Last month, amid political unrest and allegations of foreign interference, Pakistan witnessed the ouster of Imran Khan and the selection of a new prime minister, Shehbaz Sharif. Sharif hails from a well-known political family and leads the Pakistan Muslim League (Nawaz party). On April 11, 2022, Mr. Sharif was sworn in as the 23rd prime minister of the country and will lead Pakistan until new elections are held in August 2023.
In his first speech to parliament, Sharif welcomed good relations with the Gulf monarchies and Iran. He also announced his strategy to build trade and political relations with these states in the future. The prime minister stressed his appreciation of the supportive role the Gulf Cooperation Council (GCC) states have played in recent years, as well as his determination to forge deeper ties with these countries. Indeed, Mr. Sharif embarked on his first foreign trip to the Gulf region—visiting Saudi Arabia and the United Arab Emirates on April 27, 2022.
Shehbaz: An Old Acquaintance
Shehbaz Sharif, the former chief minister of the Punjab province and a poetry-loving Pakistani, is no stranger to the Gulf monarchies and even lived in Saudi Arabia for several years. Nawaz Sharif, the elder brother of the current prime minister, served as PM himself three times, but was deposed by then-Army Chief of Staff Pervez Musharraf in 1999 following a coup. Shortly after this period, the Sharif family was exiled to Saudi Arabia.
The Sharif family’s reputation in Saudi Arabia and Shehbaz’s appreciation for Saudi Crown Prince Mohammed bin Salman (MBS) prompted the Saudi leader to personally congratulate Sharif after he was elected by the parliament as PM. MBS went on to welcome closer bilateral ties between Saudi Arabia and Pakistan. Indeed, the prospect of increased economic assistance from Saudi Arabia and Sharif’s close personal ties to the Kingdom left no doubt as to where the new PM would visit first.
During the new PM’s trip to Riyadh, he sought to secure greater economic cooperation with and financial backing from the Saudi government. Media reports claimed that Shehbaz sought an additional foreign aid package of $3.2 billion dollars. Pakistan’s economic woes prompt the new PM to reach out to Saudi Arabia to stabilize tumultuous domestic markets and increase foreign exchange reserves. Flush with Saudi money, his government can continue to subsidize vital imports, such as oil, for two more months.
Needs Control the Relations
Sharif, for now, is likely to be eyeing some troubling economic figures. According to the Pakistan Bureau of Statistics, Pakistan’s trade deficit stood at $35.4 billion during the first nine months of the July-June fiscal year, a 70 percent increase over the previous year. To put that into perspective, Pakistan’s gross domestic product is $271 billion. At the same time, inflation surged to 12.7 percent in March on a year-on-year basis.
Saudi Arabia has a history of helping Pakistan through difficult economic times. It provided $1.5 billion in financial assistance to Nawaz Sharif in March 2014, and $20 billion to Imran Khan during MBS’s 2019 visit to Islamabad.
However, previous Pakistani governments failed to maintain good relations with Saudi Arabia, which imperils the supply of Saudi money. Islamabad refused to participate in the Saudi-led Arab Coalition war in Yemen in 2015 and adopted an ambivalent approach to the inter-GCC rift that led to the blockade of Qatar in 2017. In addition, Imran Khan’s insistence on a strong response from the Organization of Islamic Cooperation (OIC)—over which Saudi Arabia maintains significant influence—to India’s Kashmir issue in 2021 angered Saudi officials, who demanded the immediate repayment of a $1 billion loan.
Shehbaz Sharif wants to rectify Khan’s past difference with Saudi Arabia. While MBS sought to weaken the influence of Islamists in Saudi Arabia, Khan proclaimed himself a promoter of Muslims around the world, a direct challenge to MBS. Khan’s ouster and Sharif’s ascent to power have almost certainly been welcomed in Saudi Arabia as a step forward for Saudi-Pakistani relations. Khan was known for his charisma, but Sharif embraces pragmatic politics, pursuing practical interests rather than populist rhetoric.
Unlike Khan, Sharif represents the “old order of Pakistan” with stronger ties to the army. Maintaining ties with the Pakistani military remains Saudi Arabia’s top priority, so Sharif’s investiture only furthers Riyadh’s interests. Saudi Arabia is a member of the OIC Contact Group in Jammu and Kashmir. Saudi pilots and soldiers are trained in Pakistan, and Islamabad has conducted several military exercises with Saudi Arabia in recent years. Riyadh will remain a close strategic partner of Pakistan and a fierce supporter of Sharif’s government.
Likewise, Pakistan’s relationship with Saudi Arabia goes beyond the Kingdom’s deep pockets. Saudi Arabia is home to 2.5 million Pakistani workers. Remittances from expat workers account for nearly 86 percent of the secondary income balance of the Pakistani economy; almost 60 percent of these remittances are from the Gulf states. Furthermore, these states are vital for meeting Pakistan’s energy needs. It depends on the UAE and Saudi Arabia for oil imports, and on Qatar for Liquified Natural Gas. Hence, the new premier is expected to channel his efforts toward developing close relationships with the GCC states and gain access to this much-needed aid.
Shehbaz’s relations with Saudi Arabia will undoubtedly be shaped by his relations with Iran. Imran Khan established close ties with the Islamic Republic, and Saudi officials resented it. Khan’s allegation that the United States had plotted his downfall was widely reported in the Iranian media.
The harmony between Khan’s party and the Iranian government is anything but surprising. Khan had adopted anti-U.S. positions since the late 1990s. He opposed the U.S. war on terror, the American invasion of Iraq, and U.S. drone attacks inside Pakistan. These critical views of Iran’s erstwhile ally not only boosted his popularity inside Pakistan, but also in Iran. By 2011, prominent figures known for holding pro-Iran positions had joined Khan’s party. Shireen Mazari, an analyst on foreign affairs who became Khan’s key confidante and Minister of Human Rights in his government. She rose to become the most outspoken anti-GCC, anti-U.S., and pro-Iran leader of Khan’s party. Others joined as well. Shah Mehmood Qureshi, who would become Pakistan’s foreign minister under Khan’s government, shared Mazari’s views on the United States and the Arab Gulf states.
Shehbaz is a pragmatic prime minister, and Pakistan needs access to Saudi aid and oil. Although Sharif will continue Pakistan’s neighborly relations with Iran during his tenure as prime minister, he will likely draw a line between Islamabad’s relations with Tehran and Riyadh so as not to offend Saudi officials. Saudi Arabia and Pakistan have a long history of collaboration and close ties. Pakistan has provided military and security support to Riyadh, and Saudi Arabia has provided financial assistance to buttress Islamabad’s weak economy. Shehbaz Sharif is expected to seek to repair his country’s weakened relationship with Saudi Arabia and strike a balanced and pragmatic approach toward the countries in the Gulf, particularly Iran and Saudi Arabia.
The views and opinions expressed in this article are those of the authors and do not necessarily reflect the views of Gulf International Forum.