Pakistan seeks fresh $600m World Bank loan for reforms

Summary

• Pakistan is set to secure another $600 million loan from the World Bank under a new reform programme aimed at boosting private investment, improving the business environment and creating employment opportunities.
• Separately, Pakistan plans to secure another $750 million from the Asian Development Bank for pension and private-sector reforms, with the financing also intended to support the budget.
• The World Bank financing will also support reforms in overseas employment, vocational training and the pharmaceutical industry.

AI Generated Summary

Pakistan is set to secure another $600 million loan from the World Bank under a new reform programme aimed at boosting private investment, improving the business environment and creating employment opportunities.

The proposed financing, titled the Bold Reforms for Investment-Driven Growth and Employment (BRIDGE) Programme, comes despite billions of dollars in foreign loans secured by successive governments for similar reform initiatives.

According to documents released by the Washington-based lender, the loan is expected to be approved on January 29, 2027, with the Ministry of Finance responsible for securing the financing.

The programme has an estimated cost of $1.2 billion. The World Bank will provide $600 million, while the federal government is expected to contribute the remaining $593 million.

In exchange for the financing, the government has committed to introducing several legislative and regulatory changes. These include enacting a new Investment Act and Factoring Law, establishing a database of overseas-bound Pakistanis, allowing unrestricted international trade in wheat and sugar, and increasing private-sector participation in urea imports.