Saudi Arabia provides $4.2 billion to support Pakistan’s economy
Saudi Fund for Development (SFD) will deposit $3 billion with the State Bank of Pakistan under the new agreements signed at the central bank’s headquarters in Karachi on November 29.
This will help support Pakistan’s foreign reserves and boost post-pandemic recovery. The Saudi fund will additionally supply $1.2 billion worth of oil to Pakistan on credit.
SBP and SFD sign deposit agreement for $3B
The first agreement includes a $3 billion deposit to the State Bank of Pakistan to support the country’s foreign currency reserve levels and mitigate the impact of the coronavirus disease pandemic under the Saudi Royal Directive/
The agreement was signed by SBP Governor Dr. Reza Baqir and CEO of the Saudi Fund for Development Sultan bin Abdulrahman Al-Marshad. Saudi Consul General in Karachi Bandar bin Fahad Al Dayel was also present.
“The deposit amount shall become part of SBP’s Foreign Exchange Reserves. It will help support Pakistan’s foreign currency reserves and contribute towards resolving the adverse effects of the COVID19 pandemic” the state bank said.
“The deposit agreement reflects the strong and special relationship between the Kingdom of Saudi
Arabia and Pakistan and will further enhance economic ties.”
SDF finances trade in oil derivatives
The second agreement to finance the trade of oil derivatives with a value of US$1.2 billion for one year to Pakistan was signed by Minister for Economic Affairs of Pakistan Omar Ayub Khan in the presence of the CEO of SFD as well as Saudi Ambassador Nawaf bin Said Al-Malki in Islamabad.
Omar Ayub that Pakistan greatly values the bilateral and brotherly relations with the Kingdom and thanked the KSA for extending vital support for implanting the infrastructure and energy projects in Pakistan.
“These two agreements with the Ministry of Economic Affairs and the Central Bank of Pakistan to finance trade in oil derivatives and support Pakistan’s foreign currency reserves, which will contribute to the country’s economic growth and help resolve the adverse repercussions of the COVID-19 pandemic,” Al-Marshad said.