What happened
Pakistan has repaid a $700 million commercial loan to the China Development Bank, temporarily reducing its gross official foreign exchange reserves to $15.5 billion, officials said. The repayment came in the week before the third review under the International Monetary Fund’s Extended Fund Facility (EFF), according to a report by Profit, the business section of Pakistan Today.
The payment was made despite China having earlier rolled over the same loan for a period of three years, the report said. Another $1 billion loan from the China Development Bank is due to mature in June, and Islamabad may repay it ahead of schedule to secure refinancing before the end of the current financial year.
Reserves and the IMF review
An IMF mission will visit Pakistan from 25 February to 11 March 2026, spending three days in Karachi before formal talks with the federal government in Islamabad from 2 March. The mission is expected to review approval of a $1 billion tranche under the EFF, along with more than $200 million under a climate facility.
Following the repayment, gross official reserves held by the central bank were reported at $15.5 billion. The State Bank of Pakistan was expected to bridge the gap through increased dollar purchases from the domestic market.
The external debt picture
China has so far extended $6.6 billion in commercial loans, $4 billion in cash deposits and a $4.5 billion credit swap facility, which remain critical as foreign direct investment stays weak and exports shrink, the report said.
External public debt rose by 6 per cent to $91.8 billion as of June 2025, an increase of $5 billion over the year, according to the Ministry of Finance. Multilateral lenders, including the IMF, contributed nearly $4 billion of that rise, while commercial bank borrowing, including a $1 billion loan backed by Asian Development Bank guarantees, added $1.6 billion. Total commercial loans rose to $7.2 billion by the end of the last fiscal year.
Deposit rollovers
Pakistan also relies heavily on deposits from the United Arab Emirates and Saudi Arabia. The UAE recently rolled over a $2 billion deposit for only one month, against Pakistan’s expectation of a two-year extension at a lower interest rate. Officials said discussions were continuing for a longer-term rollover.
The report said internal discussions were under way about how long Pakistan could continue seeking annual rollovers of $12.5 billion in cash deposits from China, Saudi Arabia and the UAE. Additional short-term relief could come from new financing from Standard Chartered Bank and the Islamic Development Bank.
Why it matters
Finance Minister Muhammad Aurangzeb has said Pakistan’s external financing requirements are fully met and that there is no immediate financing gap. Prime Minister Shehbaz Sharif has separately said that heavy reliance on external borrowing burdens the country’s self-respect and limits its policy autonomy. The repayment and the shrinking reserve buffer put the coming IMF review and the pending rollovers at the centre of Pakistan’s near-term financing outlook.
Sources & reporting notes
This article summarises published reporting, not eyewitness coverage. Sources were reviewed on 15 February 2026.
- Profit by Pakistan Today — "Pakistan repays $700 million Chinese loan, FX reserves fall to $15.5 billion ahead of IMF review"15 February 2026 · Reports the China Development Bank repayment, the $15.5bn reserves figure, the IMF mission dates and the external debt and deposit-rollover details.
