Pakistan 'seeks' $1.2bn Saudi oil facility for 12 months

• Islamic Development Bank has been requested for $400mn loan.
• Gulf commercial banks, SCB have been requested for $1bn loan.
• Pakistan requires commercial re-financing of $4 billion this year.

ISLAMABAD: In a bid to bridge the $2-2.5 billion financing gap pointed out by the International Monetary Fund (IMF) for the ongoing financial year, Pakistan has requested Saudi Arabian authorities for $1.2 billion Saudi oil facility (SOF) for the next 12 months, official sources told The News.

The publication, on Thursday, reported that a finance ministry handout did not mention anything regarding the matter.

A staff-level deal was signed with the IMF under the $7 billion Extended Fund Facility (EFF), however, it is yet to be put before the Fund's Executive Board for the loan’s approval.

Meanwhile, the Saudi Arabian government wants to procure 15% stakes in the Reko Diq project through investment in two phases; nonetheless, the transaction in this regard has not been made so far.

On the other hand, the Islamic Development Bank’s ITFC facility has also been requested to provide $400 to $500 million loan. In addition, the Gulf commercial banks as well as the Standard Chartered Bank (SCB) have also been requested for $1 billion loan.

Besides fulfilling the additional financing of $2.5 billion, Pakistan is also asking three bilateral creditors to roll over $12 billion deposits lying with the State Bank of Pakistan.

The country also requires commercial re-financing of $4 billion during the current fiscal year to meet the total requirements of $26.2 billion for the ongoing fiscal year.

According to an official statement issued by the finance ministry, Federal Minister for Finance and Revenue Senator Muhammad Aurangzeb reaffirmed Pakistan’s commitment to a homegrown economic agenda centered on comprehensive institutional reforms across key sectors of the economy.

The minister made these remarks during a meeting with Saudi Ambassador Nawaf Bin Said Al-Malki, who called on him at the Finance Division on Wednesday.

Senator Aurangzeb deeply appreciated consistent Saudi economic support to Pakistan, while highlighting the Saudi investors’ renewed interest in pursuing joint ventures and business collaborations with Pakistan’s private sector.

Malki commended the Pakistani government’s efforts for implementing the structural and institutional reforms and reiterated the Kingdom’s unwavering commitment to contributing to Pakistan’s economic growth.