Hand To Mouth: As Financial Crisis Looms Large, Saudi Arabia Comes To Save Debt-Ridden Pakistan With $1 Billion

Becoming a saviour of the wobbling finances of Pakistan, Saudi Arabia has reportedly transferred $1 billion to the Islamic Republic, as reported by Bloomberg.

The transfer will bolster Pakistan’s foreign exchange reserves, which, in December, fell to $7.3 billion, the lowest in more than four and a half years. Abid Qamar, a spokesman for State Bank of Pakistan, told that Islamabad is expecting its third and final $1 billion transfer from Riyadh next month.

Pakistan is looking to bridge the gap of $12 billion, which was caused by the balance of payments mishap and is in the process of negotiating its 13th bailout with the International Monetary Fund since the 1980s.

Prime Minister Imran Khan, ever since his appointment in August, has been loath to undertake reforms proposed by the IMF. Khan has been shuttled, in order to gain bilateral funding, between China, Saudi Arabia and the UAE.

Pakistan has been Saudi Arabia’s one of the closest allies. Both are leading members of the Organisation of Islamic Cooperation (OIC). The desert kingdom has been one of the strongest supporters of Pakistan be it wars with India, Kashmir issue, or financial crises.