Islamabad, January 8, 2026 (Agencies): Pakistan and Saudi Arabia are in advanced negotiations over a major defence transaction that could involve the sale of Pakistan?manufactured JF?17 Thunder fighter jets to the Kingdom. The discussions are also expected to include the settlement of Pakistan’s outstanding $4 billion oil payments to Saudi Arabia as part of a broader strategic and financial agreement.
According to sources familiar with the talks, the deal could see a portion of Saudi financial support and deferred payments converted into a defence package, potentially valued at around $4 billion when factoring in aircraft, equipment, and operational support. Officials say the arrangement would strengthen bilateral military ties under the Strategic Mutual Defence Agreement signed in 2025, which commits both countries to defend each other against aggression.
The JF?17 Thunder, jointly developed by Pakistan and China, has drawn international attention for its cost-effectiveness and operational performance. Saudi officials are reportedly considering the aircraft as a key component of their air force modernization plans. Pakistani Air Chief Marshal Zaheer Ahmed Baber Sidhu has reportedly held high-level discussions in Riyadh to finalise military cooperation and the potential jet sale.
Negotiators are also exploring ways to use Pakistan’s deferred oil payments and existing loans to Saudi Arabia as part of the deal, a move that could help Islamabad address fiscal challenges while expanding defence exports. Analysts note that the arrangement would not only bolster Pakistan’s defence production and revenue but also deepen Saudi?Pakistan military cooperation amid regional uncertainties.
Officials cautioned that discussions are ongoing and a formal agreement has not yet been finalised. Both sides are expected to announce outcomes once technical and financial details are settled.