Pakistan returns $2 billion to UAE, remaining $1 billion to be paid next week

Islamabad (Rizwan Abbasi) – Pakistan has repaid $2 billion to the friendly country United Arab Emirates, while the remaining $1 billion will be paid next week, according to sources. With this payment, Pakistan is expected to complete all financial obligations owed to the UAE. The move is part of the government’s broader effort to ensure timely repayment of external deposits and financial commitments.

Sources said that the UAE had sought the return of its deposits placed with State Bank of Pakistan as safe deposits. The total volume of these deposits is estimated to be between $3 billion and $3.5 billion, on which Pakistan has been paying approximately 6 percent annual interest. The funds were initially provided in 2018 to support Pakistan’s balance of payments and had been rolled over annually in previous years. However, since December this year, the arrangement had been extended on a monthly basis.

According to sources, the government decided to make the repayment promptly in response to the UAE’s request while keeping national financial responsibility and credibility in view. Out of the total amount, $2 billion has already been transferred, while the remaining $1 billion is expected to be paid within the next few days, likely next week. Some reports have mentioned a total repayment of $3.5 billion, which may include portions of older financial arrangements.

Pakistan has also received financial support from the friendly country Saudi Arabia to facilitate the repayment. Recently, $2 billion were received by the State Bank of Pakistan from the Saudi Ministry of Finance with a value date of April 15, 2026. Saudi Arabia has also assured the rollover of its existing $5 billion deposit for a longer period and announced support for an additional $3 billion in financing, which has helped stabilize Pakistan’s foreign exchange reserves.

Meanwhile, Foreign Office spokesperson Tahir Andrabi said during a media briefing that the transaction is a routine financial arrangement being carried out under mutual agreements. He rejected rumors circulating on social media and emphasized that relations between Pakistan and the United Arab Emirates remain strong. According to him, the repayment is not the result of any pressure or political reason but rather the fulfillment of agreed financial terms.

Economic experts believe that the repayment demonstrates Pakistan’s commitment to meeting its financial obligations and maintaining trust with friendly countries. However, they also note that the payment could temporarily widen the country’s external financing gap, though financial support from Saudi Arabia and other sources is expected to help manage the situation.