Pakistan has said the United Arab Emirates has agreed to increase its financial assistance to Pakistan to $3 billion, a move key to bolster foreign exchange reserves for the South Asian nation reeling under an economic crisis, Ednews reports citing Hindustan Times.
UAE’s President Sheikh Mohamed bin Zayed Al Nahyan has agreed to provide $1 billion in a fresh loan and rollover an existing loan of $2 billion after a meeting with Prime Minister Shehbaz Sharif, Pakistan Prime Minister’s Office said in a statement Thursday.
UAE’s support comes two days after Saudi Arabia’s Crown Prince Mohammed bin Salman announced that it was considering to increase deposit in Pakistan’s central bank to $5 billion. Earlier this week, Pakistan also received commitments of more than $10 billion in assistance after floods that inundated a third of the nation and cut its growth by half.
Pakistan’s economy has been strapped for funds after a gridlock with the International Monetary Fund over tax targets delayed disbursal of loan installments. The nation is facing a dollar shortage with foreign exchange reserves dropping to $5.85 billion, covering less than a month of imports.
The two nations also agreed to deepen the investment cooperation and enable investment integration opportunities, said the statement. The UAE had announced to invest $1 billion in Pakistani companies spanning various sectors last year.