Pakistan Clears $3.45 Billion UAE Deposits with Final $1 Billion Repayment

The State Bank of Pakistan (SBP) has confirmed that the country has fully repaid $3.45 billion in deposits received from the United Arab Emirates, completing the final phase with a $1 billion payment made on April 23.

In a statement posted on X, the central bank said the latest repayment to the Abu Dhabi Fund for Development (ADFD) marks the completion of all outstanding UAE deposits. Pakistan had earlier returned $2.45 billion last week, followed by the final tranche this week.

According to the SBP, “This completes the repayment of total deposits of $3.45 billion to UAE.”

Previously, on April 18, the central bank had also confirmed the return of $2 billion, stating that the funds were originally placed with the SBP as a safe deposit arrangement.

The repayments come at a time when Pakistan is managing continued pressure on its external financing position. Analysts note that the return of such large deposits, along with interest obligations, is likely to widen the short-term financing gap.

Pakistan has also recently repaid $1.43 billion in external debt, including $1.3 billion in Eurobonds, as part of its broader debt management strategy.

Meanwhile, Pakistan has secured some relief through an agreement with Saudi Arabia to extend a $3 billion deposit placed with the central bank. The SBP also confirmed receiving $2 billion from the Kingdom earlier this month with a value date of April 15, 2026.

Finance Minister Muhammad Aurangzeb has stated that Pakistan is exploring multiple financing options, including Eurobonds, Islamic sukuk, commercial loans, and dollar-settled rupee-linked bonds to strengthen reserves and replace maturing liabilities.

He said Pakistan is also considering long-term energy security measures, including strategic petroleum reserves and a shift toward renewable energy, in response to global economic shocks.

Despite external pressures, officials maintain that Pakistan’s foreign reserves remain at around 2.8 months of import cover, which is considered stable under current conditions.

The International Monetary Fund (IMF) is expected to approve the next tranche of Pakistan’s $7 billion lending programme next month, which could unlock nearly $1.3 billion under existing arrangements.