Saudi Arabia has announced that it will deposit USD 3 billion in Pakistan’s central bank to boost the country’s cash-strapped economy.
Saudi Fund for Development made the statement on Tuesday, according to Geo News.
The Saudi Fund for Development has announced a $3 billion deposit with Pakistan’s State Bank (SBP). It went on to say that an official instruction had been issued to provide $1.2 billion to fund Pakistan’s oil products trade for the rest of the year.
This is a welcome relief for Pakistan, which is suffering from a severe economic crisis.
Hammad Azhar, the Information and Energy minister, verified the report.
“This will help ease pressures on our trade and forex accounts as a result of global commodities price surge,” Azhar said as he shared the news.
Pakistan prime minister Imran Khan had on Monday met Saudi Arabia’s Crown Prince Mohammed bin Salman bin Abdulaziz Al Saud on the sidelines of the Middle East Green Initiative (MGI) summit in Riyadh, which he was invited to attend at the crown prince’s invitation.
Back in May, the federal minister for information Fawad Chaudhry had said Saudi Arabia had agreed, in principle, to revive the facility of oil supply to Pakistan on deferred payments.
Finance minister Shaukat Tarin had repeated earlier this month that Saudi Arabia had agreed to provide oil on deferred payment to Pakistan.
Earlier, Saudi Arabia had provided a USD 6 billion financial package, including $3 billion deposits into the State Bank of Pakistan and the remaining $3 billion for oil facility on deferred payment on an annual basis.
Last year, the decade-long friendship between both countries took a sharp turn when Foreign Minister Shah Mehmood Qureshi’s issued a blunt warning to Saudi Arabia after the latter refused to act against India over the Kashmir issue.
On the first anniversary of the revocation of Article 370 by India, Qureshi took Saudi Arabia to task in a TV interview for not obliging Pakistan over the issue of ‘organising’ a meeting of the Council of Organization of Islamic Cooperation (OIC) Foreign Ministers (CFM) on Kashmir in early February 2020.
Qureshi’s remarks revived Riyadh’s anger, who had forced Pakistan to pay back USD 1 billion prematurely.
Riyadh has helped Islamabad many times including helping in paying for Pakistan’s first batch of F-16 fighter aircraft in the 1980s and providing USD 6 billion loans that helped Pakistan tide over its balance of payments crisis just two years ago.
Saudi Arabia had come to Pakistan’s rescue in 2018 when it had agreed to provide USD 3.2 billion worth of oil on deferred payments per annum as part of its USD 6.2 billion packages to help Pakistan tide over its balance of payment crisis.
