Pakistan to repay $2 billion UAE loan following Abu Dhabi’s demand

Pakistan has decided to repay a loan of USD 2 billion to the United Arab Emirates (UAE) on its demand, a media report said on Friday. The UAE had provided the funds to support the balance of payment, and it was being rolled out until recently. The UAE recently asked for the immediate return of the funds in the wake of the recent situation in the Middle East following the US-Israel war on Iran, sources said. Citing sources, Geo News reported that the amount was kept with the State Bank of Pakistan (SBP) as a safe deposit.
Pakistan will return USD 2 billion to Abu Dhabi by the end of this month, it added. The insiders said Pakistan has been paying around 6 per cent interest on the amount. In the past, the UAE used to roll over the deposit on a yearly basis. However, in December 2025, the amount was extended first for one month and then for two months until April 17.
For the current fiscal year, Pakistan needed a rollover of approximately USD 12 billion in external deposits, including USD 5 billion from Saudi Arabia, USD 4 billion from China and USD 3 billion placed by the UAE. Pakistan has more than USD 21 billion in reserves and will pay back to the UAE, but it may need external financing in the coming months.Pakistan has more than USD 21 billion in reserves and will pay back to the UAE, but it may need external financing in the coming months.