ISLAMABAD: In a major boost to Pakistan’s economic stability, Saudi Arabia has pledged a $1 billion oil financing facility for the fiscal year 2025–26, along with the rollover of $5 billion in deposits currently held with the State Bank of Pakistan (SBP), officials from the Ministry of Finance confirmed on Monday.
According to ministry sources, the $1 billion oil facility will help Pakistan meet its energy import requirements while easing pressure on foreign exchange reserves. The Kingdom will also roll over $2 billion due in December and $3 billion in June 2026, reaffirming Riyadh’s sustained financial support to Islamabad.
During the first quarter of the current fiscal year, Pakistan received over Rs 85 billion worth of oil supplies under the Saudi financing arrangement — equivalent to $300 million. The facility provides approximately $100 million per month, or Rs 28.37 billion in local currency.
The Saudi deposits, carrying a 4% annual interest rate, are renewed annually as budgetary support, amounting to an estimated Rs 1.45 trillion in total. Officials emphasized that these continued facilities demonstrate Saudi Arabia’s strong commitment to Pakistan’s economic recovery amid ongoing fiscal challenges.
Meanwhile, Prime Minister Shehbaz Sharif arrived in Riyadh for a three-day visit, where he was warmly received by Saudi dignitaries. During the visit, he will also attend the 9th Future Investment Initiative (FII) conference, engaging with global investors and policymakers.
Last month, Pakistan and Saudi Arabia signed a Strategic Mutual Defence Agreement, declaring that “any aggression against either country shall be considered an aggression against both.” The accord, signed during PM Shehbaz’s earlier visit to Riyadh at the invitation of Crown Prince and Prime Minister Mohammed bin Salman, marks a new chapter in bilateral relations.
Following the pact, the federal government formed an 18-member high-level committee to lead economic negotiations under the Pakistan–Saudi Arabia Economic Framework. The committee will oversee discussions to expand cooperation beyond defence and energy into environmental protection and climate resilience.
Story by Irshad Ansari
