Saudi Arabia recently displayed hostility towards Pakistan by withdrawing its aid after the latter criticized it for its neutrality regarding certain issues. Let us take a look at the recent history between the two and what led to this move.
Crux of the Matter
Saudi Arabia recently asked Pakistan to immediately repay $1 billion of its total $3 billion loan, for which the latter had to borrow $1 billion from China, which otherwise it was unable to pay.
The loan is a part of a $6.2 billion financial package, which Saudi Arabia provided to Pakistan in 2018. $3 billion of the package was directly in loan to help Pakistan repay several of its loans, and this was to be paid in installments by 2021. The remaining $3.2 billion was in the form of “deferred” oil supply – Pakistan was supplied oil for which it had to pay later.
The current decision to withdraw the aid forced Pakistan to repay the loan immediately while its oil supply from Saudi Arabia has been terminated.
Why It Happened?
Pakistan has been attempting to call a meeting of the Organisation of Islamic Cooperation (OIC) over the Kashmir issue and has been hostile since India abrogated Article 370 from the Jammu & Kashmir state. Saudi Arabia did not openly back Pakistan in the conflict, while several nations of the OIC like the UAE, Oman, Maldives supported India by labeling Kashmir issue as an “internal matter” of India.
Pakistan recently claimed it will go ahead “with or without” Saudi Arabia and the OIC if they do not support it against India, and also claimed that Saudi Arabia is not “doing enough” regarding the Kashmir issue. In return, Saudi terminated the financial aid and the oil supply to Pakistan.
Recent Saudi-Pakistan Relations
- 2018: Pakistan attended the Saudi summit even after several organizations and countries boycotted the event. The boycott occurred over the killing of a Saudi Arabian journalist Jamal Khashoggi in Turkey, who was reportedly killed by Saudi agents.
- 2018: Saudi extended a $6.2 billion aid to Pakistan.
- 2019: Pakistan PM Imran Khan himself drove Saudi Crown Prince Mohammed bin Salman from airport when he visited Pakistan. Prince Salman declared himself an “ambassador” of Pakistan in Saudi while returning the gratitude.
- The House of Saud is the ruling royal family of Saudi Arabia. It is composed of the descendants of Muhammad bin Saud, founder of the Emirate of Diriyah, known as the First Saudi State.
- The Reko Diq mine is a large copper mine located in the south-west part of Pakistan in Balochistan province. Reko Diq represents one of the largest copper reserves in Pakistan and in the world. The mineral resource at Reko Diq is estimated at 5.9 billion tonnes with an average copper grade of 0.41% and an average gold grade of 0.22 g/tonne.
- Najd is a geographical central region of Saudi Arabia that accounts for about a third of the population of the country. Najd consists of the modern administrative regions of Riyadh, Sudair, Al-Qassim, and Ha’il.
- CNN – Saudi Arabia Fast Facts
- Smithsonian Magazine – The True Story of Lawrence of Arabia
- Livemint – India invited as ‘guest of honour’ to OIC meet, Sushma Swaraj to attend
- The Print – What’s Pakistan without Saudi loan, oil and free royal jet rides for Imran Khan?
- The Guardian – Saudi summit in crisis as Khashoggi case prompts mass withdrawals
- India Today – UAE backs India on Article 370, says Kashmir its internal matter
- Vox – 9 questions about Saudi Arabia you were too embarrassed to ask
- Al Jazeera – Why have Saudi Arabia, UAE failed to condemn India over Kashmir?