Pakistan seeks $10B US economic support facility: Report

Pakistani soldiers wearing facemasks stand guard at the closed Pakistan-Iran border in Taftan, February 25, 2020. (AFP Photo)

Pakistan has requested a $10 billion financial support facility from the United States to strengthen its foreign exchange reserves, ease debt pressures and stabilize its economy, according to media reports.

Pakistani Finance Minister Muhammad Aurangzeb presented the request during a meeting with U.S. Treasury Secretary Scott Bessent in Washington on Tuesday, Dawn reported, citing diplomatic sources.

The request for an Exchange Stabilization Support Facility was first reported by Reuters and later confirmed by officials at Pakistan’s Embassy in Washington. The officials provided no further details.

Islamabad is seeking a bilateral facility with a maturity of up to five years, according to the reports.

Diplomatic sources reportedly told Dawn there were “strong chances” that Washington would approve the request, citing the Trump administration’s interest in maintaining engagement with Pakistan and its repeated pledges to help strengthen the country’s economy.

Facility would support reserves and currency stability

The proposed arrangement would allow the U.S. government, through the Treasury’s Exchange Stabilization Fund, to provide loans or other financial backstops to Pakistan.

The facility would be intended to bolster Pakistan’s foreign exchange reserves, reduce debt pressure and support broader economic stability.

Such facilities are primarily used to prevent currency instability and, when necessary, support a partner country’s currency through intervention in foreign exchange markets.

Pakistan’s Finance Ministry did not publicly mention the $10 billion request in its account of Aurangzeb’s meeting with Bessent.

The ministry said Aurangzeb sought U.S. assistance for Pakistan’s return to international markets through stronger foreign exchange reserves, improved sovereign credit ratings and better access to global capital.

JF-17 Thunder multi-purpose fighter aircraft of Pakistan Air Force in Radom, Poland, August 2018. (Adobe Stock Photo)

Aurangzeb presents Pakistan’s economic outlook

Aurangzeb briefed Bessent on Pakistan’s progress toward macroeconomic stability and its goal of achieving sustainable, export-led growth, according to a Finance Ministry statement.

He also discussed the negative effects of the regional situation on Pakistan’s economy.

The finance minister sought U.S. cooperation to improve Pakistan’s access to international capital markets, increase its foreign exchange reserves and expand market access based on stronger sovereign credit ratings.

Both sides expressed a commitment to deepen economic cooperation, increase U.S. investment in Pakistan and advance strategic projects.

Trump administration signals continued engagement

A diplomatic source told Dawn that the Trump administration “has a keen interest in remaining engaged” with Pakistan and has “more than once pledged” to support efforts to strengthen its economy.

Pakistan’s official statement said Aurangzeb sought U.S. support for the country’s “road-to-market,” based on higher reserves, better credit ratings and improved international financing access.

Neither Pakistan’s Finance Ministry nor the U.S. Treasury publicly confirmed the reported value of the proposed facility.