Pakistan Eyes Double-B Credit Rating, Aurangzeb Tells S&P in Bangkok
BANGKOK: Pakistan has told S&P Global Ratings that it aims to secure a double-B rating, Finance Minister Muhammad Aurangzeb said during meetings on the sidelines of the World Bank Group-IMF Annual Meetings 2026 in the Thai capital.
Aurangzeb briefed the agency on Pakistan’s sovereign credit outlook. He pointed to the successful bond issuance in September, strong investor participation and progress under the International Monetary Fund programme, the Finance Division said.
He also highlighted improved tax collection, a build-up in foreign exchange reserves and reduced swap and forward liabilities. The agency flagged policy continuity, implementation of reforms, a lower interest burden and stronger external buffers as the areas it will watch most closely.
Busy week of investor meetings in Bangkok
The S&P briefing was one of several high-level engagements. Aurangzeb also met officials from the United States State Department, Standard Chartered Bank and Citigroup to discuss macroeconomic stabilisation, the rating outlook and capital market strategy.
At Standard Chartered’s Sovereign Investor Roundtable, the finance minister set out plans to diversify borrowing through Islamic bonds (Sukuk), Panda bonds and a proposed rupee-denominated, dollar-settled international bond. The instruments aim to cut borrowing costs, lengthen maturities and reduce rollover risk.
A day earlier, Aurangzeb and State Bank of Pakistan Governor Jameel Ahmad briefed fund managers at a Barclays-hosted roundtable on consecutive primary surpluses, stronger reserves and renewed access to international capital markets through private placements, Panda bonds and Eurobond issuances. Talking points included tax and energy reforms, SOE restructuring, privatisation and airport outsourcing.
At a Jefferies roundtable, discussion covered Sukuk, further Panda bond issuance and tokenisation, alongside efforts to widen the tax base. The Reko Diq copper and gold project also came up.
What a double-B rating would mean for Pakistan
Pakistan currently carries a ‘B’ rating with a stable outlook from S&P, assigned in July 2026. Moody’s lifted the country from ‘Caa1’ to ‘B3’, also with a stable outlook, in August. Earlier this month, Aurangzeb said Pakistan could reach ‘B+’ by the first quarter of FY28. The double-B aim sits two rungs above that.
A move to ‘BB’ would lift Pakistan three notches from its current grade and leave it two steps short of investment grade. Cheaper borrowing on international markets would follow: lower yields on Eurobonds and Sukuk, lighter debt servicing and a stronger signal to foreign investors that reforms are holding.
The minister has tied the rating push to three years of primary budget surpluses and a fiscal deficit at its lowest in 22 years, figures he presented at the MENAP ministerial session in Bangkok. He has also said growth could reach or top four per cent in the current fiscal year.
Related: Pakistan’s fiscal deficit falls to 22-year low, Aurangzeb tells MENAP meeting
Trade, minerals and aviation on the agenda
The Bangkok visit went beyond ratings. Aurangzeb reviewed progress on a trade framework agreement with the United States and discussed diversifying energy imports. Talks covered cooperation on critical minerals, including Reko Diq, and investment financing through the US Development Finance Corporation and EXIM Bank.
Aviation also featured, with Boeing aircraft financing, clearances and digital asset regulation discussed. Pakistan also raised climate resilience and targeted relief within existing budget limits.
The finance minister said the government remained committed to sustained reforms and to moving its partnerships from aid toward trade and investment. Pakistan’s latest IMF staff-level agreement, reached on October 7, and the Fund’s push for targeted, budget-neutral subsidies form the backdrop to that pitch.
Investor mood at home will matter as well. The rupee’s recent steadiness (see the latest dollar rate) and the PSX’s nervous spell below 165,000 points show how closely markets track the reform story. Even daily fuel price revisions feed into the inflation outlook the central bank must manage.
Frequently asked questions
What is a sovereign credit rating?
A sovereign credit rating is an agency’s assessment of a country’s ability to repay its debt. Higher ratings mean lower borrowing costs.
What is Pakistan’s current credit rating?
S&P rates Pakistan ‘B’ with a stable outlook, while Moody’s rates it ‘B3’ with a stable outlook.
What would a double-B rating mean for Pakistan?
It would cut borrowing costs on Eurobonds and Sukuk, ease debt servicing and signal to investors that economic reforms are holding.
When did Aurangzeb meet S&P?
It took place on the sidelines of the World Bank-IMF Annual Meetings 2026 in Bangkok, reported on October 14, 2026.
