Saudi Arabia to deposit $2 billion in Pakistani central bank before IMF bailout — defense minister 

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Updated 27 May 2023
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Saudi Arabia to deposit $2 billion in Pakistani central bank before IMF bailout — defense minister 

  • Khawaja Asif promises to place all resources of Pakistan at the Kingdom’s disposal for its safety and security 
  • Says his party is seeking ‘judicial remedy’ to get ex-PM Nawaz Sharif’s conviction overturned before his return 

ISLAMABAD: Pakistan’s Defense Minister Khawaja Asif said on Thursday that Saudi Arabia would be depositing funds worth $2 billion in the Pakistani central bank before the revival of a stalled $6.5 billion International Monetary Fund (IMF) bailout program, amid desperate attempts by the South Asian country to secure external financing to avoid a default. 

Pakistan, a nation of over 220 million, has been facing an economic crisis for the last several months, with soaring inflation, a depreciating currency and critically low foreign exchange reserves. To avert the possibility of a default on its international obligations, the government has been striving for the resumption of the IMF loan program, stalled since November last year. 

In March, the IMF asked Pakistan to secure financing assurances from friendly states and multilateral donors before it could release $1.1 billion tranche, after which China rolled over its $2 billion loan to the cash-strapped South Asian nation. This was followed by a $2 billion pledge by Saudi Arabia and the UAE promising $1 billion support to Islamabad. 

However, the global lender has yet to sanction the release of funds. To keep the frail economy afloat, the South Asian country is facing the daunting task of securing the crucial IMF funds ahead of its budget for the next fiscal year on June 9. 

“The IMF asked them (Saudi Arabia) to give that commitment to them. They (Saudi Arabia) have already given that, that means that they will pay [the funds to Pakistan],” Asif told Arab News in an exclusive interview on Thursday. 

“I think, if I am not wrong, they will be depositing that money ($2 billion) before the IMF program. The IMF is not giving us something, not a big amount. It is just a program which we have to complete till 30th of June.” 

Pakistan’s IMF bailout program is set to expire on June 30, which has prompted the government to look for other options to avert a sovereign default. 

“We are receiving help from UAE, Saudi Arabia, China and some other sources also,” Asif said. “We hope to, God willing, come out of this economic wilderness very soon.” 

Earlier this year, the defense minister said in one of his statements that Pakistan had already defaulted, stirring a debate and fueling commotion within the country’s business community. 

“My use of the word default perhaps was not very accurate or very appropriate, but the fact remains that we are in a dire financial situation, we were in dire financial situation and we are still not out of the woods,” he replied, when asked about his statement. 

Asif said he was “just trying to explain” by using the word default that Pakistan was borrowing money to service its loans. 

During the interview, the minister lauded Saudi Arabia for its assistance to Pakistan on several occasions and expressed profound regard for the Saudi royal family. 

“Saudi Arabia, the land obviously, is the ultimate sacredness for us, the two holy cities. And our relationship with Saudi Arabia has a long history of brotherhood and respect and love for each other,” he said. 

“I have no words to explain that the feelings we have for Saudi Arabia and the ruling family of Saudi Arabia. They have helped us at very crucial junctures of our history in last 75 years and we are indebted to them.” 

He vowed to place all resources of Pakistan at the Kingdom’s disposal for its protection and safety. 

“And our forces or our resources, whatever resources we have mostly defense related, they will always be at the disposal of the Kingdom of Saudi Arabia for their defense, their protection,” Asif said. 

“Whatever worth we are, we will always stand by the Kingdom of Saudi Arabia.” 

Arab News also questioned Asif about the return of his Pakistan Muslim League-Nawaz (PML-N) party’s supremo and three-time former prime minister, Nawaz Sharif, to Pakistan. To which, Asif said said they were following a legal way to get his conviction in corruption cases overturned before his return to the country from London. 

Sharif, who is the elder brother of sitting Pakistan PM Shehbaz Sharif, was restricted for life from holding any political office by Pakistan’s top court in April 2018, followed by his conviction in a corruption case the same year. The ex-premier, who left for London in 2019 after securing bail on medical grounds and has since not returned, says the cases against him were politically motivated. 

“He will be returning soon. There are some legal hurdles, the sentence he received during 2017-18 when engineering to bring Imran Khan to power was taking place,” Asif said. “He [Sharif] had to be replaced and sentenced, that was a plan.” 

The defense minister said the “circumstances” forced Sharif to stay in exile in London. 

“He is still suffering, and he is in exile not because of his own choice,” he said, adding that Sharif was dismissed on the “most frivolous” charge of not receiving money from his son’s company. 

“We have to secure his position legally before he returns. I think that will happen soon. We are following the legal path to secure that, nothing, something which is beyond legal realm.” 

The minister said they were working on a legal strategy to get Sharif’s conviction overturned from the Supreme Court. 

“We are seeking a judicial remedy to that,” he said, adding that they would be filing a petition for it in the Supreme Court. “It’ll happen. You’ll come to know about it.” 


Pakistani PM speaks to Saudi, Qatari envoys as Iran fires missiles at US air base in Qatar

Updated 23 June 2025
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Pakistani PM speaks to Saudi, Qatari envoys as Iran fires missiles at US air base in Qatar

  • Qatar called the attack a ‘flagrant violation’ of its sovereignty and said it reserved the right to respond
  • In phone call with Saudi envoy, PM Shehbaz Sharif urges joint efforts to de-escalate tensions in the region

ISLAMABAD: Pakistan Prime Minister Shehbaz Sharif has expressed concern over Iran’s missile attack on a United States (US) military base in Qatar and called for efforts to restore peace in the region, Sharif’s office said on Monday, following his telephonic talk with Qatari and Saudi envoys to Islamabad.

Iran launched missile attacks Monday on US military bases in Qatar and Iraq in retaliation for the American bombing of its nuclear sites, state media said, amid escalating tensions in the volatile region.

Qatar said it had “successfully intercepted” missiles targeting the US base, and added it reserved the right to respond in accordance with international law. The US confirmed its air base was targeted by missile attack from Iran and said no casualties were reported.

Shortly after the attack, Sharif spoke with Qatar’s Ambassador to Islamabad Ali Mubarak Ali Essa Al-Khater and expressed solidarity with the Qatari government and people. He then spoke with Saudi Arabia’s Ambassador Nawaf bin Said-Al Malki.

“The Prime Minister urged that all efforts must be made to de-escalate tensions and restore peace in the region,” Sharif’s office said, following his conversation with the Saudi envoy.

“He said Pakistan would continue to work closely with the Kingdom of Saudi Arabia to intensify peace efforts.”

The Qatari and Saudi envoys thanked the prime minister for expressing solidarity and immediately reaching out to them after the development that could imperil peace and stability in the region, according to Sharif’s office.

Qatar earlier said it condemned the Iranian missile attack, calling it a “flagrant violation” of its sovereignty.

“We express the State of Qatar’s strong condemnation of the attack on Al-Udeid Air Base by the Iranian Revolutionary Guard Corps, and consider it a flagrant violation of the State of Qatar’s sovereignty and airspace, as well as of international law,” foreign ministry spokesman Majed Al-Ansari said in a statement.

The Al-Udeid air base is home to the US Combined Air Operations Center (CAOC), which provides command and control of air power across the region as well as the 379th Air Expeditionary Wing, the largest expeditionary wing in the world.

Iran’s retaliation came a day after the US launched a surprise attack Sunday morning on three of Iran’s nuclear sites, joining Israel in the biggest Western military action against the Islamic Republic since its 1979 revolution.

Just before the explosions, Iranian President Masoud Pezeshkian wrote on the social platform X: “We neither initiated the war nor seeking it. But we will not leave invasion to the great Iran without answer.”


PIA cancels flights to Qatar, Bahrain, Kuwait and UAE after Iran attacks on US bases

Updated 23 June 2025
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PIA cancels flights to Qatar, Bahrain, Kuwait and UAE after Iran attacks on US bases

  • Iran confirmed it had attacked US forces stationed at Qatar’s Al-Udeid air base
  • The retaliation came a day after the US attacked three of Iranian nuclear facilities

KARACHI: The Pakistan International Airlines (PIA) has canceled its flights to Qatar, Bahrain, Kuwait and the United Arab Emirates (UAE), it said on Monday, shortly after Iran struck United States (US) bases in Qatar with missiles.

Iran confirmed it had attacked American forces stationed at Qatar’s Al-Udeid air base. A caption on the screen called it “a mighty and successful response by the armed forces of Iran to America’s aggression” as martial music played during announcement on Iranian state television.

Qatar said it “successfully intercepted” missiles targeting the US base, and added it reserved the right to respond directly and in accordance with international law following the strikes. The US confirmed its air base in Qatar was targeted by missile attack from Iran and said no casualties were reported.

PIA said it had limited its flight operations as a precautionary measure due to the ongoing situation in the Gulf region, adding that its reservation department had started transferring the bookings of passengers to other flights.

“PIA flights will be resumed after the situation returns to normal,” the airline said in a statement. “All passengers who were traveling on these flights are requested to get timely information about their flights from the PIA call center.”

A UAE government spokesperson said they were closely monitoring the regional developments and continuously assessing the situation.

Kuwait’s civil aviation body issued a statement, saying: “The country’s airspace has been temporarily closed as a precautionary measure, starting today and until further notice. The decision comes within the framework of maintaining the highest levels of safety and security in light of regional developments.”

The Al-Udeid air base is home to the US Combined Air Operations Center (CAOC), which provides command and control of air power across the region as well as the 379th Air Expeditionary Wing, the largest expeditionary wing in the world.

Iran’s retaliation came a day after the US launched a surprise attack Sunday morning on three of Iran’s nuclear sites, joining Israel in the biggest Western military action against the Islamic Republic since its 1979 revolution.

Just before the explosions, Iranian President Masoud Pezeshkian wrote on the social platform X: “We neither initiated the war nor seeking it. But we will not leave invasion to the great Iran without answer.”


Pakistan says holds ample petroleum reserves amid fears of Iran’s closure of Strait of Hormuz

Updated 23 June 2025
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Pakistan says holds ample petroleum reserves amid fears of Iran’s closure of Strait of Hormuz

  • Iran’s parliament has approved cutting off the narrow shipping lane through which about 20 percent of global oil and gas passes
  • State Minister Bilal Azhar Kayani says no cause of concern for Pakistanis, government prepared to address any uncertainties

ISLAMABAD: Pakistan has ample petroleum reserves and an uninterrupted supply chain, a junior minister said on Monday, amid fears that Iran may cut off a vital oil and gas shipping lane in retaliation for US strikes on its nuclear facilities.

Iran’s parliament has approved cutting off the Strait of Hormuz, a narrow shipping lane in the Arabian Gulf through which about 20 percent of global oil and gas passes. It’s now up to Iran’s national security council to decide whether to move forward with the idea, which could lead to a spike in the cost of goods and services worldwide.

The price of oil jumped 4 percent shortly after trading began on Sunday night, but it quickly pared back as the focus shifted from what the US military did to how Iran would react. Oil futures were flip-flopping in Monday morning trading between gains and losses. They still remain higher than they were before the fighting began a little more than a week ago.

Pakistan’s State Minister for Finance and Railway Bilal Azhar Kayani denied rumors about a shortage of petroleum products in the South Asian country, stressing that his government was closely monitoring developments following tensions between Iran, Israel and the US to ensure stability.

“The Oil and Gas Regulatory Authority (OGRA) has directed all oil marketing companies to strictly maintain mandatory reserve levels in light of current global conditions, mitigating potential risks,” Kayani was quoted as saying by Pakistan’s Press Information Department.

“There is no cause for concern as petroleum product inventories are sufficient and supply operations continue smoothly across the nation.”

The statement came hours after President Donald Trump called for the US and other oil-producing economies to pump more oil as the White House sharpened its warnings to Iran against closing the Strait of Hormuz.

Global markets were trying to ascertain what lays ahead after the US struck on Sunday key Iranian nuclear facilities with a barrage of 30,000-pound bunker busting bombs and Tomahawk missiles.

Pakistan lacks adequate resources to run its oil- and gas-powered plants and mainly sources its oil from Arab Gulf nations.

Kayani reassured citizens that the Prime Minister’s office, Ministry of Petroleum and the Ministry of Finance were continuously monitoring the situation.

“We are fully prepared to address any uncertainties,” he said, adding the government was committed to ensuring the country’s energy security.


Pakistan extends airspace closure for Indian aircraft until July 23

Updated 23 June 2025
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Pakistan extends airspace closure for Indian aircraft until July 23

  • The restriction was first imposed in Apr. as part of tit-for-tat measures by India and Pakistan after an attack in disputed Kashmir
  • The attack, which India blamed on Pakistan without offering evidence, led to a four-day military conflict between the two countries in May

ISLAMABAD: Pakistan has extended for the second time its airspace ban on Indian aircraft until July 23, the Pakistan Airports Authority (PAA) said on Monday, citing continued tensions between the two countries.

The restriction was first imposed on Apr. 24 as part of a series of tit-for-tat measures announced by both India and Pakistan, days after an attack in Indian-administered Kashmir.

India blamed Pakistan for the assault that killed 26 tourists, Islamabad denied the allegation and called for a credible international probe into the incident. Both countries later engaged in a four-day military conflict in May.

“The ban on Indian aircraft from entering Pakistani airspace has been extended by one month,” the PAA said in a statement. “Pakistani airspace will remain closed to Indian aircraft until July 23, 2025.”

The ban applies to passenger and military aircraft operated by Indian airlines, according to the PAA. A Notice to Air Missions (NOTAM) has also been issued in this regard.

“Any aircraft registered in or leased by India would also be prohibited from using the Pakistani airspace,” the authority added.

Pakistan had previously extended the ban till June 24. It has forced Indian airlines to reroute their flights, resulting in increased fuel consumption, longer travel times and higher operational costs.

Air India, which operates numerous flights to Europe and North America, estimated in May that the airspace ban could lead to approximately $600 million in additional expenses over the course of a year and requested compensation from the Indian government.


Pakistan stocks, rupee plunge as investors react to US strikes on Iran

Updated 23 June 2025
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Pakistan stocks, rupee plunge as investors react to US strikes on Iran

  • Benchmark KSE-10 Index dropped more than 3 percent to the lowest in over six weeks
  • Analysts say if there was no further escalation, value buying is expected to come through

KARACHI: Pakistan’s stocks and currency markets tumbled on Monday as investors reacted to the United States’ (US) foray into the Israel-Iran conflict, traders and analysts said.

The benchmark KSE-100 index dropped more than 3 percent to 116,167 points, the lowest in more than six weeks, while the rupee continued to weaken against the US dollar in the seventh consecutive session on Monday.

The index has plunged by nearly 5 percent since June 13 when Israel first hit Iranian military and nuclear targets in Natanz, Isfahan and Fordow, killing top generals and scientists among 78 people.

“Rising geopolitical tensions following a US strike on Iran shook investor confidence, causing the KSE-100 Index to drop by 3.2 percent,” Mohammad Waqas Ghani, head of research at JS Global Capital Ltd., told Arab News, adding that this was the fourth largest single-day decline in terms of points historically.

The attacks on Iran by the US, which followed Israeli strikes, have intensified the war and deepened geopolitical tensions in the Middle East, sending jitters to markets across the globe.

Monday’s 3.2 percent fall was the worst since May 8 when the index had plunged 5.9 percent day-on-day, according to Ghani.

“The spike in global oil prices has further intensified concerns about Pakistan’s external account vulnerabilities,” he added.

Cash-strapped Pakistan, which is trying to revive its debt-ridden economy with the help of International Monetary Fund’s $7 billion program, spent $17 billion on oil imports last year.

Raza Jafri, head of research at Intermarket Securities Ltd., attributed the day’s fall to redemptions at mutual funds and possible margin calls.

“Regional tensions are the main reason behind the weak sentiment,” he said, adding that if there was no further escalation, the value buying was expected to come through.

RUPEE DROP

The ongoing tensions have also impacted the Pakistani currency that lost another 0.06 percent as the greenback closed at Rs283.87, according to State Bank of Pakistan (SBP) data.

The rupee is constantly falling and has devalued 0.3 percent since the start of Iran-Israel conflict.

“The rupee is feeling the heat of this war, very negligibly though,” Zafar Paracha, secretary-general of the Exchange Companies Association of Pakistan, told Arab News.

“This stability in the exchange rate reflects the overall macroeconomic stability the country has achieved.”