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World Bank to give $4.5B to Pakistan

May 2, 2005 at 6:55 PM

ISLAMABAD, Pakistan, May 2 (UPI) -- The World Bank announced Monday it will grant a $4.5 billion loan to Pakistan to help expedite that nation's economic recovery.

The loan will be paid during the next three years with an average annual loan of $1.5 billion, World Bank Vice President for South Asia, Praful Patel, told reporters in Islamabad.

Recent reports by international financial agencies have suggested Pakistan has made a considerable economic recovery under President Pervez Musharraf, but needs assistance to avoid a relapse.

The country's economy was on the verge collapse when Musharraf assumed power in 1999.

Patel said the World Bank loan will be used to support Pakistan's efforts at economic re-construction and to expedite social sector development.

"At present, the annual lending to Pakistan is about $900 million, which will be enhanced to $1.5 billion from fiscal year 2005-06, for a period of three years," said Patel, who was in Islamabad to participate in a meeting of the Pakistan Development Forum.

Half of the annual lending will be interest-free.

Patel heads the World Bank's South Asia wing, which deals with Pakistan, India, Bangladesh, Sri Lanka and Afghanistan.

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