Saudi Arabia agreed to provide Pakistan with the needed financial package of 8 billion. The money is to help the country, going through an economic crisis to deal with the dwindling Forex reserves. Pakistan also needs the money to revive its saturated economy.
Pakistan’s economy is ailing with a cash crisis. The inflation is sky high; forex reserves are low and the current account deficit is widening. This has also resulted in the depreciation of the value of Pakistan’s currency.
The deal was finalized during Pakistan Prime Minister Shehbaz Sharif’s visit to Saudi Arabia. The help package from Saudi Arabia includes increasing the oil financing facility, addition of money through Sukuks and deposits and adding to the existing 4.2 billion worth of facilities.
The News newspaper reported that the details of the financial package are being worked out and it will be a couple of more weeks until all the documentation would be over. Prime Minister Sharif and his delegation left Saudi Arabia, however, the Financial Minister Miftah Ismail stayed back to discuss the technicalities of the package.
Ismail tweeted that “Just said goodbye to Prime Minister Shehbaz Sharif and other colleagues at Jeddah Airport, who are on their way to Islamabad after a brief stopover in Abu Dhabi to meet Crown Prince Muhammad Bin Zayed. I remain in SA to meet Saudi officials and start technical level talks.”
Pakistan proposed that the oil facility be doubled and Saudi Arabia agreed to make it to 2.4 billion from 1.2 billion. The existing deposits of 3 billion will be extended till June 2024. Pakistan has also requested an additional package of 2 billion which is likely to get approved. Saudi Arabia had provided Pakistan with 7.5 billion dollars last year.
Pakistan is having a rising current account deficit that has reached 13.2 billion dollars added to this are external loan repayments. The cash strapped country needs the money to revive its ailing economy.
Edited By: Aaradhana Singh
Published By: Akshaj Joshi
