In a major development, the Kingdom of Saudi Arabia has agreed to give $3 billion for a year to Pakistan for preventing a balance of payment crises, as per the media reports.
It has also been decided to extend the facility of deferred payment for one-year of oil imports to Pakistan costing $3 billion.
Prime Minister—Imran Khan who would be paying a visit to the Kingdom for attending the Future Investment Initiative (FII) Conference is said to have agreed on these agreements in this regard.
According to media reports from the Kingdom capital—Riyadh, have stated that far-reaching decision on the matters of finance and bilateral trade were made during the discussions which were held between Pakistani and Saudi officials. The decisions made includes:
- A memorandum of understanding (MoU) between the Finance Minister—Asad Umar and the Saudi Finance Minister—Muhammad Abdullah Al-Jadaan. It was decided that Saudi Arabia would be placing a deposit of three billion US dollars for a span of one year as a balance of payment support.
- It was also decided that a 1-year delayed payment option for the import of oil for up to $3 billion, would be given by the Kingdom. This arrangement would be placed for three years, which would then be reviewed afterwards.
- Also, Saudi Arabi confirmed making investments in the oil refinery project in Pakistan, and a MoU would be signed once the cabinet approval is taken.
- The Kingdom also showed interest in the development of mineral resources in Pakistan.
Mohammad Sohail—the CEO Topline Securities said that the provided facility by Saudi Arabia is beyond expectations and would give the much-needed support to Pakistan’s bad accounts situation and would assist the country in negotiating a smaller loan facility from the International Monetary Fund (IMF) with lesser stern conditions.