ISLAMABAD: The Asian Development Bank (ADB) has approved an $800 million support package aimed at bolstering Pakistan’s fiscal sustainability and enhancing public financial management.
Announced on Tuesday, the Improved Resource Mobilization and Utilization Reform Program – Subprogram 2 includes a $300 million policy-based loan and ADB’s first-ever policy-based guarantee of up to $500 million. The guarantee is expected to help Pakistan mobilize as much as $1 billion in financing from commercial banks.
“Pakistan has made significant progress in improving macroeconomic conditions,” said ADB Country Director for Pakistan Emma Fan. “This program supports the government’s ongoing reforms to strengthen public finances and foster sustainable economic growth.”
The program targets wide-ranging reforms in tax policy, administration, and compliance, while improving public spending efficiency and cash flow management. It also supports digitalisation initiatives, investment facilitation, and private sector development.
These reforms aim to narrow Pakistan’s fiscal deficit and reduce public debt, creating fiscal space for critical social and development expenditures. ADB noted that the program is backed by technical assistance and close collaboration with other development partners to support Pakistan’s long-term fiscal resilience.
Advisor to the Finance Minister, Khurram Schehzad, confirmed the approval via a post on X (formerly Twitter), crediting successful diplomacy by the Economic Affairs Division and Ministry of Finance for securing broad support at ADB’s Board.
Pakistan, a founding member of the ADB, has received over $52 billion in assistance since 1966 in support of inclusive economic growth, infrastructure, energy, food security, transport, and social services.
