Pakistan to repay $1.5 billon outstanding UAE debt by April 23

Karachi: Pakistan's central bank on Saturday said it hopes to repay the outstanding $1.5 billion of the $3.5 billion loan to the United Arab Emirates by April 23.

The announcement by the State Bank of Pakistan (SBP) comes in anticipation of the disbursement of about $1.2 billion from the International Monetary Fund (IMF) and a day after it repaid $2 billion to the United Arab Emirates, which in turn, was done after Saudi Arabia deposited $2 billion, part of the $3 billion aid, with the SBP.

“Pakistan has repaid $2 billion of a $3.5 billion fund, which was placed by the United Arab Emirates with the State Administration of Foreign Exchange (SAFE) deposit with the central bank,” a spokesperson of the SBP told PTI.

“The amount of $2 billion was transferred to the UAE following the maturity of deposits held by the State Bank. The remaining amount has to be paid by April 23,” he said.

The spokesperson claimed that Pakistan’s foreign exchange reserves remained stable due to the inflow of funds.

In a related development, Finance Minister Muhammad Aurangzeb said in Washington that Pakistan is expecting to get a disbursement of about $1.2 billion from the Staff Level Agreement (SLA) with the IMF after a round of talks in Washington.

The IMF Executive Board is expected to meet in mid-May in Washington to review the SLA, which would unlock the next tranche under Pakistan’s programme, the minister said.

The UAE had provided $3.5 billion to support the balance of payment, and it was being rolled out until recently.

The UAE recently asked for the immediate return of the funds in the wake of the recent situation in West Asia following the US-Israel war on Iran, Geo News said, quoting sources, in a report earlier in the month.

Saudi Arabia reached an agreement -- announced on Friday -- with the SBP which allows for an extension in the maturity of a $3 billion deposit with it.

On Thursday, the SaudiA Fund for Development deposited USD 2 billion of the USD 3 billion with the State Bank of Pakistan (SBP), bringing a major boost to the country's skewed foreign reserves.

“The agreement, signed between the SaudiA Fund for Development (SFD) and the State Bank of Pakistan (SBP), provides for the extension in the maturity of a $3 billion deposit placed by SFD with the State Bank of Pakistan,” said a post on X by the Ministry of Finance.

The insiders said Pakistan has been paying around 6 per cent interest on the amount it owed to the UAE. In the past, the UAE used to roll over the deposit on a yearly basis. However, in December 2025, the amount was extended first for one month and then for two months until April 17.

For the current fiscal year, Pakistan needed a rollover of approximately $12 billion in external deposits, including $5 billion from Saudi Arabia, USD 4 billion from China and $3 billion placed by the UAE.

According to official figures, Pakistan’s foreign exchange reserves stood at $16.4 billion as of March 27, which officials said was sufficient to cover close to three months of imports. The repayment requirement from the UAE was met amid fresh pressure on the country’s external buffers.