Pakistan obtains Saudi loan of $ 6 billion while Khashoggi is indignant


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According to Riyadh, Khashoggi, an insider turned critic, died in a clash with Saudi officials, while Turkey said he was killed in a premeditated murder.

Saudi Arabia has agreed to grant Islamabad financial support in foreign currencies of $ 3 billion for one year, as well as a new loan of up to $ 300,000. $ 3 billion in deferred payments for oil imports.

"This arrangement will be in place for three years, and will be reviewed later," the Pakistani Foreign Ministry said in a statement.

& # 39; We are desperate & # 39;

The agreement comes after a previous visit from Khan to Riyadh, his first visit abroad since taking office in July, with no significant results. Before attending this week's conference, Mr. Khan said that Pakistan, facing a serious balance of payments crisis, was desperate to obtain Saudi loans to support the economy.

"If we do not get loans from friendly countries or the IMF, we will not have in two or three months the necessary currency to service our debts or the payment of our imports, so we are desperate." , said Khan said Middle East Eye.

Pakistan 's Finance Minister Asad Umar recently said the country would need more than $ 12 billion to clean up its finances as the current account deficit widens and foreign currency reserves rise. collapse.
Pakistan has devalued its currency several times since December and reserves plunged to $ 8.1 billion, according to Bloomberg.

This month, Umar has called for talks with the IMF to discuss Pakistan's second bailout in five years, although he said it would act the last.

Plaudits and critics

Khan faced national criticism for attending the so-called "Davos in the desert" of Saudi Arabia, but Riyadh's promise of financial support, larger than expected by analysts, also garnered him applause. .

Dawn journalist Dawes Ayesha Ijaz Khan asked if Saudi Arabia would expect Khan to agree with his version of events in the Khashoggi case compared to that of Turkey, another key ally of Islamabad.

"These are important questions to ponder as there is no free lunch in this world," she said. Other critics have asked if the Sunni kingdom is now waiting for Pakistan's support for its controversial Yemeni war against Shiite Houthi groups.

Islamabad has so far resisted such an approach, fearing that this will create problems with neighboring Shiite-dominated Iran, which supports the Houthis, and aggravates tensions between Sunnis and Shiites in Pakistan.

However, some analysts said the benefits of the deal went beyond the criticism it had raised.

"For Islamabad, the prospect of seeking financial support from a Saudi regime with fresh blood and a tarnished image is weak, to say the least", said Michael Kugelman, South Asia expert at the Wilson Center, based in the United States, at CNN.

But he added that, from the point of view of Pakistan's interests, getting help "is a flawless success".

"Islamabad has raised the necessary funds that few states were willing to provide," he said.

Mosharraf Zaidi, columnist and political analyst, said the deal should be seen in the context of Pakistan's delicate handling of complex regional dynamics and an insatiably hungry youth economy.

"It's a good start, but it only buys oxygen," he added. "The real test is reform."

According to analysts, Saudi loans will also reduce the size of the rescue package required by the IMF and strengthen Pakistan's negotiating position with the fund.

The administration of US President Donald Trump has expressed strong reservations about the fact that the IMF is granting Pakistan a new bailout plan while Islamabad assumes billions of dollars of debt for the China-Pakistan Economic Corridor ( CPEC), a series of infrastructure projects funded by China totaling several billion dollars.

"(Pakistan) may also ask the IMF for a slightly lower amount, which in turn will reduce some of the political risks of venturing for the Fund, a decision that never goes far beyond the current financial situation. Pakistani opinion, "said Kugelman.

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