WASHINGTON, July 1, 2026-The World Bank's Board of Executive Directors approved a $100 million grant from the International Development Association (IDA) to support foundational economic reforms, including in the digital, aviation, and energy sectors, aiming to open up the economy and generate more and better-paid jobs in Tajikistan.
The Second Competitive and Inclusive Tajikistan Development Policy Operation builds on the first operation approved in August 2025 and reflects the government's track record in implementing its reform commitments.
Aligned with Tajikistan's National Development Strategy 2030, the reform program focuses on improving digital and air transport connectivity, ensuring efficient use of energy, and, overall, expanding productive employment in the country. While growth has been robust, Tajikistan remains heavily dependent on remittances and externally financed public investment, underscoring the need for a stronger and competitive private sector capable of creating more and better-paid jobs.
"Tajikistan has demonstrated genuine commitment to reforms," said Gael Raballand, the World Bank Group Country Manager for Tajikistan. "We expect this operation to help turn reform commitments into tangible improvements in people's lives and business opportunities, including more affordable internet services, enhanced air transport connectivity and reliability, a more attractive energy sector for private investment, better-targeted social assistance, and stronger transparency and accountability of state-owned enterprises."
The operation supports reforms to make the economy more open and competitive. In telecommunications, measures to improve spectrum allocation management and strengthen competition are expected to improve sector governance and lower internet costs and expand access to digital services. In civil aviation, new transparent pricing mechanisms and safety oversight regulatory reforms are expected to improve contestability and affordability of airport infrastructure services and attract more airlines to the market. The program also supports investor facilitation services, dispute-resolution mechanisms, and improved work permit procedures to encourage foreign investment into the economy.
To create a more level playing field for businesses, the government is reducing preferential state aid, increasing transparency through a public registry of support measures, and advancing a new Competition Law to strengthen market oversight and enforcement. Reforms will improve the governance and transparency of state-owned enterprises through stronger disclosure requirements and internationally aligned corporate governance standards.
In the energy sector, measurable progress on tariff reform and operational efficiency have been made. In addition, there have been notable improvements in the allocation of funds, aiming to bolster governance and transparency, and create a conducive environment for private investment in renewable energy, helping meet growing electricity demand while reducing fiscal pressures. These reforms are expected to support a stronger energy system, reducing dependence on centralized infrastructure that is more vulnerable to weather hazards, such as floods and landslides.
To better support vulnerable households, the government has revised and updated its methodology for targeted social assistance. Additional reforms in education and health will improve budget transparency by publishing detailed budget allocations and expenditures at the school and primary healthcare facility levels.
Together, these reforms are expected to strengthen economic resilience, foster private sector development and job creation, enhance governance and public sector efficiency, and support more inclusive and sustainable growth in Tajikistan. The reform program aims to ensure that the economic returns from the large investment into the Rogun Hydropower Plant (HPP) Project are maximized and benefit poor and vulnerable people in the country.
The World Bank Group is one of the world's largest sources of financing and knowledge for developing countries. IDA is currently financing 25 projects in Tajikistan, totaling $1.93 billion. IFC maintains an investment portfolio of US$69 million, supporting seven private sector clients.
