Pakistan to repay $2 Billion to Saudi Arabia

By Our Staff Reporter

Islamabad: Pakistan is likely to repay the $2 billion Saudi Arabian loan and is looking for a variety of options to secure more loans aimed at retaining gross official foreign exchange reserves of more than $12 billion at their current level, media reports said Saturday.

Ministry of Finance sources told The Express Tribune that the second tranche of $1 billion of Saudi loan is maturing next month and there was a likelihood that the government will return the money two years after it was borrowed.

Saudi Arabia’s financial assistance package, initially estimated at $6.2 billion, helped Prime Minister Imran Khan ‘s government avoid defaults on international debt obligations.

“This is a bilateral confidential matter,” the Ministry of Finance said in a sad reply on Friday.

But, on condition of anonymity, the top government official said there was a possibility that Pakistan would return the money next month.

After coming to power, the Prime Minister made two trips to Saudi Arabia to secure a package that allowed the PTI government to negotiate an agreement with the International Monetary Fund (IMF).

Saudi Arabia agreed to provide Pakistan with a financial package of $6.2 billion over three years.

This included $3 billion in cash assistance and $3.2 billion in annual oil and gas supplies on deferred payments.

As per the sources told Express Tribune that the government was considering a variety of options to repay the Saudi loan on the balance sheet of the State Bank of Pakistan.

Nor has the government been able to restore the suspended $6 billion IMF programme, making it difficult for it to continue uninterrupted foreign inflows.

Sources indicate that if the IMF programme is not restored in the near future, the inflows of the World Bank may begin to dry up.

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