The State Bank of Pakistan (SBP) said on Friday it had repaid $1 billion to the Abu Dhabi Fund for Development (ADFD), completing the return of $3.45 billion in UAE deposits after settling $2.45 billion last week.
In a post on X, the central bank said the latest payment was made on April 23, marking the full repayment of deposits placed by the UAE.
“This completes the repayment of total deposits of $3.45 billion to UAE,” the SBP said.
Earlier, on April 18, the central bank had confirmed that the government had returned $2 billion in debt to the UAE. An SBP spokesperson had said the amount was kept with the central bank as a safe deposit.
The repayments come as Pakistan manages pressure on its external financing position, with the financing gap likely to expand after the return of UAE deposits, along with a 6% interest payment.
Pakistan has also recently repaid $1.43 billion in external debt, including a $1.3 billion Eurobond.
The development follows an agreement with Saudi Arabia to extend the maturity of a $3 billion deposit placed with the SBP. The central bank had also said earlier this month that it received $2 billion from the kingdom with a value date of April 15, 2026.
Finance Minister Muhammad Aurangzeb had said earlier that Pakistan was considering Eurobonds, loans from other countries and commercial debt to replace the UAE loan facility and manage foreign reserves.
“All options are on the table,’ Aurangzeb said when asked whether the government was in talks with Saudi Arabia for a loan that could replace the UAE facility.
Speaking on the sidelines of the IMF and World Bank spring meetings, he said Pakistan could manage all debt repayments and that reserves remained at around 2.8 months of import cover.
Maintaining at least that level, the finance czar said, would be “an important aspect of our overall macro stability as we go forward”.
“We are looking at Eurobond, we are looking at Islamic sukuk, we are looking at dollar-settled rupee-linked bonds,” Aurangzeb said, adding that Pakistan expected to issue Eurobonds this year and was also exploring commercial loans.
He also said the shock from the ongoing Middle East war meant Pakistan must consider a strategic petroleum reserve and a faster switch to renewable energy.
Aurangzeb said Pakistan had not yet requested any additions or changes to its $7 billion IMF lending programme due to the economic shocks of the war in the Middle East, but added that it remained a possible option depending on developments in the coming weeks.
The IMF board is likely to approve the latest lending tranche next month, which would unlock just under $1.3 billion through the Extended Fund Facility and the Resilience and Sustainability Facility.