Saudi and Pakistani investors have signed an agreement to set up a joint private equity fund, in a new private-sector step to deepen commercial ties between the two countries.

The Saudi-Pakistan Joint Business Council signed a memorandum of understanding (MoU) at a ceremony in Karachi on Monday, 9 November, to establish the Saudi-Pakistan Private Equity Fund. The council said the fund's initial size would be several hundred million dollars, with plans to expand as investment opportunities develop.

Under the proposed arrangement, private investors from Saudi Arabia and Pakistan will contribute equally to the fund. About 75% of its capital will be invested in projects in Pakistan, with the remaining 25% going to projects in Saudi Arabia.

Where the money is meant to go

The fund intends to invest in fast-growing private businesses in agriculture, mining and construction, and to assess opportunities from Pakistan's land bank monetisation programme, including airports, motorways, ports and maritime projects. Energy, power distribution and information technology are also among the sectors under consideration.

Prince Mansour bin Mohammad Al Saud, chairman of the Saudi-Pakistan Joint Business Council, attended the signing in Karachi alongside leading Saudi investors and Pakistani bank and corporate chief executives. Fawad Mukhtar, the council's co-chair and chairman of Fatima Group, was also present.

The council was established by the governments of Saudi Arabia and Pakistan, in coordination with their respective high-level committees, to promote private-sector trade and investment between the two countries. The latest MoU follows a series of meetings of the council.

Approvals still needed before any investment

No exact figure for the fund's size has been disclosed, and neither side has given a currency, a timeline for its launch or a date for regulatory approval. No specific airport, motorway or port has been named as an investment target, and no acquisition, construction contract or financial close has been announced.

The establishment of the fund and its subsequent investments will remain subject to regulatory requirements in both countries, and its final structure and first investments are expected to be confirmed only after the necessary clearances are secured.

The launch comes as Islamabad and Riyadh deepen longstanding ties, including in defence, and as Pakistan seeks private capital for infrastructure and industry. For the original reporting, see TBS News on the fund launch and The AZB on the MoU signing.