Saudi Arabia will discuss the option of extending the terms of its $ 3 billion deposit to Pakistan’s central bank to help Islamabad’s faltering economy, according to a joint statement. In recent years, Saudi Arabia has provided $ 4.2 billion in support to Pakistan in the form of a $ 3 billion loan to the central bank, as well as $ 1.2 billion in deferred oil payments to boost foreign exchange reserves. The country’s limited foreign exchange reserves fell below $ 11 billion last month. “The Kingdom of Saudi Arabia has reaffirmed its continued support for Pakistan and its economy, including discussions on increasing its $ 3 billion deposit with the central bank by extending its term or otherwise,” a joint statement issued Sunday said. The latest sign of support follows a visit to Saudi Arabia by Pakistan’s new prime minister, Shehbaz Sharif, who has inherited a crippling national debt, rampant inflation and a weak rupee. Saudi Arabia has also pledged to “further boost funding for oil products” at a time when the South Asian country is suffering from frequent power outages. The Gulf nation has long been a regular source of financial relief for successive governments. “Pakistan deeply appreciates the Kingdom’s continued support for Pakistan,” Sharif wrote on Twitter, adding that the joint statement “marks the beginning of a new era of close cooperation” between “our two sister countries”.
“Technical level discussions”
The announcement comes after recent talks between Pakistan and the International Monetary Fund (IMF) on the release of funds under an existing $ 6 billion bailout program that had stalled amid concerns over the pace of reforms. “The little financial help we can get from any country would help us given the state of our economy,” Kaiser Bengali, a veteran economist, told AFP. “But for how long will we run our economy on loans? “This policy will not work for the next five years either.” Pakistani Finance Minister Miftah Ismail, who had stayed in Saudi Arabia for “technical talks”, was due to return to Pakistan on Sunday afternoon. The Prime Minister of Pakistan Sharif also met with the Secretary General of the Organization of Islamic Cooperation, Hussein Ibrahim Taha, during his visit. A number of issues facing the Islamic world were on the agenda, including the situation in Palestine, Afghanistan and Indian-administered Kashmir. Sharif also traveled to the United Arab Emirates, where he held talks with the Crown Prince of Abu Dhabi, Sheikh Mohammed bin Zayed Al Nahyan. Sharif was elected Prime Minister of Pakistan on April 11, succeeding Imran Khan, who was ousted after a parliamentary vote of no confidence.
