Pakistan has approached Saudi Arabia with several proposals aimed at strengthening long-term economic cooperation, including converting existing deposits into longer-term financing and expanding oil supply on deferred payment terms.
The requests come as Pakistan faces increasing economic pressures amid rising geopolitical tensions in the Middle East and ongoing discussions with the International Monetary Fund over the third review of its $7 billion Extended Fund Facility program.
According to reports, Islamabad has asked Riyadh to convert the $5 billion currently placed as short-term deposits with the State Bank of Pakistan into a long-term facility lasting up to ten years at more favorable terms.
Pakistan has also proposed expanding Saudi Arabia’s oil financing facility. The government has requested that the existing deferred oil payment arrangement be increased from $1.2 billion to $5 billion, with repayment terms extended from one year to three years for each tranche.
Among other proposals, Pakistan has suggested securitising up to $10 billion in remittances from overseas Pakistanis. The move could help boost foreign exchange reserves and reduce dependence on costly external borrowing.
Officials have also sought a Saudi guarantee for future international Sukuk issuances, which could enable Pakistan to access global capital markets at lower borrowing costs.
Another request includes establishing a concessional credit line for the Export-Import Bank of Pakistan to support export-oriented growth as part of broader economic reforms linked to the IMF program.
Pakistan has additionally asked Saudi authorities to consider easing bank guarantee requirements for certain import transactions and to explore investment opportunities through the Public Investment Fund.
Islamabad has also requested Saudi support in discussions related to fiscal targets under the IMF program, particularly adjustments to primary surplus goals to accommodate planned tax reforms and rationalisation measures.
