Pakistan’s $600 million loan canceled by World Bank

Last Updated on December 16, 2024 6:17 am

The World Bank has canceled a $600 million loan promised to Pakistan for the development sector of the national budget. The world’s largest lending institution also mentioned in a statement that no more budget-related loans will be given to Pakistan in the current fiscal year.

The country’s daily newspaper Express Tribune reported this information on Friday, saying that the Pakistani government could not fulfill almost any of the conditions under which the World Bank promised this loan to Pakistan.

This move by the World Bank is a big blow to Pakistan, which is struggling with a financial crisis. Because Islamabad had planned to apply for another $2 billion loan after receiving the budget-related loan. But due to the cancellation of the budget loan, the country’s plan to apply for a new loan also practically collapsed.

The World Bank was supposed to provide this loan proposed for the development of Pakistan’s environmentally friendly energy sector. The World Bank has approved Pakistan’s government project Affordable and Clean Energy Program (PACE) for the production and use of environmentally friendly energy in 2021.

It also promised to provide an initial loan of $1 billion to develop the project. Pakistan has already received $400 million as the first installment of that loan. The second installment of $600 million was supposed to arrive in December this year.