The Ambassador of Azerbaijan, Khazar Farhadov, announced that the State Oil Company of Azerbaijan Republic (SOCAR) intends to invest $1 billion in the energy sector of Pakistan. Many other companies in Azerbaijan are also interested in developing joint ventures with Pakistan as the country is being considered as a viable market for trade and investment.
The energy sector in Pakistan comprises of electricity, gas, petroleum, and coal sectors. Pakistan’s energy sector remains one of the main obstacles to economic growth. However, Pakistan has managed to increase power generation since 2013, while solar and wind power have entered Pakistan’s energy mix to foster renewable energy development. Hydropower has also been a significant source of renewable energy in Pakistan.
The preferential trade agreement between Pakistan and Azerbaijan will lower the customs tariffs and improve bilateral trade between the two countries. Both countries have the potential to strengthen their economic ties and promote direct connectivity between the public and private sectors to expand trade.