Saudi Arabia and Qatar assure Pakistan of $5 billion financial support

ISLAMABAD: Saudi Arabia and Qatar have pledged $5 billion in financial support to Pakistan, offering critical relief to the country’s strained foreign exchange reserves as it prepares to meet significant external payment obligations in the coming weeks, official sources said.

The assistance comes at a crucial moment, with Islamabad scheduled to repay $3.5 billion to the United Arab Emirates by the end of the month, part of a broader $4.8 billion repayment burden falling due in April. Officials say the fresh inflows will help stabilise reserves and ensure the country can meet its external commitments without immediate financial stress.

The development follows a high-level meeting in Islamabad between Saudi Finance Minister Mohammed bin Abdullah Al-Jadaan and Prime Minister Shehbaz Sharif on Friday night. The meeting was also attended by senior Pakistani officials, including Foreign Minister Ishaq Dar and Chief of Army Staff Asim Munir, and focused on economic cooperation as well as evolving regional developments.

While no formal agreements were signed during the engagement, officials indicated that discussions around financial assistance had been underway between the finance ministries of Pakistan and Saudi Arabia prior to the meeting. The latest assurance is seen as a continuation of those efforts.

Pakistan has also sought additional support beyond immediate cash assistance, including an expansion of existing Saudi deposits held with the State Bank of Pakistan and an extension of the oil financing facility, which is due to expire later this month. These measures are considered vital to maintaining liquidity and managing import costs, particularly energy-related payments.

Officials warned that Pakistan’s foreign exchange reserves remain under sustained pressure due to rising import bills, exacerbated by volatility in global markets and heightened geopolitical tensions in the Middle East. Without fresh inflows, there were concerns that reserves could decline further in the near term, potentially dropping to around $11.5 billion.

The pledged support from Saudi Arabia and Qatar is expected to provide a buffer against such risks, allowing Islamabad to navigate immediate financial obligations while continuing engagements with international partners ahead of key economic discussions scheduled in Washington.

Sources said the financial backing would help Pakistan manage its external account position more effectively, particularly at a time when debt repayments and elevated import costs are placing additional strain on the economy.

The development underscores Pakistan’s reliance on support from Gulf partners during periods of economic stress, as the government works to maintain financial stability and avoid disruptions to external payments.