Aurangzeb Says Pakistan Not Seeking New Chinese Financing
Pakistan is not currently looking for additional financing from China as Islamabad moves to diversify its sources of external funding and rebuild access to international capital markets, Finance Minister Muhammad Aurangzeb has said. His comments signal a shift in the government's financing approach as it seeks to rely less heavily on repeated bilateral support and attract a broader range of international investors.
Aurangzeb made the remarks in an interview with the Financial Times, explaining that Pakistan's growing engagement with the United States is focused largely on trade, investment and restoring confidence among global investors. He stressed that closer financial engagement with Washington should not be interpreted as Pakistan choosing the United States over China, which remains one of Islamabad's most important economic partners and creditors.
China continues to hold a major position in Pakistan's external financing structure. Citing World Bank figures, the Financial Times reported that China accounted for about 23% of Pakistan's total outstanding foreign debt of $129.7 billion as of 2024. Chinese financing has played a significant role in Pakistan's infrastructure development, balance-of-payments support and bilateral economic relationship over several years.
The finance minister's comments come as Pakistan pursues a proposed $10 billion Exchange Stabilisation Support Facility with the United States. Aurangzeb previously confirmed to Business Recorder that Islamabad had formally sought the arrangement and that discussions with Washington were continuing. He has described the proposed facility as a mechanism intended to strengthen foreign-exchange stability and improve investor confidence rather than as a conventional loan or credit programme.
Aurangzeb told the Financial Times that the proposed US facility could serve as a signal to private investors that Pakistan's external position is becoming more stable. He also sees potential roles for the Export-Import Bank of the United States and the US International Development Finance Corporation in supporting investment and commercial activity involving Pakistan. According to the minister, those institutions have demonstrated an appetite for taking investment risk in the country.
Pakistan's broader objective is to move toward market-based financing while improving its ability to attract private foreign capital. Such a transition could reduce dependence on emergency bilateral financing if the government succeeds in maintaining economic stability, strengthening foreign-exchange reserves and improving access to global debt markets. The strategy is particularly important because recurring external financing requirements have historically placed pressure on Pakistan's balance of payments and increased dependence on friendly countries and multilateral lenders.
Aurangzeb said engagement with the United States over the proposed $10 billion facility had been constructive, although no final agreement had been reached. He indicated that Islamabad hoped to receive a response within the coming months. The outcome will be closely watched by financial markets because any credible external stabilisation mechanism could influence perceptions of Pakistan's ability to meet financing requirements and return to international capital markets on more sustainable terms.
The next phase of Pakistan's financing strategy will therefore depend on progress in negotiations with Washington, conditions in global capital markets and Islamabad's success in maintaining economic stability. At the same time, the government is expected to preserve its longstanding economic relationship with Beijing while seeking a wider mix of financing and investment partners. The approach reflects an attempt to strengthen Pakistan's external position through diversification rather than replacing one strategic economic relationship with another.