Islamabad prepares phased repayment of long-standing UAE loans, signaling progress in external debt management.
ISLAMABAD: Pakistan has finalized arrangements to repay approximately $3.45 billion in loans and deposits to the United Arab Emirates, marking a significant step in managing its external financial obligations, officials familiar with the matter said.
According to sources, the repayment plan includes $450 million originally borrowed in 1996–97, along with $2 billion and $1 billion deposits secured in recent years. The government is expected to begin repayments immediately, with $450 million scheduled to be paid within the current week.
The remaining $3 billion will be cleared in phases later this month. Officials indicated that $2 billion is due to be repaid on April 17, followed by another $1 billion installment on April 23.
The development reflects Islamabad’s efforts to maintain financial stability and strengthen ties with key regional partners, particularly the UAE, which has long supported Pakistan through deposits and financial assistance during periods of economic stress.
Economic analysts say timely repayment could improve Pakistan’s credibility with international lenders and help unlock further financial support if needed. However, they also note that the repayments may put short-term pressure on the country’s foreign exchange reserves.
The government has not publicly detailed the funding sources for the repayments, but officials suggest the move is part of a broader strategy to manage debt obligations while sustaining economic reforms.
The repayment schedule comes amid ongoing efforts by Pakistan to stabilize its economy and reassure global financial markets of its fiscal discipline.
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