Pakistan receives $3bn in funds from Saudi Arabia
The State Bank of Pakistan on Saturday received a much-awaited $3 billion deposit from Saudi Fund for Development, reports Geo.
Taking to official Twitter handle, Adviser to Prime Minister on Finance and Revenue Shaukat Tarin announced: “Good news, $3 billion Saudi deposit received by SBP.”
The PM's aide acknowledged the support provided by Saudi Arabia and wrote: “I want to thank Crown Prince Mohammed Bin Salman and Kingdom of Saudi Arabia for the kind gesture.”
On November 29, the central bank of Pakistan and the Saudi Fund for Development signed a deposit agreement for funds worth $3 billion.
According to a joint statement, under this deposit agreement, SFD shall park $3 billion in the SBP. “The deposit amount under the agreement shall become part of SBP’s foreign exchange reserves,” it had said.
The central bank had stated that the deposit would help support Pakistan’s foreign currency reserves and “contribute towards resolving the adverse effects of the COVID-19 pandemic.”
The deposit agreement was signed by SFD Chief Executive Officer H E Sultan Bin AbdulRahman Al-Marshad and the SBP Governor Dr Reza Baqir at the State Bank of Pakistan in Karachi.
On October 27, the Saudi Fund for Development agreed to deposit $3 billion in the SBP to help support its foreign reserves.
The fund had stated that an official directive was issued to supply $1.2 billion to finance Pakistan’s oil products trade during the year.
Saudi Arabia will charge around 3.2 to 3.5% markup on annual basis for this deposit amount.
According to the central bank, Pakistan’s total liquid foreign reserves stood at $22.498.8 billion on November 26, 2021. The break-up of the figures shows that foreign reserves held by the SBP were standing at $16.010.3 billion and net foreign reserves held by commercial banks were standing at $6.488.5 billion.
During the week ended on November 26, 2021, the SBP's reserves decreased by $244 million or 1.5%.
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Saudi Arabia will soon disburse cash deposits to Pakistan under the pledged financial assistance after approval of the Royal Court and signing of a Memorandum of Understanding (MoU) in a few days, Saudi Ambassador Nawaf Bin Said Al-Malki said on Thursday.
“This will be soon Insha’Allah. There will be the agreement from the Royal Court and the MoU will be signed in a few days for the payment, and also for the deferred oil payment [facility],” the Saudi envoy said in an exclusive interview with APP.
Saudi Arabia had recently announced to provide Pakistan $3 billion as cash deposit with the State Bank to address its balance-of-payments crisis. Also, the kingdom had pledged a one-year deferred payment facility for the import of oil, worth up to another $1.2 billion.
Ambassador Al-Malki said the government of Saudi Arabia considered Pakistan as “a dear country” with a very deep and strong relationship. He said Saudi Arabia always stood with Pakistan and extended support to it on multiple occasions, adding that the relationship with Pakistan was regardless of any government in power.
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“Our connection is with the Pakistani flag and we consider it our brotherly country,” he said.
The Saudi ambassador mentioned the camaraderie between the Saudi Crown Prince Mohammed Bin Salman and Prime Minister Imran Khan, and expressed confidence that the relationship would strengthen in the future.
In three years, the six visits of PM Imran Khan to the Kingdom reflect the level of relationship, he added.
Ambassador Al-Malki, who in a few months is completing eight years of his stay in Pakistan, said the people of the country were very friendly and deserved a lot of good in their lives.
He said, from JF-17 fighter aircraft to the thousands of factories in Faisalabad, there were a lot of positive things for Pakistan to be proud of.
