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Living on borrowed dollars | The Express Tribune

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Living on borrowed dollars | The Express Tribune



KARACHI:

Pakistan’s external sector is once again under scrutiny as the country prepares to meet a $1 billion Eurobond repayment due shortly after Eid, a development that has reignited concerns about foreign exchange reserves, debt sustainability, and continued reliance on multilateral support.

While policymakers project confidence in meeting the obligation, the repayment highlights the persistent vulnerabilities in Pakistan’s external financing position and the delicate balance between stabilisation and long-term sustainability.

According to data from the State Bank of Pakistan (SBP), the country’s foreign exchange reserves have shown some improvement in recent months, hovering in the range of $8 to $9 billion by early 2026. While this marks a recovery from critically low levels seen during the 2023 balance-of-payments crisis, when reserves had fallen below $4 billion, the current stock still covers barely 1.5 to 2 months of imports, well below the internationally recommended threshold of at least three months. This limited buffer makes large external repayments, such as the upcoming Eurobond maturity, particularly significant for market confidence.

The $1 billion Eurobond repayment is part of Pakistan’s broader external debt servicing obligations, which remain substantial. Official figures from the Ministry of Finance indicate that Pakistan’s total external debt and liabilities exceed $125 billion, with annual debt servicing requirements running into tens of billions of dollars. For FY2025-26, gross external financing needs – including debt repayments and current account requirements – are estimated at over $25 billion, placing sustained pressure on the country’s external account.

Pakistan has relied on a combination of rollovers from friendly countries, multilateral financing, and limited access to international capital markets to meet its obligations. However, access to global bond markets has remained constrained in recent years due to credit rating downgrades and high risk premiums. Pakistan’s sovereign bonds have traded at distressed levels since 2022, effectively shutting the country out of fresh commercial borrowing. As a result, upcoming repayments must be met primarily through existing reserves, bilateral support, or inflows linked to international financial institutions.

The role of the International Monetary Fund (IMF) is therefore central to the current situation. Pakistan’s ongoing IMF programme has been instrumental in stabilising the economy, restoring a degree of investor confidence, and unlocking additional financing from other multilateral and bilateral partners. Disbursements under the programme, along with associated support from institutions such as the World Bank and the Asian Development Bank, have helped rebuild reserves and manage external liabilities. However, IMF support is conditional on continued fiscal discipline, structural reforms, and adherence to programme targets.

The timing of the Eurobond repayment is particularly important. Occurring soon after Eid, it will test the resilience of Pakistan’s reserves position at a moment when external inflows are closely watched by markets. A smooth repayment would reinforce confidence in Pakistan’s ability to meet its obligations without disruption. Conversely, any signs of strain could renew concerns about liquidity risks and raise borrowing costs further.

Pakistan’s external vulnerability is rooted in structural issues that extend beyond short-term financing gaps. One of the most persistent challenges is the country’s narrow export base. Despite recent improvements in sectors such as IT and some recovery in traditional exports, total exports remain insufficient to generate the foreign exchange needed to comfortably service external debt. Merchandise exports have hovered in the range of $25-30 billion annually, while imports – even after compression measures – remain significantly higher, creating a structural current account deficit.

Remittances from overseas Pakistanis have historically provided a critical cushion, contributing around $30 billion annually in recent years. However, remittance flows are sensitive to global economic conditions and exchange rate dynamics, making them an important but not entirely stable source of foreign exchange. Any slowdown in remittance growth could exacerbate external pressures, particularly during periods of high debt servicing.

Another factor complicating Pakistan’s debt dynamics is the composition of its external liabilities. A significant portion of debt is owed to bilateral creditors, including China, Saudi Arabia, and other partners, often in the form of deposits or project financing. While these sources have provided crucial support, they also require periodic rollovers, adding an element of uncertainty to external financing planning. Multilateral debt, while generally on concessional terms, is tied to reform conditions that can be politically challenging to implement.

In recent years, Pakistan has managed its external obligations through a combination of debt rollovers, refinancing arrangements, and IMF-backed stabilisation programmes. For example, deposits from friendly countries have been rolled over multiple times to avoid immediate outflows, effectively providing temporary breathing space. However, such measures do not reduce the underlying debt burden and highlight the need for more durable solutions.

The key challenge is to transition from crisis management to sustainable debt reduction. This requires strengthening export competitiveness, attracting stable foreign investment, and maintaining fiscal discipline. The government has taken steps in this direction, including efforts to boost IT exports, promote agriculture-led growth, and facilitate investment through initiatives such as the Special Investment Facilitation Council. While these measures show promise, their impact will take time to materialise.

Monetary policy also plays a role in managing external stability. The SBP’s cautious approach to interest rate adjustments reflects the need to balance inflation control with external sector considerations. Lower interest rates can support growth but may also increase import demand and pressure the current account. Conversely, tight monetary conditions can help contain external imbalances but may slow economic recovery. Navigating this trade-off remains a central challenge for policymakers.

The Eurobond repayment also has implications for Pakistan’s sovereign credit profile. Rating agencies closely monitor a country’s ability to meet external obligations, and successful repayments can support ratings stability, even in a challenging environment. Conversely, delays or reliance on extraordinary measures could negatively affect creditworthiness and investor perception. Restoring access to international capital markets will ultimately depend on sustained improvements in macroeconomic fundamentals and policy credibility.

Pakistan’s external financing outlook will depend on several key factors. Continued engagement with the IMF and successful completion of programme reviews will be essential to unlock further funding. Bilateral support from key partners will remain important, particularly in the form of deposit rollovers and project financing. At the same time, global economic conditions – including interest rates, commodity prices, and investor sentiment – will influence the availability and cost of external financing.

The Eurobond repayment represents more than a routine debt obligation; it is a critical test of Pakistan’s external resilience at a time when economic stabilisation remains fragile. While improved reserves and IMF support provide a degree of assurance, underlying structural challenges – including a narrow export base, high external debt, and reliance on external financing – continue to pose risks. Successfully navigating this repayment will require careful coordination of monetary, fiscal, and external policies, as well as sustained commitment to reforms that enhance Pakistan’s capacity to generate foreign exchange.

THE WRITER IS A MEMBER OF PEC AND HOLDS A MASTER’S DEGREE IN ENGINEERING



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Gulf crisis: British Airways and SWISS add India flights – The Times of India

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Gulf crisis: British Airways and SWISS add India flights – The Times of India


NEW DELHI: With the big Gulf carriers operating a fraction of their schedules, foreign airlines are expanding their India flights to meet the increased demand for options to the likes of Emirates, Qatar Airways and Etihad. SWISS will operate a second daily light between between Delhi and Zurich from April 1 to May 31, 2026. British Airways will have a third daily service from Delhi starting April 7, followed by a third daily service from Mumbai from May 15. Air India has been adding flights to the west whenever possible during the Iran war.In a statement Thursday, Lufthansa group carrier SWISS said it is increasing its flight offering between Switzerland and India. “From April 1 to May 31, 2026, in addition to its regular service from Zurich to Delhi, SWISS will operate a second daily connection using an Airbus A330. Numerous passengers of other airlines are currently unable to take their originally booked flights via the Gulf region. As a result, many are switching to direct connections to and from Asia. SWISS is seeing a corresponding rise in demand for such nonstop services. We are pleased to offer our customers this additional flight to Delhi over the next two months. The flights are available for booking with immediate effect,” SWISS said in a statement.“Depending on further developments in the Middle East, SWISS continuously assesses how aircraft and capacities that become available can be deployed where demand is particularly strong. In addition to demand, key factors include operational constraints such as available airport slots, traffic rights and fleet deployment capabilities,” SWISS statement added.British Airways also announced additional flights from Delhi and Mumbai “to meet strong travel demand”. “In response to the ongoing situation in the Middle East, the airline is adding short-term capacity from Delhi and Mumbai to meet customer demand. A third daily service from Delhi will launch on April 7, followed by a third daily service from Mumbai from May 15. With this additional capacity, British Airways will operate up to 63 weekly flights with more than 1,000 additional seats per week between India and the UK, offering more options for customers travelling to the UK or connecting onwards across the airline’s global network,” BA said in a statement.Neil Chernoff, British Airways’ chief planning and strategy officer, said: “As we continue to respond to the evolving situation in the Middle East, we’ve been able to reallocate additional capacity to meet strong demand to other destinations across our route network. India remains one of our most important global markets, and these additional services from Delhi and Mumbai respond to customer demand and provide greater choice and flexibility for our customers when travelling to the UK and beyond. We will continue to review our network and make adjustments based on where our customers want to fly this summer.”



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Major outgoing CEOs are citing AI as a factor in their decisions to step down

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Major outgoing CEOs are citing AI as a factor in their decisions to step down


Two major CEOs told CNBC in recent months that the rise of artificial intelligence contributed to their decisions to hand over the reins and step down from their positions.

It’s one of the latest insights into how America’s corporate leaders are sizing up the AI transition.

Coca-Cola CEO James Quincey told CNBC’s “Squawk Box” on Thursday that his decision to step down from his role was influenced by larger “waves of the organizational momentum.”

“My job is also to think who’s the best team to put on the field to get the next wave done,” Quincey said. “And I concluded that, actually, it was time to put someone else on the field for the next wave of growth.”

Quincey, who has served as CEO of the beverage giant since 2017, will be succeeded by current COO Henrique Braun, effective at the end of this month.

“In a pre-AI, a pre-gen-AI mode, we made a lot of progress. But now there’s a huge new shift coming along,” Quincey said.

While he said he’s leaning into the technological advances, he believes the beverage company needs “someone with the energy to pursue a completely new transformation of the enterprise.”

That person, Quincey said, is Braun, who he believes will uniquely equip the company to embrace its next chapter.

Quincey’s comments echo sentiments from former Walmart CEO Douglas McMillon in December ahead of his departure from that role.

Walmart CEO Doug McMillon on tenure: You can't get growth without change

McMillon, who had held the position as CEO of the global retailer since 2014, told CNBC’s “Squawk Box” at the time that he had decided to hand over the role to someone “faster.” John Furner, who was previously head of Walmart U.S., took over the top job on Feb. 1.

“With what’s happening with AI, I could start this next big set of transformations with AI, but I couldn’t finish,” McMillon told CNBC.

“About a year ago, I really started feeling like this next run, you could see what agentic commerce was gonna look like, the vision for AI shopping, and I started thinking about everything that needs to happen over the next few years, and it really caused me to think that now was the right time [to step down],” he said.

Walmart in December made the move to list on the Nasdaq, something McMillon said was symbolic of the progress the company has made with technology.

The retailer has been incorporating AI to optimize its supply chain, provide assistants for customers and more.

“I think what you’re going to see from the Walmart team is they’re just going to keep scaling what we’ve already started, build some new stuff on top, and then use AI to transform it all,” he said.

Choose CNBC as your preferred source on Google and never miss a moment from the most trusted name in business news.



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India’s voluntary carbon market gains ground as net-zero goals drive ecosystem buildup – The Times of India

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India’s voluntary carbon market gains ground as net-zero goals drive ecosystem buildup – The Times of India


NEW DELHI: With Climate action gaining momentum as part of India’s net-zero commitment by 2070, the country’s carbon market is beginning to take shape and gain momentum. Homegrown institutions such as the Carbon Registry of India (CRI) are emerging as important enablers for the voluntary carbon market offering platforms to register and track carbon projects, even as corporates and developers scale up efforts around offsets, credits, and trading in line with evolving global frameworks. While the regulatory framework is still in the development stage across many industries, India is leading the development of platforms for listing of voluntary carbon projects in South Asia, creating implementation partners, enabling trading of credits and audit process — all to to align the processes with international standards having an end-to-end setup. “The carbon market today is split into two clear paths,” says Priya Bahirwani, co-founder of Terrablu Climate Technologies, a carbon project developer with proprietary carbon accounting, offsetting and trading platform. “The compliance market is regulation-led and has different levers and framework within which it operates. But the voluntary carbon market is where intent shows up, where companies invest for credibility, brand and long-term responsibility. It is this voluntary market that is now steering the path and driving the momentum in India for a climate-driven economy. This market is driven by corporates looking to go beyond compliance and are committed to demonstrating real climate impact and social impact – Indian Carbon for Global Markets. CRI (a public-private registry) and other such reputed organisations are building the ecosystem in a sustainable manner. Especially companies like Varaha, Terrablu, NextNow Green (NNG), and other entities are slowly but steadily building the momentum for a climate resilient economy in India. From large conglomerates to mid-sized firms, companies are increasingly investing in carbon credits not just to meet regulatory norms, but to build long-term brand credibility and stakeholder trust. The is the just the beginning of new wave of building a climate resilient economy. CRI helps companies register and formalise their carbon projects in a standardised format. For India, this shift represents a strategic move — from being a supply-side participant to shaping the rules of the market itself. “Carbon markets will only scale on the foundation of trust, transparency, and traceability. With its depth in innovation and resilience, India is well placed to lead this evolution.,” says Richard Bright, CEO of CRI. CRI, he adds, is focused on building a credible domestic bridge between Indian climate projects and global demand, while leveraging digital frameworks to improve transparency, traceability and access. Companies listed on the CRI for carbon projects include Sahyadri Farms, Piplantri FPO, L&T Metro and others are in the pipeline, says Bright. Terrablu’s Bahirwani says India should not just generate carbon credits, but also own the platforms that certify them. “CRI is creating that opportunity, and we are already seeing increasing interest from corporates in sourcing credits listed on such platforms.” Companies such as NNG, which is a carbon consultancy and ecosystem implementation partner, believes that as India moves from a voluntary to a rules- and penalties-based setup in carbon, companies will increasingly work on carbon and climate strategies to strengthen their play in the area. “We are already seeing efforts in this regard. There are enquiries about how to go about carbon projects, how to carry out assessment and audit of current work, and how to work out credits and even offset them, or trade them, across diverse sectors including agriculture and industrial decarbonisation,” says NNG’s Archana Raha. This push is also being reinforced by ecosystem players such as legal frameworks to project developers. They see value in strengthening India’s own carbon market architecture. “Global registries will continue to play a role, but India needs trusted domestic platforms as well,” says Vishnu Sudarsan, senior partner at law firm JSA. “Platforms like CRI provide visibility and credibility within the Indian ecosystem, which is critical as the market matures, supported by robust, dual-layer governance structures that reinforce transparency and accountability,” Sudarsan adds. On the ground, this shift is already taking shape through projects that are choosing to align with India’s emerging carbon infrastructure. Take Piplantri as an example. It is a model that goes beyond carbon to integrate afforestation, water conservation and community livelihoods. By listing on CRI, stakeholders are signalling a clear intent to prioritise transparency, traceability and alignment with India’s evolving climate ecosystem. The market is gradually maturing as reputed and credible market players with sophistication and focus are shaping the ecosystem . The decision reflects a broader trend. Project developers and intermediaries are increasingly working with platforms like CRI and CCTS, supported by ecosystem players such as Terrablu and implementation partners like NNG. Alongside them, credible validation and verification bodies — including KBS certification, 4K Earth Science, VKU Certification and others — are empanelled with CRI, strengthening the integrity and credibility of the overall ecosystem, and helping create a more locally anchored yet globally credible carbon market framework. Experts say that India’s emerging carbon ecosystem is beginning to offer answers through creation of stronger platforms, better verification, and tighter integration across the value chain. “The direction is clear: India is not just participating in the global carbon market but it is leading the market for other emerging economies,” says Sudarsan. It is believed that with the foundation for the climate economy coming in place, India is well poised to become a hub for high-integrity carbon solutions.



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