Pakistan’s struggling economy has received major support from Saudi Arabia, which has agreed to provide a $1 billion oil financing facility during the current fiscal year and extend $5 billion in existing deposits, according to the Ministry of Finance.
The $1 billion oil facility, valued at approximately Rs290 billion, is part of Saudi Arabia’s ongoing economic cooperation with Pakistan. Official data shows that oil worth Rs85 billion (around $300 million) has already been supplied during the first three months of this fiscal year.
Under the agreement, Saudi Arabia will continue supplying $100 million worth of oil per month, equivalent to nearly Rs28.37 billion. This arrangement allows Pakistan to import oil without the immediate burden of cash payments, easing pressure on the country’s foreign reserves.
In addition to the oil financing, the kingdom has rolled over $5 billion in deposits placed with the State Bank of Pakistan (SBP). These deposits are aimed at stabilizing Pakistan’s foreign exchange reserves and improving investor confidence.
Out of the total deposits, $2 billion will mature in December 2025, while the remaining $3 billion will mature in June 2026. The deposits carry an annual interest rate of 4% and are renewed each year as part of Riyadh’s continued financial assistance to Islamabad.
According to finance ministry officials, the Saudi deposits, worth around Rs1,450 billion, are classified as budgetary support loans. They play a key role in helping Pakistan maintain fiscal stability, meet external obligations, and manage its balance of payments amid ongoing economic challenges.
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The continued backing from Saudi Arabia highlights the strong bilateral relationship between the two nations and underscores Riyadh’s commitment to supporting Pakistan’s economic recovery.
