(Bloomberg) --

Qatar’s sovereign wealth fund plans to invest $3 billion in key sectors of Pakistan’s economy as the gas-rich Gulf state extends its support to the cash-strapped South Asian nation.

The $445 billion Qatar Investment Authority is evaluating strategic investments in the country’s main airports in Islamabad and Karachi, as well as in the renewable energy, power and hospitality sectors, according to people familiar with the matter.

The investments from the QIA may partly overlap with the $2 billion in bilateral support Qatar has already planned for Pakistan, one of the people said, asking not to be identified because the information is private. The fund may end up investing more or less than $3 billion depending on the asset valuations and opportunities, the people said, without sharing a time frame.

The Qatari ruler’s office confirmed the plan to invest in Pakistan in a statement posted on its website. The decision came during a meeting between ruler Sheikh Tamim Bin Hamad Al Thani and Pakistan Prime Minister Shehbaz Sharif.

Default Risk

Qatar is pledging its support for Pakistan to help ease the country’s funding crunch and the consequent risk of a default. Prime Minister Sharif has been visiting Qatar ahead of an IMF board meeting next week that could lead to the release of $1.2 billion in financing. Arab nations committed to supporting the country only after it secured a program from the Washington-based lender. 

During the meeting, officials also discussed the progress Qatar -- the world’s top supplier of liquefied natural gas -- has made on investing in Pakistan’s next import terminal, according to people with knowledge of the discussions. While progress has been made, some steps remain, they said. 

Shares in state-controlled Pakistan International Airlines rose as much as 10% following the news of Qatar’s interest in the hospitality sector. The carrier owns the Roosevelt Hotel in New York and has previously tried to sell the iconic property. 

The South Asian nation will also get $1 billion in oil financing from Saudi Arabia and a similar amount in investments from the United Arab Emirates. Gulf states often provide a mix of deposits and investment pledges when they provide aid to states. 

The Pakistan rupee is the best performer globally this month and has gained about 9% since dropping to a record low last month as worries over a possible default fade, according to data tracked by Bloomberg.

(Updates with details, share move in sixth and seventh paragraphs.)

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