Pakistan has formally requested a $10 billion bilateral exchange stabilisation facility from the United States in a move aimed at strengthening the country’s foreign exchange reserves, supporting the Pakistani rupee, and improving access to international capital markets.
The request was reportedly made by Finance Minister Muhammad Aurangzeb in a letter addressed to US Treasury Secretary Scott Bessent, seeking a facility with a maturity period of up to five years. If approved, the arrangement could provide Pakistan with dollar liquidity, currency swaps, or financial guarantees to help cushion the economy against external shocks.
Pakistan Seeks US Support to Strengthen Foreign Exchange Reserves
According to reports, the proposed exchange stabilisation facility would serve as a financial backstop by increasing Pakistan’s foreign exchange reserves and reducing pressure on the local currency during periods of global economic uncertainty.
The initiative is intended to enhance Pakistan’s financial resilience while improving investor confidence and reducing dependence on emergency external financing.
Diplomatic Engagement with Iran Linked to the Request
The request comes after Pakistan played a diplomatic role in facilitating dialogue related to the Iran conflict, an effort that reportedly strengthened Islamabad’s international standing.
During his recent meeting with US Treasury Secretary Scott Bessent, Finance Minister Muhammad Aurangzeb highlighted Pakistan’s economic vulnerability to regional geopolitical developments and sought greater US support for improving access to global capital markets, strengthening foreign exchange reserves, and enhancing the country’s sovereign credit profile.
Exchange Stabilisation Facilities Are Rare
Exchange stabilisation facilities provided through the US Treasury’s Exchange Stabilisation Fund (ESF) are relatively uncommon.
Recent examples include support extended to Argentina in 2025, while Uruguay received similar assistance in 2002. Mexico also maintains a long-standing currency swap arrangement with the United States.
Unlike permanent Federal Reserve swap lines available to major central banks, these facilities are temporary mechanisms designed to strengthen reserve buffers and promote currency stability during periods of financial stress.
Pakistan Continues IMF Reform Programme
Pakistan remains under the $7 billion Extended Fund Facility (EFF) agreed with the International Monetary Fund (IMF), which requires continued fiscal reforms, tax measures, and expenditure controls.
Government officials believe that securing a US-backed stabilisation facility would help diversify external financing sources and reduce reliance on periodic IMF disbursements as well as bilateral financial assistance from countries including China and Saudi Arabia.
Pakistan’s foreign exchange reserves have remained dependent on external inflows and debt rollovers in recent years. Earlier this year, the country repaid approximately $3.5 billion to the United Arab Emirates, while Saudi Arabia provided $3 billion in fresh financial support.
Potential Economic Impact
The State Bank of Pakistan (SBP) has projected that the country’s foreign exchange reserves could approach $20 billion by the end of 2026 if current trends continue.
If the proposed $10 billion facility is approved, it would significantly strengthen Pakistan’s reserve position, improve its ability to manage external payment obligations, and provide greater protection against global risks such as oil price volatility, supply chain disruptions, and geopolitical instability.
The additional liquidity could also improve investor confidence, support Pakistan’s sovereign credit outlook, and help lower borrowing costs over the medium term.
US Yet to Respond
The US Treasury has not commented publicly on Pakistan’s request, while Pakistan’s Ministry of Finance has also not issued an official response beyond reaffirming its commitment to strengthening bilateral economic cooperation with the United States.
If approved, the proposed exchange stabilisation facility would represent one of the largest bilateral financial support arrangements sought by Pakistan in recent years and could become an important component of the country’s broader strategy to strengthen economic stability and reduce vulnerability to external financial shocks.