By Qudsia Bano

Pakistan is implementing 86 foreign-funded development projects with financial support from multilateral and bilateral partners, underscoring the continued role of international development cooperation in financing infrastructure, social development and institutional reforms across the country.

According to the Ministry of Planning, Development and Special Initiatives' Monthly Development Update (June 2026), the current portfolio comprises 15 fully foreign-funded projects, while the remaining projects are being implemented with a combination of foreign assistance and local counterpart funding provided by the government.

The report states that the government has allocated a rupee cover of Rs229 billion for foreign-funded projects during FY2025-26 to facilitate timely implementation. Funds are released through a structured mechanism under which the Ministry of Planning authorises one-line releases to sponsoring ministries and divisions in accordance with quarterly expenditure ceilings approved by the Finance Division. Principal Accounting Officers (PAOs) are authorised to sanction both foreign assistance and local counterpart funding according to individual project requirements.

According to SAP records cited in the report, ministries and divisions had sanctioned Rs121.3 billion for foreign-funded projects by the end of May 2026, while actual expenditure reached Rs98.6 billion, reflecting continued implementation across sectors supported by international development partners.

The World Bank remained Pakistan's largest development financing partner during the period. According to the report, projects supported by the World Bank accounted for Rs54.1 billion in expenditures and Rs63.5 billion in major sanctions, highlighting the institution's significant contribution to the country's ongoing development programme.

The Asian Development Bank (ADB) also continued to play a major role, with project sanctions amounting to Rs30.8 billion and expenditures reaching Rs21 billion during the reporting period. The report indicates that ADB-supported initiatives remain concentrated in infrastructure, energy and other priority development sectors.

Other international development partners also maintained their support for Pakistan's development agenda. According to the report, projects financed by multiple donors accounted for Rs16.3 billion in sanctions and Rs15.8 billion in expenditure. Additional assistance was provided by Germany, France, South Korea and the United States through a range of sector-specific initiatives.

The report emphasises that effective implementation of foreign-funded projects remains a key priority for the government. To strengthen oversight, the Ministry of Planning continued to monitor and evaluate project performance through a structured monitoring and evaluation (M&E) framework aimed at ensuring the prudent utilisation of public resources and improving service delivery.

According to the document, monitoring and evaluation activities help identify implementation gaps at an early stage and facilitate timely corrective measures. The ministry considers M&E an important instrument for strengthening institutional oversight, improving project execution and promoting evidence-based decision-making throughout the development process.

During May 2026, the Ministry of Planning successfully monitored 20 development projects, meeting its monthly target in full. In addition, three projects were evaluated to assess implementation progress and ensure that planned development outcomes were being achieved.

According to the report, the combination of sustained international financing and strengthened monitoring mechanisms is expected to improve the efficiency of project implementation while ensuring better utilisation of development resources. The government believes that close coordination with international development partners and regular project oversight will remain essential for delivering infrastructure, social sector and institutional reforms that support Pakistan's long-term economic development.

Credit: INP-WealthPk