Pakistan and World Bank sign loan agreement worth $918 million

June 18, 2019: Adviser to the Prime Minister on Finance, Revenue and Economic Affairs, Dr. Abdul Hafeez Shaikh, witnessed the signing ceremony of following three loan agreements worth $918 million with the World Bank today.

Secretary, Economic Affairs Division, Noor Ahmed signed the financing agreements on behalf of Government of Pakistan while the representatives of Higher Education Commission (HEC) and Government of Khyber Pakhtunkhwa signed their respective Project Agreements. Country Director, World Bank, Patchamuthu Illangovan, signed the agreements on behalf of the World Bank.

Later, the World Bank’s Country Director held a meeting with the Adviser to Prime Minister on Finance. The Adviser thanked the World Bank Team for extending their continuous support to the Government of Pakistan in its efforts to achieve the sustainable economic development of the country. He appreciated the World Bank relationship with Pakistan and desired the programs implementing agencies to put their best efforts to implement their respective programs to help achieving the programs objectives.

The details of the agreements are as follows:

• Pakistan Raises Revenue Program worth $400 million: The development objective of the program is to contribute to a sustainable increase in domestic revenue by broadening the tax base and facilitating compliance.

The Program’s targeted results include: (i) increasing Pakistan’s tax to GDP ratio to 17 percent; (ii) increasing the number of active taxpayers to 3.5 million; (iii) reducing the compliance burden of paying taxes; and (iv) improving the efficiency of customs controls.

• Higher Education Development in Pakistan worth $400 million: The development objective of the program is to support research excellence in strategic sectors of the economy, improve teaching and learning and strengthening governance in the higher education sector.

The project will finance the following components: (i) nurturing academic excellence in strategic sectors; (ii) supporting decentralized higher education institutes for improved teaching and learning; (iii) equipping students and higher education institutions with modern technology; (iv) higher education management information system and data drive services; and (v) capacity building, project management and monitoring & evaluation.

• Khyber Pakhtunkhwa Revenue Mobilization and Resource Management Program worth $118 million: The development objective of the program is to increase collection of KP’s own-source revenues and improve the management of public resources. This objective is to be achieved through (a) efficient revenue mobilization and (b) effective public resource management and (c) capacity building to enhance e-government functionality.

The Program will help the Government of Khyber Pakhtunkhwa to mobilize own source revenue to address the constraint of limited fiscal space for investment and public service provision and efficient and strategic use of the province’s financial resources.