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

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Updated 22 September 2023
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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.”


Plans afoot for new facility to produce low-carbon chemicals, says Saudi energy minister

Updated 6 sec ago
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Plans afoot for new facility to produce low-carbon chemicals, says Saudi energy minister

DOHA: Stressing the key role of the petrochemical industry in the fight against climate change, the Saudi energy minister disclosed the Kingdom’s plan to build a carbon dioxide utilization hub to produce low-carbon chemicals.

Prince Abdulaziz bin Salman was speaking at the 17th Annual Gulf Petrochemicals and Chemicals Association Forum in the Qatari capital on Sunday. He said the petrochemical sector has a crucial role to play in the global campaign to reduce greenhouse gas emissions.

Prominent industry leaders attended the forum titled “Using chemistry to achieve impactful transformation” and advocated the use of sustainable practices in the oil and gas sector.

The Saudi minister affirmed the Kingdom’s commitment to preserving cultural heritage while embracing positive changes.

“We’re not going to change our beliefs, we would not change our pride, of our history, of our culture, but I’m sure what we are trying to do with all of our visions is to make sure that the generations to come will be proud as we are today proud of ourselves,” he said.

“We envision (that) the (carbon utilization) hub will maximize value for carbon dioxide and enable new green industry in the Kingdom’s clean energy economy,” Prince Abdulaziz added.

He also expressed pride in the Kingdom’s success in converting oil derived from plastic waste into certified circular polymers, marking a first in the Middle East and North Africa through collaboration between Saudi Aramco, SABIC, and Total Energies.

Prince Abdulaziz also revealed plans for a minimum of four projects to be launched in the upcoming years, specifically emphasizing liquid-to-chemical processes.

SABIC CEO Abdulrahman Al-Fageeh emphasized the journey of the forum, a testament to a vision combining entrepreneurial spirit with industry knowledge inherited across generations.

Al-Fageeh acknowledged geopolitical risks and uncertainties but urged resilience and the discovery of new avenues for growth, underscoring chemistry as a solution provider to global challenges.

Saad Sherida Al-Kaabi, CEO of Qatar Petroleum, stressed the need for a meaningful and realistic transition, urging a common understanding of achievable goals.

He highlighted three essential areas, which include greater investment in energy efficiency and low carbon innovation, political commitment through coordinated policies, and raising awareness about the crucial role the chemical industry plays in improving lives worldwide.

Al-Kaabi concluded with a call for collective action to challenge the status quo and contribute to a better tomorrow.

The GPCA represents the downstream hydrocarbon industry in the Arabian Gulf.

Established in 2006, the association voices the common interests of more than 250 member companies from the chemical and allied industries, accounting for over 95 percent of chemical output in the Arabian Gulf region.

The industry makes up the second-largest manufacturing sector in the region, producing over $108 billion worth of products a year.

The association supports the region’s petrochemical and chemical industry through advocacy, networking, and thought leadership initiatives that help member companies to connect, share and advance knowledge, contribute to international dialogue and become prime influencers in shaping the future of the global petrochemicals industry.


Saudi cybersecurity body releases toolkit to fortify digital infrastructure

Updated 03 December 2023
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Saudi cybersecurity body releases toolkit to fortify digital infrastructure

RIYADH: Saudi Arabia’s National Cybersecurity Authority has released its second package of cybersecurity tools in a strategic initiative to fortify the Kingdom’s digital infrastructure.

This comprehensive suite of tools is designed to enhance the efficiency and effectiveness of cybersecurity measures across various sectors, aligning with the Kingdom’s efforts to combat evolving threats and boost digital readiness.

The newly released toolkit includes a range of templates and procedures for developing robust cybersecurity policies and standards, according to a statement issued by the authority.

Available in both Arabic and English, it caters to a wide spectrum of entities in the government and private sectors.

This initiative reflects the authority’s commitment to establishing and governing cybersecurity policies, frameworks, standards, and guidelines in Saudi Arabia.

Developed through an extensive study of various policies and best practices in the cybersecurity domain, the toolkit encompasses critical topics such as malware protection, risk management, email and network security, web application protection, and data security.

It also covers security aspects of user and mobile devices, industrial control systems, social media, and virtual environments.

The authority emphasizes that these implements aim to ensure a safer cyber environment for all stakeholders in the Kingdom.

The availability of the toolkit on the authority’s website ensures easy access and widespread adoption.

As the national reference in cybersecurity holds significant importance, the authority’s primary objective is to protect the region’s vital interests, national security, and critical infrastructures.

Saudi Arabia’s cybersecurity reforms have been rapidly growing with the hosting of the Global Cybersecurity Forum last month in Riyadh.

Furthermore, the NCA announced its second cybersecurity accelerator program in October to boost entrepreneurship, investment, and innovation in the sector.

The program provided more than SR6.5 million ($1.7 million) to support expanding companies and over 500 hours of guidance and direction.

These initiatives coincide with the Kingdom’s position as one of the global leaders in cybersecurity.

In June, Saudi Arabia secured second place in the Global Cybersecurity Index in the World Competitiveness Yearbook for 2023 by the Swiss-based International Institute for Management Development.


Closing Bell: Saudi main index rises to close at 11,219

Updated 03 December 2023
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Closing Bell: Saudi main index rises to close at 11,219

RIYADH: Saudi Arabia’s Tadawul All Share Index rose on Sunday, gaining 41.54 points, or 0.37 percent, to close at 11,219.02.  

The total trading turnover of the benchmark index was SR4.13 billion ($1.10 billion) as 148 of the listed stocks advanced, while 71 retreated.   

On the other hand, the Kingdom’s parallel market Nomu slipped 391.54 points, or 1.55 percent, to close at 24,844.08. This comes as 29 of the listed stocks advanced, while as much as 25 retreated.  

Meanwhile, the MSCI Tadawul Index also rose 3.86 points, or 0.27 percent, to close at 1,445.89.  

The best-performing stock of the day was Middle East Healthcare Co. The company’s share price surged 9.95 percent to SR86.20.  

Other top performers included Naqi Water Co. as well as Fawaz Abdulaziz Alhokair Co., whose share prices soared by 6.34 percent and 6.03 percent, to stand at SR78.80 and SR17.24 respectively.  

In addition to this, other top performers included Arab Sea Information System Co. and Saudi Co. for Hardware.  

The worst performer was Development Works Food Co., whose share price dropped by 5.64 percent to SR130.40.  

Other poor performers were Al-Rajhi Co. for Cooperative Insurance as well as Naseej International Trading Co., whose share prices dropped by 5.26 percent and 3.03 percent to stand at SR162.00 and SR54.40, respectively.  

Moreover, other worst performers also included Saudi Automotive Services Co. and Arabian Cement Co.  

On the announcements front, the Saudi Exchange has announced the trading suspension on Dur Hospitality Co.’s shares starting Dec. 3 to commence delisting procedures of the company’s shares.  

According to a statement from Tadawul, this decision follows the firm’s announcement of the extraordinary general meeting’s approval of the offer submitted by Taiba Investments Co. to acquire shares of Dur Hospitality Co. from shareholders through a securities exchange offer.  

On another note, Methanol Chemicals Co. has announced the issuance of the Ministry of Energy’s approval to allocate the required feedstock for manufacturing methyl diethanolamine, choline chloride dimethyl disulfide, and n-methyl pyrrolidone. 

A bourse filing has disclosed that all the targeted products will be the first of their kind in the region. Furthermore, these innovative products are anticipated to find applications in critical and strategic industries in the Kingdom, including but not limited to oil and gas, pharmaceuticals, fertilizers, and construction materials, among others.  

Moreover, Taiba Investments Co. has announced the results of the extraordinary general assembly meeting which included the increase of the firm’s capital remotely utilizing contemporary technology using the Tadawulaty platform.  

Meanwhile, Abdulaziz and Mansour Ibrahim Al-Babtain Co. has announced the signing of an agreement with Nestle Saudi Arabia.   

According to a Tadawul statement, the agreement will come into force from the date of its signature and expire on Dec. 31. However, it will be automatically extended upon the expiry of the period. 


UNIDO expert highlights crucial steps for hydrogen economy transition at COP28

Updated 03 December 2023
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UNIDO expert highlights crucial steps for hydrogen economy transition at COP28

DUBAI: Partnerships between the private and public sectors are required to address hydrogen development infrastructure, according to a UN Industrial Development Organization expert.

Eunji Park emphasized in a panel discussion titled “Connecting the Dots for the Hydrogen Economy” by King Abdullah Petroleum Studies and Research Center on the sidelines of the 2023 UN Climate Change Conference key factors for a successful global transition to a hydrogen-based economy.

She highlighted the impact of policies like the Carbon Border Adjustment Mechanism, encouraging industries in developing countries to shift toward cleaner industrial processes.

Park said: “Only 10 percent of the projects are presented for local offtake, so in order to solve infrastructure challenges in line with the scale of financing, we really need to ensure that public-private partnerships address more basic infrastructure to be in place for hydrogen development.”

The expert also called for the proximity of renewable energy sources to industrial clusters, advocating on-site installations for maximum efficiency. Park underscored the need for more hydrogen transport pipelines to facilitate widespread adoption.

In addressing a critical gap, she emphasized the urgency for more skills development, citing deficiencies in current international assistance schemes.

“We need more skills development and technical capacity building within the countries. This is something that is currently lacking in the international assistance schemes, so more opportunities for upskilling sufficient knowledge,” she said.

Park added: “I think these are the elements that need to be closely addressed within the public-private partnerships.”

On the topic of upskilling and reskilling, she emphasized the need for a just transition, recognizing the challenge of shifting fossil fuel-based economies without job losses.

Park stressed the importance of a systemic approach to ensure inclusivity in the transition process.

Green hydrogen is hydrogen produced by the electrolysis of water using renewable electricity. The production of green hydrogen causes significantly lower emissions than the production of gray hydrogen, which is derived from fossil fuels.

As COP28 progresses, experts like Park continue to play a pivotal role in shaping discussions and strategies for a sustainable and inclusive hydrogen economy.


Saudi budget airline flynas launches first direct flight from Jeddah to Brussels

Updated 03 December 2023
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Saudi budget airline flynas launches first direct flight from Jeddah to Brussels

RIYADH: Saudi Arabia’s budget airline flynas announced on Sunday the inauguration of its first direct flight connecting Jeddah with Brussels.

This move marks a major milestone in flynas’ European expansion, establishing it as the first Saudi national airline to provide direct connectivity between the Kingdom and the heart of the EU, according to a report by the Saudi Press Agency. 

The new route, part of flynas’ growing portfolio of international destinations, is a strategic component of the Saudi Air Connectivity Program. 

This program is a key initiative in line with the National Tourism Strategy, aiming to increase the Kingdom’s global connectivity. 

The strategy aims to draw 150 million tourists and expand Saudi Arabia’s international flight destinations to over 250 by 2030. 

The launch, signifying the strengthening of Saudi-Belgian relations, was attended by key dignitaries, including Pascal Gregoire, the Belgian ambassador to Saudi Arabia. 

The celebratory event at the Brussels Airport was graced by the deputy ambassador of Saudi Arabia in Brussels, Mohammed Moanes, along with representatives from flynas and prominent figures from the travel and tourism sector. 

The Air Connectivity Program, initiated in 2021, is crucial to the Kingdom’s tourism growth. 

It focuses on enhancing Saudi Arabia’s global air links by developing existing and potential flight paths, thereby positioning the region as a leading global tourist destination. 

The program operates as the executive arm of the National Tourism and Aviation Strategies, aiming to foster collaboration and partnerships across public and private sectors in tourism and aviation. 

This route expansion by flynas signifies a step in Saudi Arabia’s aviation capabilities and aligns with the broader vision of diversifying the Kingdom’s economy and enhancing its global standing as a key player in international travel and tourism. 

On Dec. 2, the airline also inaugurated six destinations and routes, including two domestic flights to Abha and Tabuk and four in the international category — to Dubai, Amman, Istanbul and Ankara — to be operated alongside the other four existing destinations from Madinah to Riyadh, Jeddah, Dammam and Cairo.