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Pakistan and the Islamic Development Bank (IsDB) signed three financing agreements in Islamabad on January 20, 2026, totaling US$603.4 million. The funding is allocated to a motorway segment, a poverty-graduation project, and education access in Azad Jammu and Kashmir (AJ&K). IsDB reported the total in a January 21 release.
How the US$603.4 million is divided
| Project | IsDB financing | Sector and stated reach |
|---|---|---|
| M6 Motorway Project | US$475 million | Transport infrastructure: a 120.8-kilometer segment of the Peshawar–Karachi Motorway. |
| Poverty Graduation Project | US$118.4 million | Livelihoods and human capital support, with job creation as an aim; IsDB says it will support 68,500 households. |
| Out-of-School Children Project, AJ&K | US$10 million | Non-formal learning intended to reach 60,000 out-of-school children, upgrade 135 schools, establish 250 learning centers, and train 4,000 teachers. |
The three allocations add up to US$603.4 million, the total reported by IsDB. Most of the financing—US$475 million—is for the M6 segment.
What each agreement is intended to fund
M6 Motorway: a 120.8-kilometer link
IsDB’s US$475 million allocation is for a 120.8-kilometer portion of the M6, part of the Peshawar–Karachi Motorway. The stated purpose is to close a gap in Pakistan’s north–south transport corridor. The release describes the funded segment and purpose but does not provide a construction timetable or completion date.
Poverty Graduation Project: household support figures differ by source
IsDB says the US$118.4 million project will support 68,500 households to improve livelihoods, enhance human capital, and contribute to job creation. That is the bank’s stated wording and beneficiary figure.
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Radio Pakistan separately reports a total project cost of US$134.2 million, including US$118.4 million from IsDB, and says the initiative will be implemented in 25 districts and benefit more than 160,000 households. The two reports give different household figures and do not explain the difference; they should not be treated as equivalent measures. See Radio Pakistan’s account for its project-cost and reach figures.
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What is known about the broader financing framework
IsDB said the signings conclude financing agreements under its 2023–2025 Country Engagement Framework for Pakistan. The bank also said it proposed starting a 2026–2030 Member Country Partnership Strategy aligned with the government’s Uraan Pakistan plan for 2024–2029. The release presents the new strategy as a proposal, not as an adopted or completed strategy.
The event announcements do not specify detailed financing instrument terms, repayment schedules, disbursement milestones, procurement arrangements, or project completion dates. The US$603.4 million headline total alone does not establish those details.
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