CROWN PRINCE IN PAKISTAN TO BOOST TIES AND SUPPORT PEACE
▶ Sheikh Mohamed bin Zayed meets Imran Khan as UAE considers billions more in assistance and investment
Sheikh Mohamed bin Zayed, Crown Prince of Abu Dhabi, visited Islamabad yesterday for talks with Pakistani Prime Minister Imran Khan, who is seeking the UAE’s help to avert a financial crisis.
Sheikh Mohamed, also Deputy Supreme Commander of the Armed Forces, was making his first visit to Pakistan in 12 years as the UAE considers billions of dollars in aid and investment.
He expressed keenness to develop co-operation with Pakistan and serve the two countries’ common interests, the state news agency Wam reported
The UAE already announced a US$3 billion (Dh11bn) cash injection and Pakistani officials have said $3.2bn in deferred oil payments was under discussion.
Plans for the UAE to help build an oil refinery had also reached their “final stage”, Pakistan’s Information Minister said. Sheikh Mohamed and Mr Khan have met three times in as many months as Islamabad looks for help to stave off a balance of payments crisis.
Mr Khan expressed thanks for the UAE’s generosity and its interest in investing in Pakistan’s oil and gas, logistics, ports and building sectors.
He praised Sheikh Mohamed for the role UAE was playing in Afghan peace talks by hosting them in Abu Dhabi. The two agreed to work closely for peace and stability in Afghanistan.
Pakistan’s Ministry of Foreign Affairs said yesterday’s visit was “testimony to the special nature of our brotherly relations”.
The importance of the relationship to Islamabad was underlined by the warm welcome given to Sheikh Mohamed.
He was greeted with a guard of honour and 21-gun salute when he touched down at Nur Khan air base in Islamabad, before Mr Khan took the wheel to personally drive him to a reception at Prime Minister House.
The streets of Islamabad were strung with portraits of Sheikh Mohammed.
“It’s a very important relationship in the sense that Pakistan wants to expand its relations with Muslim countries and is desperate to get financial assistance,” said Talat Masood, a political analyst.
Mr Khan inherited a looming economic crisis when he took office five months ago, with foreign reserves almost empty and a growing balance of payments crisis. South Asia’s second-largest economy is trying to fill a balance gap estimated to be $12bn.
His government is in negotiations with the International Monetary Fund, Mr Khan has repeatedly said he was reluctant to rely on the body.
An IMF bailout would be Pakistan’s 13th since the late 1980s and is expected to come with demands for painful reforms and transparency over sensitive Chinese loans to Islamabad.
Instead, Mr Khan has shuttled between China, Saudi Arabia and the UAE to seek help.
Pakistan said in October that Saudi Arabia had pledged a $3bn cash injection and $3bn in deferred oil payments.
The last of three Saudi cash payments is expected this month.
China, which is investing billions in Pakistan through its Belt and Road plan to drive trade through Asia, has also helped out but refuses to reveal by how much.
Mr Masood predicted Islamabad would still need to approach the IMF, but the billions gained from Saudi Arabia, China and the UAE would give it a stronger negotiating hand.
“The money has been reasonably generous but I think we would still be going to the IMF,” he said. “We need far greater discipline in our financial system and we can only get that from the IMF.”
Pakistani media also suggested that the UAE was poised to build an oil storage depot at the new Chinese-built port of Gwadar, and a deep-conversion oil refinery joint venture.
The UAE also supports Pakistan with aid for education, health, energy and infrastructure development, and has given large sums to fund the country’s polio eradication programme.
Mr Khan’s months in office since his July election win have been dominated by attempts to deal with the country’s financial woes, but his critics complain of indecision in finding a plan to turn the economy around.
The rupee has been devalued twice since he took power, and while his Pakistan Tehreek-e-Insaf appears to be the most popular party, rising costs may soon begin to eat into his popularity.
Mr Khan has also had to deal with the country’s powerful hardline religious bloc, which successfully demanded the removal of one of his economic advisers because he was a member of the Ahmadi religious minority.