On October 23, 2018, the much awaited “Future Investment Initiative” conference, also nicknamed “Davos in the Desert” began in the Saudi capital Riyadh. This was meant to showcase Saudi Arabia’s progress and the reforms the kingdom is undertaking with the Crown Prince Mohamed Bin Salman at the helm of affairs, in order to both boost investor confidence and attract new investments to the kingdom. The brutal murder of Saudi dissident and journalist Jamal Khashoggi inside the Saudi consulate in Istanbul, however, cast a long shadow on the conference. While investigation into the gruesome crime is still underway, it has sparked global condemnation and many countries and industry bigwigs, mostly Western, preferred to stay away the mega show. There has however been some high-profile presence in the conference, one of which has been that of Pakistan’s new Prime Minister Imran Khan.
To be fair, Khan had from the outset of the Khashoggi case tweeted his support of the Kingdom of Saudi Arabia. Not that this is surprising. Khan had earlier supported the kingdom in its spat with Canada. The kingdom was also the first foreign country that the cricketer-turned-politician visited in his new role as Pakistan’s Prime Minister. This was but natural. Pakistan and Saudi Arabia have for decades shared a very cozy relationship. Their military cooperation began in the 1960s. In 1969, in a joint air operation they repulsed a South Yemeni incursion into Saudi Arabia. In the 1970s and 1980s, up to 15,000 Pakistani troops were stationed in the kingdom. During the 1990-1991 Persian Gulf War, Pakistan sent troops to protect the kingdom. It continues to provide extensive training support for the Saudi military and has regularly sold small arms to the Saudis. It is widely believed that the two have an understanding whereby Pakistan provides nuclear cover for the Saudis and a security guarantee for its holy sites.
The relationship deepened as Pakistan became the frontline state in the Afghan jihad against the Soviet Union that was generously bankrolled by the Saudis; subsequently they became one of only three countries to recognize the Taliban government in Afghanistan. The Saudi-Pakistan relationship became, in the words of Saudi analyst Madawi al Rasheed, “the perfect client patron relationship” and that “the alliance with Pakistan helped Saudi Arabia promote Islamic identity rather than Arab nationalism.”
Pakistan’s steadily deteriorating economy has been bailed out from time to time by Saudi largesse. In 2014, for instance, Saudi Arabia loaned USD 1.5 billion to Pakistan to help Islamabad pay its debts and undertake much needed infrastructure projects. Saudi investment, together with the remittances from around 1.5 million Pakistanis working in Saudi Arabia, remains much needed.
Pakistani politicians have always shared a special relationship with the House of Saud and all have usually paid their first official visit to the kingdom, especially given its elevated status in the Muslim world as the custodian of the holy places. Imran Khan cannot but continue the special relationship, even if he tries to maintain a balance with Iran.
While Pakistan’s refusal to join the Saudi coalition’s war in Yemen in 2015 strained their relations, Pakistan has since been eager to make amends. And it was Imran Khan’s party then in the opposition that had been most vocal against Pakistan’s participation in the Saudi led coalition’s war in Yemen. The Saudis, not accustomed to being refused by a client state, especially at a time when their relations with their traditional military ally the US were beginning to fray, let their displeasure be known in a string of measures. Already the kingdom, together with some of the Gulf countries, had been wary with the role of Pakistan and the involvement of its citizens in terror networks across the world. Over the years, as ties with India warmed, Saudi Arabia has deported a number of key terror suspects, including those belonging to Lashkar-e-Taiba terror group based in Pakistan. In 2014 Saudi Arabia banned its citizens from marrying Pakistani women; in 2017 it deported some 39,000 Pakistani men from the kingdom for fear of terrorism. Again, last year Abdulla Al Sadoun, chairman of the Shoura council called for a thorough scrutiny of Pakistanis before they are inducted for work in Saudi Arabia. The Arab-American-Muslim summit in Riyadh last year established the Terrorist Targeting Financial Center to target terror networks. Amongst others, these networks included the Taliban, Lashkar-e-Taiba and the Haqqani network, all three groups that have targeted Indian interests at home and abroad and are known to have support and sanctuaries within Pakistan. More recently in June 2018, the Saudis allowed Pakistan to be put on grey list on the Financial Action Task Force’s (FATF) grey list. Worse, Saudi Arabia and its other Gulf allies like the UAE turned towards India for closer defense, economic, and energy cooperation.
With the most recent package of generosity from the Saudis, Imran Khan’s Pakistan has inadvertently drawn closer to the Sunni bloc. Much of it is rooted in Saudi Arabia’s need for militarily strong and non-Arab Muslim allies like Pakistan.
However, for Khan, relations with Saudi Arabia and the other Gulf monarchies are an imperative now. He has inherited a Pakistan whose external debt amounts to USD 91.9 billion, and by IMF estimates is slated to touch USD 103 billion by June 2019. At least one fifth of this is estimated to be owed to China. Its fiscal deficit was 6.6 percent of GDP in 2017-18. In September, the Trump administration canceled more than USD 300 million in aid to Pakistan as punishment for its continued unwillingness to take decisive action against the Taliban and other extremist groups. The US-backed IMF has warned any loans it disburses will come with strings attached.
In Riyadh during his first visit, Khan stressed that Pakistan “always stands by Saudi Arabia” in an interview to Al Arabiya TV. The Saudis, however, had evinced interest only in participating in an oil refinery and pipeline in Gwadar and in mineral mining. This time around, on a special invitation from the kingdom, Khan left for the conference saying Pakistan was “desperate for loans.” This is widely being seen as Pakistan leveraging the Khashoggi tragedy to its own advantage. In Riyadh, the Saudis agreed to pay Pakistan USD 3 billion for a year to address its balance of payments crisis and also offered to it a one-year deferred payment facility for import of oil worth up to USD 3 billion for three years. This actually takes the aid package to USD 6 billion.
Khan held discussions with the Crown Prince Mohamed Bin Sultan and with King Salman bin Abdel Aziz, and an entire session was dedicated to Pakistan where Khan got ample opportunity to showcase his country as a favorable investment destination and also talked about his Vision 2025 for his country.
While this has been hailed by much of the Pakistani media, there have been cautionary voices too. After all, Pakistan’s refusal to participate in the Yemen war had stemmed from its reluctance to get embroiled in the Middle East’s power struggles and sectarian wars. It seeks to maintain a balance between its relations with the Saudi led Sunni bloc as well as with their regional rival Shia Iran, whose territory is contiguous to Pakistan. Pakistan also has a sizeable Shia population, and the Saudi-funded Wahabi strain had resulted in sectarian tensions and violence within Pakistan itself. Soon after Khan took over as Prime Minister, Iran’s foreign minister Javeed Zareef paid a visit to Islamabad as a goodwill gesture. Iranian president Hassan Rouhani also extended an invitation to Khan to visit Teheran. Even in his interviews during his very first visit to Saudi Arabia and the UAE as Prime Minister, Khan repeatedly spoke about peace in the region and how Pakistan would like to play the role of peacemaker there, neatly side-stepping picking sides. Pakistan also has close defense and economic ties with Turkey, a model that many of Pakistan’s leaders seek to fashion their country after.
Nevertheless, Pakistan’s stakes in the Saudi led bloc, including in the UAE and Bahrain, is enormous. Therefore, it sought to quickly mend ties with the Saudis as well as its other Gulf Cooperation Council (GCC) allies. The former Prime Minister Nawaz Sharif had paid numerous visits to the kingdom, as had the real power driver in Pakistan — General Qamar Bajwa, the Chief of Staff of the Pakistani army. 5,000 Pakistani troops had been dispatched to the kingdom, and former Army Chief General Raheel Sharif took over as Commander of the Saudi-initiated Islamic Military Counter Terrorism Coalition (IMCTC).
With the most recent package of generosity from the Saudis, Imran Khan’s Pakistan has inadvertently drawn closer to the Sunni bloc. Much of it is rooted in Saudi Arabia’s need for militarily strong and non-Arab Muslim allies like Pakistan, especially given the American disentanglement from the region. While former President Barack Obama allowed sanctions to be lifted from Iran, current President Donald Trump, whose family is close to the Saudi Crown Prince, did not hesitate to publicly state that Saudi Arabia’s King Salman would not last in power “for two weeks” without the backing of the US military. The Saudis would also have noted Iranian overtures to the new administration in Islamabad. The widening Shia arc in the region, which is also drawing in Sunni powers like Qatar and Turkey, could even challenge Saudi leadership of the Muslim world. And the Khashoggi case, which refuses to die down, has put Saudi Arabia, especially its Crown Prince Mohamed bin Salman, under intense international scrutiny. Hence, if in case regional fault-lines deepen and the Saudis ask for a quid pro quo, Pakistan will have less space to maneuver and remain neutral.