ISLAMABAD: Pakistan has successfully repaid a total of $3.45 billion in deposits to the Abu Dhabi Fund for Development (ADFD), with the final $1 billion installment paid on April 23, according to the State Bank of Pakistan (SBP).
The central bank confirmed that this payment completes the full return of UAE deposits, following an earlier repayment of $2.45 billion last week. These deposits had been held with the SBP as part of Pakistan’s external financial support arrangements.The repayments, which also include approximately 6% interest, come at a time when Pakistan is facing mounting pressure on its external financing position. Analysts expect the country’s financing gap to widen after the outflow linked to the UAE repayments.
Earlier this month, Pakistan also repaid around $1.43 billion in external debt, including a $1.3 billion Eurobond, further impacting foreign exchange reserves. In a related development, Saudi Arabia has extended the maturity period of its $3 billion deposit with Pakistan, providing temporary relief to the country’s reserves. The SBP also confirmed receipt of an additional $2 billion from the kingdom with a value date of April 15, 2026.
Finance Minister Muhammad Aurangzeb said the government is exploring multiple financing options to manage reserves and replace the UAE facility. These include issuing Eurobonds, Islamic sukuk, and securing commercial loans.
Speaking on the sidelines of meetings hosted by the International Monetary Fund (IMF) and the World Bank, Aurangzeb stated that Pakistan remains capable of meeting its debt obligations, with reserves currently covering around 2.8 months of imports.He emphasized that maintaining this level of reserves is critical for macroeconomic stability. The minister added that Pakistan plans to issue Eurobonds within the year and is actively exploring alternative funding avenues.
Aurangzeb also noted that the ongoing Middle East conflict has added economic pressure, prompting the government to consider building strategic petroleum reserves and accelerating the transition to renewable energy. Regarding the $7 billion IMF programme, the minister said Pakistan has not yet sought any modifications despite emerging challenges but may consider adjustments depending on future developments.
The IMF board is expected to approve the next tranche under the Extended Fund Facility and the Resilience and Sustainability Facility next month, which would unlock nearly $1.3 billion in additional funding for Pakistan.
