PUTRAJAYA - Saudi Arabia's national oil company will invest US$7 billion (S$9.84 billion) to set up an oil refinery in Malaysia's ambitious Pengerang Integrated Petroleum Complex (PIPC), a deal that Prime Minister Najib Razak said was the single largest investment in the project led by state-run oil company Petronas.

Speaking to reporters after a bilateral meeting with visiting King Salman Abdulaziz Al Saud on Monday (Feb 27), Datuk Seri Najib called the deal - which will be signed between Saudi Aramco and Petronas on Tuesday (Feb 28) - a "vote of confidence in our economy".

He also hit back at critics who have accused him of endangering Malaysia's sovereignty by welcoming huge amounts of Chinese deals into the country.

"You can see that Malaysia has got very good relations with many countries. When we went to China, we were accused of selling our sovereignty. I wonder, will they say we sold our sovereignty to Saudi Arabia," he said.

"It is not a matter of sovereignty but investment. It is a strong vote of confidence in our economy."

Political opponents have attacked his announcement of RM144 billion in projects after a week-long visit to Beijing late last year. This included the controversial East Coast Rail Line, which critics said was being built at an inflated price tag of RM55 billion.

Mr Najib's detractors also noted that the railway line stretching from the Klang Valley to Kelantan in the northeast would be paid via a loan from China, with Malaysian taxpayers eventually saddled with the bill.

Saudi Arabia has been a strong supporter of Mr Najib, who has faced continued accusations of graft over US$700 million found in his personal accounts which was linked to troubled state firm 1Malaysia Development Berhad.

However, Riyadh has backed the Malaysian leader's claims that the money was a political donation by Saudi's royal leaders ahead of the previous election held in 2013.