Pakistan Loan: Islamabad is turning to another lifeline as its economy struggles to stay afloat. The World Bank has approved a $70 million loan (approximately Rs 6,270 crore) for Pakistan. It is aimed at stabilizing public services and supporting economic reforms.
According to Reuters, the loan will be disbursed under the Public Resources for Inclusive Development – Multi-Step Program Approach (PRID-MPA), a larger program that could release up to $1.35 billion in funding. The country is expected to receive the amount in multiple phases.
Where The Funds Will Go
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Out of the total loan, $60 million is allocated to a federal programme, while $10 million is earmarked for a provincial initiative in Sindh.
This approval follows the World Bank’s $47.9 million grant in August for primary education reforms in Punjab, the country’s most populous province.
Potential Objections From India
A report uploaded in November by Pakistan’s Finance Ministry, prepared with input from the International Monetary Fund (IMF) and the World Bank, highlighted that fragmented regulations, opaque budgets and political interference are undermining investments and weakening revenue collection.
Reuters reported that this international funding could trigger regional tensions, as India is likely to oppose World Bank loans to Pakistan.
Pakistan’s Reliance On Borrowing
Pakistan’s economy runs heavily on borrowed funds, frequently seeking loans from the IMF and the World Bank to keep its finances afloat. In addition, Islamabad has secured credit from China and Saudi Arabia that has contributed to its growing debt burden.
Earlier in August, Pakistan received $47.9 million World Bank grant for improving primary education in Punjab. These developments make it clear that the country’s financial stability is heavily dependent on external funding.
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