Pakistani government has paid back $1 billion loan of Saudi Arabia that it took one and a half year ago. Pakistani government had taken $3 billion loan from Saudi Arabia to avoid default on international debt obligations.
According to the Pakistani Ministry of Finance and the State Bank of Pakistan (SBP), Pakistan has taken the loan of $1 billion from China to pay back the Saudi Arabia loan.
According to Tribune report, Pakistan’s time-tested friend, China, has immediately come forward and extended $1 billion in loan to help Pakistani government to pay back the $1 billion loan of Saudi Arabia.
In October 2018, Saudi Arabia had agreed to provide the financial package of $6.2 billion to Pakistan for three years. This included $3 billion in cash assistance and $3.2 billion worth of annual oil and gas supply.
According to Pakistani Ministry of Finance, Pakistan pays 3.2% interest on the $3-billion Saudi loan.
Last fiscal year, Imran Khan Government took over $13 billion foreign loans to repay maturing external debt and cushion the shrinking foreign exchange reserves.