Islamabad: The Prime Minister's Office of Pakistan has announced that the country has signed an agreement with the Saudi Fund for Development on February 3.
Under this agreement, Pakistan will receive $1.2 billion worth of petroleum products from Saudi Arabia on a deferred payment basis for one year.
The government of Pakistan stated that this agreement would ensure a stable supply of petroleum products, which is crucial for strengthening the country’s economy.
Additionally, Pakistan has signed a $41 million financing agreement with Saudi Arabia for a water supply project in Mansehra, Khyber Pakhtunkhwa. Prime Minister Shehbaz Sharif attended the signing ceremony.
According to the media reports, Prime Minister Shehbaz Sharif welcomed the financial relief on oil payments, highlighting that Pakistan would pay for the imports after one year.
The agreement for the water supply project in Mansehra aims to provide clean drinking water to 150,000 local residents and meet the demand of 200,000 people by 2040.
Pakistan imports a significant portion of its oil from Saudi Arabia, with fuel purchases constituting a major part of its import expenditures.
Observers suggest that this deferred payment arrangement from Saudi Arabia could support Islamabad in boosting its foreign exchange reserves, especially ahead of the International Monetary Fund’s (IMF) review of Pakistan’s $7 billion loan program scheduled for March.
