ISLAMABAD: The Asian Development Bank (ADB) has approved an $800 million programme aimed at strengthening Pakistan’s fiscal sustainability and improving public financial management.
This significant financial support marks a key milestone in Pakistan’s efforts to enhance its economic stability and promote sustainable growth.
Details of the Funding and Programme Objectives
The approved programme, titled the “Improved Resource Mobilisation and Utilisation Reform Programme,” includes a policy-based loan of $300 million and ADB’s first-ever policy-based guarantee of up to $500 million. This guarantee is expected to mobilise additional financing of up to $1 billion from commercial banks.
According to Emma Fan, ADB’s country director for Pakistan, the programme supports the government’s commitment to policy and institutional reforms designed to strengthen public finances. It targets improvements in tax policy, administration, and compliance, while also focusing on better public expenditure and cash management.
Long-term Impact and Support
The initiative also promotes digitalisation, investment facilitation, and private sector development, aiming to reduce Pakistan’s fiscal deficit and public debt. By doing so, it will create more room for social and development spending.
The programme is backed by a comprehensive support package, including technical assistance and close coordination with development partners, to help Pakistan build long-term fiscal resilience and stability. Khurram Schehzad, adviser to the finance minister, confirmed the programme’s approval and highlighted the successful diplomacy efforts led by the Economic Affairs and Ministry of Finance in securing the majority support at the ADB board.
This infusion of funds and expertise is expected to play a crucial role in Pakistan’s economic recovery, fostering improved governance and boosting investor confidence in the country’s fiscal management.
