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Pakistan is set to receive 75% of the investment allocated under a new private equity fund backed by Saudi Arabian and Pakistani investors, following an agreement signed on Monday to strengthen bilateral investment cooperation.
The Saudi-Pakistan Joint Business Council (SPJBC), established by the governments of both countries to promote private-sector cooperation, signed a memorandum of understanding (MoU) on November 9 to establish the fund.
According to the council, the fund will initially have a size of several hundred million dollars, with the potential to expand as additional investment opportunities emerge across different sectors.
Under the proposed arrangement, three-quarters of the fund's capital will be directed towards projects in Pakistan, while the remaining 25% will be allocated to investment opportunities in Saudi Arabia.
Investors from both countries are expected to contribute equally to the fund, which will target private-sector businesses in agriculture, mining, construction and other industries.
The initiative will also explore investment opportunities arising from Pakistan's plans to commercialise public assets, including airports, motorways, ports and maritime development projects.
In Saudi Arabia, potential investments will include commercial projects, particularly in the Kingdom's holy cities.
The agreement provides for financial institutions from both countries to participate in the equity of the fund management company. However, the fund's establishment and investment activities remain subject to regulatory approvals in Pakistan and Saudi Arabia.
The development follows a series of engagements between Pakistani and Saudi business leaders aimed at expanding economic cooperation beyond traditional government-to-government arrangements.
In August, SPJBC Chairman Prince Mansour bin Mohammad Al Saud met Prime Minister Shehbaz Sharif during a visit to Pakistan, with discussions focusing on potential Saudi investments in agriculture, infrastructure, energy, information technology and real estate.
Saudi investors have also explored opportunities in Pakistan's transport infrastructure, including the Sukkur-Hyderabad Motorway project, as Islamabad seeks greater foreign private-sector participation in major development projects.
The latest agreement represents another step towards institutionalising investment cooperation between the two countries, although the fund's final structure and initial investments will depend on the completion of regulatory approvals.
The Saudi-Pakistan Joint Business Council (SPJBC), established by the governments of both countries to promote private-sector cooperation, signed a memorandum of understanding (MoU) on November 9 to establish the fund.
According to the council, the fund will initially have a size of several hundred million dollars, with the potential to expand as additional investment opportunities emerge across different sectors.
Under the proposed arrangement, three-quarters of the fund's capital will be directed towards projects in Pakistan, while the remaining 25% will be allocated to investment opportunities in Saudi Arabia.
Investors from both countries are expected to contribute equally to the fund, which will target private-sector businesses in agriculture, mining, construction and other industries.
The initiative will also explore investment opportunities arising from Pakistan's plans to commercialise public assets, including airports, motorways, ports and maritime development projects.
In Saudi Arabia, potential investments will include commercial projects, particularly in the Kingdom's holy cities.
The agreement provides for financial institutions from both countries to participate in the equity of the fund management company. However, the fund's establishment and investment activities remain subject to regulatory approvals in Pakistan and Saudi Arabia.
The development follows a series of engagements between Pakistani and Saudi business leaders aimed at expanding economic cooperation beyond traditional government-to-government arrangements.
In August, SPJBC Chairman Prince Mansour bin Mohammad Al Saud met Prime Minister Shehbaz Sharif during a visit to Pakistan, with discussions focusing on potential Saudi investments in agriculture, infrastructure, energy, information technology and real estate.
Saudi investors have also explored opportunities in Pakistan's transport infrastructure, including the Sukkur-Hyderabad Motorway project, as Islamabad seeks greater foreign private-sector participation in major development projects.
The latest agreement represents another step towards institutionalising investment cooperation between the two countries, although the fund's final structure and initial investments will depend on the completion of regulatory approvals.
