Pakistan receives $3 billion from Saudi Arabia

PAKISTAN has received $3 billion (£2.2 bn) from Saudi Arabia as part of financial assistance sought from the kingdom to stabilise the country's economy, according to a senior government official.

The financial support to Pakistan comes more than a month after prime minister Imran Khan visited Riyadh and held talks with Crown Prince Mohammad bin Salman.

Following the talks, Saudi Arabia agreed to provide $4.2 bn (£3 bn) worth of assistance to Pakistan, out of which $3 bn was to be transferred as a deposit in Pakistan's central bank and also financing refined petroleum products with $1.2 bm (£900 million) during the year.

Shaukat Tarin, the prime minister’s adviser on finance and revenue, confirmed on Saturday (4) that the State Bank of Pakistan (SBP) received a $3 bn from Saudi Arabia.

It is expected to ease pressure on the Pakistani rupee and boost the foreign exchange reserves.

Last month, Pakistan's cabinet approved the deal, paving the way for the transfer of funds, which was followed by the SBP signing the agreement with the Saudi Fund for Development to receive the amount.

The help came when the Pakistan rupee reached an all-time low at 176 to the dollar and it is expected to improve the balance of payment which has been the main worry of the government.

In 2018, Saudi Arabia had provided $3 bn in cash deposits and promised a $3 bn oil facility to Pakistan to help its foreign exchange reserves.

However, as the bilateral relations deteriorated later, Islamabad had to return $2 bn (£1.5 bn) of the $3 bn deposits.

Pakistan announced in June this year that Saudi Arabia was about to make available $1.5 bn (£1.1 bn) oil facility per annum.

(PTI)