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Pakistan, Saudi Arabia ink agreement to finance $1bn oil derivatives

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Pakistan and the Kingdom of Saudi Arabia inked an agreement on Thursday to finance oil derivatives worth $1 billion, Economic Affairs Ministry confirmed.

The development comes amid news reports that Saudi Arabia is augmenting plans to increase the amount of investment and deposit in cash-strapped Pakistan which is struggling with a worsening currency crisis.

According to an official statement, the agreement was inked by Economic Affairs Secretary Dr Kazem Niaz, and Saudi Fund for Development (SFD) Chief Executive Officer (CEO) Sultan bin Abdulrahman Al-Murshed.

Dr Niaz, speaking on the occasion, revealed that the pact was an extension of previously signed agreements in 2019 and 2021 valued at $4.44 billion to finance oil derivatives in Pakistan.

Since its establishment, he said, the SFD had supported more than 40 projects and programmes in different development sectors valued at approximately $1.4 billion.

‘All the programmes were aimed at helping the country achieve its sustainable development goals and build a prosperous future,” he added.

For his part, SFD CEO said that the agreement emphasised the Kingdom of Saudi Arabia’s commitment to continue supporting the brotherly Islamic Republic of Pakistan.

Saudi Arabia mulls increasing Pakistan deposit 

Islamabad’s efforts to shore up the country’s forex reserves with the help of Saudi Arabia — amid a worsening currency crisis — have started paying off as Riyadh is considering ‘beefing up’ its deposit in the State Bank of Pakistan (SBP) from $3 billion to $5 billion.

According to Saudi media, Crown Prince Mohammad Bin Salman earlier this week directed his financial officials to study increasing the Pakistan deposit by $2 billion.

The development came after the Saudi crown prince’s meeting with Chief of Army Staff General Asim Munir, who was on his first overseas official visit to the kingdom.

Last month, the SFD extended its term for the $3 billion deposit in the SBP which was set to mature on December 5.

The SBP had signed an agreement with the SFD in November 2022 to receive $3 billion, to be placed in the central bank’s account with an aim to improve its foreign exchange reserves.

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China Contributes 43 New Foreign Firms to the 6% Growth in SECP Registrations

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The Securities and Exchange Commission of Pakistan has registered 2,617 new firms this year, a 6% increase from 2023, with assistance from the Special Investment Facilitation Council. This increases the overall number of businesses that are registered to 231,111.

Non-profits, trade associations, and public unlisted firms make up 4% of these, while private limited corporations make up 55% and single-member companies 41%. It is noteworthy that 99.8% of the registrations were done online, demonstrating SECP’s attempts to digitise.

Real estate has 237 new businesses, services has 306, and trade has 377 new businesses. These are the main sectors exhibiting growth. While the healthcare and textile industries each had 49 new businesses, the education sector saw 101.

China contributed the most, adding 43 new companies, out of the 61 new companies that were registered as a result of foreign investment.

These recently registered businesses are anticipated to decrease imports, increase domestic production, and contribute to closing the trade deficit.

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PSX reaches an all-time high as the KSE-100 Index surpasses 86,000 points.

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The Pakistan Stock Exchange (PSX) has achieved a significant milestone, as the benchmark KSE-100 Index has attained an unprecedented peak.

On Tuesday at midday, the index ascended by 788 points, attaining a record high of 86,846 points. Following the ratification of the constitutional amendments, the stock market has increased by 1500 points over a span of two days.

Earlier today, the KSE-100 Index increased by 683 points, attaining a value of 86,741 points, before concluding at this new apex.

The bullish trend was apparent from the commencement of the trading session, with the index rising an additional 555 points to reach 86,612 points throughout the day. The reinstatement of the 86,500-point threshold signifies robust market performance.

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In three months, Pakistan’s IT exports increased by 33.54 percent.

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During the first three months of FY 2024-25 (July to September), Pakistan’s IT export remittances hit US$ 876 million, a notable 33.54 percent rise from US$ 656 million during the same period previous year (FY 2023-24).

In a statement, Minister of State for IT and Telecommunication Shaza Fatima Khawaja stated that the amount of money sent home by the export of ICT services was US$ 292 million in September 2024, a 41.7% increase from US$ 206 million in the same month the previous year.

She stated that efforts to make it easier for businesses to conduct business in the nation are the reason why IT exports are rising and that actions are being taken to increase them.

In response to the Prime Minister’s directions, Shaza Fatima stated that the Ministry of IT and Telecommunication, the Pakistan Software Export Board, and the IT industry are dedicated to boosting IT exports with the full assistance of the Special Investment Facilitation Council (SIFC).

A trade surplus of US$ 764 million was recorded by the IT & ITeS sector in the first three months of FY 2024–25, accounting for 87.21 percent of all ICT export remittances.

Over the same period last year, this surplus represents a 36.67 percent gain over US$ 559 million. The services industry as a whole, however, experienced a trade deficit of US$ 699 million during this period.

The largest of all service sectors, ICT export remittances from July to September 2024, were US$ 656 million, followed by “other business services” at US$ 374 million.

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