ISLAMABAD: Pakistan plans to borrow $500 million from the Asian Development Bank to finance pension reforms, a loan equivalent to about 138.48 billion Pakistani rupees, according to sources in the Finance Ministry.
The program, titled the Transforming Public Sector Pension Program, will be structured as a three-year program loan, the sources said.
The ADB financing will also include $15.92 million in technical assistance, they said.
According to the sources, the program is scheduled to begin Nov. 1, 2026, and conclude in November 2029.
The new loan program will be linked to the achievement of specified reform results, the sources said.
Pakistan’s existing pension system has become a major burden on the national treasury, with the federal government’s annual pension bill reaching 1.169 trillion rupees, according to the sources.
The planned reforms are aimed at addressing the growing fiscal pressure from pension expenditures and improving the sustainability of the public sector pension system.