PM briefed on Pak-Saudi B2B MoUs signed so far
Source: The News International
ISLAMABAD: Prime Minister Shehbaz Sharif has been informed that two memoranda of understanding (MoU) have been signed on business-to-business (B2B) in the wake of a 50-member Saudi delegation's visit early last month.
The PM had sought a report on any Pak-Saudi business joint ventures since the Suadi delegation concluded its visit.
The Pak-Saudi entrepreneurs have signed two MoUs -- fried onions products and the human resource development (HRD) -- so far, top officials in SIFC (investment facilitation council) and Board of Investment (BoI) told The News.
"However, there is a possibility of further MoUs in meat, HR and mining sectors while interest expressed by KSA entrepreneurs for investment in telecom sector. The interest was also shown for investment in oil sector with a major refinery." This has been reported to Prime Minister Shehbaz Sharif.
When asked as to why a breakthrough in joint ventures under B2B interaction between entrepreneurs of both the countries, did not take place, the relevant officials said investment agreements take time to mature. More importantly, private sector companies often hesitate to share with the government about the progress on the talks with their counterparts keeping in view the corporate culture of both the countries. The officials, however, said that entrepreneurs from KSA are very keen to invest in the projects of which bankable feasibility is available, and the Pakistani entrepreneurs have to develop their projects with bankable study ensuring that the projects will soon yield monetary dividends.
The KSA business delegation comprised representatives from thirty companies. These thirty companies held 447 B2B meetings with more than 140 Pakistani companies. In the report submitted to the premier, a follow-up mechanism has been proposed for facilitating business interaction among the companies of both countries under which focal points in SIFC, Ministry of Commerce and Board of Investment (BoI) will be established. Sectoral DG's, Liaison Officers and MTI to remain in contact with Pakistani and Saudi companies.
Under the proposed follow-up mechanism submitted to the prime minister, delegations of Pakistani companies will visit KSA after the Royal Visit to Pakistan and in the future multiple trade promotion activities will be utilized for follow-up interaction between entrepreneurs of Pakistan and KSA.
As many as 55 Pakistani companies participated in Saudi Food Fair held on May 21, 2024. Authorities will continue to make arrangements for further participation of Pakistani and KSA entrepreneurs in more trade promotion activities to be held in both the countries in future such as Lifestyle Exhibition in Riyadh, Single Country Exhibition in Jeddah, Global Health Saudi Arabia Exhibition, Saudi Build pertaining to construction sector, LEAP IT Exhibition KSA, Saudi Food Show, Market Place of Pak specific goods in Jeddah, FOOD-AG Exhibition in Pakistan and TEXPO in Pakistan.
"The main products exported from Pakistan to Saudi Arabia were rice ($86.2 million), bovine meat ($32.7 million), and spices ($25.3 million). During the last 26 years, the exports of Pakistan to Saudi Arabia have increased at an annualised rate of 4.62pc, from $146m in 1995 to $472m in 2021. In 2021, Saudi Arabia exported $3.4B to Pakistan."
In 2021-22, the bilateral trade remained at $5.581 billion as Pakistan exports to the KSA stood at $428 million and imports from the KSA stayed at $5.152 billion showing a trade deficit of $4.723 billion. However, in 2022-23, the bilateral trade between the two countries declined to $4.753 billion because of less imports from the KSA, which stood at $4.190 billion due to restrictions on imports in the wake of dollars' availability crisis."However, the country's exports in 2022-23 slightly increased to the KSA registering growth at $563 million. The trade deficit in 2022-23 with the KSA stayed at $3.627 billion.
"During the first half of the current fiscal 2023-24, the bilateral trade stayed at $2.482 billion during July-December period 2023-24 as the imports stood at $262.58 million and imports from the KSA remained at $2.219 billion showing a deficit in trade of $1.957 billion. The major export products from Pakistan are rice, meat of bovine animals, fruit and vegetables tents and camping. However, major imports from KSA are POL products, polymers of propylene and polymers of ethylene.