The deal with Pakistan's Port Qasim Authority is for a major leisure, commercial and residential development in Karachi that would include hotels, parks and an 18-hole golf course.

The agreements were signed after talks between UAE Vice President and Prime Minister Sheikh Mohammad Bin Rashid Al-Maktoum and Prime Minister Shaukat Aziz during the UAE leader's day-long visit to Pakistan on Tuesday.

"This landmark development will set the standard for the future projects planned for Pakistan. This is an ambitious project that will create new lifestyle choices and options for the citizens of Pakistan," said Emaar chairman Mohamed Ali Alabbar.

"We have projects planned for other cities in Pakistan which we will be rolling out in the near future."

The UAE is the largest investor in Pakistan after its state-run Etisalat bought controlling share in the privatised Pakistani telecom firm in June last year for 2.6 billion dollars.

Pakistan's government also agreed to authorise Dubai Islamic Bank to open 50 branches in Pakistan, officials said.

Trade between the two countries totalled 2.78 billion dollars last year, with the balance in favour of the UAE due to Pakistan's oil imports.

Sheikh Mohammad also met President Pervez Musharraf and lauded "excellent relations between the two countries" in a speech at a state banquet.