ISLAMABAD, Feb 6: The World Bank has hinted at revival of its semi-commercial loans for funding development projects in the energy sector and areas that fall in the zone of corridor in Pakistan.

Managing Director World Bank Ms Ngozi Okonjo-Iweala disclosed this in meetings held with economic team of Pakistan led by State Minister for Finance Ms Hina Rabani Khar followed by another meeting with the prime minister here on Friday.

Ms Ngozi was on a fact-finding mission to Pakistan to review the performance of economic indicators as part of $500 million loan for poverty reduction and economic support programme inked recently but awaited approval of the World Bank board.

After having presentation from the economic team, Ms Ngozi appreciated the fiscal and monetary discipline maintained by the financial team of the new government. She hoped that this momentum would continue in future. She said that Pakistan has immense potential to develop as the logistical hub of the region as well as the Middle East.

The assurance of semi-commercial loan of (International Bank for Reconstruction and Development--IBRD) is linked with the improvement in the macroeconomic indicators during the first-half-year of the current fiscal year.

She informed that the WB would like to help Pakistan in its agenda for social development, especially government schemes like Benazir Income Support Programme.

Ms Ngozi appreciated Pakistan’s efforts for revenue collection and meeting the revenue targets. She added that Pakistan needs to capitalise on new initiatives from institutions like International Finance Corporation (IFC) and other multilateral and bilateral donors.

She informed Pakistan’s economic team about the Bank’s support for organising a donors’ conference in order to mobilise multilateral and bilateral donors in a structured process to meet the country’s financing gaps.

Prime Minister Yousuf Raza Gilani during a meeting informed the World Bank managing director that the IMF programme was on track. He said that steps have been taken by his government to implement macroeconomic reforms such as phased removal of subsidies on petroleum and power prices, tightening of monetary policy, increasing revenue and controlling expenditures while reducing borrowing from the State Bank.

He said that the IBRD’s financing in Pakistan should be resumed. The World Bank should consider supporting financing the energy sector projects. He said Pakistan is looking forward to increased support from the World Bank in the development and infrastructure sectors.

He also appreciated the Bank for considering supporting Pakistan in developing the North-South Trade corridor, which would include building of rail, road and allied infrastructure. This, he said, would boost trade in the country in addition to benefiting the economy in general.He lauded World Bank’s indication to disburse approximately $500 million as budgetary support by June 30, 2009.

The prime minister expressed the confidence that The Friends of Pakistan forum would open new vistas of economic assistance, and investment in Pakistan in the coming months allowing the country to meet the challenges it is currently faced with.

He said the government has taken steps to improve the power situation in the country and in addition to encouraging new power plants and importing energy from Iran, alternate energy sources are also being tapped.