Saudi Arabia on Wednesday extended the term of its $3 billion deposit with the State Bank of Pakistan (SBP) for another year, according to a statement issued by the central bank.
“The Saudi Fund for Development (SFD) on behalf of the Kingdom of Saudi Arabia has extended the term for the deposit of $3 billion maturing on [Dec. 5, 2023] for another one year,” it said, adding the amount had been placed with the SBP on behalf of Pakistan.
“The extension of the term of the deposit is a continuation of the support provided by the Kingdom of Saudi Arabia to the Islamic Republic of Pakistan, which will help to maintain the foreign currency reserves of Pakistan and contribute to the economic growth of the country” it said, adding this reflected the “continuation of the close relationship between the two brotherly countries.”
The $3 billion deposit agreement was initially signed through the SFD with the SBP in 2021 and subsequently rolled over in August 2022. According to economic observers, this would help solidify the ongoing $3 billion Standby Arrangement between Pakistan and the International Monetary Fund, as the global lender had sought confirmation from lenders and friendly countries of their commitments to Islamabad during the recently conducted first review.
According to data issued by the SBP, the central bank currently has $7.18 billion in foreign exchange reserves, while commercial banks hold $5.122 billion—totaling $12.302 billion.