Saudi Arabia extends $3 Billion lifeline to Pakistan

KARACHI: Saudi Arabia has rolled over its $3 billion deposit in the State Bank of Pakistan (SBP) for another year, offering crucial support to Pakistan’s foreign exchange reserves, according to the State Bank of Pakistan (SBP).

The State Bank of Pakistan (SBP) said that the Saudi Fund for Development (SFD) had extended the deposit, which was set to mature on December 5, 2024.

The extension aims to bolster Pakistan’s economic stability amid its $26 billion debt servicing obligation for the fiscal year.

As of November 29, 2024, SBP’s reserves reached $12.038 billion, a 47.5 per cent rise since the year’s start, with total reserves, including commercial banks, standing at $16.62 billion.

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This development followed Prime Minister Shehbaz Sharif’s recent meeting with Saudi Crown Prince Mohammad Bin Salman during the “One Water Summit” in Riyadh.

The leaders discussed enhancing economic, trade, and investment ties and reviewed progress on Saudi investment agreements in Pakistan.

The deposit, first agreed upon in 2021 and renewed in 2022 and 2023, reflects Saudi Arabia’s consistent support for Pakistan’s economy. Efforts are also underway to secure similar arrangements with China and the UAE.