Saudi Arabia has agreed to provide financial support of $4.2 billion to Pakistan, which is battling several economic challenges. The development took place within days after Pakistan Prime Minister Imran Khan concluded his three-day visit to Saudi Arabia.  The assistance will include about $3 billion in safe deposits and $1.2bn to $1.5bn worth of oil supplies on deferred payments.

Information Minister Fawad Chaudhry in his tweet said, “Saudi Arabia's announcement supports Pakistan with 3 billion US dollars as deposit in Pakistan central bank and also financing refined petroleum products with 1.2 billion US dollars during the year.”

Saudi Arabia, which has been bankrolling Pakistan in the past.

Also read: Pakistan, IMF talks for fresh $1 billion loan remain inconclusive

In 2018 the two nations signed a $6.2 billion agreement. As part of this agreement, a $3.2 billion oil package was provided to the cash strapped Pakistan government by Saudi Arabia. The move was aimed at easing Pakistan’s external sector woes. Pakistan, earlier this month, had to repay $1 billion of the $3.2 billion loan. The repayment was possible only after China extended financial assistance to the Khan government.

However, relations between the two countries nosedived and last year in August, Pakistan had to repay part of the loan that it received from Saudi Arabia.

Meanwhile, Pakistan also initiated talks with the International Monetary Fund for fresh assistance but talks have remained inconclusive.

Pakistan’s economic challenges have risen significantly. The country’s economy has taken a beating as Islamabad has been put on the Financial Action Task Force’s (FATF) grey list since June 2018.