Friday, December 1, 2023

Cabinet approves deal to keep Saudi Arabia’s $3 billion in SBP

The federal cabinet has accepted a deal that will see $3 billion in Saudi Arabian aid remain at the State Bank of Pakistan (SBP) for the foreseeable future.

The agreement was approved by the Cabinet on Saturday, according to a circulation summary.

The Saudi government has previously stated that it would retain a $3 billion reserve at the State Bank.

According to the agreement, the assistance will be held in a deposit account at the State Bank for a period of one year.

“The SBP has finalized all arrangements, and everything is now in place, and the amount of the agreed-upon deposit will be received within the next few days,” top government officials confirmed to The News in an interview.

According to reliable sources, Pakistan would pay the Saudi government a 4 percent annual profit on this cash in exchange for its cooperation.

An agreement with the Saudi government has been prepared and forwarded to the Ministry of Law and the Office of the Attorney General for further consideration.

The Attorney General’s Office and the Ministry of Law have come to an agreement on a draught of the legislation.

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Following the legal opinion, a copy of the agreement was submitted to the federal cabinet for consideration and approval.

Three billion dollars from the Saudi Development Fund have been approved for retention by the State Bank, according to the cabinet.

According to the central bank, Pakistan’s total liquid foreign reserves were at $22.773 billion on November 19, 2021, a decrease from the previous day.

On the basis of the data, the SBP held $16.254 billion in foreign reserves, while commercial banks held net foreign reserves of $6.519 billion.

SBP reserves fell by $691 million to $16.254 billion during the week of November 19, 2021, mostly as the result of repayments of external debt, according to the SBP.

Saudi Arabia has agreed to give $1.2 billion for the delivery of refined petroleum products, according to official sources. The Economic Affairs Division (EAD) of the Pakistani government is negotiating on the country’s behalf.

In response to concerns, Muzammil Aslam, Spokesperson for the Adviser to the Prime Minister on Finance, stated that Pakistan expects to receive $7 billion from only three sources over the next 60 days, according to his office.

Three billion dollars in deposits from Saudi Arabia, a $1.2 billion Saudi Oil Facility with deferred payments, an $800 million oil facility from the Islamic Development Bank, one billion dollars raised through the sale of Sukuk bonds, and one billion dollars from the International Monetary Fund are among the resources available (IMF).

He asserted that the sum of all of these dollar inflows would be adequate to relieve the burden on existing import bills.

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