Pakistan delays issuance of $250 million Panda Bond

ISLAMABAD (Mudassar Ali Rana) – The government has postponed its planned issuance of $250 million worth of Panda Bonds in December, pushing the launch to January or February, according to highly placed sources in the Ministry of Finance.

Officials said Pakistan had initially decided to float the Panda Bonds in China’s interbank bond market by the end of this year. However, the timeline has been revised for the third time due to pending approvals.

While the Asian Development Bank (ADB) has already cleared its part of the guarantee, the Asian Infrastructure Investment Bank (AIIB) has yet to secure board approval, they added.

Sources revealed that both ADB and AIIB will jointly provide up to 95 percent credit guarantee for the bonds, offering direct assurance to bondholders. Maximum guarantee limit has been set at $285 million, with ADB covering $160 million and AIIB $125 million.

The delay stems from the pending AIIB board meeting, expected either later this month or early next month. A final issuance date will be determined once approvals from both Pakistani and Chinese regulators are in place.

Under the revised plan, Pakistan will raise the equivalent of $250 million in Chinese yuan through three year fixed rate bonds, with the interest rate expected to remain in the single digits. The initial issuance target was set for November 2025, later moved to December, and now tentatively scheduled for early 2026.

Financial advisory and underwriting services for the Panda Bonds are being provided by China International Capital Corporation and Habib Bank Limited.

Source also disclosed that Pakistan faces a $1 billion Eurobond repayment in April 2026. To avoid pressure on the State Bank’s foreign exchange reserves, the government is exploring alternative financing sources.

Speaking to Dunya News, the Finance Ministry spokesperson said he was unaware of any changes to the issuance schedule.