UAE Rolls Over $2 Billion Loan for Pakistan, Commits to New Investments
- Abeera Marium Siddiqui
- January 8, 2025
- 9:52 am
- 34
- Current Affairs
UAE rolls over $2 billion loan for Pakistan, bringing a significant boost to the country’s economy. Prime Minister Shehbaz Sharif announced this during a federal cabinet meeting on Tuesday. The loan, originally due for repayment in January, has been extended following a “positive and constructive” meeting with UAE President Sheikh Mohammed bin Zayed Al Nahyan in Rahim Yar Khan.
In this meeting, the UAE president not only confirmed the loan rollover but also assured Pakistan of additional investments. This decision highlights the Gulf nation's strong commitment to its historic partnership with Pakistan.
Strengthening Bilateral Economic Ties
Moreover, Prime Minister Shehbaz Sharif emphasized that the UAE president called for expediting ongoing investment projects. He also expressed interest in exploring new areas for economic collaboration. The discussions covered various sectors, including energy, trade, and agriculture. Specifically, both leaders highlighted potential growth in Halal meat, rice exports, and edible oil imports.
This loan rollover signals a renewed chapter of bilateral cooperation that will pave the way for sustainable economic growth,
Focus on Energy Reforms
Additionally, the prime minister addressed the urgent need to reduce energy costs. Competitive electricity prices, he explained, are critical for boosting industrial growth and enhancing exports. He shared that the government has already developed 2–3 actionable strategies to bring down energy rates. These measures are expected to be implemented in collaboration with federal and provincial governments.
Our industries and exports cannot thrive unless we reduce the cost of energy,
He also noted that Pakistan would engage with the International Monetary Fund (IMF) to ensure these reforms align with existing commitments.
Currently, Pakistan is part of a $7 billion, 37-month loan program with the IMF. The next review, scheduled for February, will be a pivotal moment for addressing fiscal challenges while driving economic reforms.
Export-Led Growth and SME Development
Meanwhile, PM Shehbaz underscored the importance of export-led growth and non-traditional exports for stabilizing Pakistan’s economy. He highlighted recent progress in textile exports and reiterated the government’s commitment to empowering small and medium-sized enterprises (SMEs). Notably, a fully functional SMEDA Board has been established, with upcoming policy discussions focused on further supporting SMEs.
UAE's Role in Regional Stability
Beyond financial support, the UAE’s collaboration with Pakistan extends to shared goals of regional stability and addressing global challenges like climate change. This partnership reaffirms the UAE’s position as a key investor and development ally for Pakistan.
A Path Toward Prosperity
Prime Minister Shehbaz Sharif shared an optimistic vision for the country’s future. He acknowledged the challenges but expressed confidence in the nation’s resilience and collective efforts.
We are stabilizing the economy through hard work and determination. This journey requires sacrifices, but it will ultimately lead to a prosperous and self-reliant nation.
As Pakistan continues to tackle economic hurdles, the UAE’s financial backing and investment commitments create a brighter outlook. This collaboration demonstrates the vital role of strong bilateral relationships in achieving long-term stability and growth.
