Pakistan signs deal with Saudi Arabia to defer oil payments

(MENAFN) Pakistan and Saudi Arabia have reached an agreement to delay a USD1.2 billion payment for oil imports for one year, according to an official statement released on Monday. The agreement was formalized at the Prime Minister's Office in Islamabad, with the signing done by Pakistan's secretary of economic affairs, Kazim Niaz, and Saudi Fund for Development CEO, Sultan Abdulrahman Al-Marshad. The ceremony was attended by Prime Minister Shehbaz Sharif and Saudi Ambassador Nawaf bin Said Al-Malki.

The agreement, known as the Oil import Financing Facility, will allow Pakistan to receive oil on deferred payments over the next year, totaling USD1.2 billion. This deal is expected to help Pakistan stabilize its petroleum supply while easing immediate fiscal pressures. The prime minister welcomed the signing, emphasizing its importance for the country’s economic resilience.

In addition to the oil deal, Saudi Arabia’s fund will also provide USD41 million for a project to improve access to clean drinking water for 150,000 people in the Khyber Pakhtunkhwa province. The Gravity Flow Water Supply Scheme in Mansehra district will benefit residents by ensuring better access to water.

Prime Minister Sharif expressed his gratitude for Saudi Arabia’s ongoing support, particularly through the fund’s contributions to Pakistan’s health, energy, education, and infrastructure sectors. The funding has also been crucial in supporting reconstruction efforts following the 2022 floods.

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