Pakistan raises $250m equivalent in inaugural Panda bond issuance

Advisor to the Finance Minister Khurram Schehzad said that Pakistan raised $250 million equivalent through its inaugural Panda bond issuance in the Chinese capital market at an interest rate of 2.5 per cent, with a three-year maturity.

In a social media post on X on Thursday, Schehzad said: “Pakistan has successfully completed its inaugural Panda bond issuance in China’s onshore capital market today, marking the country’s first-ever entry into the world’s second-largest and deepest capital market.”

Advisor to the Finance Minister Khurram Schehzad said the inaugural Panda Bond is a 3-year fixed-rate instrument, making it Pakistan’s first-ever RMB-denominated sovereign issuance in China’s onshore capital market.

Khurram Schehzad  said that the landmark Panda Bond issuance of RMB 1.75 billion (equivalent to US$250 million) attracted overwhelming investor demand of over RMB 8.8 billion (approximately US$1.26 billion). 

He said importantly, demand for the inaugural tranche alone exceeded Pakistan’s entire planned Panda Bond programme size of RMB 7.2 billion (US$1 billion equivalent) - a powerful reflection of growing international investor confidence in Pakistan’s economic outlook and reform trajectory.

Khurram Schehzad said the strong order book enabled highly competitive pricing (2.5% coupon), demonstrating the market’s positive assessment of Pakistan’s improving macroeconomic fundamentals, external stability, disciplined fiscal management, and sovereign repayment capacity. 

Federal Finance Minister Senator Muhammad Aurangzeb has termed the issuance of Panda Bond as a historic success. In a statement Finance Minister said Pakistan’s first Panda Bond has received unprecedented acceptance from global investors. The successful issuance of Panda Bond has increased global confidence in Pakistan, Finance Minister added. 

He said that the world’s confidence in Pakistan’s economic reforms and sovereign financial credibility has been strengthened.

Advisor to the Finance Minister said it marks Pakistan’s strategic entry into China’s capital market, diversification of the country’s investor base, strengthening of Pakistan-China financial cooperation, and Pakistan’s structured return to international capital markets from a position of improving stability and credibility. 

The success of the Panda Bond sends a powerful signal to global investors that Pakistan’s economic recovery is gaining international recognition. It reflects confidence in the country’s reform agenda, improving fiscal and external indicators, successful debt management, and commitment to sustainable growth. 

Advisor to the Finance Minister  said from stabilization to strategy, from crisis management to market confidence and from short-term financing pressures to long-term capital market access. This milestone marks the beginning of a new chapter in Pakistan’s economic and financial engagement with the world.