In a significant development for Pakistan’s external financing landscape, a Project Agreement between the International Finance Corporation (IFC) and Bank Alfalah Limited (BAFL) for Pakistan’s first Diversified Payment Rights (DPR) Programme was signed today at the Finance Division, Islamabad, in the presence of Federal Minister for Finance and Revenue, Senator Muhammad Aurangzeb.
The Project Agreement was signed by Ms. Momina Aijazuddin, Regional Industry Director, Financial Institutions Group, Middle East & Central Asia, IFC, and Mr. Atif A. Bajwa, President & CEO, Bank Alfalah Limited.
The DPR Programme, being pursued under the direction of the Prime Minister, provides an innovative mechanism for mobilizing long-term foreign currency financing through eligible future foreign-currency payment flows. The initiative aims to diversify sources of external financing and facilitate greater access to international capital markets.
The initial transaction envisages up to US$100 million of financing under the DPR structure. Subject to market conditions and the performance of the initial transaction, the programme may provide a platform for further financing and broader participation by international institutional and private investors.
Speaking on the occasion, Senator Muhammad Aurangzeb appreciated the close coordination among the Ministry of Finance, State Bank of Pakistan, IFC and Bank Alfalah in developing the transaction. He noted that the initiative involved significant regulatory, policy and technical work and described its successful progression as an important first step that could pave the way for similar market-based financing structures in the future.
The Finance Minister emphasized the importance of diversifying Pakistan’s sources of foreign currency financing and developing innovative financing mechanisms to support investment and productive economic activity. He also highlighted the importance of effectively utilizing the financing channel and developing a pipeline of eligible projects requiring foreign currency funding.
Representatives of IFC appreciated the support and coordination extended by the Government of Pakistan and the State Bank of Pakistan and acknowledged the efforts of all stakeholders involved in bringing the transaction to this stage. They expressed confidence that the DPR structure could open an additional avenue for long-term international financing and contribute to further development of Pakistan’s capital markets.
Bank Alfalah acknowledged the support of the Government, State Bank of Pakistan and IFC and highlighted the significance of being the first Pakistani bank to undertake a DPR transaction. The bank expressed its commitment to leveraging the structure to support eligible foreign currency requirements and productive investment.
The transaction marks an important milestone in the development of Pakistan’s debt capital market and external financing framework. It also establishes a potential precedent for future DPR transactions by other Pakistani banks, subject to market conditions and the performance of the initial programme.
The ceremony was attended by Secretary Finance, Mr. Imdadullah Bosal; Mr. Simon Andrews, Division Director, Pakistan, Afghanistan, Kyrgyz Republic, Tajikistan & Turkmenistan, IFC; along with senior representatives from the Finance Division, International Finance Corporation, Bank Alfalah Limited and State Bank of Pakistan.
 and Bank Alfalah Limited (BAFL) for Pakistan’s first Diversified Payment Rights (DPR) Programme was signed today at the Finance Division, Islamabad, in the presence of Federal Minister for Finance and Revenue, Senator Muhammad Aurangzeb.){kind=link}