SFD signs agreement to extend deposit of $3bn. at SBP

The Saudi Arabian Development Fund (SFD) on Friday signed an agreement with the State Bank of Pakistan (SBP) to extend the maturity of its 3 billion deposit. Radio Pakistan reported.

“The agreement signed between the Saudi Fund for Development (SFD) and the State Bank of Pakistan (SBP) provides for the extension of the term of a USD 3 billion deposit placed by the SFD with the State Bank of Pakistan,” according to X post.

The agreement was signed by Sultan bin Abdulrahman Al-Marshad, Chief Executive Officer (CEO) of SFD, and SBP Governor Jameel Ahmad, on behalf of SBP.

Finance Minister Muhammad Aurangzeb witnessed the signing ceremony of a key financial agreement in Washington, DC, in the presence of Pakistan’s ambassador to the US, on the sidelines of the World Bank-IMF Spring Meetings 2026.

According to the ministry’s X-post, the extension underscores the strong and long-standing economic partnership between Pakistan and the Kingdom of Saudi Arabia. It is expected to support the country’s stability in the external sector.

Yesterday, Pakistan received a financial inflow of $2 billion from Saudi Arabia, providing timely relief to its foreign exchange reserves, just as the country prepares to repay $3.5 billion to the United Arab Emirates (UAE) this month.

Read: SBP receives $2 billion Saudi credit

The SBP confirmed receipt of the funds from Saudi Arabia’s Ministry of Finance, while the Ministry of Finance said the assistance is part of a wider $3 billion funding commitment from Riyadh aimed at stabilizing Pakistan’s reserves.

In addition, Saudi Arabia has secured the transfer of its existing $5 billion deposits for an extended period, removing the previous requirement for annual renewals.

Officials said this support would significantly ease the pressure on reserves, especially in light of the large repayment by the UAE, which accounts for nearly 18% of Pakistan’s official foreign exchange reserves.

The inflow comes at a critical time as Pakistan moves to meet its external financing needs and maintain reserve targets under its IMF program.

According to finance ministry sources, the government aims to raise reserves to about $18 billion, equivalent to about 3.3 months of import coverage, in the coming months.

At the same time, Islamabad has finalized arrangements to repay $3 billion to the UAE in a phased manner.

Of this, $2 billion is expected to be paid on April 17, followed by the remaining $1 billion on April 23.

Separately, Pakistan has already approved a long-term loan of $450 million to the UAE.

On Wednesday, FinMin said Saudi Arabia has committed $3 billion in additional deposits, with disbursement expected in the coming week. He further stated that the existing $5 billion Saudi deposit would no longer remain subject to the previous annual rollover arrangement and would instead be extended for a longer period.

Additional IMF loans

This was reported by government sources Express Pakinomist that it has been decided to seek an additional loan from the IMF under the existing package and there were high chances that the IMF would honor Pakistan’s request.

The IMF’s managing director has said her organization expected $50 billion in funding requests from member countries to deal with the shock of war in the Middle East.

Read more: Saudi Arabian largesse closes Pakistan’s sudden reserves gap

The sources said IMF managing directors also urged the fund’s management to either expand existing programs or provide new financing windows. They added that it may not be possible to seek a new financing facility from the IMF, but the existing program can be expanded with additional loans.

Pakistan can use up to 600% of its quota in the IMF and so far the country has used up 350% of the total quota. The sources said there was a window of between $2 billion and $2.5 billion available that Pakistan wanted to use to deal with the effects of the Middle East war.

The sources said that Pakistan was entitled to avail the additional IMF financing to deal with the war shocks. They said there were very high chances that the IMF would accept Pakistan’s request to increase the loan size.

Extending a loan to Pakistan to deal with the war impact would not be a favor but to support the country to get through the crisis, the sources said.

With a quota of 600%, Pakistan can avail a loan of a total of $16 billion, and the country has used up $9.5 billion. This is a strong case for the reinforcement under the existing Extended Fund Facility (EFF) programme.