Pakistan plans to return to global debt markets with Eurobond issuance

Pakistan is planning to re-enter the international debt markets next year by issuing dollar-denominated Eurobonds, Bloomberg reported, ending a near five-year hiatus. The move forms part of the government’s broader strategy to diversify its financing sources.

Khurram Shehzad, adviser to the finance minister, confirmed the plan but gave no further details on the timing or size of the issuance. He also reiterated that Pakistan intends to issue Panda bonds this year, further diversifying its funding sources.

Pakistan last tapped the Eurobond market in 2021. The government’s decision to return to global markets is seen as an effort to strengthen investor confidence and increase returns on sovereign bonds, with support from the International Monetary Fund (IMF).

Finance Minister Muhammad Aurangzeb has previously announced plans to issue a Eurobond under Pakistan’s Global Medium-Term Note (GMTN) programme in 2026. This follows the successful repayment of a $500m Eurobond in September 2025, which had a 10-year maturity.

According to Bloomberg, Pakistan’s dollar bonds have surged by 24 percent so far this year, marking the best performance in Asia, driven by improving investor appetite and easing global financial conditions. Major credit rating agencies, including Fitch, S&P, and Moody’s, have also upgraded their outlooks for Pakistan.

In addition to Eurobonds, Pakistan plans to raise $250 million through yuan-denominated Panda bonds this year and has already secured $1 billion in financing from Middle Eastern banks in June.

The drought in commercial bond issuance in the last three years is linked to Pakistan’s weak credit rating and an impending balance of payments crisis. With Moody’s raising the country’s rating to Caa1 and Fitch upgrading it to B- earlier this year, both with stable outlooks – Pakistan is now seen as ready to re-enter the commercial debt market.