ISLAMABAD: The government has decided not to issue a Eurobond or Sukuk bond during the current fiscal year. Instead, it plans to raise funds by launching Pakistan’s first Panda bond in the Chinese market.
According to official sources, the government aims to raise $250 million through the first Panda bond issue, which is likely to be launched in mid-January 2026. The Prime Minister’s Office has approved the launch up to January 31, 2026. A second transaction of $500 million is expected to be completed before June 30, 2026.
Sources said the Panda bond is expected to be issued at an interest rate of around 4 percent.
Pakistan has to repay two major Eurobond amounts during the current fiscal year. A $500 million repayment was made in September 2025, while another $1.3 billion—including $1 billion principal and $300 million mark-up—will fall due in April 2026.
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Officials explained that due to high interest rates in the United States and Pakistan’s increased risk level, issuing a Eurobond at this stage would mean paying double-digit interest, which the country cannot afford.
Therefore, the government will wait for better global market conditions and may consider issuing a Eurobond or Sukuk in the next fiscal year (2026-27).
The International Monetary Fund has raised questions about the Panda bond plan, suggesting that if Chinese banks are the main buyers, Pakistan could have opted for commercial loans instead.
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However, Pakistani officials told the IMF that the goal is to diversify financing options and strengthen Pakistan’s presence in the Chinese financial market through the Panda bond.
Meanwhile, the Finance Ministry said that Muhammad Aurangzeb, Federal Minister for Finance and Revenue, chaired a meeting at the Finance Division to review progress on Pakistan’s first-ever Panda bond issuance.
