ISLAMABAD: Pakistan has signed a financing agreement amounting to $386 million with the International Islamic Trade Finance Corporation (ITFC), a subsidiary of Islamic Development Bank (IsDB) Group, for import of oil and LNG.
According to a press statement issued on Monday, this facility will be utilized by Pakistan State Oil Company Limited, Pak Arab Refinery Limited (PARCO) and Pakistan LNG Limited (PLL).
The agreement was signed between the Economic Affairs Division, ITFC and the representatives of PSO, PARCO and Pakistan LNG Limited.
The financing agreement provides trade financing amounting to $386 million for a period of one year for import of oil and LNG. ITFC has agreed to provide trade financing of $1.2 billion during the year 2020 for import of oil and LNG by PSO, PARCO and Pakistan LNG Ltd.
It may be recalled that this facility is a part of a framework agreement signed with ITFC in April 2018 for a total envelope of $4.5 billion over for a period of three years (2018-2020).
Signing of this financing facility will be helpful in financing oil and gas import bills of the country and easing pressure on foreign exchange reserves of the country.
During the signing ceremony, both sides voiced hope to work closely with each other for mobilization of socio economic development of the country.
Globally we are moving towards an energy transition phase. Hope this facility will also address the high trade costs in terms of energy input, which are holding back our exports.