ISLAMABAD: Iranian President Hassan Rouhani will visit Pakistan this week for talks on improving relations and strengthening economic links, the Foreign Office said on Wednesday.

It said the lifting of sanctions on Iran following its nuclear deal with the West “has opened new avenues for enhancing economic interaction”.

Rouhani would also discuss cooperation on regional and international issues during his visit on Friday and Saturday, the ministry said.

Prime Minister Nawaz Sharif visited Iran in May 2014 and in January this year to try to ease tensions between Iran and Saudi Arabia.

Read: Nawaz stresses peaceful resolution to Saudi-Iran row

Saudi Arabia cut diplomatic ties with Iran in early January after protesters burned Saudi diplomatic missions in Iran.

They were angry at the kingdom's execution in early January of Shia cleric Nimr al-Nimr.

Pakistan is counting on a joint project with Iran to solve a long-running power crisis that has sapped economic growth and left its 200 million people fuming at incessant electricity cuts.

A $7.5-billion Iran-Pakistan gas pipeline intended to feed Pakistani power plants was inaugurated with great fanfare in March 2013.

But the project immediately hit quicksand in the form of the international sanctions on Tehran, which meant that cash-strapped Pakistan struggled to raise the money to build its section.

Tehran has already built its own section of the 1,800-kilometre (1,100-mile) pipeline, which should eventually link its South Pars gasfields to the city of Nawabshah near Karachi.

As part of an ambitious $46 billion economic corridor linking western China to the Middle East through Pakistan, Beijing recently started work on the section of a pipeline between Nawabshah and the port of Gwadar close to the Iranian border.

Once this is completed, Pakistan will build the last 80 kilometres to Iran.