Is Pakistan for sale as ‘friendly’ countries seek valuable assets?
Pakistani Finance Minister Miftah Ismail said Qatar is interested in buying two Pakistani LNG power plants based in Punjab province. The two power stations based in Punjab are Haveli Bahadur Shah and Balloki Power Station, both of which source their gas from Balochistan.
With the statement, Ismail cleared up initial confusion during Prime Minister Shehbaz Sharif’s visit to Qatar earlier this week that the Gulf country was providing $2 billion in aid to Pakistan to bail it out of default. Murtaza Syed, deputy governor of the State Bank of Pakistan (SBP) had said during a briefing on August 23 that Pakistan would receive $2 billion from Qatar in bilateral support.
The news was widely reported in many media.
Prime Minister Shehbaz Sharif was received by His Highness Sheikh Tamim bin Hamad Al Thani, Amir of the State of Qatar in Deewan-e-Ameeri
— Development Pakistan (@developingpak) August 24, 2022
At a press conference on August 26, Finance Minister Ismail also said that Qatar was interested in leasing Pakistan’s airports.
However, now that Sharif’s visit is over, it is clear that Qatar has expressed its desire to make $3 billion worth of investments in a crumbling Pakistan rather than providing $2 billion in aid. dollars.
Geopolitical analyst Mark Kinra says the Gulf countries have once again come to the aid of “brother nation” Pakistan, but there is a catch this time around, now they want something in return.
Kinra adds, “On July 24, the Pakistani Cabinet approved the Intergovernmental Business Transactions Ordinance 2022 to sell assets and shares of state-owned companies to foreign countries. Earlier in 2019, Saudi Arabia promised to invest $20 billion, which materialized. This time, the kingdom has pledged to invest $1 billion, but it is under the umbrella of a deferred oil facility.”
Like Qatar and Saudi Arabia, the United Arab Emirates has also decided to change course regarding investments in Pakistan.
Kinra says the UAE also plans to invest $1 billion in gas, energy infrastructure, renewable energy, healthcare, biotechnology, agricultural technology, logistics, digital communications, e-commerce and financial services. “These promised investments only show that the Gulf countries want returns. With China unable to recoup its vast investments due to deep-rooted corruption and structural problems, friendly Gulf countries want to be doubly safe.
With Pakistan’s economy in the doldrums, the International Monetary Fund (IMF) had asked Pakistan to boost friendly countries’ foreign exchange reserves by August 29 so it could consider providing a package to the cash-strapped country. money destroyed by historic floods, rising radicalism and the Baluchis. insurrection.
pakistani newspaper, The Express Grandstand said the Qataris had told Pakistan that the oil-rich country, which is part of the six-member Gulf Cooperation Council (GCC), would invest $3 billion through its $425 billion sovereign wealth fund. dollars in “airports, power plants, port terminals, solar energy and the stock market”. Investments will be made through the Qatar Investment Authority (QIA).
The Qataris have apparently shown interest in acquiring stakes in two power plants – Haveli Bahadur Shah, which was manufactured by Chinese company SEPCOIII Electric Power Construction as part of the massive China-Pakistan Economic Corridor (CPEC); and Balloki Power Station, a joint venture between China’s Harbin Electric International Company and Habib Rafiq. So far Islamabad seems reluctant to part with some of its ‘crown jewels’.
But Pakistan currently has foreign exchange reserves of $7.8 billion that will only last a month, giving it little leverage on the negotiating table.
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