Saudi Arabia’s ITFC inks $4.5bn worth oil deal with Pakistan

By Shilpa Annie Joseph, Desk Reporter
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Saudi Arabia-based leading financial institution Islamic Development Bank’s (IDB) financial arm International Islamic Trade Finance Corporation (ITFC) has signed a $4.5 billion worth framework agreement with the Government of Pakistan to provide financing for the oil and gas imports.

According to the Ministry of Economic Affairs, ITFC has signed the three-year framework in order to finance the import of essential commodities such as crude oil, refined petroleum products, LNG, and urea.

The framework agreement also covers ITFC’s support for trade related technical assistance projects in the Islamic Republic of Pakistan, which will be selected jointly by both parties according to the national economic priorities and development plan of Pakistan.

The signing took place virtually, where Mr. Omar Ayub Khan, Minister of Economic Affairs witnessed the signing ceremony between Eng. Hani Salem Sonbol, CEO of ITFC, and Mr. Noor Ahmed, Secretary at Ministry of Economic Affairs, Islamic Republic of Pakistan. This agreement will further strengthen partnership between Islamic Republic of Pakistan and ITFC.

Hani Salem Sonbol
Eng. Hani Salem Sonbol
CEO – ITFC

“ITFC is continuously working closely with its member countries to meet their requirements by providing integrated solutions that include financing and capacity building tools that allows for maximizing the development impact of ITFC interventions. We are delighted and we will continue to mobilize financial resources to support Pakistan in its endeavors to achieve its economic targets through the new framework agreement.”

As per the reports, the agreement will make it easier to identify potential areas of collaboration at the national and regional levels, as well as to improve and promote trade, trade capacities of key state bodies and financial institutions, and trade cooperation in Pakistan.

Furthermore, the financing available through this facility will be utilized by Pakistan State Oil (PSO), Pak-Arab Refinery Ltd (PARCO), and Pakistan LNG Ltd (PLL) for the import of crude oil, refined petroleum products, and LNG during the years 2021-2023.

Related: UAE, Pakistan to enhance bilateral trade, investment ties

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