Reportedly, Saudi Arabia has approved funding worth $2 billion for Pakistan’s economy, which is expected to provide a much-needed boost. This development follows significant progress in financing worth $3 billion from friendly countries.
In March, China extended its safe deposit of $2 billion on existing terms, as Pakistan’s foreign exchange reserves remain stable. Sources revealed that the deferment of payment has been done for a year.
Pakistan had requested confirmation of financing from Saudi Arabia and the United Arab Emirates (UAE) to secure a loan tranche from the International Monetary Fund (IMF), which is considered a prerequisite. Earlier this week, Minister of State for Finance and Revenue, Ayesha Ghous Pasha, stated that the IMF is verifying external financing from friendly countries such as China, the UAE, and Saudi Arabia. In this regard, Finance Minister Ishaq Dar is expected to contact UAE officials before leaving for the United States on April 10.
This funding from Saudi Arabia is a significant development for Pakistan’s economy, which has been facing economic challenges. However, the IMF remains concerned about Pakistan’s economic policies, including objections to the annual subsidy of Rs900 billion and demands for further interest rate increases to keep pace with inflation. The IMF has also called for the collection of Rs850 billion rupees under petroleum levy and a reduction in the import of petrol and diesel.