The Pakistan has finalized arrangements to repay approximately $4.8 billion in external debt by June 2026, including a substantial portion owed to the United Arab Emirates. The federal government aims to return $3.5 billion to Abu Dhabi, with $2 billion scheduled for payment by the end of April.
These funds had previously been held as deposits with the State Bank of Pakistan, earning an interest rate of 6 percent. The timely repayment reflects the government’s commitment to honoring international obligations and maintaining trust with creditor nations.
In addition to UAE debt, Pakistan has secured assurances of more than $5 billion from two allied countries to support its broader external financing requirements. These arrangements are part of a coordinated strategy to manage foreign obligations without placing additional pressure on domestic resources.
Officials emphasized that meeting these debt obligations is crucial for sustaining financial stability, maintaining access to international credit markets, and supporting ongoing economic reforms. Timely repayments also help improve Pakistan’s creditworthiness and investor confidence.
Analysts note that effective debt management, including leveraging deposits and foreign assurances, will be key to navigating the country’s external financing needs in the coming months. With careful planning, Pakistan aims to honor commitments while mitigating the risk of disruptions to economic activity and foreign reserves.
The repayment plan highlights the government’s focus on fiscal discipline and proactive engagement with international partners to ensure smooth debt servicing. It also underscores the importance of maintaining strong diplomatic and financial relations with creditor countries.
