Pakistan secures $6 billion loan from Saudi Arabia

Riyadh: Pakistan secured loans up to USD 6 billion from Saudi Arabia on the sidelines of the ongoing Future Investment Initiative conference in Riyadh.

A statement released by Pakistan’s Press Information Department (PID) stated that Pakistan’s Prime Minister Imran Khan held bilateral talks with Saudi King Salman bin Abdulaziz and Crown Prince Mohammad bin Salman.

The release also mentioned that a Memorandum of Understanding (MoU) was signed between both the sides. “A MoU was signed between the Finance Minister Asad Umar and the Saudi Finance Minister, Muhammad Abdullah Al-Jadaan. It was agreed Saudi Arabia will place a deposit of USD 3 Billion for a period of one year as balance of payment support.”

“It was also agreed that a one year deferred payment facility for import of oil, up to USD 3 Billion, will be provided by Saudi Arabia. This arrangement will be in place for three years, which will be reviewed thereafter,” mentioned the statement which was released on October 23.

Saudi Arabia further “confirmed” their interest in setting up a petroleum refinery near Gwadar in Pakistan, reports the Dawn. The statement mentioned that a MoU in this regard will be signed between the two sides after “obtaining cabinet approval”.

The kingdom further showed interest in the “development of mineral resources in Pakistan”. The release said, “Saudi Arabia expressed interest in development of mineral resources in Pakistan. For this purpose, the Federal Government and the Government of Balochistan will consult, following which a delegation of the Kingdom will be invited to visit Pakistan,” stated the release.

Saudi’s financial bailout to Pakistan comes in the midst of the Islamic nation’s current account deficit of USD 18 billion, which had triggered Pakistan to seek assistance from the International Monetary Fund (IMF) earlier this month. A delegation from IMF is scheduled to visit the nation on November 7 to discuss the loan amount that is required by Pakistan, according to the Dawn.