UAE agrees to two-month rollover of $2 billion deposit for Pakistan

The United Arab Emirates has agreed in principle to roll over a $2 billion deposit with Pakistan for two months, extending the facility until April 17, 2026, The News reported, citing official sources.

The assurance was conveyed after Deputy Prime Minister and Foreign Minister Ishaq Dar contacted UAE authorities this week. The existing one-month extension was due to expire in four days.

Officials said the rollover would be granted at an interest rate of 6.5%, while formal approval from the relevant authorities in the UAE is awaited. The development comes ahead of Pakistan’s third review talks with the International Monetary Fund under the $7 billion Extended Fund Facility and the release of a $1 billion tranche.

A Foreign Office spokesperson said the tenure of the rollover was the prerogative of the depositor and confirmed that the deputy prime minister was engaged with UAE authorities on the matter. He added that the rollover remained assured and not linked to specific conditions. He also referred to statements by the finance minister that Pakistan did not face an external financing gap.

Earlier, the UAE had extended the maturity of the same $2 billion deposit for one month after $1 billion matured on February 16 and another $1 billion on February 22. In January, the UAE had similarly granted a one-month rollover when the amount matured.

The government has sought a longer-term rollover of the deposit and conveyed to UAE authorities that it would again request an extended arrangement after completion of the IMF review.

According to officials, the Abu Dhabi Fund for Development has placed $3 billion with the State Bank of Pakistan in three tranches of $1 billion each. Two tranches that matured in January were rolled over for one month, while the third tranche of $1 billion is due to mature in July 2026.

In December, Saudi Arabia extended the maturity of its $3 billion deposit with the State Bank of Pakistan by one year under a 2021 arrangement.

For the current fiscal year, Pakistan is seeking rollover of about $12 billion in external deposits, including around $9 billion from Saudi Arabia and China, in addition to the $3 billion from the UAE.