Pakistan will repay $3.5 billion debt to the United Arab Emirates this month, ending speculation about rollover extensions, according to senior cabinet officials briefing reporters.
Authorities confirmed repayment dates: $450 million on April 11, $2 billion on April 17, and $1 billion on April 23, using central bank reserves.
The $450 million loan originated in 1996-97 for one year, but remained outstanding for nearly three decades before scheduled repayment next week, officials disclosed Friday.
Pakistan will cumulatively repay $4.8 billion in April, including $1.3 billion Eurobond on April 8, alongside the UAE debt settlement commitments.
Officials said discussions continue regarding converting part of the UAE debt into investment, though repayment arrangements remain the government’s immediate priority amid external financing challenges.
The UAE previously rolled over two $1 billion loans in January for only one month, rejecting Pakistan’s request for a two-year extension.
Pakistan had sought reduced interest rates near 3%, but the UAE maintained 6.5%, despite earlier charging 3% in 2018, according to government financial sources.
Under the $7 billion IMF programme, UAE, Saudi Arabia and China pledged to maintain $12.5 billion deposits with Pakistan’s central bank until September next year.
Prime Minister Shehbaz Sharif and central bank governor Jameel Ahmad requested rollover extensions from the UAE, but Abu Dhabi insisted on repayment of outstanding loans.
Officials acknowledged foreign exchange reserves stand at $16.4 billion, describing levels as manageable, though exports have fallen 8% during the first nine months of this fiscal year.
IMF to Release $1.2bn
Pakistan is expected to receive $1.2 billion from the International Monetary Fund in May, following a scheduled executive board meeting under the ongoing $7 billion programme.
Finance ministry officials confirmed Pakistan has met all key conditions required by the IMF, with no major obstacles anticipated for the disbursement of the upcoming tranche.
In addition, Pakistan is likely to secure $210 million under the Resilience and Sustainability Facility, supporting climate-related financing initiatives alongside the main IMF release.
Authorities assured the IMF regarding rollover of deposits from Saudi Arabia, China and the UAE, with $2 billion maturing this month and $1 billion in July.
