Islamabad(The COW News Digital)The government of Pakistan has formally requested a series of long-term economic support measures from Saudi Arabia, including converting the existing $5 billion deposit into a 10-year financial facility and expanding the kingdom’s oil financing support.
According to senior government sources, Islamabad has presented eight key proposals to Riyadh as part of broader efforts to strengthen long-term economic cooperation between the two countries. The proposals were shared during ongoing discussions aimed at stabilizing Pakistan’s external financing position and supporting its fragile economy.
One of the main requests involves converting Saudi Arabia’s current $5 billion short-term deposit, placed in Pakistan’s central bank reserves, into a long-term arrangement lasting up to ten years. Officials believe such a move would significantly improve Pakistan’s financial stability and foreign exchange reserves.
Pakistan has also proposed a major expansion of the deferred oil payment facility provided by Saudi Arabia. Under the current arrangement, Pakistan imports oil worth approximately $1.2 billion annually on deferred payments. Islamabad is now seeking to increase that facility to $5 billion and extend the repayment period to ease pressure on the country’s balance of payments.
Another important proposal includes the securitization of remittances from overseas Pakistanis, potentially raising up to $10 billion by leveraging future inflows from expatriate workers. Officials say this financial mechanism could help Pakistan access additional international liquidity without increasing traditional borrowing.
Government sources indicated that these proposals come at a time when Pakistan is facing growing economic challenges amid rising geopolitical tensions in the Middle East. The ongoing conflict involving Iran, and tensions involving United States and Israel, have contributed to global uncertainty and increased financial pressure on several regional economies.
At the same time, Pakistan is currently negotiating with the International Monetary Fund (IMF) to complete the third review of its $7 billion Extended Fund Facility (EFF) program. Successful completion of the review is considered critical for unlocking further financial assistance and maintaining investor confidence.
Pakistan and Saudi Arabia have been engaged in discussions on a comprehensive economic cooperation package for several months. Officials say Riyadh has traditionally played a crucial role in supporting Pakistan during periods of financial difficulty through deposits, oil facilities, and investment initiatives.
If approved, the proposed measures could significantly strengthen Pakistan’s financial outlook by stabilizing foreign reserves, reducing short-term financing pressure, and improving energy import financing.
Economic analysts say the outcome of these negotiations will be closely watched, as they could play a key role in shaping Pakistan’s economic recovery strategy in the coming years.
