Saudi Arabia has extended the term of a $3 billion deposit placed with Pakistan to support its economy for another year, the State Bank of Pakistan said on Thursday.

The extension is a “continuation of the support provided by the Kingdom of Saudi Arabia to the Islamic Republic of Pakistan, which will help in strengthening the foreign exchange reserves of Pakistan and contribute to the country’s economic growth and development”, the press release stated.

The term of the deposit, which was maturing on Thursday, was initially signed with State Bank of Pakistan in 2021, and was subsequently rolled over in 2022 and 2023, the bank said.

In November 2021, the central bank entered into an agreement with the Saudi Fund for Development (SFD) for a $3 billion deposit aimed at bolstering the country’s foreign exchange reserves. The agreement was formalized by SFD CEO Sultan Bin Abdul Rahman Al-Marshad and the then-SBP Governor Reza Baqir during a signing ceremony at the SBP’s Karachi office.

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Last year, the SBP announced that Saudi Arabia had agreed to extend the term of this deposit for an additional year.

Islamabad and Riyadh share historic brotherly relations and cooperation in different sectors such as culture, economy, trade, and defence, among others.