ISLAMABAD – China has reportedly agreed to provide financial aid to the tune of $1.5 billion to Pakistan for pay off the loan of Saudi-Arabia.
Pakistan has to pay $2 billion dollars the Arab country as it had returned $1 billion of $3 billion loan in August earlier this year.
Sources within the finance ministry and the State Bank of Pakistan (SBP) told local media outlets that Pakistan was going to pay back the loan taken from the kingdom.
Immediately, Pakistan would return $1 billion while remaining amount is expected to be paid in January next year.
Sources told media that the financial help would not add to the Pakistan’s loans as it is being released as an increase in the size of a 2011 bilateral Currency-Swap Agreement (CSA).
China and Pakistan reached the CSA in December 2011 with an aim to promote bilateral trade, finance direct investment, and provide short-term liquidity support.
In 2018, Saudi Arabia had paid $3 billion in foreign currency support for a year and a further loan worth up to $3 billion in deferred payments for oil imports to help Pakistan drive out of economic woes.
