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Virendra Pandit

New Delhi: Annoyed with Pakistan dispatching its army and equipment to Saudi Arabia under a defense pact, and simultaneously trying to broker peace between the US and Iran, the UAE has forced Islamabad to repay a debt of USD 3.45 billion this month, the media reported on Friday.

The amount was in the form of the UAE deposits to shield Pakistan from bankruptcy.

The State Bank of Pakistan confirmed repayment on Friday, marking a significant development in Islamabad’s external financing management amid ongoing economic pressures.

The central bank said the final repayment was completed on Thursday.

“State Bank of Pakistan repaid a deposit of USD 1 billion to Abu Dhabi Fund for Development (ADFD), UAE on April 23, 2026. Deposits of USD 2.45 billion were repaid last week. This completes the repayment of total deposits of USD 3.45 billion to UAE,” it said.

According to reports, the UAE had sought the immediate return of the funds following recent tensions in West Asia after the US-Israel war on Iran; the UAE had warned Pakistan to pre-pay the debt within a month.

The repayment comes shortly after Pakistan received USD 3 billion in financial assistance from Saudi Arabia where it has dispatched its armed forces and equipment to shield it against Iranian attacks.

The Saudi support was disbursed in two tranches, with the second tranche of USD 1 billion received on April 21.

The deposits were part of external financing support extended by the UAE in 2019 to help stabilize Pakistan’s balance of payments.

In March, Islamabad failed to secure an agreement with the UAE to roll over the USD 3.5 billion facility, the first such setback in seven years, triggering concerns over near-term financing needs.

Pakistan’s foreign exchange reserves remain under strain, though the country continues broader economic stabilization efforts under IMF-backed reforms. Analysts said external financing risks remain a major vulnerability, especially amid volatile energy prices and tight global capital markets.