ISLAMABAD: Pakistan expects progress by September on its request to the United States for an Exchange Stabilisation Facility, Finance Minister Muhammad Aurangzeb said on Wednesday.
Speaking to the media in Islamabad, Aurangzeb said the request was currently with the US Treasury Department, and that progress was expected by September — if approved, it could provide a lifeline for the cash-strapped South Asian economy.
Aurangzeb also said work was under way to extend the maturity period of bilateral loans, with Pakistan seeking to take the repayment period to 10 years.
He said “various options” were being considered to extend the maturity of the loans. The finance minister added that discussions were continuing with the US EXIM Bank and other institutions.
The request, which Reuters reported was for $10 billion, follows Pakistan’s role in brokering talks over the US-Iran war, which raised its diplomatic profile and stirred hopes that it could seek economic gains from Washington and other partners.
The facility, if agreed to, would bolster Pakistan’s reserves, ease pressure on the rupee and reduce its reliance on multilateral financing, even as Islamabad undertakes tighter fiscal and monetary policies in line with its International Monetary Fund programme.
Pakistan remains under $7 billion IMF discipline that has required politically unpopular tax increases, spending restraint and reforms.
Exchange stabilisation facilities are rare US Treasury backstops, usually routed via the Exchange Stabilisation Fund, that provide dollars, swaps or guarantees to support reserves and steady currencies.
These facilities are different from the permanent standing dollar swap lines that the US Federal Reserve has with some major central banks and act as an international supply line of US dollars to underpin financial stability.
A 2025 Argentina package was the first new foreign-government exchange stabilisation facility operation since Uruguay in 2002, aside from Mexico’s long-standing swap line, dating to the 1940s and now sized at $9 billion.
Pakistan narrowly avoided default in 2023 with a $3 billion IMF standby deal and later secured a $7 billion Extended Fund Facility, along with a separate $1.3 billion loan to build up its resilience to climate change and natural disasters. But its reserves still depend on official financing, rollovers and deposits from China and Saudi Arabia.
That leaves Islamabad exposed to shifts in bilateral support and IMF disbursement delays. That vulnerability was exposed in April when Pakistan repaid about $3.5 billion, one-fifth of its reserves, to the United Arab Emirates, with Saudi Arabia providing $3 billion in fresh support.
State Bank of Pakistan said in January that reserves could return to near their 2021 record, reaching $20 billion by the end of 2026.
