WASHINGTON, October 18 — Pakistan plans to extend the maturity of its domestic and external debt portfolios, a strategic move aimed at lowering refinancing risks and interest rate volatility, Finance Minister Muhammad Aurangzeb said on Friday.
Speaking during a high-level meeting with the Currency Exchange Fund (TCX) delegation in Washington, Aurangzeb emphasized that shifting from short-term borrowing towards longer-term instruments is vital for ensuring macroeconomic stability.
“The objective is to reduce reliance on short-term debt, which increases refinancing pressure and exposes the economy to interest rate shocks,” said the finance minister. “Longer-term debt allows for more predictable servicing costs and sustainable debt management.”
The TCX delegation was led by Deputy CEO and Chief Investment Officer Othman Boukrami. The two sides discussed debt restructuring, local currency lending, and hedging strategies to shield Pakistan’s economy from currency and interest rate risks.
TCX provides long-term currency and interest rate hedging solutions for businesses and governments in developing markets, helping mitigate exposure to external shocks.
Aurangzeb welcomed TCX’s engagement in strengthening local financial systems and reaffirmed Pakistan’s intent to re-enter international capital markets, including through Panda Bonds, Eurobonds, and International Sukuk. These instruments, he said, will be used strategically to diversify Pakistan’s funding sources and extend the average maturity of its debt.
In a separate meeting with US Congressman French Hill, Chairman of the House Financial Services Committee, Aurangzeb underscored the importance of deepening US-Pakistan economic ties.
Key areas of discussion included expanding cooperation in digital financial services, promoting investment in Pakistan’s mineral sector, and fostering collaboration in emerging industries such as information technology.
You May Also Like: PM’s Adviser Criticizes India’s Violations of Indus Waters Treaty at Global Water Forum
Aurangzeb highlighted the government’s commitment to structural reforms, noting that debt sustainability and market confidence are central to Pakistan’s broader economic recovery strategy.
The meetings come at a critical time as Pakistan seeks to stabilize its economy, broaden its investor base, and reduce vulnerability to short-term financial shocks.
