​Pakistan has agreed on terms for $1 billion loan with two Middle Eastern banks

Pakistan has agreed on terms for a $1 billion loan with two Middle Eastern banks at a 6%-7% interest rate, Finance Minister Muhammad Aurangzeb told Reuters on Tuesday, as the South Asian country looks for more financing.

"With two institutions we have now gone forward in signing up the term sheet — one bilateral and one for trade (finance)," Aurangzeb said during an interview on the sidelines of the World Economic Forum annual meeting in Davos.

The loans were short-term — or up to one year, Aurangzeb added.

Pakistan aims to boost its finances after securing a $7 billion International Monetary Fund (IMF) bailout in September, with the first review set for late February.

"We have the first formal review of the EFF coming through towards (the) end of February," Aurangzeb said. "I do think we are in good stead for that review."

IMF's EFFs provide financial assistance to countries facing serious medium-term balance of payments problems resulting from structural weaknesses that require time to address.