By Staff Reporter
ISLAMABAD: The World Bank rated implementation of its flagship fiscal-reform loan to Pakistan as moderately satisfactory, while classifying overall risk as substantial and flagging delays in meeting a condition tied to the country’s statistics bureau.
The assessment, set out in disclosures published on Wednesday, also covers a $70 million digital-infrastructure program in Punjab province, which the lender rated moderate to substantial for risk. Together the operations are meant to support macroeconomic stability, improve service delivery and raise the tax-to-GDP ratio to 15% within five years.
The financing at the center of the review is the Pakistan Public Resources for Inclusive Development Multiphase Programmatic Approach, or PRID-MPA. The bank described political and governance risk as high. It put macroeconomic, sector strategy and policy, institutional capacity, fiduciary, and environmental and social risks at moderate to substantial.
One of the program’s central goals is to lift Pakistan’s tax-to-GDP ratio from 12.3% in June 2025 to 15% by June 2030. The bank said the operation became effective on May 14 and that an advance disbursement of $164.52 million was made on June 29. It noted strong progress on most disbursement-linked indicators, “reflecting continued momentum in the reform programme.”
That marks a change from the picture earlier this year. A previous status report showed the program not yet in effect, with its planning document awaiting clearance from a government development panel and no money released. The bank said Islamabad is now putting in place the technical assistance component and related implementation arrangements, after refinements to project activities and cost allocations.
The bank also reported to the government for correction delays in forming the governing council of the Pakistan Bureau of Statistics and in appointing a chief statistician, which it described as a key lapse in the program’s conditions. Under those terms, the post can’t stay vacant during implementation, and an existing official can’t be formally delegated the role. The bank said the position has been empty since Sept. 24, 2026.
The government and the bank are working closely to advance preparatory activities and limit the effect of approval delays on effectiveness conditions and reform implementation, according to the disclosure.
The revenue target is demanding. The Federal Board of Revenue collected about 13 trillion rupees in the fiscal year that ended in June, missing an International Monetary Fund-linked target by 975 billion rupees, and its tax-to-GDP ratio slipped to 10.2%. The agency now faces a goal of 15.264 trillion rupees for the current year. The IMF’s $7 billion bailout carries tax-collection conditions.
In Punjab, the bank’s board approved $70 million for the Connected Punjab Program on June 30. The financing comes through the International Development Association and forms part of a $278 million investment program, including $208 million from the provincial government. The program runs through June 2031 and focuses on three areas: broadband access and connectivity, digital service delivery and artificial-intelligence readiness, and cashless transactions.
The bank assigned its moderate-to-substantial risk rating for political, governance, macroeconomic and fiduciary reasons, even as it acknowledged “strong ownership at the highest levels of the Government of Punjab.” The Punjab Information Technology Board has secured provincial approval, which the bank cited as evidence of institutional preparedness. Next steps include setting up an AI oversight committee and drawing up a data governance framework, a personal data protection strategy and a cybersecurity strategy.
By 2031, the program aims to extend improved digital services to 28.9 million people and raise the share of women using them from 19% to 30%. It also targets cutting average right-of-way permit times for broadband from 90 days to 21 days, and drawing at least $50 million in private investment.
The bank’s board approved the PRID-MPA on Dec. 19, 2025, as a program that could provide up to $1.35 billion in total. The initial $700 million comprises $600 million for federal programs and $100 million for Sindh province. The bank describes it as an innovative national program that supports federal and provincial reforms to mobilize domestic revenue, improve spending quality and use data and digital tools to deliver better services.
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