MM News
Friday 29th September 2023 / 14 Rabiulawal 1445

Pakistan seeks $3bn deposit rollover, additional support from Saudi Arabia

ISLAMABAD: Prime Minister Shehbaz Sharif will discuss the rollover of $3 billion deposits and additional financial support with the kingdom’s authorities during his visit to Saudi Arabia, a report revealed on Tuesday.

To avoid a balance-of-payments catastrophe, Pakistan urgently requires rapid financial assistance from friendly nations like Saudi Arabia and China, as well as from the International Monetary Fund.

Prime minister, who is on a visit to the Kingdom with his team including Finance Minister Ishaq Dar, will also talk about the continuation of the oil facility on deferred payment and materializing $10-12 billion potential investment for the construction of the Petrochemical Complex at Gwadar Port with the Saudi authorities, according to a report in The News.

The Pakistani government is also considering asking for permission to use KSA aid funds for financial support during the current fiscal year. The Saudi Development Fund (SDF) mission is scheduled to visit Pakistan next month to finalize a future investment for the development of a refinery in Gwadar, therefore the Pakistani delegation will also meet with them.

Next month, the premier also intends to travel to China. Pakistan owes China $23 billion in bilateral debt, of which it would ask for the rollover of SAFE deposits and commercial loans totaling $6.3 billion, as well as further assistance to meet the current fiscal year’s urgent needs for external funding.

The PM will initiate the second phase of the China-Pakistan Economic Corridor (CPEC) and ask China for further funding in order to develop industrial, agricultural, and other forms of cooperation.

Pakistan’s external funding needs for the current fiscal year are between $32 to $34 billion. The first three months of the current fiscal year have seen $2.23 billion in currency inflows managed by Islamabad. Prior to leaving for Saudi Arabia on Monday, PM Shehbaz and the Asian Development Bank (ADB) inked a loan deal for $1.5 billion. It is anticipated that the funds will be disbursed this week.

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