Pakistan Nears Historic Panda Bond Launch in China, Finance Minister Confirms

Published On: January 22, 2026

Pakistan is moving closer to launching its first-ever Panda Bond in China’s domestic capital market, a landmark step aimed at diversifying external financing and strengthening long-term economic cooperation with Beijing. The development was confirmed by Finance Minister Senator Muhammad Aurangzeb during an interview with China Global Television Network (CGTN).

The finance minister described the planned Panda Bond issuance as a new phase in Pakistan-China economic relations, reflecting growing international confidence in Pakistan’s economic direction and reform agenda.

China Remains Pakistan’s Largest Trading Partner

Aurangzeb highlighted that China is Pakistan’s biggest trading partner, with bilateral trade nearing $17 billion in just the first eight months of the year. He noted that the economic relationship has gradually shifted from traditional infrastructure-led cooperation to a more market-driven and private-sector-focused partnership.

CPEC Enters Second Phase

According to the finance minister, the China-Pakistan Economic Corridor (CPEC) has now entered its second phase, moving beyond roads, ports, and power plants. The focus is now on monetising existing infrastructure, encouraging business-to-business collaboration, and attracting private investment.

New Areas of Cooperation

Aurangzeb identified agriculture, minerals and mining, artificial intelligence, and the digital economy as priority sectors drawing strong Chinese interest. He stressed that cooperation now goes beyond capital inflows and includes skills development, technology transfer, and capacity building.

Thousands of Pakistani agriculture graduates are currently studying in Chinese universities to learn modern farming techniques, while major Chinese technology firms, including Huawei, are training Pakistani IT graduates to support Pakistan’s digital transformation.

Reducing Reliance on Dollar-Based Funding

The finance minister said the proposed Panda Bond — expected ahead of the Chinese New Year — would enable Pakistan to tap into the world’s second-largest capital market. This would help reduce reliance on US dollar-based borrowing, complementing existing access to eurobond and sukuk markets.

He also acknowledged China’s continued support during Pakistan’s challenging economic periods, including assistance linked to the IMF program.

Clear Roadmap for the Future

Looking ahead, Aurangzeb said recent high-level engagements between Pakistan and China have produced a clear economic roadmap that will guide cooperation in the coming years, reinforcing the two countries’ long-term strategic and economic partnership.