Pakistan may return USD 2 billion Saudi Arabian loan: Report
Islamabad: Pakistan may return USD 2 billion loan to Saudi Arabia and the cash-strapped country is looking for various options to secure more lending aimed at retaining gross official foreign exchange reserves at their current level of over USD 12 billion, a media report said on Saturday.
The Saudi Arabian financial assistance package, originally estimated at USD 6.2 billion, had helped the government of Prime Minister Imran Khan to avoid looming default on international debt obligations.
The second tranche of USD 1 billion of Saudi loan is maturing next month and there is the likelihood that the government will return the money two years after the borrowings, The Express Tribune quoted sources in the Ministry of Finance as saying.
"It is a bilateral confidential matter," said the Ministry of Finance in a terse response on Friday.
But a top government official said on condition of anonymity that there was a possibility that Pakistan will be returning the money next month.
After coming into power, Prime Minister Khan had twice flown to Saudi Arabia to secure the package, which enabled his government to negotiate a deal with the International Monetary Fund (IMF).
Saudi Arabia had agreed to provide USD 6.2 billion worth of financial package to Pakistan for three years. This included USD 3 billion in cash assistance and USD 3.2 billion worth of annual oil and gas supply on deferred payments.
As per the agreement, the Saudi cash and oil facility was for one year with an option to roll over the amount at the end of the year for a period of three years., the report said.
Pakistan was paying 3.2 per cent interest on the USD 3-billion facility, according to the information that the Ministry of Finance shared with the National Assembly.
The Saudi oil facility has already been suspended while Pakistan has also paid back Saudi Arabia USD 1 billion out of the USD 3 billion in May this year.
The sources said the government was considering various options to repay the Saudi loan, which is booked on the balance sheet of the State Bank of Pakistan.
A senior Finance Ministry official said that Pakistan could get USD 2 billion from China like it did last time when it paid back USD 1 billion to Saudi Arabia. The official did not explain whether the Chinese lending will be concessional or commercial loans.
Chinese authorities have privately expressed reservations over slow progress on the China Pakistan Economic Corridor (CPEC) but they are likely to bail out Islamabad due to the strategic nature of the relations, the report said.
The government has also not been able to get the suspended USD 6 billion IMF programme restored, which is making it difficult for it to continue uninterrupted foreign inflows. The sources said if the IMF programme is not restored in near future, the World Bank inflows may start drying up.
The IMF is not bending on two conditions of introducing a mini-budget and increasing electricity tariffs, which has complicated matters for the government that is already facing criticism for high inflation.
The programme loans from the other two multilateral creditors were also critical to return USD 10.6 billion in maturing loans in the current fiscal year, excluding the Saudi Arabian and the UAE debt.
Pakistan's gross official foreign currency reserves of about USD 12.2 billion are largely built by taking foreign loans.
Pakistan has also utilized a USD 3 billion Chinese trade financing facility to cushion its reserves. The USD 3 billion facility is also expiring in May next year, which Pakistan has decided to request China to rollover.
As of September this year, the central bank also borrowed USD 5.8 billion from commercial banks under the forward and currency swap arrangements, according to the SBP data.
Just six months ago, in February 2020 when Pakistan was implementing the IMF loan programme, the SBP's borrowing under the swap and future contracts was USD 2.9 billion, including USD 1.6 billion in long-term contracts.
After excluding all short term liabilities, the central bank's reserves are negative by about USD 10 billion, the report said.
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Tell US President Donald Trump to stop West Asia conflict: Owaisi to PM Modi
Hyderabad (PTI): AIMIM president Asaduddin Owaisi on Friday called on Prime Minister Narendra Modi to "break his silence" on the conflict in West Asia and ask US President Donald Trump to end the war.
Addressing a gathering here, he also asked the PM to provide a full account of the sinking of an Iranian ship, IRIS Dena, off Sri Lanka by a US military submarine two days ago.
Taking strong exception to US Treasury Secretary Scott Bessent's recent announcement regarding Indian oil imports, he said the BJP-RSS should give a strong response to the American official and assert that India would purchase oil according to its own will.
He accused the BJP-RSS combine of being "scared" of US President Donald Trump.
"This war should end. Prime Minister should break his silence. Take the phone and tell Trump to stop this tamasha. They (US) are not suffering any losses. Our citizens are suffering. Who is dying there? Indians are dying. You maintained silence over Gaza," he said.
Owaisi dismissed the argument that the Iranian vessel sank outside the Indian waters, saying it is important to realise that it occurred close to India.
"If a Chinese ship comes close to our nation, what would you do? You say that it was not in Indian waters. Water does not have borders. You see how close the enemy has come. It is the Constitutional responsibility of the Prime Minister to tell the country what happened. We are with America in Quad," he said.
Pointing to India's strategic agreements with the US, the AIMIM leader said the Iranian frigate had visited Visakhapatnam at the invitation of India, while America had refused to participate in the naval exercise there.
Highlighting that one crore Indian citizens work in the Gulf region, a widening war lead to job losses for Indian diaspora.
He alleged that Israel aims to create a 'Greater Israel', encompassing much of the Arab region.
"The evil eye of these oppressors extends up to the holy city of Madinah."
Responding to US Treasury Secretary's comments that America is issuing a temporary 30-day waiver to allow Indian refiners to purchase Russian oil, Owaisi wondered if India truly is a sovereign country.
"Have you mortagaged India before US. Speak out BJP-RSS people. A (US)minister says you purchase for a month. Is this what we have secured freedom from the English that a white-skinned person says you purchase for a month ? But, they will not speak. They are scared of Trump," he said.
Quoting America's trade minister as saying that the US would not let India emerge like China, the AIMIM leader asked whether "India is a slave of America?"
He further questioned, "What is America's role in the progress of India?"
"BJP and RSS people are terrified of speaking against the white-skinned officials," he alleged.
He also hit out at the Centre for allegedly providing funds to a right-wing organisation to hold an event.
The organisation has openly favoured making India a 'Hindu Rashtra', "converting the religion of Muslims and throwing away 25 crore people," he alleged.
