The Allure of Prince Mohammed bin Salman
India is still healing from last week’s terrorist attack in the Pulwama region of India-controlled Kashmir. In one of the worst attacks the region has seen in the last fifty years, Pakistani-based terrorist outfit Jaish-e-Muhammad has claimed responsibility for the suicide bombing that killed over 40 paramilitary police. India has accused Pakistan of aiding JeM in carrying out the attack. Leaders from across the political aisle are standing united in condemning the attack and are calling for an appropriate response. Major Indian industries have cancelled multi-million dollar deals and have cut ties with Pakistan. Trade preferences given to Pakistan under the Most Favoured Nation status have been removed and customs duties have been raised to 200%. Pakistan, on the other hand, has denied any role in the attack and has promised to fight back if India attacks. China, which has repeatedly vetoed India’s attempts to declare JeM leader Masood Azhar as a global terrorist at the UN, has cautioned India to exercise restraint.
Against this backdrop, the Saudi Crown Prince Mohammed bin Salman is on an Asian tour visiting three countries: Pakistan, India and China.
On February 18, less than four days after the Pulwama attack, MbS arrived at Pakistan to a lavish welcome. The day was declared a public holiday and Pakistan PM Imran Khan personally chauffeured the Prince from the airport. Two days later, MbS arrived in India, and Prime Minister Narendra Modi broke protocol by going on the airport tarmac to give him a grand welcome. The man who just signed deals worth $20 billion with India’s enemy number one and praised its anti-terror efforts, was given one of the longest and warmest hugs ever given to a foreign leader. He was later accorded a ceremonial welcome by Indian army. The only concession India had asked was for the Prince to go back to Saudi from Pakistan before flying into India. Later in the evening, the Prince announced that he saw scope for investing over $100 billion in India over the next two years. To provide you some comparison, we can expect India’s own government spending for the next two years to be around $600 billion, one-sixth this amount is considerable. And as for Pakistan, their imports from India that would be hurt by the new tariffs were a paltry $0.5 billion last year. Compare that to the $20 billion pledged by MbS.
This is the same Prince whose international reputation was deeply damaged last October after the murder of journalist Jamal Khashoggi, a fierce critic of the Saudi Kingdom. Top intelligence agencies in the US concluded that the murder could not have happened without the approval of the Prince. US President Trump called it the “worst-cover up in history” but refused to cancel the $450 billion worth of deals signed. If the number is right, it would be the single largest arms deal in US history. Only some European nations have halted their trade deals with the kingdom citing the murder, war in Yemen, and human rights abuses. Britain, on the other hand, is seeking to further ties. Canada has decided to keep the $15 billion arms deal while strongly condemning the kingdom.
Despite human rights groups calling foul, the Crown Prince is a rockstar to many back home. He is not only heir to the throne, but also chairman of the Council for Economic and Development Affairs, chairman of the Council of Political and Security Affairs, and Minister of Defense. Apart from introducing many progressive cultural reforms in the last two years, the Prince has also set out to make the kingdom less dependent on oil by diversifying its economy through the Vision 2030 program. The slew of investments in major countries around the world is a part of this program. In addition to these, MbS has gone after major corporations and rising startups. Earlier last year, he held meetings with top businessmen in America including Tim Cook, Elon Musk, Stephen Schwarzman, Sergey Brin, Rupert Murdoch, Jeff Bezos and Peter Theil. His visit also included meetings with Hollywood celebrities and the cherry on top was Oprah Winfrey. The US tour happened after an equally grand UK tour.
During the aftermath of the Khashoggi murder, many of the executives he met with pulled out of Saudi’s flagship investment conference last year, but companies are still flooding with Saudi money with only a few cutting business ties. The Public Investment Fund of Saudi Arabia has written fat checks to companies like Tesla, Uber, Lyft, Snap and is the major backer of the SoftBank Vision Fund, which in turn has invested in over 50 companies. In my other article, I talk about the magnanimity of the $100 billion SoftBank fund, and Saudi Arabia has contributed $45 billion to it. SoftBank CEO Masayoshi Son, a close friend of MbS, condemned the murder but said the investments will continue as the company has a “responsibility to the people of Saudi Arabia.” SoftBank is planning on raising another $100 billion fund and expects Saudi to be the lead investor again.
The Prince’s next stop on the Asian tour is China and you can expect deals and investments that trump all others mentioned here. Despite the many merits of these enormous investments, the allure of the Saudi Prince — or more importantly — his money, should make us all wonder how we have so easily put money above all.
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