ISLAMABAD: The World Bank will provide Pakistan with a $20 billion loan at a concessional interest rate of just 2 per cent over a ten-year period.
Sources divulged, the funding will support six priority sectors, including climate resilience, poverty alleviation, health, education, child stunting reduction and inclusive development. The sources within the Ministry of Finance has made it clear that the clean energy, improved air quality and the promotion of private investment have also been identified as key areas of focus.
The concessional loan forms part of a ten-year Country Partnership Framework already finalised between Pakistan and the World Bank. Implementation of the framework is now in its final phase of planning, with a national plan currently under preparation.
An additional $20 billion is expected to be made available to Pakistan’s private sector under the same framework, though at relatively higher interest rates. The total volume of lending under the agreement is projected to reach $40 billion over the next decade.
Sovereign loans to Pakistan will be channelled through the World Bank’s International Development Association (IDA), while financing for the private sector will be routed through the International Finance Corporation (IFC), according to officials.
