Pakistan Likely to Secure $1.2 Billion Saudi Oil Facility in December

A high-level Saudi delegation will likely visit Pakistan by December 2024 to finalize the terms of a $1.2 billion oil facility. Saudi Arabia recently confirmed its willingness to support this new facility to help Pakistan secure International Monetary Fund (IMF) approval for a $7 billion Extended Fund Facility (EFF), reported a national daily. Pakistan plans to request a 12-month deferred payment arrangement under the Saudi Oil Facility with $100 million in monthly disbursements. The repayment could start in 2025, and while the facility may operate for three years, the exact timeline has yet to be determined. In 2023, the Saudi Fund for Development (SFD) disbursed approximately 1.3 billion Saudi riyals for Pakistani development projects, out of a committed 1.6 billion SR. The SFD provided 901.25 million SR for constructing the Mohmand Dam, which aims to produce 800 megawatts of hydropower, store 1.6 million cubic meters of water, and mitigate flood risks. Other significant contributions from the SFD in 2023 included funding for Tarbela Dam repairs (178.28 million SR) and irrigation projects along the Indus River (231.5 million SR). In total, the KSA extended 3.5 billion SR in grants for various infrastructure projects across Pakistan, including the Makran Coastal Highway, Neelum-Jhelum and Golen Gol hydropower plants, and infrastructure reconstruction in Malakand.