The Saudi Fund Development (SFD) was instructed by King Salman bin Abdulaziz Al Saud, the Custodian of the Two Holy Mosques, to prolong the time for the $3 billion deposit made by the Kingdom of Saudi Arabia (KSA) to the State Bank of Pakistan (SBP).
According to a press release from the Islamic Republic of Pakistan, “the extension of the term of the deposit is a continuation of the support provided by the government of the Kingdom of Saudi Arabia to the Islamic Republic of Pakistan, as the deposit aimed to shore up the foreign currency reserves in the Bank and help Pakistan in facing the economic repercussions of the COVID-19 pandemic; it, furthermore, contributed to meet external sector challenges and achieve sustainable economic growth for the country.”
In November 2021, the $3 billion deposit deal was signed.
The Pakistani government’s ministry of finance revealed earlier this week on Tuesday that it had received $500 million from the Asian Infrastructure Investment Bank (AIIB). Deposited with the SBP, the money will increase reserves.
SBP’s reserves dropped by $327 million on Thursday, reaching $7.5 billion. The overall reserves of the nation, including bank reserves, decreased by $267 million to $13.4 billion. Because of this, the import cover calculated using the average imports over the previous 12 months came in at 1.1 months, which is a very low number.
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