World Bank rejects reports of delay in Pakistan‘s loans’ approval

By: News Desk
Published: 06:37 PM, 19 Jan, 2023
World Bank rejects reports of delay in Pakistan‘s loans’ approval
Stay tuned with 24 News HD Android App
Get it on Google Play

World Bank Country Director for Pakistan Najy Benhassine Thursday rejected reports of delay in the loan approval for the country, reported 24NewsHd TV channel.

As per details, the World Bank Pakistan representative refuted rumours and said that there is no truth in such news.

He further said the tentative board approval dates of all of our proposed operations, as well as their amounts, are indicative and the World Bank decides on the timing for sharing project proposals for board consideration following due process and based on the proposed projects.

Earlier, it was reported by Reuters that the World Bank has deferred its approval of two loans for Pakistan worth $1.1 billion until the next fiscal year pending some steps on the country’s energy debt and tariffs.

The funds were to be provided for two projects including Resilient Institutions for Sustainable Economy (RISE-II) and Program for Affordable and Clean Energy (PACE-II). World Bank was due to give Pakistan $450 million for RISE-II and $600 million for PACE-II. However, it has now deferred the disbursement until the next fiscal year. The bank also opposed the 1%-3% flood levy on imports to fulfil the financing gap of $32 billion.

The approval of the loans has been awaited since June last year, a finance ministry source told British news agency, declining to be named as they were not authorised to talk to the media.

The government had hoped to receive the approval of at least $450 million by January 2023, which would have unlocked a further $450 million loan by the Asian Infrastructure Investment Bank (AIIB).

The government was already facing difficulty securing a financing loan from the International Monetary Fund (IMF), and with such a blow by the WB the government is left with an additional $1.5 billion hole.

Reports said World Bank expressed its grievances regarding 1%-3% flood levy on imports to raise Rs60 billion to Rs70 billion in additional taxes to cover imports. The flood levy is part of the Rs200 billion budget that the government set to appease the IMF bailout.