Pakistan: Islamic Republic of Pakistan: Enabling Asset Leasing as a Financing Approach for Schools

Sovereign Project | 55289-001

The proposed TA will support the preparation of a feasibility report to evaluate various education sector-focused asset leasing_models for procuring school equipment,_infrastructure-facilities and services by public and private sector schools in Pakistan. The TA will also develop a program implementation plan and operations model with appropriate private sector participation.

Project Details

  • Project Officer
    Hegde, Abhishek Naveen
    Central and West Asia Department
    Request for information
  • Country/Economy
    Pakistan
  • Sector
    • Education
Project Name Islamic Republic of Pakistan: Enabling Asset Leasing as a Financing Approach for Schools
Project Number 55289-001
Country / Economy Pakistan
Project Status Active
Project Type / Modality of Assistance Technical Assistance
Source of Funding / Amount
TA 6860-PAK: Enabling Asset Leasing as a Financing Approach for Schools
Technical Assistance Special Fund US$ 200,000.00
Strategic Agendas Inclusive economic growth
Drivers of Change Governance and capacity development
Partnerships
Private sector development
Sector / Subsector

Education / Education sector development

Gender Equity and Mainstreaming No gender elements
Description The proposed TA will support the preparation of a feasibility report to evaluate various education sector-focused asset leasing_models for procuring school equipment,_infrastructure-facilities and services by public and private sector schools in Pakistan. The TA will also develop a program implementation plan and operations model with appropriate private sector participation.
Project Rationale and Linkage to Country/Regional Strategy

1. Pakistan has recorded significant improvements in overall school participation and educational attainment. However, it faces severe challenges in providing high-quality and adequate education to eligible children, with its primary gross enrolment ratio increasing from 49.1% in 1980 to 94.0% in 2019._Schools lack basic infrastructure-facilities and services, including electricity, toilets, and information and communication technology labs for students and teachers, creating an unfavourable learning and teaching environment. Schools also suffer from a high student to teacher ratio (number of students per teacher) and stands at 44 for primary schools across the country (footnote 3). Despite improvements made in existing schools and establishment of new schools, poor overall facilities and lack of basic facilities continue to remain as the primary reason for high student dropouts. Of the total school buildings in Pakistan, 55% have fallen into disrepair and are considered unsafe or of low quality. Only 52% of public schools have boundary walls, electricity, drinking water and toilets, while 11% of public schools have none of these.

2. Experiences, especially in the United Kingdom, have shown that asset leasing as a financing modality for procuring equipment by schools has several advantages. Asset leasing (i) leads to more efficient management of school finances; (ii) increases the affordability of schools in procuring higher standard of equipment with a lower upfront cost; (iii) reduces the burden of asset disposal beyond useful life, allowing for the latest technologies and replacement equipment to be paid for over the period the equipment is used.

3. In Pakistan, leasing is a licensed_activity that is performed either by commercial banks_or by non-banking finance companies (NBFCs) or Mudarabah._Although the leasing industry in Pakistan has a market value of approximately $206 million and has diversified to industrial machinery, automobiles, and computer hardware, it is still a relatively nascent industry. It lacks innovative products and is confined mostly to small and medium ticket leasing particularly involving vehicles and machinery. Its challenges include resource mobilization constraints relating mainly to the currently volatile interest rate scenario, squeezing of margins, and non-availability of long-term funds and difficulties in recoveries._The leasing of machinery and other industrial equipment has slowed down due to the COVID-19 induced recession._

Impact

Providing fair and equal opportunity to all children to receive a high quality of education.

Project Outcome
Description of Outcome

Asset leasing as a financing option for schools implemented

Progress Toward Outcome
Implementation Progress
Description of Project Outputs

Feasibility study on asset leasing as a financing option for schools in Pakistan prepared

Program implementation plan for asset leasing as a financing option for schools in Pakistan prepared

Status of Implementation Progress (Outputs, Activities, and Issues)
Geographical Location Nation-wide
Summary of Environmental and Social Aspects
Environmental Aspects
Involuntary Resettlement
Indigenous Peoples
Stakeholder Communication, Participation, and Consultation
During Project Design
During Project Implementation
Responsible ADB Officer Hegde, Abhishek Naveen
Responsible ADB Department Central and West Asia Department
Responsible ADB Division Office of the Director General, CWRD
Executing Agencies
Asian Development Bank
Timetable
Concept Clearance -
Fact Finding -
MRM -
Approval 08 Dec 2021
Last Review Mission -
Last PDS Update 08 Dec 2021

TA 6860-PAK

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
08 Dec 2021 - 08 Dec 2021 31 May 2022 31 Mar 2023 -
Financing Plan/TA Utilization Cumulative Disbursements
ADB Cofinancing Counterpart Total Date Amount
Gov Beneficiaries Project Sponsor Others
200,000.00 0.00 0.00 0.00 0.00 0.00 200,000.00 18 Oct 2022 6,438.56

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Evaluation Documents See also: Independent Evaluation

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Related Publications

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Tenders

Tender Title Type Status Posting Date Deadline
National Financing Expert Individual - Consulting Closed 12 Oct 2022 18 Oct 2022
Education Sector Procurement Specialist and Coordinator Individual - Consulting Closed 12 Oct 2022 18 Oct 2022
Education Sector Specialist and Team Lead Individual - Consulting Closed 12 Oct 2022 18 Oct 2022
National Financing Expert Individual - Consulting Closed 28 May 2022 01 Jun 2022
Education Sector Procurement Specialist and Coordinator Individual - Consulting Closed 28 May 2022 01 Jun 2022
Asset Leasing Specialist Individual - Consulting Closed 17 May 2022 23 May 2022
Education Sector Specialist and Team Lead Individual - Consulting Closed 02 Feb 2022 08 Feb 2022

Contracts Awarded

No contracts awarded for this project were found


Procurement Plan

None currently available.