IFC commits $2 billion annually to Pakistan, fuelling growth in key sectors

ISLAMABAD: In a recent move aimed at bolstering economic growth in Pakistan, the International Finance Corporation (IFC) has announced its plans to increase equity investments and target large-scale infrastructure financing in the country.

This initiative has the potential to unlock up to $2 billion annually over the course of the next decade.

In an interview with Reuters, IFC Managing Director Makhtar Diop highlighted the significance of this investment, saying it will play a crucial role in driving Pakistan’s development, particularly in critical areas such as international airports, energy, water and ports.

Diop stressed that the IFC’s focus on key sectors, including agriculture, infrastructure, digital innovation, and financial services, will be instrumental in fostering sustainable growth and economic progress in the country.

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Diop’s comments come on the heels of a recent meeting with Pakistani Prime Minister Shehbaz Sharif, where the two leaders discussed the IFC’s ongoing and pipeline portfolio in Pakistan. The prime minister expressed his appreciation for the role of IFC – the private sector investment arm of World Bank Group – in fostering private sector investments and expanding its portfolio in Pakistan.

Pakistan is currently facing a challenging economic recovery, with the country narrowly avoiding a sovereign debt default due to insufficient foreign exchange reserves. The country is currently under a $7 billion bailout program from the International Monetary Fund (IMF).

Notably, the IFC’s exposure in Pakistan has reached a record $2.1 billion for the fiscal year 2024. Diop noted that equity investments will play a larger role in the country’s development as the IFC increases its equity investments globally, including in Pakistan.