percent decline in vegetable prices from December to January, alongside a 0.3 percent decrease in fish and seafood prices.

Meanwhile, costs remained stable across key sectors such as education, health services, and telecommunications.

However, according to the report, some essential commodities saw notable price hikes. Bread and cereal prices rose 1.3 percent, while meat and poultry prices surged 5.0 percent.

Dairy, cheese, and eggs recorded a modest increase of 0.3 percent, and oils and fats edged up by 0.7 percent. 

The sharpest price spike was in fruits, which jumped by 9.8 percent. These price increases were key contributors to the 1.6 percent monthly inflation in January, compared to a flat reading in December.

Other sectors also experienced price increases. Personal care products rose by 1.5 percent, hospital services by 1.4 percent and furnishings and household appliances by 0.6 percent, as well as electricity, gas, and fuel by 0.1 percent, and hotel services by 3.3 percent.

Compared to January, several categories recorded substantial annual increases, the report showed.

Food and beverages rose by 20.2 percent, tobacco and alcoholic drinks by 29.5 percent, housing, utilities, and fuel by 18.7 percent, healthcare services by 40.5 percent, and transport by 33.6 percent, while education costs remained unchanged.

The steepest annual jumps were seen in postal services, which were up 94.3 percent, cultural and recreational services by 48 percent, and transport services by 39 percent.

Despite a slight moderation in annual inflation, elevated food and transport costs remain a key challenge for Egyptian households and businesses.

The rising prices of essential goods, including staples such as wheat and cooking oil, continue to strain consumer purchasing power.

Analysts expect inflationary pressures to persist in the near term, driven by a combination of currency fluctuations, global commodity price trends, and domestic supply chain constraints.

The Egyptian pound has witnessed notable depreciation, contributing to the higher cost of imports, particularly for food and energy.

In response, the Egyptian government has introduced measures such as subsidies and price controls on essential goods to contain inflation and support vulnerable segments of the population.

Efforts include increasing government-backed distribution of basic commodities and negotiating import deals to secure food supplies at stable prices.

However, structural economic reforms, including subsidy cuts and fiscal consolidation efforts under Egypt’s broader economic program, may counterbalance these interventions.

With ongoing economic reforms and external pressures, inflation trends will remain a closely monitored factor in Egypt’s economic trajectory.

Policymakers are likely to adjust monetary and fiscal measures as needed to balance growth with price stability, particularly as the country navigates global economic uncertainties and financing challenges.

The central bank’s stance on interest rates will also play a crucial role in managing inflation expectations in the coming months.


Ericsson, Mobily MoU to explore intent-driven autonomous network through AI, official says 

Updated 31 min 26 sec ago
Follow

Ericsson, Mobily MoU to explore intent-driven autonomous network through AI, official says 

RIYADH: Saudi telecommunication firm Mobily and Swedish company Ericsson have signed an agreement to explore an intent-driven autonomous network that enhances speed, scalability, and capacity, an official said. 

Speaking to Arab News on the sidelines of the LEAP Tech Conference in Riyadh, Patrick Johansson, senior vice president and head of Market Area in Middle East and Africa at Ericsson, said that the memorandum of understanding will also explore the possibilities of bringing artificial intelligence into the telecommunications industry, which could elevate the performance of network providers. 

The agreement comes amid the continued expansion of the Kingdom’s growing telecom and information and communication technology infrastructure sector, reaching a value of $3.5 billion in 2023.

According to analysis firm Research and Markets, the sector is expected to grow at a compound annual growth rate of 7.1 percent through 2029, driven by initiatives under the Kingdom’s Vision 2030. 

“We signed an MoU with Mobily for an intent-driven network, which is very exciting because this is really bringing AI into our industry and how we make network performance even better. And as we go along through the days, we will continue to sign new agreements with direct customers and other partners as well,” Johansson told Arab News. 

He added: “This intent-driven network is very much about using the information that you have in the network to enhance performance even further, and then using AI to make sure that this is an automated functionality within the network. Basically, you can say things that you used to do by hand or by individuals are now done automatically in the system.” 

The MoU also aims to drive operational efficiency enhancements, boost service quality, and elevate user experiences among customers in Saudi Arabia. 

In a separate press statement, Hakan Cervell, vice president and head of Ericsson in the Kingdom, said that an autonomous network can change requirements dynamically without human involvement. 

“As we move toward intelligent society and industry, artificial intelligence will be integrated into almost everything — learning, adapting, and intelligently automating. We are glad to sign the MoU with Mobily to explore the potential of autonomy on their network to achieve unparalleled efficiency in service delivery and operations,” said Cervell. 

Regarding Ericsson’s presence in Saudi Arabia, the official said that the Kingdom is a fantastic market and that the company has been operating in the nation since 1978. 

He also added that the company is working with telecommunications firms like stc, Mobily, and Zain KSA to enhance customer experience.

It is also collaborating with the King Abdullah University of Science and Technology to explore the possibilities of a 6G rollout in the Kingdom in the coming years. 

“We have a very long experience and collaboration within the Kingdom. We have been here through 1G, 2G, 3G, 4G and 5G. And now, we’re looking to the future, getting into 5G standalone, 5G advanced and bringing new services,” said Johansson. 

He added: “This is the place where we have the biggest amount of spectrum available, which means that we can provide superior service together with our customers stc, Mobily, and Zain in the market. Now, we’re embarking into new opportunities as well with 6G, not around the corner, but in a couple of years. We’re working with KAUST to have research on that topic.”

During the interview, Johansson said that the establishment of Ericsson’s regional headquarters in Riyadh is helping the company serve its customers in the broader Middle East and North Africa region. 

The communication technology firm announced in January that the Kingdom will be served under a newly established Customer Unit. 

This move was part of Ericsson’s strategic ambition to simplify its organizational setup, enhance customer responsiveness, and strengthen local market accountability.

Regarding the localization of jobs, Johansson said that 60 percent of the employees in the company are Saudi nationals. 

He added that Ericsson has also been engaged in providing graduate programs for Saudi nationals over the past few years, out of which more than 50 percent of the students enrolled are females. 

Talking about the rollout of 6G, Johansson said that it is an “evolution rather than a revolution” happening in the telecommunications sector. 

“We’ve had a number of revolutions; going from fixed to mobile, but now 6G will build on 5G. So it is creating greater speeds, even lower latency, and maybe, one of the more important from a consumer point of view, it is about energy efficiency that is good for sustainability, but it’s also for battery life,” said Johansson. 

He added: “So it is basically about enhancing everything that we had in 5G and making it better. There are a few use cases that are being discussed. And again, this is why the collaboration between companies and academia is so important.” 

Affirming Ericsson’s commitment toward sustainability, Johansson said that it is crucial to properly eliminate electronic waste.

“It is about providing the latest and greatest of technology, but we need to be kind to Mother Nature as well. With one of our partners in the Kingdom, Mobily, we have already brought back more than 400 metric tonnes of equipment and made sure that it’s disposed of. So, it is creating this overall circular economy and how we work together,” he added. 

According to the Ericsson official, the use of AI is poised to revolutionize the telecommunications sector by enabling faster processing of large amounts of data.

“AI is really bringing further efficiency into our market. We have a lot of data. We used to do tweaking by hand. We added further software functionality. But with AI, we can combine so much more data, making it intent-based. We talked about the Mobily case of how we can actually make this much faster using AI technology,” said Johansson. 


LEAP 2025: AI, smart lenses, and wearable tech take center stage

Updated 45 min 3 sec ago
Follow

LEAP 2025: AI, smart lenses, and wearable tech take center stage

RIYADH: Advanced technologies and innovative solutions were in focus at LEAP 2025, showcasing ideas that could shape industries and the future. 

Among the key presentations was the Saudi Accelerated Innovation Lab, which introduced Aramco’s Robotics Assistant, or SARA. 

SAIL, launched during LEAP 2024 by Saudi Aramco President and CEO Amin Nasser, also houses AramcoMetaBrain, a proprietary generative artificial intelligence model designed to enhance operational efficiency. 

SARA, an AI-powered voice assistant, was introduced by Ibrahim Al-Sowayigh, innovation and commercialization leader at SAIL. He highlighted its potential to meet the highest cybersecurity and operational standards. 

“In enterprises and highly regulated environments, there was one persistent problem: trust. That’s why one of the very first business opportunities we were introduced to was securing a device that can be trusted to connect to our internal Aramco network and comply with best-in-class cybersecurity requirements,” Al-Sowayigh said. 

“We needed a device that is secure, industrial-grade, with intuitive-personalized interactions. That’s when we decided to build, not buy, and SARA — our very own industrial Gen-AI tabletop voice assistant — was born.” 

Ibrahim Al-Sowayigh introduces SARA, an AI-powered voice assistant. AN

AramcoMetaBrain powers SARA, enabling it to process vast amounts of industry-specific data, interpret complex queries, and provide highly contextualized responses. The model is trained in Aramco’s proprietary operational language, equipping it to navigate the company’s guidelines and processes. 

SARA is poised for commercialization through Aramco Digital, offering enterprises a secure, integrated AI solution. 

“SARA ensures that queries and data are processed and protected on-premise, giving organizations full control over their information while benefiting from cutting-edge AI capabilities,” Al-Sowayigh said.

“This makes SARA the ideal digital companion for industries requiring the highest levels of data security and operational efficiency.” 

Smart contact lens 

Tech innovation at LEAP 2025 extended beyond AI, with XPANCEO, a Dubai-based computing firm, unveiling a smart contact lens that aims to revolutionize vision enhancement and health monitoring. 

The lens offers a full-screen, full-color augmented reality experience while functioning as a miniature laboratory for the eye. Integrated neuro-interfacing jet electrodes enable enhanced vision, including night vision and zoom capabilities. 

“This is not actually science fiction, but rather what I will try to show you today. So this is already a rapidly developing reality,” said Valentyn Volkov, scientific partner at XPANCEO. 

Dubai-based computing firm XPANCEO unveiled a smart contact lens. AN

The smart lenses, set for development in three phases, will initially improve vision in low-light conditions. The second iteration will incorporate health-tracking features such as stress levels, blood sugar, body temperature, and dry eyes. The final version aims to display visual content directly on the lenses, delivering a seamless augmented reality experience. 

Despite progress, technological and biological challenges remain, as developers seek to miniaturize smartphone capabilities into a contact lens while ensuring biological compatibility. 

A prototype was showcased at LEAP, with XPANCEO targeting a market release by the end of 2026. 

Wearable technology 

Dutch designer Anouk Wipprecht brought a futuristic vision to LEAP 2025 with her collection of robotic dresses that merge fashion and engineering. 

Her designs include a heartbeat-monitoring dress featuring a central crystal that blinks in sync with the wearer’s pulse. Another highlight, the Spider Dress, incorporates animatronic mechanical limbs and 3D-printed sensors to monitor and protect the wearer’s personal space. 

Using proximity and respiration sensors, the dress responds to external stimuli, adjusting its movements accordingly. Wipprecht noted that such designs are practical for crowded urban environments like New York, where wearers can use them to maintain personal space. 

LEAP 2025 continues to showcase innovations that challenge the status quo, reinforcing Riyadh’s position as a global hub for technological advancement.


Oil Updates — crude climbs on supply worries, Trump tariffs check gains

Updated 11 February 2025
Follow

Oil Updates — crude climbs on supply worries, Trump tariffs check gains

SINGAPORE: Oil prices extended gains on Tuesday amid concerns over Russian and Iranian oil supply and sanctions threats, despite worries that escalating trade tariffs could dampen global economic growth.

Brent crude futures were up 55 cents, or 0.72 percent, at $76.42 a barrel by 10:17 a.m. Saudi time, while US West Texas Intermediate crude rose 50 cents or 0.69 percent to $72.82.

Both contracts posted gains of near 2 percent in the prior session after three weekly losses in a row.

“It’s more financially driven and price mean aversion rather than fundamental. Brent went from over $80 per barrel (in mid-January) to $74 (last week) so its time to take the position again,” LSEG analyst Anh Pham said.

The rebound came amid signs of tightening supplies, ANZ analysts said in a research note.

ANZ analysts noted Russian oil production fell short of its OPEC+ quota in January, easing concerns of an oversupply. Output fell to 8.96 million barrels per day and is 16,000 bpd below its approved levels under the production agreement.

Shipping of Russian oil to China and India, the world’s major crude oil importers, has been significantly disrupted by US sanctions last month targeting tankers, producers and insurers.

Adding to supply jitters are US sanctions on networks shipping Iranian oil to China after President Donald Trump restored his “maximum pressure” on Iranian oil exports last week.

But countering the price gains was the latest tariff by Trump which could dampen global growth and energy demand.

Trump on Monday substantially raised tariffs on steel and aluminum imports to the US to 25 percent “without exceptions or exemptions” to aid the struggling industries that could increase the risk of a multi-front trade war.

The tariff will hit millions of tons of steel and aluminum imports from Canada, Brazil, Mexico, South Korea and other countries.

Trump last week introduced 10 percent additional tariffs on China, for which Beijing retaliated with its own levies on US imports, including a 10 percent duty on crude.

Also weighing on crude demand, the US Federal Reserve will wait until the next quarter before cutting rates again, according to a majority of economists in a Reuters poll who previously expected a March cut.

The Fed faces the threat of rising inflation under Trump’s policies. Keeping rates at a higher level could limit economic growth, which would impact oil demand growth.

US crude oil and gasoline stockpiles were expected to have risen last week, while distillate inventories likely fell, a preliminary Reuters poll showed on Monday.

The poll was conducted ahead of weekly reports from industry group, the American Petroleum Institute, due at 12:30 a.m. Saudi time on Wednesday and an Energy Information Administration report due later that day.