Pakistan's economy to boost after Saudi extension of $3b deposit
Saudi Arabia has agreed to extend the term of its
$3 billion deposit with Pakistan, according to sources familiar with the
matter. The extension is seen as a crucial move to support Pakistan’s foreign
exchange reserves and help stabilize its economy.
The original agreement, signed in November 2021 between the State Bank of Pakistan (SBP) and the Saudi Fund for Development (SFD), involved a deposit of $3 billion to be held in Pakistan's central bank account. The purpose was to bolster Pakistan's foreign reserves at a time of economic strain.
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Arabia extends $3 billion deposit to Pakistan for an additional year
With the extension, the deposit's maturity, which was set to expire on Thursday, has now been pushed forward by an additional year. This move is expected to provide much-needed support to Pakistan's financial sector, particularly in maintaining foreign exchange stability.
The Saudi Development Fund confirmed the
extension, which aims to further solidify Pakistan's economic recovery and
provide a buffer against potential currency volatility. Currently, the $3
billion is still held in the State Bank of Pakistan’s account.
This extension comes as Pakistan continues to
navigate a challenging economic landscape, with the recent news of the
country’s bank deposits reaching a record high of Rs. 31,626 billion in March
2025.
Additionally, the State Bank of Pakistan reported a year-on-year increase of 11.7% in bank deposits, with a notable rise of 3.8% from the previous month. Compared to March 2024, bank deposits saw an increase of Rs. 3,305 billion, further indicating growth in the country’s financial sector.
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Arabia keeps Pakistan’s economy afloat with $5b loan rollovers
In a positive development, Pakistan also recorded its highest-ever monthly current account surplus of $1.2 billion in March, highlighting a period of economic stability despite ongoing challenges.
This extension of Saudi Arabia’s $3 billion deposit is a significant gesture of support, offering Pakistan the financial cushion it needs as it continues its recovery efforts.
Source: The Opinion