Pakistan has successfully raised $3 billion through a dual-tranche Eurobond offering, marking the largest single international bond issuance in the nation’s history, the finance ministry announced. The transaction attracted nearly $6 billion in orders from global institutional investors, almost twice the amount issued.
The bonds were divided into two tranches: $1.75 billion with a five-and-a-half-year maturity carrying a 7.5 percent coupon, and $1.25 billion with a 10-year maturity offering a 7.9 percent coupon. This issuance represents the first under Pakistan’s renewed Global Medium-Term Note (GMTN) programme, following its debut Panda Bond denominated in Chinese yuan and sold in China, along with a series of sovereign credit-rating upgrades over the past three years.
The finance ministry explained that this borrowing is part of a comprehensive debt-management approach aimed at diversifying financing sources, extending the maturity profile of Pakistan’s external debt, and mitigating refinancing risks rather than simply increasing funds. The government has also been proactively retiring domestic debt before maturity, viewing this Eurobond issuance as an extension of that prudent strategy to external borrowing.
The deal was managed by a consortium of five joint bookrunners—Citi, Deutsche Bank, Emirates NBD, MUFG, and Standard Chartered—with oversight from Pakistan’s Debt Management Office within the finance ministry.
Pakistan’s return to the international bond markets comes after a period of financial strain during which access to global capital was severely limited amid a balance-of-payments crisis. Since then, the country has achieved several credit-rating upgrades from international agencies, which have played a key role in restoring investor confidence.
While the finance ministry acknowledged that challenges such as fiscal discipline, structural reforms, and improvements in export competitiveness and productivity remain, it highlighted this bond sale as a sign that Pakistan has progressed from crisis management and stabilization toward renewed engagement with global capital markets.
Following the 2026-27 budget announcement, Finance Minister Muhammad Aurangzeb indicated plans to broaden Pakistan’s access to international debt markets, preparing for potential issuances of Panda bonds, Eurobonds, US dollar-denominated bonds, and the country’s first rupee-linked, dollar-settled bonds. The government has allocated $2.82 billion in the FY27 budget for commercial and Eurobond financing, though the exact sizes of these issuances are yet to be finalized.
Pakistan has also secured approval to issue up to $1 billion equivalent in Panda bonds in China, following its debut $250 million Panda bond, which was largely supported by the Asian Development Bank and the Asian Infrastructure Investment Bank.
Aurangzeb emphasized Islamabad’s aim to alter the composition of external borrowing by increasing reliance on commercial financing while maintaining the overall external debt level. “Ideally what we want to do is to see if we can replace some of the bilateral through commercial,” he stated. This approach follows Pakistan’s repayment of $3.4 billion in bilateral UAE deposits in May and the utilization of financing from UAE commercial banks.
The finance minister clarified that the government does not intend to expand external liabilities but seeks to diversify its creditor base. The proposed bond program will provide Pakistan with additional avenues to raise funds from international capital markets and reduce dependence on certain bilateral financing sources. These remarks come as Islamabad strives to uphold fiscal stability and fulfill the financing requirements outlined in the FY27 budget.
