Saudi Arabia neither to give Loan nor Oil to Pakistan

Last Updated: Thursday, 13 August 2020 (17:33 IST)
New Delhi:has ended a loan and supply to due to Islamabad's criticism that the Organisation of Islamic Cooperation (OIC), which is led by Saudi, was not doing enough to pressure India on the issue.
Pakistan was recently forced to repay a Saudi loan of USD 1 billion that the kingdom called in after Islamabad insisted it be allowed to lead the OIC's support for Kashmir.The loan was part of a USD 6.2 billion package announced by Saudi Arabia in November 2018, which included a total of USD 3 billion in loans and an oil credit facility amounting to USD 3.2 billion.
 
Relations between the two countries started to break down when Riyadh turned down Islamabad's request to convene a special meeting of the OIC's Council of Foreign Ministers. Pakistan has been pushing for the foreign ministers' meeting of the since India abrogated Article 370, which gave special status to the erstwhile state of Jammu and Kashmir.
 
Pakistan foreign minister Shah Mehmood Qureshi's remarks against the Organisation of Islamic Conference led by Saudi Arabia for its so called inaction on the Kashmir issue has strained the relations between Saudi Arabia and Pakistan.
 
A Pakistan diplomatic source confirmed that Saudi Arabia had shown reluctance to accept Islamabad's request for an immediate meeting of OIC foreign ministers' on Kashmir, according to a report published in a Pakistan daily 'Dawn'.
 
Pakistan continued to demand that the OIC use its role to help Kashmir, with Mr Qureshi stating in an interview with a Pakistani news channel last week that ''I am once again respectfully telling OIC that a meeting of the Council of Foreign Ministers is our expectation."
He went further by warning that Pakistan would be forced to take it into its own hands, saying that ''If you cannot convene it, then I'll be compelled to ask Prime Minister Imran Khan to call a meeting of the Islamic countries that are ready to stand with us on the issue of Kashmir ......''
 
Mr Qureshi insisted that the OIC, which consists of 57 member states,  must ''show leadership on the issue.'' Saudi Arabia and Pakistan have historically had strong bilateral relations in the financial, trade and military sectors, making the increased tensions between the two countries a concern for many and particularly for Pakistan, which has been undergoing a financial crisis over the past few years.

Differences between Saudi Arabia and Pakistan deepen over Kashmir
 
New Delhi: Differences between Saudi Arabia and Pakistan have deepened over Islamabad's hardline stance on Kashmir with Saudi Arabia ending a loan and oil supply after Pakistan's threat to split the Organisation of Islamic Cooperation (OIC).
  
The differences in their relations surfaced when Saudi Arabia asked Pakistan to pay back USD one billion. Pakistan has also not received the oil on deferred payments from Saudi Arabia since May under an agreement  between the two former allies for provision of USD 3.2 billion worth the fuel.
  
Pakistan has been pressuring Saudi Arabia to convene a meeting of the 57-member OIC on Kashmir. However, Saudi Arabia has rejected the demand. 
  
Pakistan Foreign Minister Shah Mehmood Qureshi had asked Saudi Arabia to convene a meeting of the block of Islamic countries after abrogation of Article 370. 
  
Mr Qureshi had threatened that if Saudi Arabia did not support Pakistan, Islamabad would call a meeting of those Islamic countries "who stand with us on Kashmir.'' This amounted to splitting the 57 member block of Islamic countries. 
  
''I am once again respectfully telling OIC that a meeting of the Council of Foreign Ministers is our expectation. If you cannot  convene it, then I will be compelled to ask Prime Minister Imran Khan to call a meeting of the Islamic countries that  stand with us,'' Mr Qureshi had said.        
  
Pakistan Prime Minister Imran Khan has also expressed disappointment over Saudi Arabia's refusal to hold a meeting on Kashmir and said Islamic countries were divided and could not come together for a meeting on Kashmir. 
 
Saudi Arabia and Pakistan had signed Memoranda of Understanding (MoUs) worth USD 20 billion during Saudi Crown Prince Muhammad bin Salman's visit  to Pakistan in February 2019. 
  
According to the MOUs, the agreement of USD 3 billion cash support and USD 3.2 billion oil facility per annum had the provision of renewal for two more years.
  
The UAE had also announced  a USD 6.2 billion package for Pakistan in December 2018, including a USD 3.2 billion oil facility. 
   
Pakistan has already returned USD one billion Saudi loan - four months ahead of its repayment schedule. Pakistan has said it could also return the remaining USD 2 billion cash loan subject to availability of a similar facility from China.(UNI)