Defense deal signed following Israeli strikes on what it sees as Hamas targets in Doha
Saudi Crown Prince Mohammed bin Salman and Pakistani Prime Minister Shehbaz Sharif meet in Riyadh, Saudi Arabia, September 17, 2025. Saudi Press Agency/Handout via REUTERS THIS IMAGE WAS PROVIDED BY A THIRD PARTY
Pakistan and Saudi Arabia are in talks to convert about $2 billion in Saudi loans into a JF-17 fighter jet deal, two Pakistani sources said, deepening military cooperation months after the two countries signed a mutual defense deal last year.
The talks underscore how the two allies are moving to operationalize defense cooperation at a time when Pakistan faces severe financial difficulties and Saudi Arabia is reshaping its security partnerships to guard against uncertainty over U.S. commitments in the Middle East.
The mutual defense agreement was signed following Israeli strikes on what it sees as Hamas targets in Doha, an attack that shook the Gulf region.
One of the sources said the discussions were limited to the supply of JF-17 Thunder fighter jets, the light combat aircraft jointly developed by Pakistan and China and produced in Pakistan, while the second said the jets were the main option among others under discussion.
The first source said the total value of the deal was $4 billion, with another $2 billion earmarked for equipment, in addition to the loan conversion. The sources close to the military with knowledge of the matter spoke on condition of anonymity because they were not authorized to comment on the deal.
Pakistani Air Chief Zaheer Ahmed Baber Sidhu was in Saudi Arabia for bilateral talks, including on “military cooperation between the two sides”, Saudi media outlet SaudiNews50 said on social media platform X on Monday.
Aamir Masood, a retired air marshal and analyst, said Pakistan was in talks or had finalized deals with six countries to supply equipment, including JF-17s and electronics and weapons systems for jets. He said those countries included Saudi Arabia, but could not confirm any details about the negotiations.
The JF-17’s market value was increased because “it was tested and used in combat,” he said. Reutersadding that it is also profitable. Pakistan said the aircraft was deployed during the conflict with India in May last year, the heaviest fighting between the neighbors in decades.
Pakistan’s army, finance and defense ministries did not immediately respond to requests for comment. The Saudi government media office also did not respond.
The mutual defense agreement, signed in September, commits both sides to treating any aggression against either country as an attack on both countries, significantly deepening a decades-old security partnership.
Pakistan has long provided military support to the kingdom, including training and advisory deployments, while Saudi Arabia has repeatedly intervened to financially support Pakistan during periods of economic tension.
In 2018, Riyadh announced a $6 billion support package for Pakistan, including a $3 billion central bank deposit and $3 billion in deferred payment oil supplies.
Saudi Arabia has since rolled over its deposits several times, including a $1.2 billion rollover last year, helping Islamabad stabilize its foreign reserves amid chronic pressure on its balance of payments.
Pakistan has in recent months stepped up its defense activities as it seeks to increase arms exports and monetize its domestic defense industry.
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Last month, Islamabad sealed an arms deal worth more than $4 billion with the eastern Libya-based Libyan National Army, officials said, one of the country’s largest-ever arms sales, which includes JF-17 fighter jets and trainer jets.
Pakistan has also held discussions with Bangladesh over the possible sale of JF-17s, as it expands its arms supply ambitions beyond South Asia and the Middle East.
On Tuesday, Pakistan’s defense minister said the success of its arms industry could transform the country’s economic outlook.
“Our planes have been tested and we are receiving so many orders that Pakistan may no longer need the International Monetary Fund in six months,” Khawaja Asif told Geo News.
Pakistan is currently the subject of a $7 billion IMF program, the 24th, following a short-term $3 billion deal that helped avert a sovereign default in 2023. It won the Fund’s support after Saudi Arabia and other Gulf allies provided financial refinancing and deposits.
