Pakistan Secures $2 Billion from Saudi Arabia Amid Economic Struggles

Pakistan has received a significant financial boost of $2 billion from Saudi Arabia to enhance its foreign exchange reserves. This support comes at a critical time as the country grapples with economic challenges, including rising oil prices and a struggling stock market. Prime Minister Shehbaz Sharif's recent visit to Saudi Arabia aims to secure further assistance amidst ongoing tensions in the region. With a pressing need for additional funding, Pakistan's economic stability hangs in the balance as it navigates these turbulent times.

By Narendra Chaudhary Apr 16, 2026, 15:55 IST

Financial Support for Pakistan's Foreign Exchange Reserves

In an effort to bolster its foreign exchange reserves, the State Bank of Pakistan has announced the receipt of $2 billion from the Saudi Ministry of Finance, effective April 15, 2026. This information was shared via a post on social media by the central bank. Currently, Pakistan's foreign exchange reserves exceed $21 billion. Reports indicate that the country has also secured an additional $3 billion in funding to enhance its reserves, which will assist in repaying a loan to the UAE. Furthermore, Saudi Arabia has extended a $5 billion deposit to Pakistan.

Following a request from the UAE, Pakistan has committed to returning $2 billion to the United Arab Emirates by the end of this month. For the current fiscal year, the country requires approximately $12 billion in either rollover or new support, which includes $5 billion from Saudi Arabia, $4 billion from China, and $3 billion from the UAE, which is currently being repaid.

Prime Minister Shehbaz Sharif is currently visiting Saudi Arabia, where he met with Crown Prince Mohammed bin Salman in Jeddah. His trip also includes stops in Qatar and Türkiye. Pakistan is facing significant challenges due to the ongoing Iran conflict, which has resulted in the closure of the Strait of Hormuz, through which the country imports about 85% of its oil.

Earlier this month, the Pakistani government announced a drastic overnight increase of 42.7% in petrol prices, raising it to Rs 485 per litre. This decision sparked immediate protests and long lines at petrol stations. In response to public outcry, Prime Minister Sharif reverted the price to Rs 378 per litre on the same day. The economic turmoil has also severely impacted Pakistan's stock market, with the KSE 100 index plummeting nearly 6,000 points, a 3.5% drop, reaching a low of 161,638. This decline followed unsuccessful ceasefire negotiations between Iran and the US, facilitated by Prime Minister Sharif and army chief Asim Munir.

The KSE-100 Index fell by 4,567.31 points (-2.73%) to 162,624.06 within just two hours of trading.