Pakistan, World Bank sign loan agreement worth $918 million

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Adviser to the Prime Minister on Finance, Revenue and Economic Affairs Dr Abdul Hafeez Shaikh oversees the signing of the agreement. — Photo provided by Economic Division
Adviser to the Prime Minister on Finance, Revenue and Economic Affairs Dr Abdul Hafeez Shaikh oversees the signing of the agreement. — Photo provided by Economic Division

Pakistan on Tuesday signed three loan agreements worth a total of $918 million with the World Bank.

Adviser to the Prime Minister on Finance, Revenue and Economic Affairs Dr Abdul Hafeez Shaikh witnessed the signing of the agreement between Country Director World Bank Patchamuthu Illangovan and Economic Affairs Division Secretary Noor Ahmed. The representatives of the Higher Education Commission (HEC) and Government of Khyber Pakhtunkhwa signed their respective project agreements.

After the agreements were signed, the World Bank’s country director held a meeting with the Dr Sheikh, who thanked the World Bank "for extending their continuous support to Pakistan's government in its efforts to achieve the sustainable economic development of the country."

The details of the three project the funds will be used for are as follows:

'Pakistan Raises Revenue Program' — $400 million

The programme is aimed at "contributing to a sustainable increase in domestic revenue by broadening the tax base and facilitating compliance," a press release from the Economic Affairs Division said.

It is hoped that the programme will increase Pakistan’s tax to GDP ratio to 17 per cent, increase the number of active taxpayers to 3.5 million, reduce the compliance burden of paying taxes and improve the efficiency of customs controls.

'Higher Education Development in Pakistan' — $400 million

The development objective of the programme is to "support research in strategic sectors of the economy, improve teaching and learning and strengthening governance in the higher education sector."

The finances will be used towards nurturing academic excellence in strategic sectors, supporting decentralised higher education institutes for improved teaching and learning, equipping students and higher education institutions with modern technology, higher education management information system and data drive services and capacity building, project management and monitoring & evaluation.

'Khyber Pakhtunkhwa Revenue Mobilisation and Resource Management Program' — $118 million

This programme is expected to increase collection of KP’s own revenue and improve the management of public resources. "This objective is to be achieved through efficient revenue mobilisation, effective public resource management and capacity building to enhance e-government functionality," the press release said.

The program will help the government of Khyber Pakhtunkhwa to mobilise its own source revenue to and come up with the efficient and strategic use of the province’s financial resources.

Earlier this year in April, World Bank CEO Kristalina Georgieva had pledged to further strengthen cooperation with Pakistan in the areas of 'disbursements programme lending' and 'guarantees provision for raising external funds'.

The pledge was made in a meeting with Prime Minister Imran Khan on the sidelines of the second Belt and Road Forum (BRF) in Beijing.

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