Pakistan secures $6bn Saudi loan amid Khashoggi fallout

Islamabad has confirmed that it has secured a three-year loan deal with Riyadh following Prime Minister Imran Khan's second trip to Saudi Arabia as leader.

MENA

2 min read

The New Arab & agencies

24 October, 2018

Prime Minister Imran Khan has said that his country is 'desperate' for assistance [Getty]

Pakistan has secured a $6 billion support package from Saudi Arabia to aid its ailing finances, Islamabad announced on Tuesday.

The package's announcement follows Pakistani Prime Minister Imran Khan's visit to Riyadh for the Future Investment Forum (FII) business conference, which had been boycotted by a number of high-profile business leaders and politicians over the killing of Saudi journalist Jamal Khashoggi.

Pakistan will receive $3 billion of the package directly to help its balance of payments crisis, while a further $3 billion will be paid at a later date for oil imports.

"This arrangement will be in place for three years, which will be reviewed thereafter," Pakistan's Finance Ministry said in a statement.

Prior to the FII conference, Khan had expressed his country's desparation to secure economic aid, saying that Pakistan is running low on foreign currency reserves.

Following the announcement of the agreement with Riyadh, Pakistan's finance ministry has confirmed it will still seek an IMF bailout, however expects to go into talks in an "improved position," Finance Ministry spokesperson Noor Ahmed told Bloomberg.

The bailout, if agreed, will be Pakistan's 13th since the late 1980s.

Saudi Arabia has come under intense pressure since the disappearance of dissident journalist Jamal Khashoggi on 2 October. Since Saudi authorities belatedly admitted that Khashoggi was killed, pressure and global condemnation has increased, with US President Donald Trump on Tuesday calling it the "worst cover-up in history".

Trump and other Western leaders have been accused of tempering their criticism of the Saudi government over Khashoggi's killing due to multi-billion dollar arms sales to the kingdom.