- New support of $3 billion will be disbursed next week.
- Pakistan repays $1.4 billion in Eurobonds in what is termed a non-event.
- The IMF and investors are showing confidence in Pakistan’s economic prospects.
WASHINGTON: Saudi Arabia has pledged additional financial support of $3 billion to Pakistan, expected to be disbursed next week, while extending its existing deposit of $5 billion for a longer period, Finance Minister Muhammad Aurangzeb said on Wednesday.
Speaking to reporters in Washington on the sidelines of the 2026 spring meetings of the World Bank and IMF, Aurangzeb said the new Saudi support comes at a critical time for Pakistan’s external financing needs and will help strengthen foreign exchange reserves and strengthen the external account.
The development comes as Pakistan is reportedly in talks with Saudi Arabia and China for financial support as it prepares to repay a loan of around $3 billion to the UAE.
The talks, News reported, citing Bloomberginvolve loans and investments, the people said, asking not to be identified because the negotiations are private. The amount of support under discussion amounts to more than $3.5 billion, one of the sources said.
Pakistan has failed to reach an agreement with the United Arab Emirates to refinance debt for the first time in seven years. Islamabad will now repay the amount by the end of the month, straining its foreign exchange reserves, which stand at around $16 billion, enough to cover just three months of imports.
FinMin Aurangzeb, speaking to the media today, noted that the government remains committed to maintaining reserves in line with its obligations under the IMF-backed program, targeting around $18 billion – equivalent to around 3.3 months of import coverage – by the end of the current fiscal year.
He further revealed that the existing $5 billion Saudi deposit would no longer be subject to annual rollover agreements but would instead be extended for a longer duration, thereby providing greater financial stability.
Highlighting recent developments, the Finance Minister said Pakistan successfully repaid its $1.4 billion Eurobond last week, terming the transaction a “non-event”, and reaffirmed the government’s determination to fulfill all its upcoming external obligations on time under a clearly defined and disciplined financing plan.
He also said that he, along with the Governor of the State Bank of Pakistan and Pakistan’s Ambassador to the United States, had a detailed meeting with Saudi Finance Minister Mohammed bin Abdullah Al-Jadaan in Washington. He added that he had also met the Saudi minister earlier in Islamabad, but refrained from any public comments at the time due to lack of formal communication.
The minister expressed gratitude to the Saudi leadership, especially Crown Prince Mohammed bin Salman, Finance Minister Al-Jadaan and Saudi Deputy Finance Minister, for their continued support and cooperation in finalizing the package.
Aurangzeb also acknowledged the role of Pakistani leaders, including Prime Minister Shehbaz Sharif, Field Marshal Asim Munir, Deputy Prime Minister and Foreign Minister Ishaq Dar, as well as key economic officials, in securing and implementing the support.
He said Pakistan was witnessing growing confidence from international financial institutions, including the IMF and the World Bank, as well as institutional investors, stressing that the country’s recent diplomatic role in facilitating dialogue between rival states had been widely appreciated.
The minister added that this international goodwill, combined with timely assistance from Saudi Arabia, has strengthened economic momentum and investor confidence.
He further noted that Pakistan was advancing its broader external financing strategy, including the Global Medium-Term Note (GMTN) program and plans for its inaugural Panda bond issuance, aimed at diversifying financing sources and improving market access.
Concluding his speech, Aurangzeb reaffirmed the government’s commitment to macroeconomic stability, continuity of reforms, timely debt servicing and sustained engagement with bilateral and multilateral partners, adding that a detailed press conference would follow at the end of his visit.
