UAE to invest $1bn in Pakistani companies: state news agency

Report by Dawn claims that IMF had asked Pakistan to get assurances from KSA, UAE that they would give $4bn loan to Pakistan after Fund releases tranche

DUBAI: The United Arab Emirates intends to invest $1 billion in Pakistani companies across various sectors, state news agency (WAM) reported citing an official source in Abu Dhabi.

The UAE is keen to continue cooperation with Pakistan “in various fields, which include gas, energy infrastructure, renewable energy, health care,” the agency added.

The move will likely help revive investor sentiment in the country, which has been beset by dwindling foreign exchange reserves as well as a depreciating rupee. However, as an IMF bailout programme becomes clearer, sentiment has improved and the stock market on Friday rallied by some 670 points.

The IMF is likely to start the process for releasing the seventh and eighth tranches of a loan programme for Pakistan later this week, IMF and diplomatic sources told Dawn.

The report by Dawn claims that IMF had asked Pakistan to get assurances from Saudi Arabia and the UAE that they would give an expected $4bn loan to the country after the IMF releases its tranche.

“The Pakistanis received, and conveyed, the assurance from the two friendly countries,” a senior diplomatic source said according to Dawn. “So, we see no problem in the board’s approval.”

But other sources said Pakistan had been warned “not to allow the political situation to go out of hand”. The government had further been told that “street violence and protests by the opposition or a government crackdown on PTI leaders can have a negative impact on the deal”, the report adds.

Moreover, the report quoted a source saying that the US media, while commenting on Gen. Bajwa’s calls to US diplomatic and military officials three days ago, pointed out that “Pakistan’s military, which has directly ruled the country for more than half of its 75-year history, has closely worked with the US and is an official ally in the war on terror against Al Qaeda. And the calls have helped, but even the Americans cannot persuade the IMF to circumvent its procedure”.

Another report noted that “the revival of IMF’s bailout package will help Pakistan and encourage other international financial institutions to engage with the country”.

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