Pakistan is set to secure a $1 billion commercial loan from Standard Chartered Bank (SCB) with the Asian Development Bank’s (ADB) guarantee, as part of ongoing efforts to address its external financing needs, according to a news report. The loan is expected to be finalised by June 2025, following the ADB’s approval of the facility by the end of May.
In addition to this loan, Pakistan is seeking loans of up to $350 million from commercial banks in the United Arab Emirates (UAE) to meet its external financing requirements. Finance Minister Muhammad Aurangzeb led virtual meetings with Sharjah Islamic Bank, Abu Dhabi Islamic Bank, and Ajman Bank to discuss their potential support for Pakistan’s development goals. These discussions are seen as a key part of revitalizing the loan portfolio with UAE-based banks.
Minister Aurangzeb expressed gratitude to Standard Chartered Bank and Dubai Islamic Bank for facilitating the interactions with the UAE banks. He also acknowledged the ADB’s role in providing support to Pakistan’s fiscal strategies, emphasizing the importance of continued collaboration for Pakistan’s fiscal and development goals.
The finance minister briefed the UAE banks on Pakistan’s progress toward macroeconomic stability, highlighting that the country is on track to close the fiscal year 2025 with a current account surplus, primary surplus, and forex reserves of nearly $14 billion, providing three months of import cover. He noted the easing of inflation to 0.3% and a significant reduction in the policy rate, which contributed to a more favorable economic outlook.
Further discussing the country’s fiscal strategy, the minister assured the banks of the government’s commitment to long-term reforms, including restructuring state-owned enterprises, implementing privatisation programs, and rightsizing the federal government. He emphasized that the stability Pakistan is experiencing now is a result of necessary but difficult reforms.
On the revenue front, Minister Aurangzeb revealed that Pakistan aims to achieve a tax-to-GDP ratio of 10.6% by June 2025, with a target of 11% for the next fiscal year. The government is focusing on reforming the Federal Board of Revenue (FBR), including end-to-end digitization, to broaden the tax base and enhance compliance.
Pakistan has made significant progress under the IMF’s Extended Fund Facility (EFF), meeting all the quantitative targets and key structural benchmarks, including the introduction of agricultural income tax. The country’s recent upgrade in sovereign credit rating by Fitch was seen as a sign of improving market confidence.
The finance minister emphasized Pakistan’s shift towards a productivity and export-led growth model. He pointed to the growth in the IT sector, with exports reaching $3.4 billion in March 2025, and the momentum in the mining sector, particularly through the Reko Diq project, which has sparked interest in the country’s copper reserves.
In a separate meeting, Minister Aurangzeb met with a high-level delegation from Deloitte to discuss collaboration on critical minerals, energy sector reforms, privatization, and the Country Partnership Framework (CPF). The discussions focused on leveraging Deloitte’s expertise in accelerating structural reforms and promoting productivity, with an emphasis on sectors like health, energy, and mining.
The finance minister reiterated Pakistan’s commitment to climate resilience and population management as key priorities, with substantial funding, including a $1.3 billion allocation under the Resilience and Sustainability Facility (RSF).
Muhammad Aurangzeb shared key insights from his recent meeting with World Bank President Ajay Banga, reaffirming Pakistan’s commitment to utilising financial resources responsibly.
The discussion emphasised two primary national priorities: climate resilience and population management, both of which are supported by significant funding, including the $1.3 billion Resilience and Sustainability Facility (RSF).
Minister Aurangzeb stressed that Pakistan’s current needs are focused not on further financing, but on strategic support and expertise from global partners.
