World Bank recommends key reforms in Pakistan

ISLAMABAD: The World Bank in its South Asia development report emphasized for improvement in taxation system and enhancing tax collection in Pakistan.

The WB report suggested key reforms for Pakistan also include modernizing irrigation and linking energy subsidies to social protection programs.

The World Bank recommends measures to discourage pollution as a way to improve revenue collection.

The report observed that Pakistan faces severe water shortages, with inefficient irrigation and agricultural practices causing major water wastage. Modern irrigation projects in Punjab have demonstrated that 57% water can be saved while crop yields can rise by 14–31%.

The report warns that groundwater resources are depleting rapidly in South Asia region, highlighting the need for sustainable water management and long-term agricultural reforms.

The report also stresses improvements in agriculture and social sectors to ensure sustainable growth.

The World Bank emphasizes that Pakistan needs to boost its tax system to increase revenue. Linking electricity and gas subsidies to the Benazir Income Support Program can help reduce misallocation, cut financial losses, and curb circular debt.

The report notes that redirecting fuel subsidies toward social protection programs could support vulnerable populations while ensuring fiscal stability.

The report also highlights ongoing reforms in social sectors, including establishing a climate risk facility to support small businesses affected by floods.

The Benazir Income Support Program (BISP) has been made effective with digitization. During Covid-19 pandemic 12 million families were provided assistance with BISP mechanism, report said.