THE administration’s campaign to bring Gulf investment to Pakistan continues apace, with the prime minister wrapping up a one-day trip to the UAE on Thursday. Shehbaz Sharif spent a busy day in the Emirates, meeting UAE ruler Mohamed bin Zayed, addressing a conference on tech collaboration, and exchanging notes with other Emirati officials and businessmen.
The meeting with MBZ apparently went well, with Emirati state media saying $10bn had been allocated for investment in “promising economic sectors” in Pakistan. Mr Sharif has mentioned IT, renewable energy and tourism as fields that may attract UAE cooperation. The government has also been courting Saudi Arabia, with the prime minister making two trips to the kingdom over the past two months, while Saudi ministers and delegations have visited Pakistan to reiterate Riyadh’s commitment to invest here. The Saudis have reportedly promised investment worth $5bn.
The pledges from our friends in the Gulf are reassuring, but the multibillion-dollar question is: when will they materialise? Perhaps the Saudis and Emiratis are waiting for the IMF to green-light the next loan to Pakistan before releasing their own funds. Though the IMF loan has yet to be approved, Fund officials have described discussions with the government as “fruitful”, saying that “significant progress” has been made towards a staff-level agreement. Hopefully, once the loan is approved in the near future, the investment agreements signed with Gulf partners will start taking firmer shape.
Unfortunately, due to our past financial profligacy and indiscipline, even traditional allies are wary about putting their money in this country, and await the nod of international financial institutions. On their part, IFIs also monitor our financial dealings with our foreign partners before writing us a cheque. The government must change this negative perception through better financial management, moving the state towards a sustainable economic model.
The prime minister, during his brief UAE trip, addressed these unpleasant issues when he announced that the “begging bowl” had been “broken”. Over 240m Pakistanis are hoping this is actually the case. To truly break free from the shackles of financial dependence, we must put the projected foreign investment to good use, tax the untaxed internally, and learn to live within our means.
Decades of living large — with the elite of this country primarily culpable — has brought us to this sorry pass, and the current opportunity to set our house in order should not be wasted. We must keep pursuing foreign investment, and give the investors a business-friendly climate free of bureaucratic obstacles. Profit repatriation should also be eased to attract foreign money. There needs to be continuity in economic policies, while development must be focused on bringing prosperity to the masses. Moreover, internal harmony, and undisturbed representative rule, are essential for real stability in Pakistan.
Published in Dawn, May 25th, 2024
