Says that any attempt to make the transaction appear otherwise is false and misleading
Foreign Ministry spokesman Tahir Andrabi speaks at a press briefing today, Thursday 26 March. PHOTO: SCREENGRAB
The State Department on Saturday rejected what it called “misleading and unfounded” comment about financial deposits from the United Arab Emirates (UAE) with the State Bank of Pakistan (SBP), describing the matter as a “routine financial transaction.”
The statement followed a senior minister’s announcement on Friday that the government had decided to repay the $3.5 billion debt owed to the UAE within the month, putting to rest speculation about the status of the debt. Abu Dhabi had previously only extended the transfer of this amount for one month.
🔊PR No. 9️⃣1️⃣/2️⃣0️⃣2️⃣6️⃣
Pakistan rejects misleading comments on UAE financial deposits, confirms strong partnership with UAE pic.twitter.com/0RCfCEbmea
— Ministry of Foreign Affairs – Pakistan (@ForeignOfficePk) April 4, 2026
According to the statement issued by the FO today, X said the payments were made under bilateral commercial agreements that reflect the UAE’s strong support for Pakistan’s economic stability and prosperity.
“In accordance with mutually agreed terms, the Government of Pakistan through the SBP is now in the process of returning the matured deposits to the UAE. This is a routine financial transaction and any attempt to portray it otherwise is false and misleading,” the FO stressed.
Read: Pakistan must repay $3.5 billion. UAE debt this month
The statement further highlighted the long-standing, brotherly partnership between Pakistan and the UAE, built on trust and strategic cooperation in areas such as trade, investment, defense and people-to-people ties. It noted that this relationship has “stood the test of time and has grown stronger with each passing year.”
The people of Pakistan, the statement added, “warmly cherish the central role played by the late Sheikh Zayed bin Sultan Al Nahyan in forging this enduring friendship, as well as his special devotion to Pakistan.”
Concluding the statement, the FO reaffirmed Pakistan’s full commitment to further strengthen this enduring partnership for a shared and prosperous future.
Express Pakinomist had reported in January that the United Arab Emirates transferred two loans of $1 billion each, which expired on January 16 and 22, for just one month. Pakistan had sought a two-year rollover and an interest rate of around 3%. But the United Arab Emirates rolled it over then to the old terms of 6.5% interest.
Under the $7 billion IMF program, the UAE, Saudi Arabia and China had committed to maintain their combined $12.5 billion in cash deposits with the SBP, at least until the program expires in September next year.
Also read: No demand for repayment of $2bn loan from UAE, SBP governor briefs NA panel
In December, the Governor of the State Bank of Pakistan, Jameel Ahmad, had requested the UAE government to transfer the debt of $2.5 billion for two years and cut the interest rate by almost half.
Subsequently, Prime Minister Shehbaz Sharif also requested the UAE President to extend the repayment period. The prime minister said the United Arab Emirates had agreed to transfer the debt, but gave no further details.
The United Arab Emirates gave $2 billion to Pakistan in 2018 for one year, but Pakistan was unable to repay the amount and since then has applied for rollovers annually. Later, the UAE extended another $1 billion loan in 2023 to help Pakistan meet external financing requirements for an IMF bailout.
Early last month, SBP Governor Jameel Ahmad said the UAE was not demanding repayment of the $2 billion loan but had instead moved it to a monthly rollover”.
In December, Governor Ahmad had requested the UAE government to roll over $2.5 billion in debt for two years and cut interest rates by almost half. Subsequently, Prime Minister Shehbaz Sharif also requested the UAE President to extend the repayment period. The prime minister said the United Arab Emirates had agreed to transfer the debt, but gave no further details.
Read: UAE rolls over $2bn Pak loans in a month
Pakistani authorities said the government would return $450 million on April 11, $2 billion on April 17 and another $1 billion on April 23. They said they were making arrangements to pay the debt.
However, there was a possibility that the money would be paid out of the $16.4 billion in foreign exchange reserves held by the central bank.
Cumulatively, Pakistan will repay $4.8 billion of debt in April, including the $1.3 billion Eurobond on April 8.
