The kingdom enhances the capital of the Saudi Industrial Development Fund (SIDF) by SAR6 billion.

Jojo Puthuparampil is a business news writer for Inc. Arabia.

In a bid help finance the kingdom’s foray into more industries, Saudi Arabia plans to enhance the capital of the Saudi Industrial Development Fund (SIDF) by SAR6 billion ($1.6 billion), Energy Minister Khalid al-Falih said.

The extra allocation would be in addition to capital worth SAR3 billion that was injected in the fund recently.

This, on the ground, would mean a massive capital push for the kingdom’s small and medium-sized enterprises (SMEs).

SIDF was established in 1974 to finance the growth of the private industry by providing loans for setting up factories and upgrading existing ones.

However, currently, it is involved in guaranteeing loans for small and medium-sized enterprises.

Saudi Arabia has been trying to diversify the economy beyond oil exports as low crude prices have hurt state revenues.

“(Increasing) the capital of the fund by a large amount will give it an opportunity to develop other industries,” al-Falih told reporters. “We are talking about renewable energy, conversion, automotive and vital industries that have never existed in the kingdom.”

Military and pharmaceutical projects would receive support, he said.

The plan is part of a series of initiatives launched by the Saudi Arabian government as the Kingdom deploys financial reserves to move into non-oil industries.

Recently, the Saudi Arabian government and Japan’s SoftBank Group joined hands to create a technology investment fund that could grow as large as $100 billion.

The Public Investment Fund (PIF), Saudi Arabia’s top sovereign wealth fund, will be the lead investment partner and may invest up to $45 billion over the next five years while SoftBank will invest at least $25 billion.

The tech fund is expected to be one of the world’s largest private equity funds.

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