China 'rolls over' $3.4bn of commercial loans to Pakistan

• Beijing rolls over $2.1bn, refinances another $1.3bn loan.
• Reserves to reach IMF-required $14 billion target.
• China remains Pakistan's largest bilateral creditor.

China has rolled over $3.4 billion in loans to Pakistan, which together with other recent commercial and multilateral lending will boost Pakistan's foreign exchange reserves to $14 billion, a finance ministry source said on Sunday.

Beijing rolled over $2.1 billion, which has been in Pakistan's central bank's reserves for the last three years, and refinanced another $1.3 billion commercial loan, which Islamabad had paid back two months ago, the source said.

Another $1 billion from Middle Eastern commercial banks and $500 million from multilateral financing have also been received, he said.

"This brings our reserves in line with the IMF target," he said.

The loans, especially the Chinese ones, are critical to shoring up Pakistan's low foreign reserves, which the IMF required to be over $14 billion at the end of the current fiscal year on June 30.

Pakistani authorities say that the country's economy has stabilised through ongoing reforms under a $7 billion IMF bailout.

Earlier, on March 9, 2025, China extended the repayment period of a $2 billion loan to Pakistan by one year, the finance ministry had confirmed.

Around 92% of Pakistan's external debt is owed to three major sources including multilateral and bilateral creditors as well as international bonds, according to The News.

Among the bilateral creditors, China is on the top keeping in view the total external debt and liabilities.

Pakistan’s foreign exchange reserves held by the State Bank of Pakistan (SBP) declined by $2.66 billion during the week ending June 20, 2025, bringing the central bank’s reserves down to $9.06 billion, according to data released by the SBP.