Riyadh signals readiness to provide more credit

Pakistan claimed on Wednesday that it received an indication from Saudi Arabia for additional loans that may help to break gridlock with the International Monetary Fund (IMF) and said that it was not planning to prematurely quit the $6.5 billion programme. “We have received an indication from Saudi Arabia about getting something,” Dr Aisha Pasha, the Minister of State for Finance, said after attending a meeting of a parliamentary committee, without explaining the loan amount. She also informed the Senate Standing Committee on Finance that some progress was made a day earlier on a friendly country deposit, saying, “we will soon reach the stage to sign the Staff-Level Agreement with the IMF”. The IMF has asked Pakistan to arrange $6 billion in additional loans and at least half of those must be materialised before the board meeting. The funds are needed to avoid sovereign default and also increasing the foreign exchange reserves to a level sufficient to back 17 months of imports. Pakistan had told the IMF that it would get $2 billion in additional loans from Saudi Arabia and $1 billion from the UAE to meet the additional financing requirements. Hamad Obaid Ibrahim Salim Al-Zaabi, Ambassador of the UAE also called on Finance Minister Ishaq Dar. The finance minister highlighted various avenues in which both countries could enhance their existing trade and investment relations, according to the finance ministry handout.