Pakistan and the United Arab Emirates are moving towards a transaction under which UAE entities will acquire shares in companies owned by the Fauji Foundation, a move that would eliminate a $1 billion external liability, Foreign Minister Ishaq Dar said on Saturday.
Briefing the media during a UAE official visit to Pakistan, Dar said the $1 billion amount, which had earlier been rolled over by the UAE, would no longer remain a liability once the share acquisition is completed. He said extensive meetings had been held under his leadership, with the Fauji Foundation group taking the lead on the transaction.
He said the government expects the process to be completed by March 31, adding that shares of different Fauji Foundation group companies would be disinvested as part of the deal.
Dar said Pakistan had previously been compelled to secure around $12 billion in external support to stabilise its foreign exchange position, explaining that $12 billion included, significant contributions and rollovers from Saudi Arabia, $4 billion from China on a state-to-state basis, and $3 billion from the UAE. He said the borrowing became unavoidable to balance the country’s external accounts, as an IMF condition.
Referring to discussions with the UAE, Dar said engagement with Abu Dhabi, about the remaining $2 billion was also ongoing and is expected to move beyond rollovers towards direct investment, that would permanently retire liabilities rather than extend them.
He said Prime Minister Shehbaz Sharif also raised the issue of the $2 billion amount, due in January, during talks with UAE leadership. According to Dar, the UAE side immediately responded positively to the rollover request but both sides agreed that converting liabilities into investments would be a better long-term outcome.
Dar said discussions also touched on potential investment-related matters involving Etisalat, noting that Etisalat is a state-owned listed company with a pending transaction in Pakistan. He said both sides hold their respective positions on the issue and that further talks were expected after Etisalat contacted him ahead of the visit to seek discussions.
The foreign minister said Pakistan’s recent diplomatic engagements had helped improve its standing internationally, adding that proactive and result-oriented diplomacy had played a role in restoring confidence among partner countries.
He said Pakistan had faced diplomatic isolation in previous years but had since re-engaged with the international community through sustained outreach and negotiations, expressing hope that continued engagement would further stabilise the country’s external position.
