Will the UAE come to the rescue of financially deprived Pakistan? Pakistan is actively exploring opportunities for seeking $6B aid from the UAE, after securing nearly $6.2B financial assistance from Saudi Arabia. If the aid is granted, Pakistan would cover its immediate financing needs for the current fiscal year. The amount is paid in the form of cash deposits and oil on deferred payments.
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According to the sources, PM Imran Khan may fly to the Emirates after the upcoming visit of China. Both the sides have covered significant ground during the ministerial-level talks held at the Prime Minister’s Office.
The UAE delegation was led by State Minister and Officer of Abu Dhabi National Oil Company Dr Sultan Aljaber. The delegation agreed to strengthen economic, trade and investment relations.
The UAE and Pakistan have also agreed to resolve a decade-old dispute over $800 million outstanding payments that Etisalat owed to Pakistan on account of privatization dues of the Pakistan Telecommunication Limited (PTCL).
The financial assistance has been sought on the Saudi Arabian model. Last week, the kingdom agreed to place $3 billion with the State Bank of Pakistan and $3 billion worth oil on deferred payments facility.
The sources said Pakistan requested the UAE to place $5 billion interest-free deposits with the central bank in addition to giving $3 billion oil facility. Pakistan also discussed the country’s requirement of oil on deferred payment in continuation of the recent agreement with Saudi Arabia.
Pakistan’s oil import is expected to peak around $18 billion in the current fiscal year due to the increase in crude oil prices in the international markets. This has contributed to an exponential increase in the country’s external financing needs, which has left a financing gap of $12 billion.