Launch of first Pakistan Skills Impact Bond

The British Asian Trust has played a pivotal role in the launch of the Pakistan Skills Impact Bond (PSIB), a government-led initiative that marks a significant shift toward outcomes-based, private-capital-enabled financing for skills development in Pakistan.

The PSIB is Pakistan’s first skills impact bond, with an inaugural Rs 1 billion pilot tranche as part of a three-year programme. It moves away from traditional input-based public spending towards a model that links funding to independently verified outcomes, including certification, job placement and sustained employment, with a strong focus on post-placement retention. Supported by a catalytic government guarantee, the Bond aims to crowd in private capital, strengthen accountability, and demonstrate a scalable approach to human capital development.

The British Asian Trust took a central role in initiating and shaping the PSIB, convening government counterparts, financial institutions, and delivery partners around a shared vision for outcomes-based skills financing. In close collaboration with the Government of Pakistan, NAVTTC, the federal apex body responsible for regulating and coordinating technical and vocational education and training in Pakistan, and the Bank of Punjab, the Trust supported the end-to-end development of the programme. This included providing technical assistance and serving as a design partner, with a focus on structuring the instrument, developing the outcomes and performance framework, aligning stakeholder incentives, and embedding gender inclusion at the core of programme design. The British Asian Trust’s technical assistance for the design and launch of the PSIB was supported in part through a grant from the UK Foreign, Commonwealth and Development Office (FCDO).

Following the launch, the programme is now moving into implementation. NAVTTC has issued a Request for Proposals to onboard service providers, marking the start of delivery preparations. In parallel, work is underway to strengthen provider readiness for outcomes-linked financing. A dedicated Programme Management Unit is also being established to coordinate stakeholders and oversee performance management as implementation begins.

With implementation underway, the PSIB has been designed with a clear pathway to scale, creating opportunities for additional outcomes funders and catalytic partners to come in alongside government to support this ground breaking initiative to achieve greater impact.

The PSIB has the potential to strengthen skills systems, improve employment outcomes, and demonstrate the value of effective public-private partnerships at scale.