Saudi Arabia will provide an additional $3 billion in support to Pakistan to help Islamabad bridge a multi-billion-dollar financing gap linked to debt repayment to the United Arab Emirates.
Reuters reported on Wednesday, April 15, that Pakistan’s Finance Minister Muhammad Aurangzeb described the move as a sign of deepening ties with Riyadh.
The relationship was strengthened last year through a mutual defense pact under which any attack on one of the two countries is considered an attack on both.
A spokesperson for the Saudi Ministry of Finance told Reuters: “We can confirm that Saudi Arabia has agreed to a $3 billion deposit with Pakistan to support their balance of payments.”
Pakistan is facing a $3.5 billion repayment to the UAE this month, a development that has put pressure on the country’s foreign exchange reserves.
According to the report, Pakistan’s reserves stood at around $16.4 billion as of March 27, and this repayment accounts for about 18 percent of the total reserves.
Under Pakistan’s $7 billion program with the International Monetary Fund (IMF), the country aims to raise its foreign exchange reserves to more than $18 billion by June.
