Saudi Arabia halts 3-year aid plan to Pakistan in just 1 year; 'not keen' to renew

Saudi Arabia's massive $6.2 billion, three-year financial package to Pakistan seems to have reached an end within just a year after the former expressed that it was not keen to continue rolling out the money to the debt-ridden country. Pakistani media reported that the one-year term of the lease came to an end on July 9, after which Riyadh was to renew the financial assistance for another two years. However, no talks of renewal have been made between the two countries even a month after the lease expired.  

In October 2018, Saudi Arabia decided to provide a $6.2 billion worth of financial package to Pakistan for a period of three years. This included $3 billion in cash assistance and $3.2 billion worth of annual oil and gas supply on deferred payments. The deal, however, came with a caveat, that Saudi Arabia would only provide assistance to Pakistan for a year after which it had the option to renew the package for the next two years. Sources report that Saudi Arabia is not keen to see the deal going forward anymore.

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Pak borrows from China to repay Saudi Arabia

This comes amid reports of frantic Pakistan running to China requesting financial aid to avoid defaulting on its debt payments to Saudi Arabia. According to the Pakistani Ministry of Finance and the State Bank of Pakistan (SBP), Pakistan has taken a loan of $1 billion from China to repay a $1 billion loan taken from Saudi Arabia.

This also comes against the backdrop of the recent 'threat' by Pakistan's Foreign Minister Shah Mehmood Qureshi to Saudi Arabia where he claimed that if Saudi Arabia did not hold an OIC meeting over Kashmir soon, Pakistan would pull out its allies from the OIC and do so itself. The OIC has been consistently denying Imran Khan's requests of holding a meeting over Pakistan-occupied Kashmir, where the latter has been using to wage a proxy war against India for decades.

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