Pakistan has requested financial support worth 10 billion yuan (about $1.4 billion) from China, Finance Minister Muhammad Aurangzeb revealed during an interview with an international media outlet. He said Pakistan aims to issue 10 billion yuan worth of Panda bonds in China’s domestic bond market by the end of 2025.
Aurangzeb shared that talks with the heads of the Asian Infrastructure Investment Bank (AIIB) and the Asian Development Bank (ADB) about the Panda bonds have been positive. Preparations are underway to launch these bonds, which could play a major role in Pakistan’s efforts to stabilize its economy. Panda bonds are yuan-denominated bonds issued by foreign entities in China’s domestic market, providing Pakistan with a new way to boost its foreign exchange reserves.
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Finance Minister Muhammad Aurangzeb said Pakistan has launched a new $1.3 billion program with the International Monetary Fund (IMF) focused on climate financing. He expects the IMF executive board to approve the program in early May 2025. Aurangzeb also shared that Pakistan is close to completing the first review of its ongoing $7 billion Extended Fund Facility (EFF) program, which began in August 2024. A successful review would release a $1 billion tranche, helping to further stabilize the country’s economy.
Economic Growth Outlook
Aurangzeb expressed confidence in Pakistan’s economic recovery, forecasting around 3% growth for the 2024-25 fiscal year. He expects growth to improve to 4–5% in 2025-26 and eventually reach 6% in the years ahead. He credited strong economic reforms and strict financial management for these positive projections.
India-Pakistan Relations and Trade
On ties with India, Aurangzeb said tensions between the two countries continue to hurt the economy. Referring to the recent killing of 26 people at a tourist site, he warned that the situation was “not going to be helpful.” He pointed out that trade between Pakistan and India had already fallen to just $1.2 billion in 2024. Aurangzeb stressed that better trade relations could unlock major economic potential for the entire region.
Aurangzeb underlined the importance of partnerships with China and international financial institutions for Pakistan’s economic recovery. “We want to diversify our lending base and have made good progress. We hope to make an initial move this year,” he said.
