Pakistan’s foreign exchange reserves remain under pressure due to rising import costs
ISLAMABAD:
Saudi Arabia and Qatar will provide Pakistan with $5 billion in financial assistance, allowing Islamabad to avoid pressure on the country’s weak foreign exchange reserves while making external payments in June, official Pakistani sources told Anadolu on Saturday.
The development comes as Islamabad prepares to pay a $3.5 billion debt to the United Arab Emirates at the end of the month. Riyadh has assured Islamabad of its financial support amid growing external pressures and rising costs linked to ongoing tensions in the Middle East.
Saudi Finance Minister Mohammed bin Abdullah Al-Jadaan met Prime Minister Shehbaz Sharif on Friday evening in Islamabad.
The meeting, attended by senior Pakistani officials including Foreign Minister Ishaq Dar and Chief of Army Staff General Syed Asim Munir, focused on economic cooperation and regional developments.
Pakistan has requested additional financial assistance, including an expansion of existing cash deposits and an extension of its oil financing mechanism, which is set to expire at the end of this month.
While no formal agreements were announced during the meeting, officials said discussions on financial support had been initiated earlier between the two countries’ finance ministries.
Pakistan’s foreign exchange reserves remain under pressure due to rising import costs, and officials warn that without new inflows, reserves could decline further in the coming weeks. The government is also engaging with international partners ahead of key financial meetings in Washington.
Sources told Anadolu that Saudi Arabia and Qatar have assured Pakistan of $5 billion in financial assistance, which will allow Islamabad to avoid strain on the country’s weak foreign reserves while making external payments.
Pakistan is repaying $4.8 billion in debt this month, including $3.5 billion in debt to the United Arab Emirates. In the absence of new loans, foreign exchange reserves could fall to $11.5 billion.
