Saudi Arabia has pledged to provide Pakistan with additional deposits of US$3 billion, expected to be disbursed next week, while extending its existing deposit of US$5 billion for a longer period, in a departure from its previous annual rollover arrangements. This significant financial injection, announced by Pakistan’s Federal Minister for Finance and Revenue, Senator Muhammad Aurangzeb, during the World Bank-IMF Spring Meetings in Washington, DC, is set to significantly bolster the country’s foreign exchange reserves and bolster its external account at a critical juncture, according to an official statement issued today.
Senator Aurangzeb emphasised that this support arrives at a vital moment for Pakistan”s external financing requirements, strengthening foreign exchange reserves and its external financial position. The government remains committed to maintaining reserves in line with market obligations and its IMF-supported programme, aiming for approximately USD 18 billion, equivalent to about 3.3 months of import cover, by the fiscal year”s conclusion.
The Finance Minister also highlighted the successful repayment of Pakistan”s USD 1.4 billion Eurobond last week, characterising it as a “non-event” to underscore financial stability. He reiterated the government”s unwavering commitment to meeting all forthcoming external financial commitments and maturities punctually, affirming a clearly defined and responsibly executed external financing strategy.
During his engagements in Washington, Senator Aurangzeb, accompanied by the Governor of the State Bank of Pakistan and Pakistan’s Ambassador to the United States, held extensive discussions with Saudi Finance Minister H.E. Mohammed bin Abdullah Al-Jadaan. Recalling a prior meeting in Islamabad, the Minister explained that public commentary was deliberately withheld until formal communication ensured clarity and mutual understanding, despite earlier media speculation.
Profound gratitude was extended to the leadership of the Kingdom of Saudi Arabia, particularly His Royal Highness Crown Prince Mohammed bin Salman, H.E. Mohammed bin Abdullah Al-Jadaan, and the Saudi Vice Finance Minister, for their continuous backing. Senator Aurangzeb also acknowledged the vital contributions of Pakistan”s Prime Minister, the Field Marshal, the Deputy Prime Minister, the Governor of the State Bank, Finance Secretary Mr. Imdad Ullah Bosal, and their respective teams in securing and implementing this support package.
The Finance Minister observed a significant uplift in international sentiment and confidence surrounding Pakistan. He noted “unprecedented appreciation” from global financial institutions, including the IMF and World Bank, institutional investors, and international counterparts. Particular recognition was given to Pakistan”s recent diplomatic efforts in facilitating dialogue between long-estranged parties.
This international approbation, combined with Saudi Arabia”s timely financial assistance, provides considerable momentum and assurance for Pakistan”s economy and its external account, encompassing commercial dimensions. Pakistan is concurrently advancing its broader external financing agenda, which includes the recently announced Global Medium-Term Note (GMTN) programme and the planned inaugural Panda Bond issuance, aimed at diversifying funding sources and enhancing market access.
Concluding his remarks, the Finance Minister reaffirmed the government”s steadfast commitment to macroeconomic stability, fulfilling external liabilities, continuing reforms, and sustaining engagement with bilateral and multilateral partners. Further detailed interactions with media representatives are expected at the conclusion of his visit.