Pakistan seeks financial support as it prepares to repay a $3 billion loan to the United Arab Emirates by the end of this month. The move comes after talks to roll over the debt failed for the first time in years, increasing pressure on the country’s already tight finances.
Officials say Pakistan is now in discussions with Saudi Arabia and China to secure fresh loans and investment. The total support under consideration could exceed $3.5 billion, which may help ease immediate financial stress.
The repayment is expected to hit foreign exchange reserves, which stand at around $16 billion. This level is only enough to cover about three months of imports, making the situation more challenging for the government.
During a recent visit to Islamabad, Saudi Finance Minister Mohammed Al-Jadaan held talks with Prime Minister Shehbaz Sharif. The discussions focused on expanding cooperation in trade, investment, and economic development. Pakistan has been working to strengthen ties with Saudi Arabia, especially as regional dynamics continue to shift.
At the same time, Pakistan maintains close economic links with China, its largest lender. The country is looking to move forward with the next phase of the China-Pakistan Economic Corridor, part of Beijing’s broader Belt and Road Initiative.
Pakistan seeks financial support not only to manage immediate debt obligations but also to stabilize its economy in the long term. Meanwhile, the International Monetary Fund has already agreed in principle to release about $1.2 billion as part of a larger $7 billion program, offering some relief.
The UAE has not officially explained why it declined to extend the loan. Pakistani officials have described the repayment as a routine financial matter, rejecting speculation of political tensions.
Pakistan seeks financial support at a critical time, as rising debt and limited reserves continue to test the country’s economic stability.