The International Finance Corporation (IFC), the World Bank Group’s private sector arm, has announced its first investment in Pakistani rupees to support the country’s agricultural sector.
In a statement on Tuesday, IFC revealed an unfunded credit guarantee of up to 33.6 billion rupees. This will enable long-term financing from Standard Chartered Bank Pakistan to Engro Fertilisers Limited.
As Pakistan’s inaugural local currency investment by IFC, it expands access to vital long-term funding in both local and foreign currencies—essential for growth in key areas like agriculture, micro-enterprises, and small businesses.
The initiative will help Engro Fertilisers strengthen Pakistan’s agricultural value chain by tapping domestic financial resources. Supported by a first-loss guarantee from IFC and Canada’s Facility for Resilient Food Systems, it promotes food security and operational resilience through rupee-denominated financing.
This funding allows Engro to maintain facilities, conduct necessary turnarounds, and ensure a steady supply of urea and other fertilizers to meet national demand. It also backs farmer programs, aligning with the company’s mission of reliable production.
Agriculture is central to Pakistan’s economy, accounting for 24% of GDP, 70% of exports, and 40% of employment. Yet it faces challenges like inefficient supply chains, limited farmer funding, low literacy, and rising input costs—this investment addresses several of these.
Engro Fertilisers CEO Ali Rathore said: “Engro has consistently aimed to address Pakistan’s most urgent challenges in a meaningful way. Utilizing local capital to fortify local value chains demonstrates our dedication to the country and our farmers, who are the backbone of Pakistan’s economy, through reliable fertilizer production. We appreciate partners IFC and Standard Chartered for facilitating this mission.”
IFC’s Regional Industry Head for Manufacturing, Agribusiness, and Services in the Middle East and Central Asia, Ashraf Megahed, added: “This initiative showcases the strength of our collaboration with Engro Fertilisers and Standard Chartered Bank, as well as our mutual commitment to delivering innovative solutions that sustainably address challenges. Through this project, we are creating new avenues for long-term financing in local currency that supports growth and financial resilience, managing country risk in a sector crucial to the economy.”
Standard Chartered’s CEO and Head of Coverage in Pakistan, Rehan Shaikh, noted: “At Standard Chartered, we are dedicated to financing solutions that foster sustainable growth and long-term resilience within Pakistan’s economy. This collaboration with IFC and Engro Fertilisers embodies our shared goal of enhancing food security and supporting one of the nation’s most vital value chains. We look forward to continuing our partnership with IFC to replicate this successful model throughout our network.”
The announcement builds on a partnership forged about two months ago with the State Bank of Pakistan (SBP). On October 21, SBP signed an agreement with IFC under the International Swaps and Derivatives Association (ISDA) framework, enabling multilateral investments in rupees while managing exchange rate risks.
Borrowing in hard currencies like the US dollar—while earning revenue in local currency—exposes emerging-market businesses to major exchange rate risks. This approach bolsters financial resilience and economic stability.
