Pakistan in talks with China, KSA to repay UAE loan: report

Pakistan is in talks with Saudi Arabia and China to repay a loan of about $3 billion to the United Arab Emirates (UAE), reported Bloomberg, citing people familiar with the matter. The development comes after Pakistan “failed to reach an agreement with the UAE to roll over the debt for the first time in seven years”, prompting Islamabad to arrange alternative funding. As per the report, the amount of support under discussion is over $3.5 billion.What options does Pakistan have to pay off $3.5bn UAE loan? The UAE had sought a shorter rollover period of less than a year, which Pakistan did not accept. However, Pakistan’s Ministry of Foreign Affairs has described the repayment as a “routine financial transaction,” said Bloomberg. The loan had been rolled over since 2018, including a $3 billion facility at around 6% annual interest, but was shifted from annual to monthly extensions earlier this year before Islamabad decided to repay it in full, with clearance expected by April 23, a government official told Reuters.