Pakistan Repays $2 Billion to UAE Using Funds Borrowed from Saudi Arabia

Islamabad: The State Bank of Pakistan has announced that the government has repaid a $2 billion loan to the United Arab Emirates (UAE). To facilitate this repayment, Pakistan had received a fresh loan of $2 billion from Saudi Arabia just three days prior. In this regard, Pakistani Prime Minister Shehbaz Sharif had met with Saudi Arabia's Crown Prince and Prime Minister, Mohammed bin Salman Al Saud. During this meeting, in addition to seeking financial assistance from Saudi Arabia, he also requested an extension on the repayment deadline for previously granted loans.

What did the State Bank of Pakistan say?

On Saturday, a spokesperson for the State Bank of Pakistan stated that this amount had been held by the central bank as a secured deposit prior to its repayment. This confirmation comes at a time when Pakistan is actively seeking fresh loans from friendly nations and international financial institutions. The International Monetary Fund (IMF) has also indicated that it may soon release a new tranche of loans to Pakistan; a staff-level agreement regarding this has already been reached, and it now awaits formal approval from the Board.

How much does Pakistan still owe to UAE?

Pakistan maintains that the $2 billion payment to the UAE constitutes part of its broader repayment commitments. However, the UAE had originally demanded the repayment of a total loan amounting to $3.5 billion. Pakistan still has an outstanding balance of $1.5 billion to repay, with the deadline for this payment set for April 23. Furthermore, Pakistan is also required to repay loan installments to various other countries and international financial institutions. Should Pakistan fail to meet these obligations, it risks being declared a defaulter.

How ​​much debt does Pakistan owe?

Pakistan's central bank has asserted that the $2 billion repayment to the UAE will not adversely impact the country's foreign exchange reserves. They further claim that the nation's external financial position remains stable. According to reports from March–April 2026, Pakistan's total public debt has risen to approximately 80.52 trillion Pakistani rupees. Pakistan's debt-to-GDP ratio also remains between 70% and 72%.

Where did Pakistan get the money?

Pakistan recently received $2 billion from Saudi Arabia, providing additional support to its foreign exchange reserves. This amount was received just two days prior to the confirmation of a payment made to the UAE, reflecting the consistent bilateral financial assistance being received from key regional partners. Furthermore, Pakistan also raised $500 million a day earlier by issuing Eurobonds.