Saudi Arabia: Major Source of Cheap Foreign Loans for Pakistan

Pakistan relies heavily on foreign loans, with Saudi Arabia being a major provider of cheap loans at 4% interest.

These loans, used to help Pakistan's economy, are significantly cheaper than those from China or commercial borrowing.

Pakistan also has other loans, including those from China, UAE, and commercial banks, which come with varying interest rates, some much higher.

The IMF requires these deposits from Saudi Arabia, China and UAE to be maintained.

Pakistan's central bank has had to purchase a substantial amount from the local market to cover maturing debt obligations despite the IMF package.