Pakistan and Saudi Arabia are negotiating a major defense-linked financial arrangement. The talks focus on converting a $2 billion Saudi loan into a fighter jet supply agreement. Reuters reported the development, citing informed sources.
Under the proposal, Pakistan would not repay the loan in cash. Instead, it would supply JF-17 Thunder fighter aircraft of equal value to Saudi Arabia. The move would strengthen defense cooperation between the two allies.
Loan Conversion and Aircraft Supply
Pakistan has proposed settling the $2 billion loan through the delivery of JF-17 Thunder jets. The aircraft are jointly developed by Pakistan and China. They form the backbone of Pakistan’s air combat fleet.
Saudi Arabia has shown interest in diversifying its defense procurement. The JF-17 offers a cost-effective multirole option. Negotiations are still ongoing. No final agreement has been announced so far.
$4 Billion Defense Framework
The overall value of the proposed arrangement stands at $4 billion. Of this amount, $2 billion would cover the loan conversion through aircraft supply. The remaining $2 billion would be spent on additional defense equipment purchases.
Reuters said the talks reflect deepening strategic ties between Islamabad and Riyadh. If finalized, the deal would mark a significant milestone in Pakistan–Saudi defense cooperation.
