Islamabad – Pakistan is preparing to return to the international bond market for the first time in four years, reflecting significant progress in stabilizing its economy after narrowly avoiding default in recent years. The government is expected to issue a call for advisors in the coming weeks, with Finance Minister Muhammad Aurangzeb confirming that options under consideration include dollar, euro, sukuk, and Pakistan’s first-ever panda bond.
The move comes as the country showcases its improving economic conditions on global platforms. At the World Economic Forum in Davos, Prime Minister Shehbaz Sharif led a delegation promoting investment opportunities in sectors such as minerals, agriculture, and technology, highlighting Pakistan’s macroeconomic achievements and reform agenda.
Finance Minister Aurangzeb emphasized that the country has consolidated gains in macroeconomic stability. Improvements have been recorded across key indicators including inflation, interest rates, fiscal balance, and the current account, signaling stronger investor confidence. Inflation, which had previously soared to nearly 40%, has now dropped to single digits. The country has also recorded a primary fiscal surplus, and international ratings agencies have upgraded Pakistan’s outlook, reflecting enhanced credibility in global markets.
Foreign exchange reserves are projected to reach a three-month import cover by June 2026, meeting global benchmarks. Aurangzeb added that the Pakistani rupee is stable with no immediate risk of depreciation, supported by robust remittances, rising services exports, and a healthier balance of payments.
The finance minister also highlighted that macroeconomic stabilization has coincided with long-delayed structural reforms, including the privatization of state-owned enterprises and expansion of the tax base. Last month, Pakistan finalized the sale of its national airline. The government is now exploring options to privatize a stake in New York’s Roosevelt Hotel, outsource management of major airports, and divest nearly two dozen additional state-owned companies.
Aurangzeb stressed the importance of export-led growth to prevent recurring import-driven balance-of-payments crises. “We must stay the course on reforms. That is the only way to achieve sustainable growth,” he said, emphasizing that fiscal discipline, structural reforms, and investment promotion remain central to Pakistan’s long-term economic strategy.
The anticipated return to the international bond market, including the potential issuance of panda bonds, marks a major milestone for Pakistan. It underscores the government’s efforts to restore credibility, attract foreign investment, and provide sustainable financing for infrastructure, energy, and other critical sectors, while reinforcing macroeconomic stability after years of financial volatility.
This planned market re-entry signals Pakistan’s readiness to integrate further with global financial markets, capitalizing on recent economic reforms, improved investor sentiment, and a more resilient fiscal and external position.
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