After $2bn from Saudi, Pakistan receives $1bn from UAE to boost its reserves

Islamabad: Pakistan on Wednesday received USD 1 billion from the UAE to boost its reserves, a day after Saudi Arabia transferred USD 2 billion to the country's central bank in the wake of a deal with the International Monetary Fund.

Finance Minister Ishaq Dar announced the transfer of funds by the Gulf nation on the eve of the board meeting of the IMF to approve a USD 3 billion Stand-by Agreement.

"We received confirmation some time ago that our brother country, our friend, the UAE has deposited USD 1 bn to the State Bank's account. The Federal Reserves Bank has confirmed that this amount has been credited to the (SBP's) account,” he said in a video message shown live on television.

Dar said the funds received from Saudi Arabia and the UAE this week had collectively "increased the country's reserves by USD 3 bn in two days" which would reflect in the weekly update of foreign exchange reserves due to be issued on July 14.

He thanked the UAE leadership on behalf of Prime Minister Shehbaz Sharif, Chief of Army Staff General Asim Munir and the Pakistani nation for support in difficult times.

Prime Minister Sharif also thanked UAE President Mohamed Bin Zayed for the USD 1 billion deposit. "As a time-tested friend and brotherly country, the UAE has always come forward to support Pakistan,” he said.

He said that Pakistan acknowledged the "kind gesture" which was critical to the efforts to stabilise the economy.

Pakistan has been struggling to arrange enough foreign exchange to satisfy the IMF which refused to provide the remaining USD 2.5 billion out of a USD 6.5 billion loan program which was signed in 2019 and expired on June 30 this year.

Later, the IMF agreed to provide USD 3 billion over a period of nine months under strict conditions including arranging funds to boost the balance of payments.