In a major boost to Pakistan’s public finance, the Asian Development Bank (ADB) has approved an $800 million package to support fiscal reforms and strengthen financial sustainability. The aid includes a $300 million policy-based loan and a landmark $500 million guarantee to attract up to $1 billion from commercial banks.
Focus on Fiscal Sustainability
The funding comes under Subprogramme 2 of the ADB’s “Improved Resource Mobilisation and Utilisation Reform Programme.” It aims to help Pakistan stabilize its economy by reducing its fiscal deficit and public debt while expanding fiscal space for development and social spending.
ADB Country Director for Pakistan, Emma Fan, noted, “Pakistan has made significant progress in improving macroeconomic conditions. This programme supports the government’s reform agenda to enhance public finance and encourage sustainable growth.”
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Tax and Spending Reforms at the Core
The reform programme targets several key areas. It focuses on overhauling tax policies and improving tax compliance and administration. In addition, the plan emphasizes better public expenditure management and efficient cash handling to ensure transparency and accountability.
The ADB stressed that improving revenue generation and controlling spending are vital steps to reduce reliance on debt and create room for critical investments.
Digital Tools and Private Sector Role
Another major goal of the programme is the digitalisation of financial systems. It promotes online platforms to enhance transparency in public transactions and aims to support investment facilitation. Private sector development is also a core pillar, with policies geared toward a more business-friendly environment.
Long-Term Vision Backed by Global Support
This funding is part of a wider assistance strategy that includes technical guidance and coordination with other international development partners. The goal is to help Pakistan build long-term fiscal resilience through institutional reforms and policy consistency.
The ADB’s move signals strong international backing for Pakistan’s reform efforts and a renewed push toward financial stability and economic recovery.
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