Owing to legal and procedural delays, Pakistan authorities have not been able to operationalise a 1.2 billion USD Saudi oil facility (SOF), local news reported on Friday.
The Saudi government had agreed to provide 4.2 billion USD economic support to Pakistan in June 2021 and then formally signed an agreement in November, Dawn newspaper reported.
The economic package included a 3 billion USD foreign exchange deposit in Pakistan's account and 1.2 billion in oil supplies at the rate of 100 million USD per month at an interest rate of 3.8 per cent -- higher than the previous rate of 3.2 per cent, the publication added.
The Dawn citing sources reported that the finance ministry was required to provide sovereign guarantees on oil supplies which took time.
The designated entities of the two countries -- Pakistan State Oil, Pak-Arab Refinery Limited (Parco) and National Refinery Limited (NRL) and Saudi Aramco -- were required to sign a subordinate commercial purchase agreement which also consumed time in vetting by the law division, the sources added.
Last year in October, during Prime Minister Imran Khan's second visit to Saudi Arabia, the kingdom had formally committed to providing an oil facility worth 100 million USD per month for one year on deferred payments to Pakistan, according to Dawn.
The terms of financing include the price of purchase by the SFD along with a margin of 3.80 per cent per annum. The SFD is providing financial assistance for various development projects.
( With inputs from ANI )
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