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Is Pakistan paying 7.5% or 8.25%?
Both numbers can appear without contradiction. The official coupons are 7.50% and 7.90%, while market reports put the issuance yields around 7.75% and 8.25%. Coupon and yield are different concepts.
How much annual interest does the new debt create?
Approximately $230 million in initial annual coupon payments: $131.25 million on the $1.75 billion tranche and $98.75 million on the $1.25 billion tranche.
Will Pakistan pay more interest than it borrowed?
Not under the stated contractual schedule. Approximate cumulative coupons are $1.709 billion if both bonds remain outstanding to maturity, versus $3 billion of principal.
Is Pakistan’s bond really a junk bond?
Yes, in conventional market terminology. Pakistan remains below investment grade at B/B3/B- across the major rating agencies.
Was the $3 billion raised to pay old debt?
The government’s stated GMTN strategy explicitly includes repaying expensive short-term debt and reducing rollover risk. Express Tribune additionally reported, citing a Finance Ministry official, that the issue was raised to repay the $3 billion Saudi facility connected to the earlier UAE financing gap.
