World Bank Approves $700m to Support Pakistan’s Fiscal Reforms and Services

World Bank Country Director for Pakistan, Bolormaa Amgaabazar, said the programme focuses on ensuring that public resources are both mobilised fairly and used efficiently to deliver real benefits.

The World Bank has approved $700 million in financing for Pakistan under a new multi-year reform programme aimed at strengthening macroeconomic stability, improving public service delivery, and mobilising domestic revenue more effectively.

The funding was approved by the World Bank’s Board of Executive Directors for the Pakistan Public Resources for Inclusive Development – Multiphase Programmatic Approach (PRID-MPA), an ambitious national initiative supporting both federal and provincial reforms. The programme is designed to enhance how public resources are raised, managed, and spent, with a strong focus on transparency, efficiency, and inclusive development.

The PRID-MPA aligns closely with Pakistan’s ongoing fiscal reform agenda, including commitments under the International Monetary Fund’s Extended Fund Facility and the National Fiscal Pact. Over its full duration, the programme will provide up to $1.35 billion in total financing. Of this, $600 million has been approved for federal-level reforms, while $100 million will support a dedicated programme in Sindh province.

A key feature of the initiative is its results-based design, meaning funds will only be disbursed once agreed reform targets and outcomes are achieved. This approach aims to strengthen accountability and ensure that public financing delivers measurable improvements for citizens.

World Bank Country Director for Pakistan, Bolormaa Amgaabazar, said the programme focuses on ensuring that public resources are both mobilised fairly and used efficiently to deliver real benefits.

“Pakistan’s path to inclusive, sustainable growth requires mobilizing more domestic resources and ensuring they are used efficiently and transparently to deliver results for people,” she said. “Through this programme, we are working with the federal and Sindh governments to provide more predictable funding for schools and clinics, fairer tax systems, and stronger data for decision-making, while protecting priority social and climate investments.”

At the federal level, the programme will prioritise reforms to raise domestic revenues in a more equitable manner, improve budget planning and execution, and strengthen national data systems to support evidence-based policymaking. Key actions include tax policy and administration reforms, scaling up the Integrated Financial Management Information System and linked e-procurement platforms, targeted subsidy reforms, and strengthening the national statistical system led by the Pakistan Bureau of Statistics.

These measures are expected to bolster fiscal stability, expand fiscal space for essential social and climate-related spending, improve transparency, and enhance the quality and efficiency of public services.

World Bank Lead Country Economist for Pakistan, Tobias Akhtar Haque, said strengthening fiscal foundations is critical to restoring economic stability and institutional credibility.

“Through the PRID-MPA, we are launching a coherent nationwide approach to support reforms that expand fiscal space, boost investments in human capital and climate resilience, and strengthen revenue administration, budget execution, and statistical systems,” he said. “These reforms will help ensure resources reach frontline services and deliver better outcomes for people with greater efficiency and accountability.”

In Sindh, the provincial component of the programme is expected to increase local revenues, speed up and improve the transparency of government payments, and expand the use of data in decision-making. The reforms will directly support more inclusive development outcomes, including fairer and more responsive financing for primary healthcare facilities and increased funding for schools.

The World Bank says the PRID-MPA represents a significant step towards building stronger public financial systems in Pakistan, supporting long-term economic resilience, and improving trust in public institutions.