Pakistan-Kingdom of Saudi Arabia: Moving Forward


Senator Sehar Kamran

Pakistan has always been committed to the protection of the territorial integrity of the Kingdom of Saudi Arabia

Pakistan and the Kingdom of Saudi Arabia are strategic allies. This bilateral relationship has withstood the test of time and dates back to the 1940s, even before the creation of Pakistan. Saudi Arabia was among the first countries to recognize Pakistan after its independence. Over the years, despite the political developments, paradigm shifts, and the evolving geopolitical landscape, there has been an unparalleled harmony of interests and affinity between the two countries, on every front.With every passing decade, these bilateral relations have touched new heights. We have witnessed numerous symbolic gestures as well as a physical manifestation of this mutual consideration, in different forms of cooperation between the two.
Pakistan has always been committed to the protection of the territorial integrity of the Kingdom of Saudi Arabia and the Holy cities of Makkah al-Mukarramah and Al-Mad?nah al-Munawwarah and has demonstrated this resolve time and again. As witnessed during the siege of Makkah in 1979, and the Gulf War of 1990-91, the country has been offering training and support to Saudi armed forces.
Similarly, the Kingdom of Saudi Arabia has been at the frontlines with its support for Pakistan during its time of need. Whether it was the Indo-Pakistan wars of 1965 and 1971 or the UN sanctions after the nuclear tests by Pakistan, KSA has always led efforts in providing humanitarian assistance to the country whenever natural disasters struck and have provided financial support for development projects in Pakistan.
It is no secret that throughout the country’s worst financial woes over the decades, Pakistan has always looked towards the Kingdom for a financial bailout package, and Riyadh has always come through for Islamabad. In the last ten years, during the tenure of two different governments Kingdom of Saudi Arabia has provided around some $15.9 billion worth of financial assistance, in the form of deposits and oil facilities. During the last PMLN government (2013-2018), Riyadh ‘provided a $7.5 billion package. Under the PTI-led regime, Saudi Arabia provided a package of $4.2 billion, including $3 billion deposits and a $1.2 billion oil facility for one year and linked it with the IMF programme.’
It was no different this time. During the inaugural visit of Pakistan’s new Prime Minister Shahbaz Sharif along with some of his cabinet members including the Foreign Minister and Chairman of Pakistan Peoples Party Bilawal Bhutto Zardari, the country managed to gain KSA’s support on economy-related issues. The discussion of augmenting the three billion dollar deposit in Pakistan’s central bank by extending its term “or through other options” was welcomed by the country, as the national reserves had fallen down to $10.8 billion. Further discussions regarding KSA’s economic support to Pakistan are currently underway, including exploring options to further enhance the financing of petroleum products and supporting the economic structural reforms for the benefit of Pakistan and its people.
The visit was considered a big success domestically because Pakistan’s economy is in dire straits. The country was in desperate need of a financial bailout package to escape a looming crisis of balance of payment.
During the visit, some extremely unfortunate scenes were witnessed at the Holy place of Masjid-e-Nabwi (S.A.W), in Al-Mad?nah al-Munawwarah. The political sloganeering there, was a deliberate attempt to tarnish Pakistan’s image in the Muslim Ummah, as well as the world. The unruly incident was deeply upsetting and insulted the sentiments of millions of Muslims around the world. Needless to say that our domestic politics and issues should not become a source of friction between the two countries.
However disregarding this one unfortunate episode, it was heartening to note that the joint statement issued by both countries affirmed both countries’ stance to consolidate security and stability, renounce extremism, and terrorism and support the unity and independence of the countries of the region and their territorial integrity.
Pakistan and the Kingdom of Saudi Arabia have a vast array of mutual areas of cooperation which need to be diversified to explore their maximum benefits for both sides. It is important to note that Pakistan is an important trading partner of the Kingdom of Saudi Arabia. According to the data available at the Observatory of Economic Complexity (OEC), In 2020, the exports from Saudi Arabia to Pakistan were around $1.8B which included Crude Petroleum ($696M), Propylene Polymers ($244M), and Ethylene Polymers ($233M). During the last 25 years, the exports of Saudi Arabia to Pakistan have increased at an annualized rate of 10.6%, from $146M in 1995 to $1.8B in 2020.
Whereas Pakistan’s Exports to Saudi Arabia accounted for US$402.81 million in 2021, according to the United Nations COMTRADE database on international trade. In 2020, they were at $516 million, as per the OEC. The products include Rice ($97.1M), Bovine Meat ($37.9M), and Awnings, Tents, and Sails ($24.6M). During the last 25 years, the exports of Pakistan to Saudi Arabia have increased at an annualized rate of 5.19%, from $146M in 1995 to $516M in 2020.
Undoubtedly, Pakistan needs to look into the imbalance in trade, diversify its exports to the Kingdom and strive to achieve a balance in its trade. As the mammoth current account deficit is a big liability for the country’s economy. There are undoubtedly innumerable positives and strengths in the bilateral relationship, but as with any affiliation, in order to move forward together, there is a need to transcend conventional channels of cooperation, to strengthen it further.