The World Bank has rated Pakistan’s tax reforms as showing moderate progress, while flagging substantial risk to two loan programmes worth about $670 million. In a public disclosure on Wednesday, the Washington-based lender gave the programmes an overall rating of “moderately satisfactory.” The World Bank Pakistan tax reforms report points to strong momentum on most targets, but it also records delays and risks that could slow the work.
What the bank rated and why
The two programmes are meant to support macroeconomic stability, improve public service delivery, and raise the tax-to-GDP ratio to 15 percent within five years. The tax-to-GDP ratio measures how much tax the government collects compared with the size of the economy. One key goal of the Pakistan Public Resources for Inclusive Development programme, called PRID-MPA, is to lift this ratio from 12.3 percent in June 2025 to 15 percent by June 2030. The bank gave the $700 million PRID-MPA financing a substantial risk rating, and said the loan became effective on June 19, 2025.
The bank said the rating reflects high political and governance risk, along with moderate to substantial risks in macroeconomic management, sector policies, institutional capacity, fiduciary matters such as the handling of funds, and environmental and social standards. It described overall risks as “substantial.” The figures do not fully match: the two programmes are put at about $670 million, while the PRID-MPA financing is listed at $700 million. The sources do not explain the gap, so the exact total should be read with care.
Progress, delays and the Punjab programme
Despite these risks, the bank noted strong progress across most of the disbursement-linked indicators, which are targets that must be met before loan money is paid out. It said this reflected “continued momentum in the reform programme.” An advance disbursement of $164.52 million was made on June 29, after the MPA operation became effective on May 14. The bank said the government was operationalising the technical assistance component, meaning it was putting support arrangements into practice, after changes to project activities and cost allocations.
The bank has also reported delays to the government for correction. These concern the constitution of the governing council of the Pakistan Bureau of Statistics, the official statistics agency, and the appointment of a chief statistician, which the bank called a key lapse in programme conditions. It said the post has been vacant since Sept 24, 2026, and that it should not remain empty during implementation, while no existing official should be formally given the role.
The bank also rated the $70 million Connected Punjab Programme as moderate-to-substantial risk, citing political, governance, macroeconomic and fiduciary reasons. It acknowledged strong ownership at the highest levels of the Punjab government. The programme covers broadband access, digital service delivery and artificial intelligence readiness, and cashless transactions, and runs until June 2031. The Punjab Information Technology Board has secured provincial approval, and next steps include an AI oversight committee, a data governance framework, a personal data protection strategy and a cybersecurity strategy. The government and the World Bank are now working closely to advance preparatory work and reduce the impact of approval delays on the reforms.
Timeline: what has happened so far
- June 2025: The tax-to-GDP ratio was 12.3%, and the $700 million PRID-MPA financing became effective on June 19.
- May 14: The MPA operation became effective (the year is not stated in the sources).
- Dec 19, 2025: The World Bank board approved the PRID-MPA programme.
- June 29: An advance disbursement of $164.52 million was made (the year is not stated in the sources).
- Sept 24, 2026: The chief statistician post became vacant, the bank said.
- Wednesday: The bank published its public disclosure rating the programmes.
Aasan alfaaz mein
World Bank ne Pakistan ki tax reforms mein moderate progress ki baat ki hai, lekin do loan programmes (lagbhag $670 million) par substantial risk bhi bataya hai. Is ka maqsad tax-to-GDP ratio ko 12.3 percent se barha kar June 2030 tak 15 percent karna hai. Report mein kisi naye tax ya qeemat ka zikr nahin hai, lekin statistics ki khali post bharne ko kaha gaya hai. Aam logon ke liye abhi asar yeh hoga ke reforms kitni tezi se chalte hain.
