Pakistan plans to seek an expansion of its 30 billion yuan currency swap line with China when the facility expires in 2027, while the government expects a response within two months on its request for a $10 billion exchange stabilization facility from the United States, Finance Minister Muhammad Aurangzeb said.
Pakistan remains reliant on external financing to support its foreign exchange reserves and meet debt repayments, making financial support from China, Gulf states and multilateral lenders important for maintaining economic stability and investor confidence.
Aurangzeb said Pakistan had fully drawn the existing 30 billion yuan swap line with China. He said the government had not yet decided how much additional financing it would seek when the facility comes up for renewal but plans to make a formal request at that time. He said China had indicated that it was open to the request, but the process would have to be followed before any decision is made.
Separately, Aurangzeb said he expected a response within two months to Pakistan’s request for a $10 billion exchange stabilization facility from Washington. The government is also in talks with the Export Import Bank of the United States and the US International Development Finance Corporation.
EXIM financing could support aircraft purchases from Boeing by Pakistan International Airlines following the privatization of the national carrier. DFC financing could help fund a planned $5 billion program to upgrade Pakistan’s oil refineries.
Asked about seeking additional financial support from both China and the United States, Aurangzeb described it as an “and and” approach. He said China remained a long-standing strategic partner, while Pakistan also had a strong relationship with the Trump administration.
Aurangzeb said Pakistan had managed the initial rise in crude oil prices following US and Israeli strikes on Iran relatively well, but warned that the outlook had become more uncertain.
He said Pakistan had secured enough oil stocks to meet its needs through September and was well positioned for October. Planning for November supplies was already underway, while an institutional mechanism was reviewing the situation daily.
The finance minister warned that a prolonged Middle East conflict extending into November or December could become a concern and put the government’s 4 percent economic growth target for the fiscal year at risk.
Despite the external financing needs, Aurangzeb said the government had no plans to seek additional financing or emergency support from the International Monetary Fund. He said the situation remained manageable.
An IMF mission is due next week for the fourth review of Pakistan’s $7 billion program and the third review of its Resilience and Sustainability Facility. Aurangzeb said Pakistan was in good standing on its quantitative benchmarks and was largely compliant with its structural benchmarks.
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