Claim: Prime Minister Shehbaz Sharif announced that the World Bank will invest $40 billion in Pakistan, with $20 billion allocated to the private sector through the International Finance Corporation (IFC) and another $20 billion for development sectors including health, education, and youth development.
Fact: The Prime Minister’s statement contains significant misrepresentations of the World Bank Group’s (WBG) Country Partnership Framework (CPF) for Pakistan.
On February 17 2025, the Government of Pakistan and Prime Minister Shehbaz Sharif shared official announcements about the World Bank investing $40 billion in the country. Shortly after, social media was abuzz with posts sharing the news.
An article published by Dawn.com was more carefully worded, with the headline “PM Shehbaz welcomes $40bn ‘investment’ from World Bank”. The article quotes a statement from the Prime Minister’s House saying, “Under the World Bank’s recent Country Partnership Framework, an investment of $40bn will be made in Pakistan, which is welcome,” before going on to state, “In January, an official statement announced that the World Bank pledged to provide $20bn to Pakistan under a 10-year country partnership framework (CPF) to support inclusive and sustainable development within the country.”
This statement was also shared on 17 February by the Prime Minister’s official Facebook page, as well as the Government of Pakistan’s official page with a caption celebrating Sharif’s meeting with World Bank Executive Directors.
Fact or Fiction?
The World Bank’s Country Partnership Framework, offered to Pakistan for the 2026 fiscal year up to the 2035 fiscal year, was initially announced by the World Bank on 14 January 2025. On the same day, a press release discussing the details of this program was also released.
Social media posts shared after the prime minister’s announcement give off the impression that the World Bank invested in Pakistan in light of the country’s improving economic metrics. However, the executive summary of the CPF document notes, “After decades of volatile low growth and low investment, Pakistan has fallen behind its peers in key metrics of development. It now has an opportunity to durably take another course. Per capita incomes have long stagnated, and high rates of child mortality, child stunting, fertility, and learning poverty persist, following decades of underinvestment in health, education, water and sanitation, and other public services.”
The document announcing the CPF program notes that it is a WBG “financing” of “US$30 to 40 billion,” which entails that the total financing amount can be anywhere between US$30 to 40 billion and is not necessarily exactly $40 billion.
In addition, it states that the World Bank’s indicative lending envelope for FY26–35 will total around US$20 billion with US$14 billion coming from the International Development Association (IDA) and US$6 billion from the International Bank of Reconstruction and Development (IBRD). Both of these loans will depend on various metrics such as availability of IDA special windows, country demand, overall macroeconomic performance, and global developments which may affect the IBRD’s financial capacity and demand by other Bank borrowers.
The report further notes, “Due to Pakistan’s relatively low gross national income per capita, low socioeconomic indicators, institutional and fiscal challenges, and vulnerability to climate shocks, it is not expected to graduate from IDA during the coming cycles that span the CPF period.” Pakistan’s ability to access IDA funding depends on various achievements in the six key outcomes mentioned later in this article.
The CPF program is essentially a 10-year loan with a Performance and Learning Review (PLR) planned in the fiscal year 2030. Only after the PLR is conducted can the final terms of the CPF be decided. And in order to ensure that the CPF remains intact, the World Bank Group will evaluate Pakistan’s performance based on the following key features from their WBG Corporate Scorecard, mentioned in the document linked above:
- 50 million people receiving quality health, nutrition, and population services, 30 million women using modern contraceptives, 60 million people provided with water, sanitation and/or safely managed hygiene.
- 12 million students supported with better education with focus on foundational learning of primary and secondary school students.
- 30 million people with strengthened food and nutrition security, 75 million people with enhanced resilience to climate risks with focus on resilience to floods and other climate-related disasters.
- 10 gigawatts of renewable energy capacity enabled sustainably, including via grid strengthening and gradual replacement of thermal generation capacity, 35% reduction of the population-weighted PM2.5 average annual exposure (from 55 to 35 µg/m3)
- Tax revenues-to-GDP ratio above 15% with increased collections.
- Rise in private investment as a percentage of GDP.
While these indicators are still far from reach, the World Bank’s CFP document notes that in Pakistan poverty has “after decades of decline, poverty has begun to rise,” with school dropouts and food insecurity increasing in the poorest districts.
Primary features of the loan package
According to the official CFP program document:
- Annual commitments are expected to remain in the US$1.5 billion to US$2 billion range, with increased leveraging of World Bank lending as well as the suite of guarantees instruments, to support cross-border investment, lending, and trade finance.
- The CPF period currently runs from FY26 up to FY35, with a PLR in late FY30 to assess progress, course-correct if priorities or circumstances change significantly (including lack of sustained traction in certain areas), and to decide whether the CPF will cover the whole 10-year period or a new CPF will need to be designed.
- The World Bank will closely collaborate for joint funding initiatives with the ADB, the Asian Infrastructure Investment Bank (AIIB), the European Investment Bank (EIB), the Islamic Development Bank (IsDB), and United Nations agencies — as well as s the Bill and Melinda Gates Foundation (BMGF), the Global Partnership for Education, Gavi, the Vaccine Alliance, the Green Climate Fund-IFC Global Resilient Water Infrastructure Facility, and the Global Financing Facility (GFF) and bilateral aid agencies from the UK, France, Germany, Japan and others.
Unlike local media’s coverage, international news organisations such as Nikkei Asia and DW, make it very clear that it is a long-term loan agreement. DW mentions “The World Bank will supply Pakistan with $20 billion of loans over the next decade which are expected to be invested in nutrition, education and renewable energies in the hope of stimulating private-sector growth.”
It is clear that this new package is a series of loans which are to be disbursed over the next 10 years, depending on the PLR which is scheduled to be done in 2030. This should neither be considered an investment nor a testament to Pakistan’s improving economic situation.
Virality
Several news organisations such as ARY News Urdu, Express Tribune, PTV World, Azaad English, News 99 and others, shared the news without any clarification of the terms of these loans, on Facebook.
Other posts were also found on the platform, some of which can be seen here, here, here, here, here, here, and here. The PMLN also shared it on their Facebook page here.
Conclusion: The World Bank is not investing $40 billion in Pakistan, the bank is merely giving the country a long-term loan, which too will be based on how Pakistan’s performance meets specific metrics.
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Background image in cover photo: Investopedia
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