Pakistan is attracting foreign direct investment around $1.5 billion a year and this figure is rising. Surprisingly, Kuwait's investment in Pakistan stood at just $21 million in 2016, the Board of Investment told Khaleej Times. The trade balance is tilted in Kuwait's favour as it exports a number of oil products to Pakistan. In fy-16, Kuwait exports to Pakistan were worth $1,333.91 billion, according to the Ministry of Commerce. Pakistani exports to Kuwait in the same year were worth only $100.28 million.
Pakistan Prime Minister Nawaz Sharif has offered Kuwait and other regional countries, including the UAE, big investment and trade opportunities as its economy opens up. At the same time, implementation of the China Pakistan Economic Corridor (CPEC) projects are on fast track.
Another indication of the Pakistan economy opening up is the equity market boom, which has seen the Pakistan Stock Exchange index-100 shooting up from 34,398 in early July 2016 to 36,262.23 on May 11, 2016. PSX shot up further to an unprecedented 50,000 in February 2017 and was moving at around 49,350 in mid-March.
The decisions for greater cooperation between Pakistan and Kuwait were taken to crucial discussions between Kuwaiti Emir Sheikh Sabah Ahmad Al Jaber Al Sabah and Sharif during his visit to Kuwait. Some of the key decisions were:
. The Emir accepted Sharif's request to end the eight-year-old ban on issuance of Kuwaiti visas for Pakistanis. More than 114,000 Pakistanis live in Kuwait, of who a large number are highly skilled.
. Kuwait and Pakistan will strengthen bilateral relations by enhancing cooperation in a number of fields, including trade and investment. It will be funded by the public and private sectors. Pakistan will guarantee protection of investments and 100 per cent repatriation of investment and dividends.
Greater cooperation in the field of industry, agriculture, energy and defence sectors.Investments were offered in projects related to the CPEC.
The CPEC will connect Shanghai, China, travelling north-west and culminate at the port city of Gwadar, Pakistan, facing the UAE, and will cost $56 billion. Close to 20 per cent of the project has been completed, according to officials. It will attract nearly $150 billion from foreign investors and governments, estimates Pakistan's Board of Investment (BoI). The projects, among others, include transport, shipping, energy, consumer goods, food processing and marketing, oil exploration and transport, says the BoI.
. Inviting Kuwait to invest in CPEC projects, the Emir was explained its significance, broad contours and the fact that it will connect South-east China, Central Asia, Iran, Afghanistan on its east to north-west run and then connect UK and EU via Turkey and Pakistan which has the potential of a huge production base and shipping.
Sharif urged Kuwaiti investors to invest in Pakistan. All sectors are open to them, also those located on and along the CPEC route, inside Pakistan, and at any location where the government has established special economic zones for profitable tax and tariff concessions and to promote production and export. The government provides cheap land and all services to operate industries.
. Pakistan will continue to import a number of oil products and requested the Emir for assistance. Trade volume needs to be further enhanced to its full potential, in sectors such as agriculture, construction, poultry, livestock and fisheries.
. The Joint Ministerial Commission of Kuwait and Pakistan provides the best platform to take stock of bilateral cooperation in various economic sectors and set new benchmarks to carry this cooperation forward.
. Sharif emphasised the importance of early resumption of the GCC-Pakistan Free Trade Agreement negotiations with the support of Kuwait, and removal of visa restrictions as it will remove a major hurdle to freedom of movement for businessmen.
Sharif told the Emir: "Pakistan is an investment-friendly country and an attractive destination for foreign investors, due to its liberal investment policy and high rate of return."
More than 1,000 leading multi-national companies - several dozen of them from the UAE, Kuwait and Saudi Arabia - are successfully operating in Pakistan. They include high profit-earning financial institutions such as Bank Al Falah and Al Meezan Bank, and telecom operators such as Etisalat-Pakistan Telecom Ltd, Warid mobile and Qatar LNG, to name a few. Pakistan also expects Kuwait to invest in its big, multi-billion dollar energy and infrastructure projects.