Pakistan foreign exchange reserves steady as SBP targets April 23 UAE loan repayment

Pakistan’s central bank said it aimed to clear the remaining USD 1.5 billion of a USD 3.5 billion UAE loan by April 23. The State Bank of Pakistan (SBP) linked the plan to expected inflows, including about USD 1.2 billion from the International Monetary Fund (IMF). The SBP statement followed a USD 2 billion repayment to the UAE.

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A spokesperson explained that the UAE funds were held as deposits with Pakistan’s central bank. "Pakistan has repaid USD 2 billion of a USD 3.5 billion fund, which was placed by the United Arab Emirates with the State Administration of Foreign Exchange SAFE deposit with the central bank, a spokesperson of the SBP told.\" The spokesperson described the payment schedule for the balance.

State Bank of Pakistan IMF disbursement timeline

In Washington, Finance Minister Muhammad Aurangzeb said Pakistan expected to receive about USD 1.2 billion under a Staff Level Agreement (SLA) with the IMF. Muhammad Aurangzeb said talks in Washington preceded the expectation. The IMF Executive Board was expected to meet in mid-May in Washington. The review could unlock the next tranche.

The SBP spokesperson said foreign exchange reserves stayed stable because funds flowed in. The spokesperson said the USD 2 billion was sent after deposits held by the SBP reached maturity. The spokesperson added that the remaining amount must be repaid by April 23. The SBP framed the repayments as manageable with support.

UAE loan repayment and Pakistan foreign exchange reserves

The UAE had earlier provided USD 3.5 billion to support Pakistan’s balance of payments. The deposit had been rolled over until recently. Geo News earlier reported the UAE sought an immediate return of the funds. The report cited sources and connected the move to tensions in West Asia. It mentioned the US-Israel war on Iran.

Saudi Arabia also moved funds linked to Pakistan’s reserves position. On Thursday, the SaudiA Fund for Development deposited USD 2 billion of a USD 3 billion package with the SBP. A separate agreement, announced on Friday, allowed an extension in the maturity of a USD 3 billion deposit with the SBP.

\"The agreement, signed between the SaudiA Fund for Development SFD and the State Bank of Pakistan SBP, provides for the extension in the maturity of a USD 3 billion deposit placed by SFD with the State Bank of Pakistan, said a post on X by the Ministry of Finance.\" The post described the deal as a maturity extension. It did not detail the revised timeline.

Pakistan foreign exchange reserves and external deposit rollover needs

Officials and insiders said the UAE deposit had carried costs for Pakistan. Insiders said Pakistan paid around 6 per cent interest on what it owed the UAE. They said the UAE once rolled over the deposit each year. However, in December 2025, the extension was first one month. It then ran two months until April 17.

For the current fiscal year, Pakistan needed rollover of about USD 12 billion in external deposits. The total included USD 5 billion from Saudi Arabia and USD 4 billion from China. It also included USD 3 billion placed by the UAE. These rollovers were part of efforts to manage financing gaps.

Official figures showed Pakistan’s foreign exchange reserves at USD 16.4 billion as of March 27. Officials said this level covered close to three months of imports. The repayment need to the UAE was met while external buffers faced fresh pressure. The SBP said inflows helped keep reserves from falling sharply.

With inputs from PTI