Saudi Arabia has rolled over its additional $3 billion deposit for Pakistan for a reasonable period. Finance Minister Muhammad Aurangzeb confirmed the rollover on Wednesday. As a result, it removes a near-term repayment deadline that fell due at the end of October.
Rollover matters because Pakistan still depends on friendly countries rolling over existing deposits while it manages large external repayments, and a missed extension would have added immediate pressure on its foreign exchange reserves.
Aurangzeb told reporters at Parliament House that Saudi Arabia had extended the facility. He added, according to Dawn: “It has been extended and for a reasonable period. You don’t need to worry as to for how long given the kind of strategic relationship we have.”
He said he had held a very good meeting with his Saudi counterpart, Mohammed Al-Jadaan. Meanwhile, the meeting took place during the recent World Bank-IMF meetings in Bangkok. The two discussed the rollover there.
Dawn reported that the $3 billion financing came in April this year. It bridged a gap arising from $3.5 billion in repayments to the United Arab Emirates. It matured on October 31 under a three-month term.
Duration and wider Saudi support
Aurangzeb declined to disclose the exact new duration. In addition, Business Recorder reported that he confirmed the rollover without giving its length. That outlet cited sources suggesting a possible one-year extension. The minister himself has not confirmed that duration.
Saudi Arabia had already extended a separate $5 billion facility until 2028, Dawn reported. Furthermore, that extension took its total short-term support to $8 billion. The $3 billion now rolled over was the remaining short-term portion.
Reserves and bond issuance
Aurangzeb said Pakistan did not currently need any additional financial assistance from Saudi Arabia, according to multiple outlets, and said the country’s foreign exchange reserves stood at $21.5 billion, enough for about three months of imports.
The government and central bank planned to raise import cover to four months by the end of this fiscal year. He added that detail, the Express Tribune reported.
Pakistan raised $3 billion through an international bond issuance in the first week of September. In addition, the issuance attracted an order book of $6 billion. Aurangzeb told a Senate committee about the issuance, according to The Nation.
Aurangzeb also said prospects for a proposed $10 billion United States backstop facility appeared to have waned, Dawn reported. However, he described that facility as not essential. He said Pakistan’s external position remained comfortable without it.
Business Recorder reported a Senate panel briefing by Finance Secretary Imdad Ullah Bosal. He told the panel Pakistan’s gross external financing repayments stood at $21.5 billion. That total included $17 billion in principal and $4 billion in interest.
What remains unconfirmed
Aurangzeb spoke to the Senate Standing Committee on Finance and Revenue. He said Pakistan expects the International Monetary Fund’s Executive Board to review its $7 billion programme in December. However, officials have not confirmed a date.
| Item | Figure |
|---|---|
| Additional Saudi deposit rolled over | $3 billion |
| Earlier Saudi facility | $5 billion, extended until 2028 |
| Total Saudi short-term support | $8 billion |
| Foreign exchange reserves | $21.5 billion, about three months of imports |
| Bond raised in early September | $3 billion, with a $6 billion order book |
| IMF programme under review | $7 billion, board review expected in December |
Confirmed so far is the rollover itself. The government also stated that Pakistan needs no extra Saudi financing for now. However, the exact length of the extension remains unconfirmed. The date of the IMF board review also remains unconfirmed. December brings the next known milestone: the IMF review.
