Kuwait-backed companies are considering a $750 million investment in Pakistan, making it one of the country’s largest proposed investments in recent years. Kuwait has already invested in banking sector and other areas in Pakistan.
According to Mohammad al-Fares, chairman of Pakistan Kuwait Investment Co., Kuwait Investment Authority’s Enertech Holding Co. and Pakistan Kuwait Investment Company have applied for a digital bank license and suggested a hydrogen plant and two smart towns. A $200 million water pipeline is already in the works between the two countries.
The anticipated investments are welcome news for Pakistan, which has seen little foreign investment for more than a decade due to energy shortages, terrorism, and political unrest. It will help develop trust of other countries to invest in Pakistan.
The country’s foreign exchange reserves have decreased to less than two months’ worth of imports as a result of recent instability. The foreign investment from Kuwait in Pakistan will help the country financial stability and trust development.
Despite the fact that loans have been the primary source of financial assistance, the country has long attempted to encourage foreign investment in order to lessen its dependency on borrowing. According to al-Fares, Enertech and Pakistan Kuwait Investment Company have formed a partnership to investigate potential in Pakistan.
The latter was founded in 1979 by the governments of Pakistan and Kuwait and maintains a 30 percent share in Meezan Bank Ltd., Pakistan’s fastest growing bank by deposits.