Pakistan’s foreign exchange reserves remain under pressure due to rising import costs
ISLAMABAD:
Saudi Arabia and Qatar will provide Pakistan with $5 billion in financial aid, enabling Islamabad to stave off stress on the country’s weak foreign exchange reserves while making external payments by June, Pakistani official sources told Anadolu on Saturday.
The development comes as Islamabad must repay a $3.5 billion debt to the UAE by the end of the month. Riyadh has assured Islamabad of its financial support amid increasing external pressure and rising costs associated with ongoing tensions in the Middle East.
Saudi Finance Minister Mohammed bin Abdullah Al-Jadaan met with Prime Minister Shehbaz Sharif on Friday evening in Islamabad.
The meeting, attended by senior Pakistani officials including Foreign Minister Ishaq Dar and Chief of Army Staff General Syed Asim Munir, focused on economic cooperation and regional development.
Pakistan has requested additional financial assistance, including an expansion of existing cash deposits and an extension of its oil financing facility, which is set to expire later this month.
Although no formal agreements were announced during the meeting, officials said discussions on financial support had been initiated earlier between the two countries’ finance ministries.
Pakistan’s foreign exchange reserves remain under pressure due to rising import costs, and officials warn that without new inflows reserves could fall further in the coming weeks. The government is also in dialogue with international partners ahead of important economic meetings in Washington.
Sources told Anadolu that Saudi Arabia and Qatar assured Pakistan of $5 billion in financial aid, allowing Islamabad to stave off stress on the country’s weak foreign exchange reserves while making external payments.
Pakistan is repaying $4.8 billion in debt this month, including $3.5 billion owed to the UAE. In the absence of new loans, foreign exchange reserves could fall to $11.5 billion.
