World Bank to lend Pakistan $600m tied to investment reforms
Pakistan is set to take a $600 million World Bank loan under the BRIDGE Programme, with approval expected on January 29, 2027. The government has committed to new laws including an Investment Act and a Factoring Law.
For information only, not investment advice. Prices change quickly: check the time and source of every figure.
- The $600 million World Bank loan falls under the BRIDGE Programme, with approval expected on January 29, 2027.
- The government has pledged an Investment Act, a Factoring Law and free international trade in wheat and sugar.
- Total programme cost is estimated at $1.2 billion.
Pakistan is set to secure a $600 million loan from the World Bank under the Bold Reforms for Investment-Driven Growth and Employment (BRIDGE) Programme, according to documents the bank released late on Wednesday. The Express Tribune and Minute Mirror both reported on the papers.
The Ministry of Finance will take the loan, and approval is estimated for January 29, 2027. The programme is expected to cost $1.2 billion in total. The World Bank will provide $600 million, and the federal government will bear the remaining $593 million.
The government has assured the bank it will enact at least two new laws: an Investment Act and a Factoring Law. The Minute Mirror said the Investment Act would strengthen investor protections and set a clearer negative list of restricted sectors. The Factoring Law would let businesses raise funds against unpaid invoices and other receivables.
Other commitments include developing a database of Pakistanis going overseas, allowing free international trade in sugar and wheat, and raising the share of urea imports by private persons. Removing wheat and sugar from the Import and Export Order 2022 needs only cabinet approval, according to the Express Tribune.
The loan will also support a unified Insolvency Law with a dedicated regulatory authority, and full operation of the EXIM Bank with a banking licence. It backs full operation of the Pakistan Business Portal as a central digital platform for registrations, licences and approvals. A single national system for approving seed varieties is also included.
Further targets include shorter times to clear imports and exports. The government says it has already cut clearance times through the Customs Faceless System. The financing also supports DRAP reaching WHO Regulatory Maturity Level 3 and membership of the Pharmaceutical Inspection Co-operation Scheme.
The World Bank said that, "driven by an unfriendly business environment, private investment stands at around 10% of GDP, less than half the rate of regional peers, and FDI at around 0.6% of GDP." Pakistan plans to raise private investment from about 10% to 15% of GDP by 2035, according to the Minute Mirror.
Separately, the government has decided to take $750 million from the Asian Development Bank for pension and private-sector reforms. The Express Tribune said that money is used to finance the budget deficit. The government earlier set up the Special Investment Facilitation Council to attract foreign investment.
Why it matters
The loan depends on new laws on investment and on wheat and sugar trade, which will shape the economy Pakistanis live in. The measures also touch business registration, imports and overseas employment.
