World Bank Approves $700 Million for Pakistan Reforms

KARACHI – World Bank approved $700 million in fresh financing aimed at restoring macroeconomic stability, fixing public finances, and improving the delivery of essential services across South Asian nation.

The funding comes under Pakistan Public Resources for Inclusive Development Multiphase Programmatic Approach (PRID-MPA), a long-term, results-based reform program designed to overhaul Pakistan’s fiscal systems. The initiative is closely aligned with Pakistan’s commitments under the IMF’s Extended Fund Facility and the National Fiscal Pact.

The global lender confirmed that PRID-MPA framework allows for up to $1.35 billion in total financing over multiple phases. In the first approval, $600 million has been earmarked for federal-level reforms, while $100 million will directly support Sindh province. Crucially, funds will be released only when agreed reform targets are met, ensuring strict accountability and performance-based disbursement.

Its Country Director for Pakistan, Bolormaa Amgaabazar, said Islamabad’s path to inclusive and sustainable growth depends on mobilising domestic revenues and using public funds transparently and efficiently. She stressed that the program will deliver real, visible results for citizens, including predictable financing for schools and healthcare facilities, fairer tax systems, stronger data-driven decision-making, and protection of critical social and climate-related investments.

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At federal level, the reform push will focus on expanding domestic revenue in fair manner, tightening budget planning and execution, and strengthening national data systems. Key measures include major tax policy and administration reforms, scaling up the Integrated Financial Management Information System along with its linked e-procurement platform, implementing targeted subsidy reforms, and upgrading the national statistical system led by the Pakistan Bureau of Statistics.

WB Lead Country Economist for Pakistan, Tobias Akhtar Haque, said strengthening fiscal foundations is essential to restoring economic stability and rebuilding public institutions. He noted that the PRID-MPA introduces a coordinated nationwide reform strategy aimed at expanding fiscal space, boosting investment in human capital and climate resilience, and ensuring public funds reach frontline services with greater efficiency, transparency, and accountability.

The program is expected to significantly increase provincial revenues, speed up and make government payments more transparent, and expand the use of data in policymaking. The initiative will directly support increased public spending on inclusive development, including improved funding for primary healthcare facilities and enhanced financing for schools across the province.