The World Bank has urged Pakistan to adopt concrete and results-focused power sector reforms before seeking multibillion-dollar financing over the medium to long term. Officials said the lender wants clear actions to reduce losses, improve efficiency, and stabilise a sector that continues to drain public finances heavily.
Sources revealed that Pakistan approached the World Bank to refinance power sector debt by replacing expensive local and commercial loans with cheaper multilateral financing options. At the same time, the government plans to raise the incremental electricity package for industries from twenty five to fifty percent.
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This proposed relief aims to revive industrial demand, which fell sharply last fiscal year due to a slowdown in large scale manufacturing and reduced energy consumption. Officials believe lower power costs could help industries recover output, restore confidence, and support broader economic activity.
Meanwhile, Finance Minister Senator Muhammad Aurangzeb met World Bank Country Director Bolormaa Amgaabazar to review cooperation under the Country Partnership Framework. Both sides noted Pakistan’s progress toward macroeconomic stability through careful fiscal and monetary steps taken during recent economic challenges.
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They also stressed that stability must now translate into sustained growth, higher investment, and job creation across multiple sectors of the economy. In addition, they discussed priority areas including digital exports, agriculture, minerals, healthcare, and manufacturing for future World Bank-supported programmes.
Both sides agreed that targeted sector reforms, backed by strong regulation and institutions, could boost exports and create high-impact employment opportunities. As a result, the World Bank signalled that meaningful power sector reforms would remain central to any major future funding for Pakistan.