KARACHI, APR 15 /DNA/ – Atif Ikram Sheikh, President of the Federation of Pakistan Chambers of Commerce & Industry (FPCCI), has warmly welcomed the Kingdom of Saudi Arabia’s timely and generous decision to pledge a fresh deposit of $3 billion to the State Bank of Pakistan (SBP) – alongside the extension of the existing $5 billion facility for an additional three years through 2028.
Mr. Atif Ikram Sheikh said that the announcement made by the Finance Minister on the sidelines of the World Bank-IMF Spring Meetings in Washington is a massive breakthrough for Pakistan’s macroeconomic stability. He noted that removing the condition of an annual rollover for the $5 billion facility and adding a fresh $3 billion injection provides an unprecedented layer of predictability to Pakistan’s economic planning.
Mr. Atif Ikram Sheikh highlighted several critical economic impacts this strategic financial support will have on Pakistan’s economy; including, bolstering foreign exchange reserves as the fresh $3 billion injection comes at a critical time geo economically – significantly reinforcing the SBP’s liquid foreign exchange reserves (FERs).
Mr. Atif Ikram Sheikh said that this will play a pivotal role in helping the government achieve its target of building reserves to around $18 billion by the end of FY26 – which is necessary for providing a much-needed import cover of over 3-month for the country.
FPCCI Chief stressed that Pakistan needs currency stabilization and inflation control; and, enhanced reserves will directly ease the pressure on the Pakistani Rupee. A stable exchange rate is vital for curbing imported inflation – thereby lowering the cost of doing business and providing relief to the general public.
Mr. Atif Ikram Sheikh maintained that this injection will also prove to be instrumental in restoring business and investor confidence as the business community thrives on certainty. By securing external financing and extending the maturity of the $5 billion facility to 2028, the government has mitigated the immediate balance of payments risks and liquidity crunch.
President FPCCI explained that this renewed confidence will likely stimulate both domestic industrial expansion and foreign direct investment (FDI); which will facilitate industrial growth due to a stabilized external account. Additionally, the SBP will be in a better position to facilitate the timely clearance of Letters of Credit (LCs). This ensures a steady supply of essential industrial raw materials; machinery and petroleum products required to keep the wheels of industry running and to drive export-led growth.
Mr. Atif Ikram Sheikh stated that Saudi Arabia has once again proven to be an all-weather friend and a pillar of support for Pakistan during testing times. This financial support offers our policymakers the crucial breathing space needed to implement long-term structural reforms; improve the investment climate and shift the economy from import-reliance to export-driven growth.
FPCCI extends its profound gratitude to the Custodian of the Two Holy Mosques, King Salman bin Abdulaziz Al Saud and Crown Prince Mohammed bin Salman for their unwavering support. The Federation also commends Pakistan’s political and economic leadership – including the Prime Minister, the Finance Minister and the SBP Governor – for their successful diplomatic and financial negotiations.
The apex trade body reiterated its commitment to working closely with the government to translate this macroeconomic stabilization into on-the-ground industrial growth; job creation and enhanced bilateral trade between Pakistan and the Kingdom of Saudi Arabia.
