WB likely to approve $450m loan for Pakistan this month

ISLAMABAD: The World Bank on Tuesday confirmed that Pakistan had accomplished all conditions attached to the Resilient Institution for Sustainable Economy (RISE-II) programme of a $450 million loan. The WB’s Board of Directors is expected to approve the loan in November.

“Discussions are also under way whereby the Asian Infrastructure Investment Bank (AIIB) will grant approval for co-financing of $450 million, so a total funding of $900 million will be provided to Pakistan. All attached conditions have been fulfilled,” top officials of the Finance Ministry confirmed while talking to The News here on Tuesday.

The AIIB is also considering providing another $500 million as co-financing of the ADB’s Building Resilience with Active Countercyclical Expenditure (BRACE) programme and the Planning Commission’s Central Development Working Party (CDWP) on Tuesday granted approval for the project, paving the way for fulfilling another condition to obtain a $500 million loan from the AIIB.

In total, Pakistan is expecting $1.4 billion from the World Bank and Asian Infrastructure Investment Bank (AIIB) in the next few weeks, at a time when the country is experiencing a dollar liquidity crunch. The foreign currency reserves held by the State Bank of Pakistan (SBP) stand at $8.9 billion despite the revival of the IMF programme giving $1 billion as well as $1.5 billion from the ADB.

According to a statement issued by the Ministry of Finance, Guangzhe Chen, World Bank’s Regional Director for South Asia Infrastructure, called on Federal Minister for Finance and Revenue Senator Ishaq Dar at the Finance Division on Tuesday. Country Director World Bank Najy Benhassine, SAPM on Finance Tariq Bajwa, SAPM on Revenue Tariq Mehmood Pasha, the secretary finance and other senior officers attended the meeting. The finance minister welcomed Guangzhe Chen and highlighted the current economic outlook of Pakistan. He apprised the delegation of various policy measures being undertaken by the government to ensure sustainable and inclusive economic growth and development by enhancing ease of doing business, encouraging exports and facilitating various sectors of the economy.

Guangzhe Chen congratulated the Government of Pakistan for successfully completing the fiscal reform programme – RISE. He briefed the finance minister about other programmes being undertaken by the World Bank in the country in line with the vision of the Government of Pakistan. He highlighted the support by the World Bank for relief and rehabilitation work in flood-affected areas.

Dar commended the developmental role of the World Bank in Pakistan and said Pakistan valued the financial and technical assistance provided by the World Bank for the institutional reforms and economic development of the country. He assured the delegation that every possible support would be provided by the government for the current projects being undertaken by the World Bank in Pakistan and thanked the delegation for their persistence contribution to the economic development of Pakistan.

Under the RISE-I programme of $500 million for Pakistan, the WB had focused on improving fiscal management and fostering growth and competitiveness. The RISE assisted the government in improving the intergovernmental fiscal architecture to enable the country to improve its fiscal position.