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Saudi Arabia extends $3bn loan to Pakistan

By Pramod Kumar
Saudi Arabia's deposit renewal with the State Bank of Pakistan will boost Pakistan’s foreign exchange reserves and strengthen its economy Creative Commons
Saudi Arabia's deposit renewal with the State Bank of Pakistan will boost Pakistan’s foreign exchange reserves and strengthen its economy

Saudi Arabia has renewed its $3 billion deposit with Pakistan’s central bank for another year.  

The deposit renewal with the State Bank of Pakistan will boost Pakistan’s foreign exchange reserves and strengthen its economy, the Saudi Fund for Development (SFD) said.

The initial agreement was signed in 2021 and rolled over in 2022 and 2023.

Islamabad faces a $26 billion debt servicing obligation in the current fiscal year, Dawn, a Pakistani English daily, reported.

The government is negotiating similar agreements with China and the UAE despite officials acknowledging the reluctance from friendly nations to roll over $14 billion in loans.

The central bank’s reserves reached more than $12 billion as of November 29, 2024, an increase of 47.5 percent since the beginning of the year. It recently received a $500 million deposit from the Asian Development Bank.

The Pakistani government aims to reach a reserve target of $13 billion by the end of the current fiscal year ending June 30, 2025.

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