Pakistan to refinance short-term external debt to reduce rollover risks: Aurangzeb

Pakistan intends to refinance some of its short-term external debt over the next two to three years in order to mitigate rollover risks, according to Finance Minister Muhammad Aurangzeb. The minister disclosed this to Bloomberg News, asserting that the country's overall external debt, estimated to be nearly $100 billion, will remain largely unchanged.

Aurangzeb explained that the objective is to shift some of the short-term debt into longer tenors, thereby eliminating the need to face the short-term debt rollover risk. He emphasized that the country aims to maintain the external debt quantum as a replacement rate, promoting diversification and elongation of maturities. Aurangzeb also mentioned that the government is not eager to issue bonds this fiscal year, as they have mandated the issuance of Islamic Sukuks and dollar-settled, rupee-denominated bonds.

He further stated that inquiries for remaining Panda bonds are increasing, and the government plans to issue RFPs for these bonds. Additionally, the minister hinted at the potential tokenization of existing Eurobonds. Aurangzeb departed for Bangkok, Thailand, last week to represent Pakistan at the World Bank Group–IMF Annual Meetings 2026, scheduled from October 12 to 18, 2026.

The finance minister will participate in various high-level engagements with international financial institutions, policymakers, global investors, banks, credit rating agencies, think tanks, and international media during the visit.