Post by : Badri Ariffin

Pakistan has completed the repayment of a $3.45 billion loan to the United Arab Emirates (UAE), officially announcing the closure of its financial obligations to the Abu Dhabi Fund for Development (ADFD) on Friday, as stated by the State Bank of Pakistan (SBP).

The central bank noted that the final installment of $1 billion was paid on April 23, 2026, while the previous $2.45 billion was settled earlier last week. With this payment, Pakistan has fully cleared all outstanding borrowings to the UAE.

Initially provided as balance-of-payments support, these loans had undergone several extensions since 2018. This year, the repayment conditions shifted from annual to monthly installments, culminating in Pakistan’s decision to settle the entire debt at once.

To facilitate this repayment, Pakistan drew on recent financial inflows, notably a $2 billion deposit from Saudi Arabia, part of a larger $3 billion aid initiative.

This settlement not only alleviates Pakistan's external debt pressures but also bolsters its financial management efforts under the International Monetary Fund (IMF) program. Previously hovering around $16 billion, the nation’s foreign exchange reserves provided the necessary buffer for this repayment.

Despite earlier news suggesting a potential repayment of $3.5 billion by the end of April, the State Bank confirmed that $3.45 billion has been repaid, clarifying possible exclusions regarding an overdue amount of $450 million.

This milestone represents a crucial advancement in Pakistan’s ongoing endeavors to stabilize its economy amidst persisting regional and financial challenges.

#world news #Global News #Pakistan #Banking Sector #Loan