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World Bank Approves $700m Financing Package for Pakistan’s Economic Stability
World Bank okays $700m for Pakistan under PRID-MPA to support macroeconomic stability, fair taxation, better service delivery, and stronger fiscal systems nationwide.
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by Muhammad Hashir
2025-12-20
World Bank Approves $700m Financing Package for Pakistan’s Economic Stability

The World Bank has approved $700 million in financing for Pakistan under a multi-year initiative aimed at strengthening macroeconomic stability, improving service delivery, and enhancing public resource management, it emerged on Saturday.

According to the World Bank, the financing will be provided under the Public Resources for Inclusive Development – Multiphase Programmatic Approach (PRID-MPA), a framework that could extend up to $1.35 billion in total funding over multiple phases.

Out of the approved amount, $600 million will be allocated for federal-level programmes, while $100 million will support a provincial reform programme in Sindh. The approval follows a $47.9 million World Bank grant in August aimed at improving primary education in Punjab, highlighting the lender’s continued engagement in Pakistan’s social sector reforms.

World Bank Country Director for Pakistan Bolormaa Amgaabazar said Pakistan’s long-term economic recovery depends on mobilising domestic resources and using them efficiently and transparently.

“Pakistan’s path to inclusive, sustainable growth requires mobilising more domestic resources and ensuring they are used efficiently and transparently to deliver results for people,” she said.

She added that under the MPA framework, the World Bank is working closely with federal and Sindh governments to deliver tangible outcomes, including predictable funding for schools and healthcare facilities, fairer tax systems, and improved data-driven decision-making. The initiative will also safeguard priority social and climate investments while strengthening public trust in state institutions.

World Bank Lead Country Economist Tobias Akhtar Haque emphasised that strengthening Pakistan’s fiscal foundations is critical for restoring economic stability and institutional effectiveness.

“Through the PRID-MPA, we are launching a coherent nationwide approach to support reforms that expand fiscal space, bolster investments in human capital and climate resilience, and strengthen revenue administration, budget execution, and statistical systems,” he said.

According to the World Bank, the federal component of the programme will focus on raising domestic revenues more equitably, improving budget planning and execution, and strengthening national data systems for evidence-based policymaking. Key measures include tax policy and administration reforms, expansion of the Integrated Financial Management Information System (IFMIS) and its linked e-procurement platform, targeted subsidy reforms, and strengthening the national statistical system led by the Pakistan Bureau of Statistics.

In Sindh, the programme aims to increase provincial revenues, improve the speed and transparency of public payments, and expand the use of data in provincial decision-making. The initiative is also expected to directly support inclusive development by improving financing for primary healthcare facilities and increasing funding for schools.

The development comes amid concerns raised in a November IMF-World Bank report, which highlighted that fragmented regulation, opaque budgeting, and political capture in Pakistan have been constraining investment and weakening revenue mobilisation. The PRID-MPA programme seeks to address these structural weaknesses through sustained fiscal and institutional reforms.
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PakistanEconomy

EconomicReforms

WorldBank

MacroeconomicStability
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