Pakistan, ADB Ink $300M Deal for Economic Reforms

ADB-Backed $800M Package to Strengthen Pakistan’s Economy

By DTD- On Jun 4, 2025

Islamabad, — The Government of Pakistan and the Asian Development Bank (ADB) on Wednesday signed a landmark $300 million loan agreement under the “Improved Resource Mobilisation and Utilization Reform Program (Subprogram-II),” marking a significant step toward fiscal consolidation and macroeconomic stabilization.

The agreement was signed by Secretary of the Economic Affairs Division, Dr. Kazim Niaz, and ADB’s Country Director for Pakistan, Ms. Emma Fan, during a formal ceremony attended by senior officials from both sides.

This strategic program, implemented in a programmatic approach, aims to drive structural reforms in key areas such as trade facilitation, revenue generation, and capital market development. The initiative underscores the Government of Pakistan’s commitment to strengthening domestic resource mobilization and reinforcing long-term fiscal sustainability.

In addition to the policy-based loan (PBL), a Policy-Based Guarantee (PBG) of $500 million is also part of the broader financing package. Backed by a sovereign counter-guarantee and indemnity, the PBG will enable Pakistan to raise an additional $1 billion in commercial financing from international markets.

With a total financing envelope of $800 million, the reform program is expected to play a crucial role in supporting Pakistan’s macroeconomic recovery and ensuring sustainable economic growth through enhanced institutional capacity and improved financial resilience.

“This agreement reflects our joint resolve to implement deep-rooted reforms for economic stability,” said Dr. Niaz. Ms. Fan reiterated ADB’s commitment to supporting Pakistan’s development agenda and promoting inclusive growth.

The partnership between ADB and Pakistan continues to evolve as both sides work collaboratively to address pressing economic challenges and lay the foundation for a more resilient and diversified economy.