Pakistan gets $3 billion from Saudi Arabia as 'support' to shore up forex reserves as UAE debt looms

Saudi Arabia has provided new financial help to Pakistan with an extra $3 billion deposit. It has also extended an existing $5 billion loan. This support is important for Pakistan as it struggles to meet its growing debt payments.Pakistan’s finance minister Muhammad Aurangzeb on Wednesday said Riyadh has committed the fresh $3 billion support, with disbursement expected soon, while also agreeing to extend the tenure of the earlier $5 billion deposit beyond its annual rollover arrangement. The announcement came on the sidelines of the World Bank–IMF Spring Meetings 2026 as Aurangzeb interacted with the media in Washington, DC and shared key details about Riyadh’s financial support for Islamabad.A Saudi ministry of finance spokesperson confirmed the development and said, ‌”Saudi Arabia has agreed to a $3 billion deposit ​with Pakistan ​to ⁠support their balance of payments," as quoted by Reuters.The move comes at a critical time as Pakistan prepares to repay a multi-billion-dollar loan to the United Arab Emirates, putting pressure on its foreign exchange reserves.Aurangzeb said the Saudi support would “reinforce foreign exchange reserves and strengthen the country’s external account,” adding that the government aims to build reserves to around $18 billion, roughly 3.3 months of import cover, by the end of the fiscal year, as per Pakistan’s finance ministry statement.He emphasised that Islamabad remains committed to meeting all external obligations on time, noting that the recent repayment of a $1.4 billion Eurobond was a “non-event,” reflecting confidence in the country’s financing strategy.The financial assistance also highlights deepening ties between Saudi Arabia and Pakistan, with both nations strengthening cooperation in recent years, including a mutual defence pact signed last year.Aurangzeb expressed gratitude to the Saudi leadership, particularly Crown Prince Mohammed bin Salman, for continued support, describing the package as a result of close coordination between the two sides.Alongside bilateral support, Pakistan is also advancing its broader external financing plans, including a Global Medium-Term Note (GMTN) programme and a planned Panda Bond issuance, aimed at diversifying funding sources..The finance minister noted that sentiment and investor confidence remain “critical” at this stage, adding that international institutions such as the IMF and World Bank have shown growing appreciation for Pakistan’s economic management and diplomatic role. The latest Saudi package is expected to provide Islamabad with short-term breathing space while it navigates a challenging external financing environment.