Pakistan and the International Islamic Trade Finance Corporation (ITFC) have entered into a landmark $513 million Murabaha deal aimed at strengthening the country’s energy sector and trade capacity. The agreement, signed in Jeddah, represents the largest Murabaha financing facility ITFC has extended to Pakistan in the last three years.
The financing package, to be disbursed over three years, will help Pakistan meet its energy demands by covering imports of crude oil, petroleum products, and liquefied natural gas (LNG). Economic Affairs Secretary Dr. Kazim Niaz signed the agreement on behalf of Pakistan, while the president of the Islamic Development Bank, Dr. Muhammad Al-Jasser, attended the ceremony.
Highlighting the strategic importance of the Pakistan ITFC $513m Murabaha deal, Dr. Kazim Niaz said, “This facility will further strengthen our trade capacity,” underlining its role in supporting Pakistan’s economic stability and energy resilience.
According to ITFC officials, since 2008, the institution has provided Pakistan with $8.1 billion in cumulative financing, mainly to assist in importing critical energy resources and supporting trade operations. This consistent engagement reflects ITFC’s commitment to helping Pakistan reduce energy-related bottlenecks and stabilize its trade flows.
The Murabaha financing for energy under this agreement follows Islamic banking principles, where ITFC will purchase petroleum and energy products on behalf of Pakistan and resell them to the country with a pre-agreed margin. This model provides Pakistan with crucial liquidity while keeping financing in line with Sharia-compliant mechanisms.
Pakistan’s reliance on energy imports remains high due to rising domestic consumption and limited refining capacity. The latest ITFC energy sector funding aims to ease immediate fiscal pressure and help manage Pakistan’s balance of payments by ensuring timely access to energy supplies.
Meanwhile, in a separate development, Pakistan also signed an agreement with Japan to boost human resource capacity. Under this agreement, the Japanese government will grant $263 million through the ‘Human Resource Development Scholarship’ programme. This initiative is designed to help federal government employees pursue advanced education at leading universities in Japan.
Economic Affairs Secretary Dr. Kazim Niaz and the Japanese ambassador to Pakistan signed the agreement in Islamabad. The scholarship programme, implemented in partnership with the Japan International Cooperation Agency (JICA), will initially select 16 federal employees for Master’s degrees. The goal is to enhance policy formulation skills and administrative expertise within Pakistan’s civil service.
In its statement, the Economic Affairs Division emphasized that these scholarships aim to “equip young professionals with the tools and knowledge needed to address complex policy challenges.” By investing in human capital alongside strategic financing deals like the Islamic trade finance Pakistan agreement, the country hopes to strengthen both its economic infrastructure and institutional capacity.
Collectively, these agreements underline Pakistan’s efforts to secure sustainable financing for vital sectors and invest in its human resources. The government expects that the Pakistan ITFC $513m Murabaha deal, together with international partnerships like JICA scholarships, will contribute to long-term economic growth and energy security.
