Saudi refuses Pakistan interest-free loan

Saudi Arabia has recently declined to offer Pakistan an easy financial rescue or interest-free loans, reports The Economic Times.

Those with knowledge of the situation claim that it wants to negotiate a deal with the International Monetary Fund (IMF) before deciding whether or not to provide money to Pakistan, which is experiencing an unparalleled economic crisis.

This led Pakistan's finance minister to claim that even friendly nations are reluctant to assist Pakistan in overcoming its economic crisis.

Pakistan Prime Minister Shehbaz Sharif had said at a lawyers' convention last year, "Today, when we go to any friendly country or make a phone call, they think that we have come (to them) to beg for money."

Saudi financial bailouts were a regular affair for Pakistan for several decades. Besides, Saudi Arabia provided fossil fuel to Pakistan on a long-term credit.

Pakistan is grappling with economic challenges, as the IMF's $6.5 billion bailout programme remains in limbo despite the Pakistan Democratic Movement (PDM) government's desperate attempts to provide the country with much-needed financial stability. The IMF has imposed stricter requirements for resuming the loan program for Pakistan.

Meanwhile, India and the Gulf Cooperation Council (GCC) held the maiden meeting of senior officials in Riyadh to push for a free trade agreement (FTA) between the two sides.

The Indian delegation was led by Ausaf Sayeed, secretary (CPV & OIA), external affairs ministry, while the GCC delegation was led by Abdul Aziz Bin Hamad Al-Owaishaq, assistant secretary general for political affairs and negotiations at the council. The meeting was attended by all six member countries of the council.

The meeting was held pursuant to the memorandum of understanding signed on India-GCC Mechanism of Consultation during external affairs minister S Jaishankar's visit to Riyadh in September 2022, officials said, adding that both sides agreed for an early finalisation of the India-GCC FTA.

Sayeed called for more collaboration between India and GCC countries in renewable energy, food security, health, IT sector and counterterrorism. Both sides proposed formation of joint working groups to cater to particular areas of cooperation between India and GCC countries. These joint working groups would be headed by experts and ensure regular and continuous progress across priority sectors.

GCC is India's largest trading partner, with a total trade of $154 billion in 2021-22.

The discussion also focused on regional issues of importance, said officials. Both sides look forward to an early convention of India-GCC Troika meeting at foreign minister level, they said.