Pakistan repays UAE loan this month as Islamabad prepares to return a $2 billion deposit to Abu Dhabi, according to sources. The funds had remained with the State Bank of Pakistan as a safe deposit, but the UAE recently requested their immediate return amid the changing situation in the Middle East following the US-Israel war on Iran.
Sources said Pakistan will send back the full amount by the end of this month. They also said the country has been paying about 6% interest on the deposit. In previous years, the UAE had rolled over the amount annually, but the most recent extensions became much shorter.
The latest move follows a series of short extensions. In December 2025, the UAE first extended the deposit by one month, then by two months. Later, in February 2026, it agreed in principle to another short-term rollover for just two months.
That assurance followed Deputy Prime Minister Ishaq Dar’s contact with UAE officials. A top official said the UAE agreed to keep the $2 billion deposit in place until April 17, 2026. Before that, the UAE had also rolled over $2 billion for one month, with one $1 billion tranche maturing on February 16 and the second on February 22.
💥🇵🇰🇸🇦🇦🇪 A Pakistani Journalist claims UAE asked Pakistan to repay their loan of 2 billions dollars.
There is also rumors of Saudi Arabia asked Pakistan to repay 6 Billions dollars. There is no such news of Saudi Arabia asked anything from Pakistan. pic.twitter.com/v7RpFZpYo1
— International Observer (@Intlobserver0) April 3, 2026Why the UAE Deposit Matters for Pakistan
Officials said the Abu Dhabi Fund for Development has placed $3 billion with the State Bank of Pakistan in three separate tranches. Two tranches of $1 billion each matured in January and were rolled over for 1 month, while the third tranche of $1 billion will mature in July 2026.
Pakistan had asked the UAE to roll over the deposit for two years and later submitted a fresh request to extend the facility. However, the UAE eventually sought the immediate return of the funds, changing Pakistan’s short-term financing calculations.
For the current fiscal year, Pakistan is seeking rollover of about $12 billion in external deposits. That total includes around $9 billion from Saudi Arabia and China, $5 billion from Saudi Arabia, and $4 billion from China, in addition to the $3 billion placed by the UAE.
The repayment of the UAE deposit highlights how heavily Pakistan depends on external financing support to manage reserves and near-term obligations. It also shows that even short rollover decisions can have a significant impact on the country’s financial planning.
