UAE extends term for $2bn interest-free loan to Pakistan

Islamabad, Pakistan – Pakistan has announced that the United Arab Emirates has extended the term for a $2bn interest-free loan made in January 2019, as Foreign Minister Shah Mehmood Qureshi concluded his trip to the UAE on Tuesday.

“We greatly appreciate the UAE’s continued support and cooperation. The UAE’s decision to roll-over the $2bn deposit by the Abu Dhabi Fund, conveyed during Foreign Minister Shah Mahmood Qureshi’s just concluded visit to the UAE is yet another manifestation of the close cooperative relations between the two countries,” said Pakistani foreign ministry spokesperson Zahid Hafeez Chaudhri.

The loan was initially made to help Pakistan avert a potential balance of payments crisis. Pakistan’s economy continues to struggle with sluggish growth amid the coronavirus pandemic.

Pakistan’s foreign minister also raised the issue of visa restrictions on Pakistani nationals imposed by the UAE in meetings with top Emirati officials over a three-day tour of the country, Pakistan’s foreign ministry said earlier on Tuesday.

Qureshi concluded his visit to the UAE, a key Pakistani ally, on Tuesday, after meeting with Emirati Foreign Minister Sheikh Abdullah bin Zayed Al Nahyan, the foreign ministry said.

“[Qureshi] emphasised the need for nurturing and strengthening people-to-people linkages, as well as removing impediments that hamper travel between the two countries,” said a foreign ministry statement.

The UAE is home to an estimated 1.6 million Pakistanis and is a key source of foreign remittances for the Pakistani economy.

Since November, the UAE has imposed a ban on work visas for citizens from 13 mostly Muslim countries, including Pakistan.

Qureshi also raised the issue in an earlier meeting with UAE Minister for Tolerance and Coexistence Sheikh Nahyan Mabarak Al Nahyan, the foreign ministry said.

“Thanking the UAE’s leadership for their considerate approach towards expatriates, the Foreign Minister briefed Sheikh Nahyan about the issues faced by the Pakistani community, in particular the restrictions on visa-related matters,” a statement said.

The issue was also discussed in Qureshi’s meeting with the UAE’s Minister of State for Foreign Affairs, Ahmed bin Ali Al Sayegh, according to a Pakistani statement.

Statements issued by the UAE government did not make mention of the issue of visa restrictions.

On Sunday, UAE Foreign Minister Al Nahyan met with his Indian counterpart Subrahmanyam Jaishankar in Abu Dhabi, prompting speculation that the foreign ministers of Pakistan and India could hold a direct meeting.

This month, a senior UAE diplomat confirmed that his country was helping to mediate between the South Asian neighbours, whose diplomatic ties have been virtually frozen since a 2019 military standoff over the disputed region of Kashmir.

Qureshi, however, dismissed reports of a possible meeting between the two top diplomats in an interview with the Gulf-based Khaleej Times newspaper.

Asad Hashim is Al Jazeera’s digital correspondent in Pakistan. He tweets @AsadHashim.