A high-level Saudi delegation is expected to visit Pakistan by December 2024 to finalize the terms of a $1.2 billion oil facility aimed at bolstering Pakistan’s economy. This facility is part of Saudi Arabia’s commitment to support Pakistan in securing International Monetary Fund (IMF) approval for a $7 billion Extended Fund Facility (EFF), as reported by a national daily.
Pakistan intends to propose a 12-month deferred payment arrangement under the Saudi Oil Facility, which would involve monthly disbursements of $100 million. While the facility is projected to operate for three years, the specific timeline for its implementation remains to be clarified, with repayments likely starting in 2025.
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In 2023, the Saudi Fund for Development (SFD) allocated approximately 1.3 billion Saudi riyals for various development projects in Pakistan, out of a total commitment of 1.6 billion SR. Key contributions included 901.25 million SR for the construction of the Mohmand Dam, designed to generate 800 megawatts of hydropower and store 1.6 million cubic meters of water, as well as mitigate flood risks. Additional funding from the SFD in 2023 encompassed 178.28 million SR for repairs at Tarbela Dam and 231.5 million SR for irrigation projects along the Indus River.
Overall, Saudi Arabia has extended 3.5 billion SR in grants for multiple infrastructure projects across Pakistan, including the Makran Coastal Highway, Neelum-Jhelum and Golen Gol hydropower plants, and reconstruction efforts in Malakand.
