Key Takeaways
- Pakistan Finance Minister Muhammad Aurangzeb announced the initiation of issuance of Eurobonds, Sukuk, and dollar-settled rupee-linked bonds.
- The government aims to return to international capital markets after a four-year hiatus.
- A Task Force will be established to ensure small and medium-sized enterprises (SMEs) receive enhanced financing.
Pakistan Finance Minister Muhammad Aurangzeb has announced the initiation of the process for raising new debt through the issuance of Eurobonds, Sukuk, and dollar-settled rupee-linked bonds. This move is part of Pakistan's strategy to return to international capital markets after a four-year hiatus.
Speaking at the Pakistan Banking Summit 2026 (PBS’26) in Karachi, Aurangzeb stated that these new debt instruments are not incremental but replacement instruments aimed at extending the maturities of existing international debt. He highlighted that the government had recently exercised the greenshoe option to increase a Eurobond issue size to $750 million in April 2026 due to strong investor demand.
The Finance Minister also mentioned the successful launch of Pakistan’s inaugural Panda bond, which was oversubscribed five times and secured a record-low borrowing cost for a three-year issue. This bond issuance is seen as a significant step towards regaining access to international capital markets.
To ensure that small and medium-sized enterprises (SMEs) benefit from these new financial instruments, the government has announced the establishment of a Task Force. The task force will be led by the State Bank of Pakistan with senior representation from various stakeholders including the Pakistan Banks’ Association, Small and Medium Enterprises Development Authority, chambers of commerce and industry, and the Ministry of Finance.
Aurangzeb emphasized that SMEs are not currently receiving adequate access to finance from banks. He stated, 'SMEs are not getting access to finance [largely from banks]. We welcome large businesses, but there has to be allocation for SMEs as well.'
The task force will focus on recommending practical measures to improve financing and broaden access to credit across the banking industry. The Finance Minister added that the government would continue to scale up efforts in this direction.
For this purpose, the Ministry of Finance has issued Request for Proposals (RFPs) to global investment banks, financial institutions, and other potential participants, inviting their proposals on the structure of bonds including expected pricing and bid size. This process will lead to hiring advisors, lead managers, and consortia for the global bond transactions.
Aurangzeb concluded by stating that these initiatives are part of a broader strategy to enhance Pakistan’s financial standing in international markets and ensure sustainable economic growth.
We have just issued RFPs for Sukuk bonds, Eurobonds and for the first time, dollar-settled rupee-led bonds, because we do want to return to the international capital markets and extend the maturities of our international debt as we move forward.
Muhammad Aurangzeb, Pakistan Finance Minister
SMEs are not getting access to finance [largely from banks]. We welcome large businesses, but there has to be allocation for SMEs as well. Going forward, access to finance by SMEs cannot remain lip service and cannot be left to two or three banks. It has to be an industry-wide effort.
Muhammad Aurangzeb, Pakistan Finance Minister
