Dubai, UAE — Dubai Islamic Bank (DIB) has announced the successful completion of a landmark US$1 billion syndicated term-finance facility for the Government of Pakistan, arranged in collaboration with a consortium of regional and international financial institutions.
The five-year facility is an innovative transaction, partially guaranteed by a Policy-Based Guarantee (PBG) from the Asian Development Bank (ADB) — marking the first PBG transaction of its kind undertaken by ADB for the country.
The Islamic tranche, structured as an AAOIFI-compliant Commodity Murabaha, represents approximately 89 percent of the total facility which reflects the growing demand for Shariah-based financing and supports Pakistan’s strategic objective of expanding Islamic finance.
DIB acted as the Sole Islamic Global Coordinator and alongside Standard Chartered also served as the Joint Mandated Lead Arranger and Bookrunner. Other leading Islamic banks from the region included Abu Dhabi Islamic Bank, Ajman Bank and Sharjah Islamic Bank.
Minister of Finance, Government of Pakistan Muhammad Aurangzeb, stated, “This landmark financing arrangement not only underscores the strong confidence of regional and international financial institutions in Pakistan’s economic reform trajectory, but also marks an important step in expanding our access to innovative and Shariah-compliant funding solutions. We deeply value the role of partners like DIB and ADB in supporting our efforts to ensure macroeconomic stability and sustainable growth.”
Dr. Adnan Chilwan, Group Chief Executive Officer, DIB, commented, “This transaction marks a key milestone in demonstrating how Sharia-compliant financing can be scaled effectively to meet sovereign objectives while upholding partnership and prudence. DIB is delighted to have re-introduced Pakistan’s credit to the Islamic term financing market after a hiatus of over two years through an innovative structure.”
This facility represents a milestone in sovereign Islamic finance, combining the strengths of regional and international institutions under a robust, Shariah-compliant structure. The inclusion of an ADB Policy-Based Guarantee has played a key role in facilitating Pakistan’s return to the international commercial market, while reflecting confidence in the country’s ongoing fiscal reforms and macroeconomic resilience.
For the Government of Pakistan, the transaction marks a strategic re-engagement with Middle East capital markets after more than two years, demonstrating growing investor trust and a renewed appetite for collaboration through ethical and cost-effective financing solutions.
For participating institutions, the transaction offers an opportunity to support sustainable economic development across key emerging markets, while advancing the global adoption of Islamic finance practices in sovereign funding.
