The World Bank has proposed $600 million in financing for Pakistan, conditional on reforms targeting business regulations, trade policies and investment rules. The proposed measures include removing wheat and sugar from the Import/Export Order, 2022, and expanding private sector participation in urea imports.
The initiative, known as the Pakistan Bold Reforms for Investment Driven Growth and Employment (BRIDGE) Programme, aims to tackle longstanding barriers to private investment and job creation. Currently, private investment accounts for around 10% of Pakistan’s gross domestic product (GDP), less than half the level recorded by regional peers. Meanwhile, foreign direct investment remains particularly low at approximately 0.6% of GDP.
World Bank Proposes $1.19 Billion Reform Programme
Official programme documents outline a five-year initiative designed to attract private investment, improve access to financing, strengthen export competitiveness and align workforce skills with market needs.
The programme carries an estimated cost of $1.193 billion, including $600 million in proposed World Bank financing and $593.38 million from the government. Of the total, $1.173 billion is allocated to results-based activities, while $20 million is earmarked for technical assistance.
The operation is scheduled for approval in January 2027. Meanwhile, the Ministry of Finance will coordinate its implementation.
The initiative comes as Pakistan seeks to move beyond macroeconomic stabilisation towards sustained, investment-driven and export-oriented growth. According to the World Bank, complex regulations, limited financing, high trade costs and skills mismatches continue to restrict productivity and investment.
Business Regulations and Trade Barriers Under Review
The programme’s first component focuses on reducing regulatory, financial and trade barriers that discourage businesses from investing and expanding.
A key proposal involves establishing the Pakistan Business Portal as a single digital platform for business approvals. Additionally, a modernised Investment Act would strengthen investor protection and improve transparency.
The proposed reforms also include a unified corporate insolvency law and a dedicated factoring law. Furthermore, the programme seeks to make the Export Import Bank of Pakistan fully operational, supported by a banking licence and internationally compliant export credit and guarantee products.
Trade reforms would target faster import and export clearances. They would also expand internationally recognised accreditation for Pakistani businesses, helping improve their competitiveness in overseas markets.
Wheat, Sugar and Urea Markets Could See Major Changes
Agribusiness and therapeutic goods, including pharmaceuticals, feature prominently in the programme’s second component. The proposed measures include introducing a single national system for approving seed varieties and allowing greater private sector participation in urea imports.
Another significant proposal involves removing wheat and sugar from the Import/Export Order, 2022. The changes aim to deregulate these agricultural commodity markets and encourage greater private investment.
Meanwhile, the programme seeks to strengthen pharmaceutical exports by supporting the Drug Regulatory Authority of Pakistan in achieving World Health Organization Regulatory Maturity Level 3 status. It also aims to help Pakistan join the Pharmaceutical Inspection Co-operation Scheme.
These steps could help Pakistani pharmaceutical exporters access regulated international markets and participate in multilateral procurement opportunities.
Pakistan Plans Workforce and Skills Reforms
The third component addresses labour market inefficiencies and the gap between workers’ qualifications and employers’ requirements.
The proposed measures include developing a national Labour Market Information System that links government databases. The programme would also strengthen vocational qualifications and improve digital migration services.
Additionally, Global Skills Partnership agreements could establish structured overseas employment pathways for workers with internationally recognised qualifications.
The World Bank estimates that more than three million Pakistanis enter the labour market annually. Therefore, the programme aims to help the country turn investment into productive employment. Women are also identified as a priority beneficiary group across all three components.
How Does the Programme Fit Pakistan’s Economic Plan?
The proposed financing supports the government’s URAAN Pakistan economic transformation plan, which targets an increase in private investment to 15% of GDP by 2035.
Progress would be assessed through indicators covering business registrations, access to financing, trade clearance times, internationally recognised accreditation and vocational qualifications.
Ultimately, the programme seeks to address structural obstacles that have limited business investment and economic productivity. Its proposed reforms span agricultural markets, business regulation, exports and workforce development, with the broader goal of encouraging investment and generating sustainable employment.
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