Pakistan's balancing act may be failing: Al Jazeera

"After India's August 2019 move to revoke Indian-administered Kashmir's semi-autonomous status, Pakistan expected Arab states to ferociously endorse its Kashmir policy. However, Saudi Arabia - and its Gulf allies, such as the United Arab Emirates (UAE) - failed to take a strong stance against India, frustrating Islamabad," Al Jazeera reported.

The Gulf states have balanced their dealings with Pakistan and India in the past, the news channel said.

"But now, it seems, they are openly moving closer to India and away from Pakistan," reported the news channel.

Today, Saudi Arabia has several reasons to value its deepening partnership with India more than its historic ties to Pakistan.

While Pakistan is undoubtedly well aware of Saudi Arabia's move away from itself and towards India, given its economic dependence on the kingdom, it cannot afford to sever its ties with Riyadh completely.

This is why Pakistani Prime Minister Imran Khan recently played down his country's differences with Saudi Arabia, claiming that the "rumours" about a rift between Riyadh and Islamabad are "totally false", the news channel reported.

Saudi Arabia Development:

Saudi Arabia has not renewed an agreement with Pakistan which will allow oil supplies on deferred payments after that pact expired two months back.

An agreement between Pakistan and Saudi Arabia for provision of $3.2 billion worth of oil on deferred payments per annum has expired two months ago and a decision about its renewal remains pending with Riyadh, sources told The Express Tribune.

The $3.2 billion Saudi oil facility was part of the $6.2-billion Saudi Arabian package announced in November 2018 to ease Pakistan’s external sector woes. Pakistan has already prematurely returned $1 billion Saudi loan - four months ahead of its repayment period, reported the newspaper.

Sources told the newspaper that Pakistan could also return $2 billion remaining Saudi cash loan, subject to availability of similar facilities from China.

The agreement over $3 billion cash support and $3.2 billion oil facility per annum had the provision of renewal for two more years.

The sources said that Saudi Arabia has not provided the oil on deferred payments since May this year. The budget estimates suggested that the government was hoping to receive minimum $1 billion worth of oil in fiscal year 2020-21, which started from July.

A spokesman of the Petroleum Division  confirmed about the expiry of the facility.

“The agreement expired in May 2020,” Sajid Qazi, the spokesman of the Petroleum Division told The Express Tribune.

The spokesman said that the response from Saudi Arabian government was awaited over Pakistan’s request to further extend the facility, in line with the provision of the agreement.

The Ministry of Finance did not respond to The Express Tribune’s question about the updated status of Pakistan’s request. The State Bank of Pakistan and the Ministry of Finance have not yet taken the media into confidence about these developments.

Pakistan Gas Shortage:

Pakistan's Minister for Energy Omar Ayub Khan has said the country is currently facing a gas shortfall of about 3.5 billion cubic feet per day (BCFD) and Sindh will also be turning a gas-deficit province by next year.

Khan shared the information to the Senate standing committee on petroleum.

While testifying before a panel of the parliament’s upper house on Monday, Khan was quoted as saying by Dawn News that gas load shedding would continue during the upcoming winter as the production of indigenous gas was decreasing while the demand was on the rise.

He said all the provinces would have to sit together and find out a solution to the country’s gas shortage in an amicable manner.