Saudi Arabia rolls over $3 billion deposit for Pakistan, finance minister says
Finance Minister Muhammad Aurangzeb said Saudi Arabia has rolled over its $3 billion deposit for Pakistan. He said no further support is needed from Riyadh for now.
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- Saudi Arabia has rolled over its $3 billion deposit for Pakistan, Finance Minister Muhammad Aurangzeb said on Wednesday.
- He said Pakistan does not need further financial support from Saudi Arabia for now.
- IMF board approval of the next tranche is expected in December.
Finance Minister Senator Muhammad Aurangzeb said on Wednesday that Saudi Arabia has rolled over its $3 billion deposit for Pakistan. He announced it while speaking to the media at Parliament House in Islamabad, after a meeting of the Senate Standing Committee on Finance.
According to the reports, Saudi Arabia extended the deposit for an appropriate duration, and the matter of the loan has been deferred until an appropriate time. Aurangzeb said Pakistan does not require any additional financing from Saudi Arabia for now.
The minister said he had held a very good meeting with the Saudi finance minister. Speaking about the relationship between the two countries, he said, according to Express News: "سعودی عرب کےساتھ جس طرح کے ہمارے تعلقات ہیں، اس میں ہمیں پریشان ہونے کی ضرورت نہیں ہے". In English, this means that given the relations Pakistan has with Saudi Arabia, there is no need to worry.
Aurangzeb said Pakistan has import cover of three months. He also said the IMF board's approval of the next tranche is expected in December.
On Eurobonds, the minister said Pakistan has to make a payment of about 1.5 billion euros every year. He said the government wants to ensure that this payment is not difficult for any administration.
Geo Sports reported that the finance minister described external accounts as being in a comfortable position. It also reported that a Senate panel was told gross external financing repayments stand at $21.5 billion, and that the finance ministry said the government has repaid $5 billion so far.
Background
khabr.pk reported on 3 November that Finance Minister Muhammad Aurangzeb said the government is reviewing the tokenisation of Pakistan's existing Eurobond debt. The interbank dollar closed at Rs276.7 on 4 November, according to khabr.pk's records.
Why it matters
The rollover means the $3 billion deposit does not have to be repaid immediately, which supports Pakistan's foreign reserves. Stable reserves matter for the rupee, which closed at Rs276.7 to the dollar in the interbank market on 4 November, and for the cost of imports such as fuel. Petrol was Rs362 per litre on the same date. The finance minister said import cover is three months.
