Saudi Arabia has deposited $2 billion into Pakistan’s foreign exchange reserves, providing timely support as Islamabad prepares to repay more than $3 billion to the United Arab Emirates, officials said.
The State Bank of Pakistan confirmed on Thursday that the funds were credited on April 15, 2026, offering immediate relief to Pakistan’s strained external account.
The inflow coincides with Prime Minister Shehbaz Sharif’s visit to the Kingdom, where he is engaged in diplomatic outreach amid escalating tensions over Iran war that has affected the entire Middle East.
The visit comes days after Riyadh and Islamabad activated a bilateral defense pact, under which Pakistan has deployed several fighter jets and approximately 13,000 troops to Saudi Arabia.
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Islamabad has also enhanced its diplomatic profile by mediating the U.S. and Iran conflict, and is being seen as a peacekeeper and security provider.
Beyond the immediate deposit, Saudi Arabia has pledged an additional $3 billion in support and extended its existing $5 billion financial facility for another three years. Finance Minister Muhammad Aurangzeb said the arrangement—previously renewed annually—has now been converted into a longer-term commitment, enhancing Pakistan’s financial stability.
The Saudi support comes at a critical moment for Pakistan’s economy. Islamabad is set to repay a $3.5 billion loan to the United Arab Emirates this month, a development that has intensified pressure on foreign exchange reserves and raised concerns about meeting International Monetary Fund program targets.
Pakistan’s external position remains fragile, with rising global oil prices and ongoing regional instability adding further strain. As of March 27, the country’s reserves stood at $16.4 billion—equivalent to roughly three months of import cover.
Concerns had deepened after Pakistan was unable in March to secure a rollover of the $3.5 billion UAE facility—its first such setback in seven years—highlighting emerging short-term financing gaps.
Following the UAE’s request for repayment, Islamabad turned to key partners, including Saudi Arabia and China, to shore up reserves. Analysts say Riyadh’s timely financial intervention has helped ease immediate pressures while reinforcing its broader strategic partnership with Pakistan.
The latest support underscores Saudi Arabia’s dual role as both an economic backer and security partner to Pakistan at a time of heightened geopolitical uncertainty.
Muhammad Luqman is Associate Editor at Views News Now. He writes on wide-ranging issues including economy, South Asia, the Middle East, agriculture, economy and innovation. Luqman has worked some of the leading news organizations and won acclaim for his original and research-based works.
