Pakistan’s Refusal to Join Yemen Fight Angers Top Trade Partners – Bloomberg Business

by NewsStand

Pakistan’s refusal to join a coalition of Sunni Muslim nations fighting in Yemen has triggered a rift with top trading partners that supply most of its oil.

In a series of tweets over the weekend after Pakistan’s parliament called for a cease-fire in Yemen, Anwar Mohammed Gargash — second-in-charge at the United Arab Emirates’ foreign ministry — warned that the South Asian nation would pay a “high cost” for its “contradictory and ambiguous stance.”

That prompted a rebuttal on Sunday from Interior Minister Chaudhry Nisar Ali Khan, who called the remarks “threatening, unacceptable and an insult to the Pakistani nation,” according to a statement in Dawn newspaper.

The spat shows the risks oil-dependent Pakistan faces in trying to avoid taking sides in a battle between neighboring Iran and a group of Arab nations that attacked Yemen. Saudi Arabia and the UAE provide almost all of Pakistan’s crude imports, according to a petroleum ministry official who asked not to be identified because the data isn’t public.

Pakistan’s parliament passed a unanimous resolution on April 10 declaring support for Saudi Arabia’s “territorial integrity” but falling short of accepting a demand from Riyadh’s leadership to send ground, air and sea troops to fight the rebel Houthis, who are linked to Shiite-dominated Iran.

Pakistani Workers

The vote came shortly after Pakistan hosted Iranian Foreign Minister Mohammad Javad Zarif in Islamabad. Saleh bin Abdul-Aziz, Saudi Arabia’s Islamic affairs minister, arrived in Pakistan’s capital late on Sunday for urgent talks on Yemen, Dawn reported.

Besides oil, Saudi Arabia and the UAE host several million Pakistanis who work in jobs like construction, making them the top providers of remittances. The emirates are also preferred destinations for Pakistanis to invest in real estate, according to Mirza Ikhtiar Baig, who heads the Pakistan-UAE Business Council based in Karachi.

“We have commercial interests in the United Arab Emirates which we do not want to see hurt,” Baig said by phone. “A government delegation should go there and explain our stance and hold closed-door meetings to calm the UAE government.”

Pakistan’s benchmark KSE100 Index fell as much as 0.5 percent before recovering losses. It was little changed as of 12:36 p.m. local time.

“Some concerns on the tension developing with UAE,” Baryalay Arbab, head of equity at KASB Securities Ltd., wrote in an e-mail. “Good chunk of remittances come from the GCC,” he said, referring to the Gulf Cooperation Council.

Many Pakistani lawmakers said that picking sides would fuel sectarian conflict in the country, which is already fighting militants. While the majority of Pakistanis are Sunni, it’s home to the most Shiite Muslims outside of Iran.

via Pakistan’s Refusal to Join Yemen Fight Angers Top Trade Partners – Bloomberg Business.