PAKISTAN’S DEBT CLOCK TICKS, BRACES FOR $4.8 BILLION EXTERNAL REPAYMENT CHALLENGE — A CRISIS IN THE MAKING?
The debt-ridden Pakistan has been severely hit due to the ongoing Iran War which was clubbed by Intense border clashes and reciprocal attacks by Afghanistan. Amid the ongoing tensions, Pakistan has made arrangements to repay USD 4.8 billion in external obligations by June. The South Asian country will pay USD 3.5 billion to the UAE through three different facilities, as per local media reports. The amount had been placed with the State Bank of Pakistan (SBP) as a deposit, on which it has been paying around 6 per cent interest.
As reported by Geo News, citing sources, Pakistan has received assurances of over USD 5 billion in financial support from two friendly countries to help manage its external financing requirements.
UAE has sought immediate repayment of the loans it had granted to Pakistan in the wake of the hostile situation in the Gulf country due to US-Israel-Iran war.
According to the reports, the repayment schedule to UAE has been finalised as USD 450 million on April 11, USD 2 billion on April 17 and another USD 1 billion on April 23.
Of the total amount, USD 450 million traces back to a one-year loan taken in 1996-97, which is now set to be cleared after nearly three decades.
A $1.3 billion Eurobond, issued for a 10-year period, is also maturing this week and will be repaid, adding to short-term repayment pressure, reported news agency PTI.
For the current fiscal year, Pakistan is seeking rollover of around USD 12 billion in external deposits, including approximately USD 9 billion from Saudi Arabia and China USD 5 billion and USD 4 billion respectively.
Iran War deepens Pakistan's crisis
Pakistan is heavily dependent on its energy supplies from the Gulf. With the Strait of Hormuz blocked, the government increased the fuel price twice in a month. Pakistan reportedly imports over 85 per cent of its crude oil from Saudi Arabia and the United Arab Emirates. The supplies are being routed by way of a single maritime route through the Strait of Hormuz.
The Pakistani government had first triggered outrage by raising petrol prices by 42.7% to 485 rupees per litre, sparking street protests and long queues at fuel stations.
The increases triggered mass protests, with people furious at the government’s decision. Prime Minister Shehbaz Sharif later rolled back the hike, reducing the price to 378 rupees per litre. Sharif did not reduce the price for diesel, which will remain at 520 rupees per litre following a 54.9-percent price hike.
Pakistan’s dollar bonds are already on track for the biggest monthly drop in three years. Pakistan’s stocks are already in the bear territory, with the KSE-100 Index having fallen over 21% from this year’s peak in January, Bloomberg said in a latest report.
Foreign investors have sold off USD 383 million from stocks this year, according to data by National Clearing Company of Pakistan, the report said.
Also Read: Pakistan — The ‘Bail Me Out Nation’ — Economy Tanks, Stocks Sink, Jobs at Risk Amid Iran War
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2026-04-07T06:46:26Z