Saudi Vision 2030 – a gateway to improve Pak-Saudi bilateral economic relations

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By Shehzad Ahmad & Fahad Chaudhary

PAKISTAN and Saudi Arabia enjoy excellent bilateral relations. Close geographical proximity, historic trade ties, religious affinity and the complementary nature of economic needs have created a strong bondage of trust between Pakistan and Saudi Arabia. In addition, there is a convergence of views and interests of the two countries on most of the regional and international issues. High-level visits from Pakistan and Saudi Arabia reflect the great warmth and depth of bilateral relations.

In commercial and trade sector, Pakistan and Saudi Arabia maintain good relations and this is increasing with the passage of time. Kingdom is amongst the top 20 major export destination of Pakistan. Pak-Saudi annual bilateral trade had traditionally been around $3 billion, which in the last year had reduced around $1.2 billion (because of global oil price crisis affecting the overall bilateral trade). Major items of exports from Pakistan to Saudi Arabia include food, textiles, leather, sports, surgical and engineering sectors while Pakistan imports major requirements of petroleum from Saudi Arabia. The other items of import from Saudi Arabia, though minor in volume, includes petrochemicals, organic chemical products, plastic and plastic products, fertilizers, steel products, electrical equipment and materials etc. However, there exists a trade imbalance in favor of Saudi Arabia, mainly due to bulk import of petroleum in Pakistan from Saudi Arabia.

Despite of the fact that there has been reduction in bilateral trade volume and trade imbalance is in favor of Saudi Arabia, efforts are under way on both sides, to increase and balance the bilateral trade volume through drawing common contours between “Saudi Vision 2030” and “Pakistan Vision 2025” supported by a new era of socio-economic development of Pakistan through China-Pakistan Economic Corridor (CPEC) and its allied opportunities.

Saudi Vision 2030 envisages the desire for linkages with the international markets and offers win-win situation for both partners, especially for the countries like Pakistan who had a history of its strategic relationship with Saudi Arabia. =In order to capitalize on this opportunity and matching it with Pakistan Vision 2025 there is a need of adopting trade and economic diplomacy as an integral part of our strategy to improve our bilateral trade and investment.

In line with the above strategy, the Pakistan diplomatic missions in KSA are following a business plan that highlights ways and means to improve bilateral trade and investment, seek opportunities for joint ventures in manufacturing and services sector and strive for human resource development, to not only contribute to the host country economy but also to have positive dividends for Pakistan. It also focuses on activities that not only present the case for trade and investment potential of Pakistan and its friendly industrial and investment regime, but also enhances the understanding about CPEC and its allied economic opportunities.

Being a development partner of Saudi Arabia, the missions are working to ensure an easy access of information for our buyers about our products potential (especially traditional products like food, textiles and leather, sports goods, surgical instruments and non-traditional products like pharmaceutical, furniture, construction materials and new emerging products in the services sector), credible partners are coordinated for exports and quality products at affordable price reach the destination. This would not only give the value for money to the buyer but would also help in developing long term relationships between the stakeholders.

In order to contribute to the goal of Industrialization under Vision 2030, the missions are also developing a business model whereby the Saudi manufacturing sector would be developed by having Saudi capital investment supplemented by technology and skilled manpower from Pakistani counterparts as JV partners for these sectors, to not only do manufacturing for the domestic market but also exports to the adjacent markets in regional proximity of KSA. It would be a win-win situation for both — industrialization in KSA and Pakistan would get multiple economic benefits in the form of profits earnings, export of skilled human resource and subsequent increase in remittances.

The journey of socio-economic development with mutual cooperation between the two brotherly countries is ongoing and there is no doubt that Saudi Vision 2030 would prove to be a gateway to improve Pak-Saudi bilateral economic relations making them partners in prosperity of each other.

— The writers of the Article are the commercial team at the Consulate of Pakistan Jeddah and could be reached at Pakcom.jdh@tdap.gov.pk)


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