Saudi Arabia has signed a SR131 million loan agreement with Azerbaijan to improve the water supply system in the former Soviet republic.

The state-owned Saudi Fund for Development (SFD) inked the agreement for the expansion of water supplies and sewerage services in the country on behalf of the Kingdom.

“The cooperation between the Kingdom and Azerbaijan, especially between the state-owned SFD and Baku, is developing successfully,” said Abid Sharifov, Azeri deputy prime minister, in a statement released to the media following the signing ceremony, which took place in Baku.

Sharifov noted that Azerbaijan uses the funds of various international financial institutions, including the SFD, in the implementation of infrastructure projects in different spheres. 

“The SFD allocated loans on favorable terms for four projects covering water, transport and educational sectors,” he said. 

Speaking on behalf of the Kingdom, Yousef Al-Bassam, SFD vice president and executive director, said that the Saudi aid fund plays a “key role” in improving infrastructure and providing credit for new projects in Azerbaijan, the largest country in the Caucasus region.