IFC’s first PKR investment backs Engro Fertilizers to boost Pakistan’s agri-sector

By mobilizing PKR-denominated financing, IFC is helping reduce Pakistan’s reliance on foreign currency borrowing, which often exposes the economy to exchange rate volatility and external shocks.

The International Finance Corporation (IFC) has announced its first-ever Pakistan rupee–denominated investment, marking a major milestone in the country’s efforts to expand access to long-term local currency financing. IFC will provide an unfunded Partial Credit Guarantee of up to PKR 33.6 billion (approximately US$120 million equivalent) to support long-term PKR-based financing from Standard Chartered Bank Pakistan Limited to Engro Fertilizers Limited, one of Pakistan’s leading fertilizer manufacturers.

This landmark financing package is designed to strengthen Pakistan’s agriculture sector—responsible for 24 percent of the country’s GDP, 70 percent of export earnings and 40 percent of employment. It also aligns with national efforts to enhance food security amid rising input costs, supply chain inefficiencies, and ongoing challenges facing smallholder farmers.

The guarantee is further backed by a first-loss counter guarantee from the IFC-Canada Facility for Resilient Food Systems. This addition underscores the international commitment to bolstering Pakistan’s resilience across the agricultural value chain.

Strengthening Local Capital Markets and Food Security

By mobilizing PKR-denominated financing, IFC is helping reduce Pakistan’s reliance on foreign currency borrowing, which often exposes the economy to exchange rate volatility and external shocks. The move supports a broader shift toward developing sustainable domestic capital markets and reducing the cost of long-term borrowing.

For Engro Fertilizers, access to locally financed capital will enable crucial investments in plant maintenance, turnarounds, and infrastructure upgrades. These improvements will support uninterrupted production of urea and other essential fertilizers—key to meeting national crop nutrient demand. Additionally, the financing will sustain Engro’s farmer development programs, which provide training, advisory services, and community-focused support to enhance productivity and resilience.

Addressing Sectoral Challenges

Pakistan’s agriculture sector continues to face long-standing structural challenges, including low literacy among farmers, limited access to finance, inadequate extension services, and fragmented supply chains. Investments like these—coupled with public–private partnerships—can play a transformative role in improving productivity, strengthening value chains, and reducing rural poverty.

Voices from the Partnership

Ali Rathore, CEO of Engro Fertilizers, emphasized the company’s continued commitment to national development:“Engro has always strived to solve Pakistan’s most pressing issues meaningfully. Using local capital to strengthen local value chains reflects our commitment to the country and to our farmers—the backbone of Pakistan’s economy. We are grateful to IFC and Standard Chartered Bank for enabling us to advance this mission.”

Ashruf Megahed, Regional Industry Head for Manufacturing, Agribusiness & Services at IFC, highlighted the significance of the initiative:“This investment reflects the strength of our partnership with Engro Fertilizers and Standard Chartered Bank. Through this project, we are opening new pathways for local currency long-term financing that support growth and financial resilience in a sector vital to the country’s economy.”

Rehan Shaikh, CEO & Head of Coverage at Standard Chartered Pakistan, noted the importance of collaboration:“At Standard Chartered we are committed to financing solutions that enable sustainable growth and long-term resilience. This partnership reflects our shared vision of strengthening food security and supporting one of Pakistan’s most critical value chains. We look forward to replicating this successful structure across our network.”

A Blueprint for Future Local Currency Financing

IFC’s first PKR-denominated investment sets a new precedent for financing climate-resilient and agriculture-linked initiatives in Pakistan. By mobilizing local capital and supporting critical industries, it paves the way for future collaborations aimed at boosting financial stability, food security, and economic resilience.