Pakistan plans to issue more Panda bonds, eyes Japanese market for borrowing: report

As the government seeks to diversify its funding sources, Pakistan plans to return to China’s domestic bond market for further yuan-denominated borrowing and is exploring the possibility of issuing yen-denominated bonds in Japan, Finance Minister Muhammad Aurangzeb said in an interview to Nikkie Asia.

Pakistan issued its first panda bond worth 1.75 billion yuan ($261 million) in mid-May under a 7.2-billion-yuan programme, with partial guarantees from the Asian Development Bank and the Asian Infrastructure Investment Bank.

Panda bonds are yuan-denominated bonds issued by foreign governments or institutions in China.

The recent panda bond will not be a “one-time issuance”, Aurangzeb told Nikkie Asia. Pakistan intends to “keep going back and be a repeat issuer,” given how China is the “second largest and deepest capital market in the world,” he said.

Following a period of severe economic turmoil exacerbated by the COVID-19 pandemic, Pakistan has recovered some of its footing, supported by a $7 billion, 37-month IMF loan program known as the Extended Fund Facility signed in 2024 that includes some tough measures such as raising tax revenue on farm income.

Meanwhile, apart from accessing the Chinese market, Aurangzeb also expressed interest in exploring the Japanese capital markets, including the issuance of yen-denominated samurai bonds.

Samurai bonds “would make sense,” and are “something which we should think through,” he said.

“We need to do more homework,” added the finance minister.

A samurai bond is a yen-denominated bond issued in Tokyo by a non-Japanese company, government, or supranational organisation, and governed by Japanese financial regulations.

The finance minister departed for Bangkok, Thailand, last week to lead Pakistan’s delegation to the World Bank Group–IMF Annual Meetings 2026, scheduled to be held from October 12 to 18, 2026.

During the visit, the finance minister will represent Pakistan at key events of the International Monetary Fund (IMF) and the World Bank Group and undertake an extensive programme of over 60 high-level engagements with international financial institutions, finance ministers and policymakers, development partners, global investors, banks, credit rating agencies, think tanks and international media.

The visit comes as Pakistan continues its transition from macroeconomic stabilisation towards sustainable, investment- and export-led growth, while advancing structural reforms and strengthening engagement with international capital markets and development partners.