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Pakistan honours Saudi crown prince after US$20b deals

Islamabad

PAKISTAN conferred its highest civilian honour on the Saudi crown prince on Monday, a day after he signed investment deals worth US$20 billion on the first stop of an Asian tour clouded by his alleged role in the grisly murder of dissident journalist Jamal Khashoggi.

President Arif Alvi awarded Mohammad bin Salman the Nishan-e-Pakistan (Order of Pakistan) before the crown prince left the country for his next stop, Islamabad's arch-rival India.

Pakistan is facing a serious balance of payments crisis and hopes the huge deals signed over the two-day visit - seven separate agreements and memorandums of understanding (MOUs) - will boost its struggling economy.

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Among the deals signed by the two nations: MOUs in the energy and agriculture sectors, including one for a US$10 billion oil refinery in southwestern city of Gwadar, where China has helped build a deep water port. Saudi Arabia also signed a pact to provide Pakistan with crude oil and petroleum products on delayed payments to meets its energy needs.

"We are creating a great future for Saudi Arabia and Pakistan," Prince Mohammed, the kingdom's de facto ruler, said at a reception by Prime Minister Imran Khan on Sunday in Islamabad at the start of a two-day trip.

Prince Mohammed gave no time frame for the US$20 billion in projects, which would dwarf the roughly US$53 million Saudi Arabia has invested in Pakistan in the last three years.

Investors appeared sceptical: the benchmark Karachi Stock Exchange 100 Index fell on Monday to the lowest in about three weeks.

Prince Mohammed's investment plans may assist Mr Khan's efforts to revive an economy hurt by widening current account and fiscal deficits. They may also help Pakistan become less reliant on China, which is investing about US$60 billion in the so-called China-Pakistan Economic Corridor. China is Pakistan's largest trading partner followed by the United Arab Emirates (UAE), the US and Saudi Arabia.

Finance Minister Asad Umar said this month the nation is close to signing a bailout package with the International Monetary Fund to boost dwindling foreign reserves.

Prince Mohammad's tour coincides with a spike in regional tensions: India and Saudi Arabia's arch-rival Iran - both bordering Pakistan - have accused Islamabad of backing militant groups which have carried out bloody suicide attacks on their soil in recent days.

The crown prince's tour is expected to finish with two days in China on Thursday and Friday. AFP, BLOOMBERG