Pakistan and Saudi Arabia discuss converting Saudi loan to purchase of JF-17 fighter jets
Pakistan and Saudi Arabia are in discussions to
convert roughly $2 billion in Saudi loans into a defence deal involving JF-17
Thunder fighter jets, according to two Pakistani sources familiar with the
matter. The talks signal a deepening of military cooperation following the
landmark mutual defence pact signed by the two countries last year.
The negotiations come at a time when Pakistan is
grappling with severe financial pressures, while Saudi Arabia is recalibrating
its regional security partnerships amid uncertainty over long-term US
commitments in the Middle East. The defence pact, signed in September, commits
both countries to treat any aggression against one as an attack on both,
marking a significant expansion of their long-standing strategic relationship.
One source said the discussions are primarily
focused on supplying Saudi Arabia with JF-17 fighter jets, the light combat
aircraft jointly developed by Pakistan and China and manufactured in Pakistan.
Another source confirmed that while other options have been discussed, the
JF-17 remains the central element of the talks.
According to one source, the overall deal
could be valued at around $4 billion, with $2 billion linked to the conversion
of existing Saudi loans and an additional $2 billion earmarked for equipment
and related systems. The sources spoke on condition of anonymity as they were
not authorised to comment publicly. Pakistan’s military, as well as its finance
and defence ministries, did not respond to requests for comment, while Saudi
Arabia’s government media office also remained silent.
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Pakistan Air Force Chief Air Marshal Zaheer
Ahmed Baber Sidhu was in Saudi Arabia this week, where he met his counterpart,
Lieutenant General Turki bin Bander bin Abdulaziz. According to a military
statement, the discussions focused on bilateral defence cooperation, the
regional security environment, and future avenues of collaboration.
Aamir Masood, a retired air marshal and
defence analyst, said Pakistan is either negotiating or has finalised defence
deals with at least six countries for equipment that includes JF-17 aircraft,
electronic systems, and weapons packages. While he confirmed Saudi Arabia was
among these countries, he declined to comment on the specifics of the ongoing
talks.
He noted that the JF-17’s appeal has grown
because it is combat-tested and relatively cost-effective. Pakistan has
previously stated that the aircraft was deployed during its conflict with India
in May last year, the most intense fighting between the two neighbours in
decades.
Saudi Arabia has long been a key military and
financial partner for Pakistan. Islamabad has provided training and advisory
support to the kingdom, while Riyadh has repeatedly extended financial
assistance during Pakistan’s economic downturns. In 2018, Saudi Arabia
announced a $6 billion support package, including a $3 billion central bank
deposit and $3 billion worth of oil supplies on deferred payment. These
deposits have been rolled over several times, including a $1.2 billion deferment
last year, helping Pakistan stabilise its foreign exchange reserves.
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In recent months, Pakistan has intensified
efforts to expand arms exports and monetise its domestic defence industry. Last
month, officials said Islamabad signed a weapons deal worth more than $4
billion with Libya’s eastern-based Libyan National Army, one of the largest
arms sales in Pakistan’s history, which includes JF-17 jets and training
aircraft. Pakistan has also held talks with Bangladesh on a potential sale of
the fighter jet as it broadens its defence export ambitions.
Earlier this week, Defence Minister Khawaja
Asif said the success of Pakistan’s defence industry could significantly
improve the country’s economic outlook. He claimed that rising international
demand for Pakistani military hardware could reduce the country’s reliance on
the International Monetary Fund.
Pakistan
is currently operating under a $7 billion IMF programme, its 24th, which
followed a short-term $3 billion arrangement in 2023 that helped avert a
sovereign default. Financial support and deposit rollovers from Saudi Arabia
and other Gulf allies played a key role in securing the IMF package.
Source: Reuters