WASHINGTON: The World Bank has rated two loan programs in Pakistan worth about $670 million as “moderately satisfactory” while assigning them a “substantial risk” rating, citing high political and governance risks and challenges across macroeconomic, institutional and fiduciary areas.
The Washington-based lender said in a public disclosure that the overall implementation of the $700 million Pakistan Public Resources for Inclusive Development — Multiphase Programmatic Approach, or PRID-MPA, was rated “moderately satisfactory.” The loan became effective June 19, 2025.
One of the program’s key goals is to raise Pakistan’s tax-to-GDP ratio from 12.3% in June 2025 to 15% by June 2030. The programs are also intended to support macroeconomic stability and improve service delivery.
The bank said its rating reflected high political and governance risk, along with moderate to substantial risks in macroeconomic policy, sector strategies, institutional capacity, fiduciary standards, and environmental and social safeguards. It described overall risks as “substantial.”
The MPA operation became effective May 14, and an advance disbursement of $164.52 million was made June 29.
Despite the risks, the bank noted strong progress across most disbursement-linked indicators, “reflecting continued momentum in the reform programme.” It said the government was operationalizing the technical assistance component and related implementation arrangements after refinements to project activities and cost allocations.
The government and the World Bank are working closely to advance preparatory activities and mitigate delays in approval timelines that could affect the fulfillment of effectiveness conditions and reform implementation, the bank said.
The World Bank reported to the government delays in constituting the governing council of the Pakistan Bureau of Statistics and appointing a chief statistician, calling it a key lapse in program conditions. Under the program, the chief statistician position should not remain vacant during implementation, and an existing government official may not be formally delegated the role. The bank said the condition has been delayed because the position has been vacant since Sept. 24, 2026.
The bank also assigned a moderate-to-substantial risk rating to the $70 million Connected Punjab Programme for political, governance, macroeconomic and fiduciary reasons. The program took effect at the start of the current fiscal year and runs until June 2031.
The bank acknowledged the program benefited from “strong ownership at the highest levels of the Government of Punjab.”
The Connected Punjab Programme focuses on three areas: broadband access and connectivity; digital service delivery and artificial intelligence readiness; and expanded cashless transactions.
The Punjab Information Technology Board has secured provincial government approval, demonstrating strong institutional preparedness. Next steps include advancing the AI Oversight Committee, a data governance framework, a personal data protection strategy and a cybersecurity strategy as foundations for responsible AI adoption.
The PRID-MPA was approved by the World Bank’s board of directors on Dec. 19, 2025, which described it as an innovative national program supporting federal and provincial reforms to mobilize domestic revenue, enhance spending quality and use data and digital tools to improve services.
