The Abu Dhabi crown price will arrive in Islamabad on January 6 to formally engage with Prime Minister Imran Khan. During this visit, Pakistan authorities say that negotiations with UAE would mature and the Crown Prince may announce US$3.2 billion credit oil facility for Pakistan on the same pattern as has been extended by Saudi Arabia.
The United Arab Emirates (UAE) has already announced its decision to park $3 billion in State Bank of Pakistan to shore up the reserves. Saudi Arabia has already deposited $2 billion in SBP with US$1 billion still to be deposited.
A senior government official said the credit oil facility of $3.2 billion was in addition to supporting the balance of payment crisis and added that total UAE support to Pakistan would reach $6.2 billion.
UAE also intends to invest billions of dollars in new projects of Pak Arab Refinery Limited (Parco) that is a joint venture between Pakistan and Abu Dhabi. Parco is expected to set up new coastal oil refinery with an investment of around over $5 billion.
Pakistan also hopes to secure $1.2 billion credit facility for LNG imports from ITFC. The total oil import bill of Pakistan amounts to $12.5 billion and Pakistan has arranged to defer $6.4 billion for these imports, and if Qatar agrees to defer LNG payments then a total of $9 billion oil bill would be deferred, an official said.
Pakistan is currently importing 8 LNG cargoes per month. Out of these, Pakistan imports 5 LNG cargoes from Qatar and 3 LNG cargoes from Gunvor and ENI. The total annual LNG import bill amounts to $ 4.2 billion to $4.5 billion.
Officials said that ITFC would provide $1.2 billion credit facility for LNG imports; and reports indicate that Pakistan is negotiating procuring LNG from Qatar on deferred payment to further ease the current foreign reserve pressure.