Pakistan faces a pressing employment challenge that will determine whether its large youth cohort becomes an economic boon or a source of social strain and external migration, World Bank President Ajay Banga said in an interview during a visit to Karachi.
Banga urged Pakistan to create between 2.5 million and 3 million jobs each year over the next decade - roughly 25 to 30 million in total - to absorb the rising number of young people entering the labour force. He warned that failure to generate this scale of employment could fuel "illegal migration or domestic instability."
"We’re trying to move the bank group as a whole from the idea of projects to the idea of outcomes," Banga said, underlining that "Job creation is the North Star." He described the employment imperative as "a generational challenge," saying Pakistan’s population dynamics mean that jobs will remain a binding constraint on growth rather than a peripheral policy objective.
Financing the partnership
The World Bank Group’s 10-year Country Partnership Framework (CPF), agreed with Pakistan last year and now entering implementation, commits around $4 billion a year in combined public and private financing. Banga noted that roughly half of that sum is expected to come through private-sector operations led by the International Finance Corporation. The reliance on private capital, he said, reflects constrained government fiscal space and the fact that 90% of jobs are created in the private sector.
Banga outlined three pillars of Pakistan’s job strategy: investment in human and physical infrastructure; business-friendly regulatory reforms; and expanded access to financing and insurance, especially for small firms and farmers that typically lack bank credit. He identified infrastructure, primary healthcare, tourism and small-scale agriculture as labour-intensive areas with the most potential to absorb workers.
On the specific role of agriculture, Banga said farming alone could account for about one-third of the jobs Pakistan needs to create by 2050, reflecting its labour intensity and reach into rural communities. He also pointed to a rising cohort of freelancers as evidence of entrepreneurial energy, but said those workers need better capital, infrastructure and support if they are to scale into employers rather than remain individual contractors.
Talent outflows and labour-market strain
The pressure Pakistan faces is visible in the departure of skilled professionals. According to Gallup Pakistan data based on Bureau of Emigration figures, nearly 4,000 doctors emigrated from Pakistan in 2025, the highest annual outflow on record. Banga used this statistic to underscore concerns that weak job prospects and poor working conditions are prompting trained professionals to seek opportunities abroad.
Power sector as an immediate constraint
Banga identified fixing the power sector as the most urgent near-term priority. He said losses and inefficiencies in electricity distribution have limited growth even as generation capacity has improved. Longstanding challenges in distribution - growing debt from losses, weak bill recovery and delayed government subsidies - have strained public finances and deterred private investment.
Reforms that expand privatisation and private-sector participation in electricity distribution are, in Banga’s view, critical to improving efficiency, cutting losses and restoring financial viability. He cautioned that rapid rooftop solar adoption, while lowering energy costs for households and businesses, risks causing grid instability if distribution reforms are not accelerated.
"Electricity is fundamental to everything - health, education, business and jobs," Banga said.
Climate resilience integrated into development
On the subject of climate, Banga argued that resilience must be folded into mainstream development spending instead of treated as a separate agenda. Pakistan, he noted, is among the most climate-vulnerable countries and faces recurring floods, heatwaves and erratic monsoons. He said investments that build climate resilience should be embedded in infrastructure, housing, water management and agriculture to support jobs while lowering long-term risks.
"The moment you start thinking about climate as separate from housing, food or irrigation, you create a false debate. Just build resilience into what you’re already doing," he said.
Framing and outlook
Banga said he prefers to view Pakistan not through labels such as fragility or crisis but as a long-term job-creation opportunity. He framed the World Bank’s role in optimistic terms. "We’re in the business of hope," he said, while reiterating that operational focus must shift from isolated projects to measurable outcomes tied to employment generation.
As the CPF moves into implementation alongside ongoing work with the International Monetary Fund to stabilise the macroeconomy, Pakistan faces pressure to deliver sustained growth and large-scale job creation. The combination of financing commitments, sectoral priorities and operational emphasis on outcomes outlines a strategy that aims to confront that scale of challenge directly.