World Bank ties Pakistan financing plan to trade and investment reforms

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World Bank financing for Pakistan reforms

Highlights

World Bank's proposed BRIDGE programme for Pakistan totals USD 1.193 billion, with USD 600 million from the lender, targeting approval in January 2027.
The reforms require removing wheat and sugar trade restrictions, fully operationalising the Export-Import Bank of Pakistan, and enacting new investment and insolvency legislation.
The initiative aims to raise private investment from 10 to 15 percent of GDP by 2035, focusing on trade facilitation, export competitiveness, and labour market alignment.

Programme design and reform conditions

As reported by Business Recorder, citing the World Bank’s project document, the proposed Pakistan Bold Reforms for Investment-Driven Growth and Employment, BRIDGE, Programme carries a total estimated cost of USD 1.193 billion, including USD 600 million from the lender and USD 593.38 million from the government. The package includes a USD 1.173 billion results-based programme and a USD 20 million technical assistance component, and it is proposed for approval in January 2027.

The programme is designed to address structural constraints that have kept private investment at about 10 percent of GDP, less than half the rate of regional peers, while foreign direct investment stands at roughly 0.6 percent of GDP. It is to be coordinated by the Ministry of Finance and focuses on reducing regulatory, financial and trade barriers, improving competitiveness in export sectors and strengthening labour market functioning.

Under the reform agenda, the Bank proposes removing wheat and sugar from the Import/Export Order 2022, increasing private-sector participation in urea imports and eliminating broader barriers to investment and trade. Other measures include operationalising the Pakistan Business Portal as a one-stop digital platform for approvals, enacting a modernised Investment Act, introducing a unified corporate insolvency law and a dedicated factoring law, and fully operationalising the Export-Import Bank of Pakistan with a banking licence and export credit and guarantee products that meet international standards.

In export-oriented industries, the programme targets agribusiness and therapeutic goods, including pharmaceuticals. It also supports a single national system for approving seed varieties and reforms intended to help the Drug Regulatory Authority of Pakistan reach World Health Organisation Regulatory Maturity Level 3 and secure membership in the Pharmaceutical Inspection Co-operation Scheme.

Expected impact on trade, jobs and investment

The proposed initiative aligns with the government’s URAAN Pakistan economic transformation plan and supports the goal of raising private investment to 15 percent of GDP by 2035. The World Bank identifies a costly and complex regulatory environment, limited access to finance, high trade costs and a mismatch between workers’ skills and employers’ needs as key obstacles to stronger investment and productivity.

Trade facilitation measures are intended to cut the time needed to clear imports and exports while expanding internationally recognised accreditation for Pakistani businesses. For pharmaceutical exporters, improved regulatory standing could widen access to regulated overseas markets and multilateral procurement opportunities.

The labour component seeks to connect worker qualifications more closely to market demand through a national Labour Market Information System, stronger vocational qualifications and digital migration services. It also envisages Global Skills Partnership agreements to create structured overseas employment pathways, a significant issue as more than three million Pakistanis enter the labour market annually and women are identified as a priority beneficiary group across the programme.

In our earlier coverage of Pakistan’s push to expand priority-sector lending, we detailed the government’s targets to raise credit for housing, agriculture and SMEs by June 2027, alongside steps to speed up loan processing and reduce paperwork. The article also outlined proposed regulatory reforms, risk-sharing mechanisms and public-private partnership models intended to remove structural barriers that have limited access to formal credit in these segments.

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