On Monday, 29^th September 2025, Dr. Rashid Amjad, Professor of Economics and Director, Graduate Institute of Development Studies, Lahore School of Economics, delivered a lecture on “Role of Foreign Economic Assistance in Pakistan’s Economy” to participants of the 38^th Senior Management Course at the National Institute of Public Administration, Lahore.

Dr. Rashid began by clarifying definitions and channels of Official Development Assistance (ODA) and Foreign Economic Assistance (FEA), distinguishing grants, bilateral support, multilateral lending (IMF, World Bank, ADB, IsDB, AIIB), and commercial financing (Euro/Sukuk bonds, diaspora instruments). He traced the traditional two/three-gap justifications savings, foreign exchange, and skills gaps linking them to Pakistan’s historical boom‒bust cycles (Ayub, Zia-ul-Haq, Musharraf periods) in which surges of external inflows coincided with expansions but also postponed reforms.

Turning to macro management, he outlined the external financing gap for FY 2023‒24 (~US$28 billion) and its composition (IMF, WB/ADB, Saudi Arabia, IDB, China, commercial banks), before reviewing programmatic stabilization under the IMF 37-month EFF (2024-27) revenue mobilization, tight monetary stance to re-anchor inflation, energy-sector cost reforms. SOE governance, climate resilience and the earlier 9-month SBA (2023). He also noted the evolving CPEC envelope (approx. US$60 billion by 2024 estimates) and the World Bank’s new Country Partnership Framework (2025‒35) targeting six outcomes from human capital to cleaner energy and better public spending.

Addressing governance and political economy, Dr. Rashid highlighted concerns over debt sustainability, pricing and transparency in large projects, and risks of aid dependency alongside critiques of “aid as imperialism” and the potential for a foreign-aid trap. He urged disciplined use of assistance to close structural gaps while accelerating domestic reforms in taxation, competitiveness, and institutional capacity. The session concluded with a Q&A on calibrating external finance with reform momentum to secure sustained, inclusive growth.