The development came after China agreed to provide a $1 billion financing line to Pakistan - rescuing Islamabad for the second time
ISLAMABAD: Pakistan has returned another $1 billion of the $3 billion loan given by the Kingdom of Saudi Arabia.
The development came after China agreed to provide a $1 billion financing line to Pakistan - rescuing Islamabad for the second time. Earlier this year, Pakistan repaid $1 billion to KSA in the first quarter of the current fiscal year with China's help.
With the latest repayment, Pakistan has so far repaid $2 billion out of the total $3 billion debt.
In late 2018, Saudi Arabia had given Pakistan a $3 billion loan and a $3.2 billion oil credit facility. The money had been deposited in State Bank of Pakistan on December 15 2018 with a three years maturity period. Islamabad is repaying the amount ahead of schedule.
The last tranche of $1 billion will be repaid next month.
With the new facility, Pakistan's reliance on China increases. The country's financial account has already turned negative to the tune of $1.33 billion because of an outflow of dollars.
So far, increased remittances helped Islamabad avoid an eruption of a full fledged balance of payments crisis as remittances from abroad remained over $2 billion in the last five months.