Pakistan secures $603 million in Islamic Development Bank financing

Pakistan on Tuesday signed three loan agreements worth $603 million with the Islamic Development Bank to support infrastructure development, poverty alleviation, and education initiatives, officials said.

The agreements were signed after a meeting between Federal Minister for Economic Affairs Ahad Khan Cheema and Islamic Development Bank Vice President Dr. Rami Ahmed, according to the Ministry of Economic Affairs.

The loan documents were signed by Dr. Rami Ahmed and Economic Affairs Division Secretary Muhammad Hameer Karim. Federal Minister for Poverty Alleviation and Social Protection Syed Imran Ahmed Shah and other senior government officials were also present.

Under the agreements, the Islamic Development Bank will provide $475 million for the M-6 Sukkur-Hyderabad Motorway, a key segment of the proposed Peshawar-to-Karachi Motorway, a major north-south transport corridor.

Pakistan and the bank also agreed to launch a program aimed at lifting extremely poor and flood-affected households out of poverty. The initiative seeks to shift families away from reliance on cash assistance and toward sustainable livelihoods, economic self-reliance, and stronger financial foundations.

The poverty alleviation program has a total cost of $134.2 million, with the Islamic Development Bank contributing $118.4 million. The project will be implemented in 25 districts nationwide and is expected to benefit 160,866 households.

The agreements further include $10 million in financing for a project targeting out-of-school children in Azad Jammu and Kashmir. Officials said the project will help re-enroll approximately 60,000 children and provide training for 4,000 teachers.

Speaking at the signing ceremony, Dr. Rami Ahmed said the Islamic Development Bank is keen to expand cooperation with Pakistan in areas of mutual interest. Minister Ahad Khan Cheema welcomed the support and praised the bank’s continued assistance to Pakistan.