The International Finance Corporation (IFC), the private-sector arm of the World Bank Group, has signed its first Pakistani rupee-denominated investment partnership with Engro Fertilisers Limited, marking a major milestone in expanding access to long-term local-currency financing in Pakistan.
Under the agreement, IFC will provide an unfunded Partial Credit Guarantee of up to Rs 33.6 billion (approximately US $120 million equivalent) to support long-term Pakistani rupee financing arranged by Standard Chartered Bank Pakistan Limited for Engro Fertilisers.
The financing is designed to strengthen Pakistan’s agricultural value chain by mobilizing local capital and enabling Engro Fertilisers to make critical capital investments, including the maintenance of production facilities and operational turnarounds, while ensuring a reliable supply of urea and other fertilizers to meet national demand.
This partnership also includes a first-loss counter guarantee from the IFC-Canada Facility for Resilient Food Systems, further enhancing the structure’s attractiveness to commercial lenders and expanding the potential for similar future investments.
By leveraging PKR-denominated financing, the initiative helps reduce reliance on foreign-currency borrowing, which can expose companies to exchange-rate volatility, and strengthens domestic capital markets, an important step in supporting sustainable economic growth, especially in the agriculture sector that contributes significantly to Pakistan’s GDP, exports, and employment.
Engro Fertilisers CEO Ali Rathore emphasised that mobilising local capital reflects the company’s commitment to food security and agricultural stability in Pakistan, while IFC officials highlighted the importance of innovative financing solutions to overcome structural challenges and support long-term resilience.
This first rupee-denominated investment signals a stronger focus on developing local currency financing mechanisms and boosting investor confidence in Pakistan’s economic prospects.
