Saudi Fund for Development team due today

ISLAMABAD: A high level delegation of Saudi Fund for Development (SFD) is reaching Islamabad on Monday (toady) on a six-day official visit to finalise agreements with Pakistani authorities, well informed sources told Business Recorder.

The delegation to be headed by Dr Saud A Alshammari, General Director of Asia Operations will be composed of Mohammad S. Almasoud Head Central & West Asia Operations; Abdulrhman Alsogheer, Senior Loan Specialist; Abdulelah Alluhaidan, Project Specialist and Khalid Alqadi, Legal Specialist.

Recently, Prime Minister Shehbaz Sharif assigned Finance Minister Senator Ishaq Dar the responsibility to resolve the issues being faced by SFD with respect to funding of $ 1.6 billion as Saudi Arabia expressed unhappiness with the Economic Affairs Division for its ‘inappropriate’ attitude.

Saudi Arabia, sources said, had shown willingness to send a SFD team from October 17-22, 2022 with preconditions of resolution of issues related to taxes and delay in finalization of loan agreements.

On Monday, the delegation is scheduled to hold meeting at PM Office to finalize the Task Force, designate officials from the concerned entities, in addition to overview of SFD schedule and tasks during the Mission. A focal point from PMO will also accompany the SFD delegation during the mission.

$1.6bn funding: PM tasks Dar to resolve SFD reservations

On October 18, SFD will hold meeting with EAD officials to finalize loan agreements of: (i) Mohmand dam project; (ii) Muzaffarabad road project; (iii) gravity flow water in Mansehra project. The delegation will discuss the loans approved for new energy projects.

Pakistani and SFD delegation will also discuss the remaining balances of projects that are technically completed, i.e., Golan Goal HP project and Neelum Jhelum HP project.

Grants for Balochistan for ongoing project include reconstruction of permanent houses in Awaran, livelihoods restoration, government buildings in Awaran and equipping Hayaserairy Hospital with media equipment and furniture.

Follow up on on-going loan projects like Malakand region project and Chella Bandi project in addition to ERRA’s grant (status of the financial closure).

The delegation will hold a meeting with the authorities of Ministry of Planning, Development and Special Initiatives to discuss floods effects.

On October 19, EAD and SFD delegation will discuss the moving-forward plan for the implementation on: (i) King Salman hospital and; (ii) Girls Collage of Home Economics and Management Sciences project, besides follow up on the project “Saudi contribution for Gwadar-Lasbella Livelihood” project.

Prime Minister’s SAPM, Syed Tariq Fatemi, sources said, has informed Secretary to Prime Minister that Pakistan’s Ambassador in Riyadh had a meeting on September 27, with Dr. Saud Ayid, DG (Asia Operations) of SFD. During the meeting, Dr. Ayid gave an overview of their projects across Pakistan with a total outlay of around $1.6 billion ($1.2 billion loans and $ 400 million grants).

According to the details shared with Pakistani ambassador, out of the total funds, around $550 million ($500 million loans and $50 million grants) were still not allocated to any project due to delays in response from Pakistani side.

The sources said that SFD was facing some obstacles in executing 4-5 grant funded projects in Balochistan due to issues related to coordination with Economic Affairs Division (EAD) and agencies nominated by Pakistan.

The King Salman Hospital in Tarlai, Islamabad (a grant funded project of around $26 million) was facing delays due to the failure of PWD as the executing agency. The EAD had proposed to transfer the project from PWD to FWO.

The sources maintained that loan agreement for Mohmand Dam Hydro Power Project worth $250 million was near finalization, pending approval from Pakistan side.

According to Tariq Fatemi, Dr Ayid also expressed dissatisfaction over the modus operandi of coordination between EAD and SFD, and highlighted the following major challenges being faced by SFD in Pakistan: (i) even after receiving assurances from the Ministry of Finance, the taxation issue was still not resolved. This was seen by the SFD as a breach of the signed loan agreements; and (ii) lack of any dedicated team at the EAD designated for SFD projects.

Copyright Business Recorder, 2022