Pakistan's Debt Crisis: Trading Warplanes & Military Stakes for Repayments

• Pakistan is offering JF-17 Thunder fighter jets to Saudi Arabia to convert $2 billion in loans, a move to settle debt through weapons exports.
• The country plans to hand over a $1 billion stake in the army-run Fauji Foundation to the UAE in exchange for rolling over loans, blurring state and military interests.
• These unconventional debt restructuring methods highlight Pakistan's dire fiscal condition, marked by spiraling debt and shrinking foreign reserves.
• Critics argue that relying on arms exports as an economic strategy is fiscal desperation, not a sustainable solution for fundamental economic issues.
• The strategy risks undermining investor confidence, governance norms, and long-term economic sovereignty without addressing core financial mismanagement.

Why It Matters: Pakistan's debt-for-jets and equity swaps reveal deep fiscal distress, raising concerns about economic credibility.