Atif Ikram Sheikh, President of the Federation of Pakistan Chambers of Commerce & Industry (), has welcomed Saudi Arabia’s pledge of a fresh $3 billion deposit to the State Bank of Pakistan (SBP) and extension of the existing $5 billion facility for an additional three years until 2028.
The announcement made by Finance Minister at World Bank-IMF Spring Meetings in Washington is a significant breakthrough for Pakistan’s macroeconomic stability, according to Sheikh. The removal of annual rollover condition for the $5 billion facility and addition of fresh $3 billion injection provide unprecedented predictability to Pakistan’s economic planning.
Sheikh highlighted several critical economic impacts this strategic financial support will have on Pakistan’s economy; including bolstering foreign exchange reserves as the fresh $3 billion injection comes at a crucial time geographically. This will play a pivotal role in helping the government achieve its target of building reserves to around $18 billion by end of FY26, necessary for providing import cover over 3-months.
Sheikh stressed that Pakistan needs currency stabilization and inflation control; enhanced reserves will directly ease pressure on Pakistani Rupee. A stable exchange rate is vital for curbing imported inflation – thereby lowering cost of doing business and providing relief to the general public.
The injection will also prove instrumental in restoring business and investor confidence as the business community thrives on certainty, said Sheikh. By securing external financing and extending maturity of $5 billion facility to 2028, government has mitigated immediate balance of payments risks and liquidity crunch.
Sheikh stated that this renewed confidence will likely stimulate both domestic industrial expansion and foreign direct investment (FDI), facilitating industrial growth due to stabilized external account. Additionally, SBP will be in better position to facilitate timely clearance of Letters of Credit (LCs) ensuring steady supply of essential industrial raw materials, machinery and petroleum products.
Sheikh stated that Saudi Arabia has once again proven to be an all-weather friend and pillar of support for Pakistan during testing times. This financial support offers policymakers crucial breathing space needed to implement long-term structural reforms; improve investment climate and shift economy from import reliance to export-driven growth.
extends profound gratitude to Custodian of the Two Holy Mosques, King Salman bin Abdulaziz Al Saud and Crown Prince Mohammed bin Salman for their unwavering support. The Federation also commends Pakistan’s political and economic leadership including Prime Minister, Finance Minister and SBP Governor for successful diplomatic and financial negotiations.
The apex trade body reiterated its commitment to working closely with government to translate macroeconomic stabilization into on-the-ground industrial growth, job creation and enhanced bilateral trade between Pakistan and Kingdom of Saudi Arabia.