Govt hires IVA for USD400m ADB-backed SOEs, NHA reforms

ISLAMABAD: The government has initiated the hiring of an Independent Verification Agency (IVA) to oversee and validate reforms under a USD 400 million Asian Development Bank (ADB)-funded programme aimed at improving the governance and financial performance of 39 state-owned enterprises (SOEs) and the National Highway Authority (NHA), which collectively carry liabilities of nearly USD 12 billion.

These entities are struggling under a mounting debt burden, with disbursement of international financing tied directly to independently verified performance targets, said an official document.

The Finance Division has invited bids from audit firms, consulting companies, research institutions, think tanks, and development organisations to act as the independent verifier for the “Accelerating State-Owned Enterprises Transformation Program,” a five-year reform initiative running from 2025 to 2030.

According to the official document, the selected agency will independently assess whether key reform milestones have been achieved before ADB releases funds under the results-based lending programme.

The programme targets 40 commercial SOEs, including the NHA, focusing on strengthening corporate governance, improving financial transparency, enhancing institutional oversight, and restoring financial sustainability in public sector entities that have long burdened the national exchequer.

The ADB’s USD 400 million financing package is linked to six Disbursement-Linked Indicators (DLIs), making the verification process a critical component of the reform agenda. The Finance Division said the IVA’s reports would serve as the primary basis for determining whether agreed reform targets have been met and whether corresponding loan disbursements should be released.

The agency will verify annual progress in improving the financial performance of SOEs through the Operating Cost Recovery Ratio (OCRR), a key measure of operational efficiency. Under the programme, the aggregate OCRR of 39 SOEs must improve from a baseline of 112.9 percent in 2024 to at least 113.329 percent by 2030.

Another major reform benchmark relates to financial transparency. The IVA will verify whether audited financial statements of all targeted SOEs are publicly disclosed within six months of the fiscal year-end and whether these entities comply with International Financial Reporting Standards (IFRS). Currently, only 15 SOEs publish audited accounts online, while just eight are considered fully IFRS compliant.

Copyright Business Recorder, 2026