Pakistan and Saudi Arabia are in discussions to convert around $2 billion of Saudi loans into a deal for JF-17 Thunder fighter jets, two Pakistani sources said, signalling a deepening of military cooperation months after the two countries signed a mutual defence pact.
The talks reflect efforts by both allies to operationalise defence cooperation at a time when Pakistan is facing acute financial pressure and Saudi Arabia is recalibrating its security partnerships amid uncertainty over long-term US commitments in the Middle East.
According to one source, the discussions are focused on the provision of JF-17 Thunder fighter jets, the light combat aircraft jointly developed by Pakistan and China and manufactured in Pakistan. A second source said the JF-17 was the primary option among several under consideration.
One of the sources said the total value of the deal could reach $4 billion, with an additional $2 billion earmarked for equipment beyond the proposed loan conversion. The sources, who are close to the military, spoke on condition of anonymity as they were not authorised to discuss the matter publicly.
Pakistan Air Force Chief Air Chief Marshal Zaheer Ahmed Baber Sidhu was in Saudi Arabia this week for bilateral talks, including discussions on military cooperation, according to Saudi media outlet SaudiNews50.
Amir Masood, a retired air marshal and defence analyst, said Pakistan was either in talks or had finalised defence deals with six countries involving JF-17 aircraft, along with electronic and weapons systems. While he included Saudi Arabia among those countries, he said he could not confirm details of the negotiations.
He said the JF-17’s appeal had increased because it had been tested and used in combat, while remaining cost-effective. The aircraft was deployed during the conflict with India in May last year, the heaviest fighting between the two neighbours in decades.
Pakistan’s defence, finance and military authorities did not immediately respond to requests for comment. Saudi Arabia’s government media office also did not issue a response.
The mutual defence pact signed in September committed both countries to treat any aggression against one as an attack on both, significantly strengthening a long-standing security relationship. Pakistan has historically provided military training and advisory support to the kingdom, while Saudi Arabia has repeatedly extended financial assistance to Islamabad during periods of economic stress.
In 2018, Riyadh announced a $6 billion support package for Pakistan, including a $3 billion deposit with the State Bank and $3 billion worth of oil on deferred payment. Saudi Arabia has since rolled over deposits multiple times, including a $1.2 billion deferment last year, helping Pakistan stabilise its foreign exchange reserves.
Pakistan has recently intensified defence outreach as it seeks to expand arms exports and monetise its domestic defence industry. Last month, officials said Islamabad secured a weapons deal worth more than $4 billion with Libya’s eastern-based Libyan National Army, including JF-17 jets and training aircraft.
Talks have also been held with Bangladesh on the possible sale of JF-17s as Pakistan looks to broaden its defence export footprint beyond South Asia and the Middle East.
Earlier this week, Defence Minister Khawaja Asif said the growing success of Pakistan’s weapons industry could reshape the country’s economic outlook.
“Our aircraft have been tested, and we are receiving so many orders that Pakistan may not need the International Monetary Fund in six months,” he told Geo News.
Pakistan is currently operating under a $7 billion IMF programme, its 24th, which followed a short-term $3 billion arrangement that helped avert a sovereign default in 2023. The programme was secured with the backing of Saudi Arabia and other Gulf allies through financial assistance and deposit rollovers.