Pakistan repays $3.45B UAE deposits as reserves hold steady

The State Bank of Pakistan (SBP) has completed the repayment of $3.45 billion in deposits to the Abu Dhabi Fund for Development (ADFD), marking a significant external outflow even as the country’s foreign exchange reserves remain broadly stable.

In a statement, an SBP spokesperson said the central bank repaid a final tranche of $1 billion to ADFD on April 23. “This follows repayments of $2.45 billion made last week, completing the full settlement of $3.45 billion in deposits to the UAE,” the spokesperson noted.

Despite the outflows, Pakistan’s external position showed resilience. According to SBP data, total liquid foreign reserves stood at $20.63 billion as of April 17. Of this, $15.10 billion were held by the central bank, while $5.53 billion were maintained by commercial banks.

“During the week ended April 17, SBP’s foreign exchange reserves increased by $18 million to $15.10 billion,” the central bank said, indicating relative stability ahead of the repayments.

Pakistan has already received inflows from Saudi Arabia amounting to $3 billion which experts said it will help cushion the impact of recent repayments and support reserve levels in the coming weeks. Government sources also revealed that by next month, Pakistan is expected to receive $1.2 billion from IMF which would further strengthen the reserves.

Economists say the completed repayment to the UAE reflects Pakistan’s efforts to meet external obligations on time, a factor that could support confidence among bilateral partners and international lenders.

However, they caution that sustaining reserve adequacy will depend on continued external inflows, including deposits, rollovers, and multilateral financing, alongside improvements in exports and remittances.