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Feasibility studies for ADB and World Bank in Pakistan

Why this is important 

Pakistan is currently struggling with economic difficulties including a large debt crisis. This and a variety of other challenges – including repeated national disasters – have resulted in development indicators that are amongst the lowest in the region. There is a significant opportunity to fund development in a new and innovative manner, and outcomes-based finance and solutions are needed to address these problems at scale. 

To address some of the country’s most pressing issues, ADB and the World Bank were keen to explore the feasibility of outcomes-based finance and impact bonds in Pakistan. Both institutions individually commissioned the British Asian Trust to lead two pieces of research to this end.  

  • In 2021, the Asian Development Bank (ADB) commissioned the British Asian Trust to assesses the feasibility of applying impact bonds in Pakistan.    
  • In 2023, the World Bank commissioned us to map the non-formal education sector in Pakistan to assess the role of outcomes-based financing tools to drive better impact in the ecosystem.     

Project Partners: Asian Development Bank, World Bank 

Duration: 2021 - 2023 

What we are doing

ADB feasibility study:  

  • Provided lessons from the international deployment of impact bonds. 
  • Assessed the current funding landscape in Pakistan. 
  • Reviewed Government priority areas that would benefit from an impact bond approach.  
  • Consulted with over 70 global and local stakeholders, including Government, investors, service providers, donors and research organisations on the strengths and challenges of designing and executing an impact bond in Pakistan. 

World Bank feasibility study: 

  • Mapping non-formal education programmes that target out-of-school-children to determine where outcomes-based instruments might be suitable and deliver better outcomes. 
  •  Exploring the existing legal and regulatory environment that are relevant for different outcomes-based instruments and evaluating what is needed to design and implement programmes.  
  • Proving the business case for outcomes-based financing to demonstrate the value for money it can deliver.