UAE officially confirms extension of $2 billion deposit rollovers for Pakistan

The United Arab Emirates (UAE) has confirmed the extension of its two $1 billion deposits with the State Bank of Pakistan for another year, which were set to mature in January.

Prime Minister Shehbaz Sharif announced last week that the UAE had agreed to roll over the $2 billion payment due this month.

The rollovers from China, Saudi Arabia and UAE are part of the pledges sought by the International Monetary Fund (IMF) prior to approving a new $7 billion Extended Fund Facility for Pakistan.

Pakistan currently has pledges of $5 billion from China, $4 billion from Saudi Arabia, and $3 billion from the UAE. The government had initially planned to request these countries last year to roll over these loans for at least three years, providing greater predictability under the IMF program.

Despite higher remittances and exports, Pakistan requires at least $14 billion to service its external debt during fiscal year 2024-25. The State Bank of Pakistan aims to bolster forex reserves to $13 billion by the end of FY25.