Pakistan seeks rollover of $2bn loan from UAE as maturing debt looms

It is noteworthy that the UAE presently holds a substantial deposit of $3bn with the State Bank of Pakistan.

In a bid to manage its financial obligations, Pakistan has formally approached the United Arab Emirates (UAE) seeking the rollover of a $2 billion loan.

As per reports, the requested amount includes one loan set to mature on January 17, 2024, bearing an interest rate of 3%. Additionally, another loan, amounting to $1 billion with an interest rate of 6.5%, is also part of the appeal for an extension.

It is noteworthy that the UAE presently holds a deposit of $3 billion with the State Bank of Pakistan (SBP), underscoring the economic ties between the two nations.

Sources privy to the ongoing discussions revealed that high-level talks are underway between the Prime Minister’s office and the Ministry of Finance to navigate the complexities of this financial arrangement.

As of the latest available data, Pakistan’s foreign exchange reserves held by the central bank stand at approximately $8.2 billion. This move to rollover the loans is seen as a strategic measure by the Pakistani government to manage its debt obligations and stabilize its financial position.

The outcome of these negotiations will likely have implications not only for Pakistan’s economic trajectory but also for the broader diplomatic and economic relations between Pakistan and the UAE. Observers are keenly watching the developments, particularly as the maturation date of the $2 billion loan approaches later this month.

8 COMMENTS

  1. Loans, rollovers, loans, rollovers, loans, rollovers…..it will continue like that, how long? nobody knows. And there is no silver-lining for the common man in the dark, dark clouds.

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