Pakistan UAE debt repayment confirmed as SBP returns USD 2 billion deposit

Pakistan repaid USD 2 billion in debt to the United Arab Emirates, the State Bank of Pakistan said on Saturday. The payment came as Pakistan managed short-term pressure on foreign currency holdings. The returned money had been held with the central bank as a deposit linked to external stability.

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The State Bank of Pakistan confirmed the repayment in remarks carried by Geo News. A spokesperson said the money was parked with the central bank as a safe deposit. The UAE had provided the funds to help Pakistan’s balance of payments. The deposit had continued until recently, before the repayment took place.

State Bank of Pakistan and UAE debt repayment details

Geo News, citing sources, earlier reported that the UAE sought an immediate return of the funds. The report linked the request to developments in West Asia. It referred to "the recent situation in West Asia following the US-Israel war on Iran\". The repayment was completed amid added strain on Pakistan’s external buffers.

Insiders told Geo News that Pakistan paid around 6 per cent interest on the UAE amount. In earlier years, the UAE often rolled over the deposit each year. The sources said the timeline shifted later. In December 2025, the deposit was extended for one month. It was then extended for two months until April 17.

State Bank of Pakistan and Saudi Arabia deposit extension

Two days before the UAE repayment announcement, Saudi Arabia deposited USD 2 billion with the State Bank of Pakistan. The transfer formed part of a USD 3 billion support package. On Friday, Saudi Arabia announced an agreement allowing more time before repayment. It extended the maturity of a USD 3 billion deposit held with the SBP.

The agreement was signed by the Saudi Fund for Development and the State Bank of Pakistan. Pakistan’s Ministry of Finance described it in a post on X. The post said the deal \"provides for the extension in the maturity of a USD 3 billion deposit placed by SFD with the State Bank of Pakistan\". The Thursday deposit was described as strengthening reserves.

State Bank of Pakistan and foreign exchange reserves pressure

For the current fiscal year, Pakistan required rollovers of about USD 12 billion in external deposits. The breakdown included USD 5 billion from Saudi Arabia and USD 4 billion from China. It also included USD 3 billion placed by the UAE. The UAE repayment requirement was met while Pakistan faced fresh pressure on external buffers.

Official figures showed Pakistan’s foreign exchange reserves at USD 16.4 billion as of March 27. Officials said this level could cover close to three months of imports. The central bank’s update on the UAE repayment followed these reserve figures. It also came alongside efforts to manage deposit timelines with key partner countries.

With inputs from PTI