The World Bank has greenlit a significant financial package of $700 million for Pakistan. This move is part of a broader, multi-year initiative designed to bolster the country's economic stability and enhance the delivery of essential public services.
Details of the Funding Package
According to media reports, this financing will be released under the bank's Public Resources for Inclusive Development - Multiphase Programmatic Approach (PRID-MPA). This ambitious program has the potential to provide a total of $1.35 billion in support to Pakistan over time.
The approved $700 million will be allocated with a clear focus: $600 million is earmarked for federal-level programs, while $100 million will specifically support a provincial initiative in Sindh. This decision follows a previous World Bank grant of $47.9 million in August, aimed at improving primary education in Punjab.
Focus on Fiscal Reforms and Service Delivery
World Bank officials emphasized that the program is crucial for Pakistan's sustainable growth. Bolormaa Amgaabazar, the World Bank's Country Director for Pakistan, stated that the nation's path requires mobilizing more domestic resources and using them with greater efficiency and transparency.
She explained that the MPA is a collaborative effort with federal and Sindh governments to create tangible impacts. The key goals include:
- More predictable funding for schools and clinics.
- Developing fairer tax systems.
- Strengthening data collection for better decision-making.
- Safeguarding priority social and climate investments.
Tobias Akhtar Haque, the World Bank's Lead Country Economist for Pakistan, highlighted that strengthening Pakistan's fiscal foundations is essential. He said the PRID-MPA launches a coherent nationwide approach to support critical reforms that will expand fiscal space and bolster investments in human capital and climate resilience.
Program Objectives and Expected Outcomes
The federal component of the program will concentrate on several core areas:
- Raising domestic revenues in a more equitable manner.
- Improving the planning and execution of budgets.
- Strengthening data systems to enable evidence-based policy decisions.
The initiative is expected to directly increase public resources for inclusive development. This translates to more equitable financing for primary healthcare facilities and increased funding for schools across the country. Haque added that these reforms are designed to ensure resources reach the front line, delivering better outcomes for all Pakistanis with improved efficiency and accountability.
This World Bank support comes against a backdrop of challenges identified in an IMF-World Bank report from November. That report pointed to issues like fragmented regulation, opaque budgeting, and political capture as factors curbing investment and weakening revenue generation in Pakistan.
