Pakistan is preparing to make history by issuing its first-ever Panda bond in China’s domestic capital market, Finance and Revenue Minister Muhammad Aurangzeb confirmed on Tuesday. The move marks a significant step in Pakistan’s efforts to diversify its external financing sources and deepen long-term economic cooperation with China.
Speaking in an interview with China Global Television Network (CGTN), Aurangzeb said the government hopes to launch the inaugural Panda bond before the upcoming Chinese New Year, signaling growing confidence in Pakistan’s macroeconomic direction and its evolving relationship with Beijing.
What is Panda Bond and why is it important for Pakistan
A Panda bond is a renminbi-denominated bond issued by a foreign government or company in China’s onshore bond market. For Pakistan, this is offering a strategic alternative to traditional dollar-based borrowing, helping reduce exposure to exchange rate volatility while expanding access to one of the world’s largest capital markets.
Aurangzeb said the Panda bond would complement Pakistan’s existing funding instruments, including eurobonds and Islamic sukuk, while reducing over-dependence on Western debt markets.
Pak–China Economic Ties Enter New Phase With This Panda Bond
The finance minister described the planned bond issuance as evidence of how Pakistan–China relations have matured, shifting from infrastructure-focused cooperation toward market-based and diversified financial engagement.
China remains Pakistan’s largest trading partner, with bilateral trade nearing $17 billion in the first eight months of the current year. Aurangzeb noted that economic collaboration between the two countries has steadily expanded over decades, supported by strong diplomatic alignment.
Read also: Pakistan to launch first-ever Panda Bond with ADB support
CPEC Phase-II and New Investment Priorities
Aurangzeb has highlighted the evolution of the China-Pakistan Economic Corridor (CPEC), explaining that while Phase I focused on
- Energy
- Infrastructure
The role behind the Phase-II is to monetize existing assets and encourage business-to-business partnerships.
Following recent meetings with Chinese President Xi Jinping and Premier Li Qiang, Pakistan and China have given some of the new priorities, including:
• Agriculture and agri-technology
• Minerals and mining
• Artificial intelligence and the digital economy
• Skills development and technology transfer
He has also given various examples, such as training programmes for Pakistani agriculture graduates at Chinese universities and IT capacity-building initiatives supported by Chinese firms like Huawei.
Strategic Cooperation Amid Global Uncertainty
Addressing rising global protectionism and economic uncertainty, Aurangzeb said Pakistan continues to value China’s support, particularly during periods of financial stress and engagement linked to Pakistan’s IMF programme.
He also stated that recent high-level interactions, including meetings on the sidelines of the Shanghai Cooperation Organisation (SCO) summit in Tianjin, have assisted in shaping a clearer economic roadmap for Pakistan–China cooperation in the medium and long term.
The planned Panda bond issuance, he concluded, strongly depicts Pakistan’s intent to pursue
- Innovative
- Resilient
- Diversified financing strategies