ISLAMABAD: Pakistan has made eight requests to Saudi Arabia under long-term economic cooperation, including conversion of short-term existing deposits of $5 billion into a long-term facility of 10 years, enhancing oil facility on deferred payment from $1.2 billion to $5 billion with increased tenure, securitisation of Pakistani diaspora’s remittances of $10 billion and others.

Top official sources confirmed to The News that Pakistan’s economic woes were multiplying in the aftermath of ongoing geopolitical tension amid the ongoing US-Israel-led war against Iran.

On the other hand, Pakistan is negotiating with the IMF for completion of the third review under the $7 billion Extended Fund Facility (EFF).

Pakistan and the KSA were already negotiating a comprehensive economic cooperation package, and the recent escalation has given impetus to the ongoing parleys, whereby at the highest level, Pakistan asked for the required support to tackle the arising challenges.

Pakistan has requested the conversion of existing KSA deposits of $5 billion lying with the SBP into a long-term facility. This request has been made to convert a short-term deposit of $5 billion into a long-term facility of 10 years with favourable pricing.

The second request is to jack up the oil facility on deferred payment under which the KSA is being asked to enhance the facility of $1.2 billion to $5 billion. The tenor period for repayment may also be increased from one year to three years, whereby repayment of every tranche is made after three years.

The third request has been made to the KSA for the securitisation of diaspora’s remittances. This kind of securitisation can boost forex reserves and reduce costly foreign borrowing.

For the fourth request, the KSA may consider providing a guarantee for Pakistan’s any new endeavours for international Sukuk issuance in order to allow the country to raise international capital at lower rates.

Pakistan made the fifth request to the KSA for a concessional credit line to the EXIM Bank of Pakistan. The Government of Pakistan has established a new EXIM Bank in order to achieve export-led growth under the IMF programme.

Islamabad has also made a request to the KSA for the consideration of waiving off bank guarantee requirements for import-related transactions with Pakistan.

The KSA has been asked to consider investment, especially in the Public Investment Fund (PIF), in order to explore investment opportunities in the country.

The Government of Pakistan also requested the KSA to help it in adjustments in primary surplus targets in line with the IMF programme to accommodate the proposed tax rationalisation. The expenditures remain highly rigid, curtailing further cuts, so the fiscal deficit may rise further, but the long-term impact will be positive.

The KSA response could not be ascertained immediately to these eight requests from Pakistan.

This scribe sent questions to both the Ministry of Finance and the State Bank of Pakistan for seeking their comments but received no reply. The finance ministry spokesman, however, replied that he would ask from the relevant colleagues, but till the filing of the report, there was no reply.