The project sponsor is Foundation for Higher Education (the “Foundation”). The Foundation, registered under the Societies Registration Act of 1860, was set up in 1994 as a non-profit institution committed to the provision of quality education in Pakistan.

The Foundation comprises majority family members of Mr. Shahjehan S. Karim, the Founder, and some eminent businessmen and academics. Mr. Karim is a very well respected member of the civil community with over 37 years of experience with the Pakistan Civil Services and the United Nations. The President of the Foundation or any other person of eminence appointed by the Foundation shall be the President of the Foundation.

The total project cost is estimated to be $18.4 million. The proposed IFC investment is a partial credit guarantee of up to $3.5 million equivalent in Pakistani Rupees of the approximately $6.0 million local bank loan.

3.38 million (USD)

Product Line	IFC Investment (million USD)
Risk Management
Guarantee	3.38
Loan
Equity

* These investment figures are indicative

IoBM’s current campus is spread over 9 acres of land in Korangi, Karachi. It is about 8km from the city center of Karachi in an industrial area. The land to be purchased as part of the Project is expected to be near the existing campus.

The project will have strong development impact in the following areas:

Increasing access to high-quality tertiary education in Pakistan: Gross enrollment in tertiary education is about 3% in Pakistan (based on 2002 World Bank figures), ranking the country among the lowest in the world and putting it at a competitive disadvantage relative to other countries that are investing more heavily in the development of skilled human capital.
Enable the Institute to expand its financial assistance program to cover additional low-income students: IoBM rewards academic excellence among students through merit-based scholarships, in all, allocating up to 15% of its revenues to finance these activities.

Provision of long term local currency financing through a partial credit guarantee: Long term funding to education institutions is not easy to get in the local market. In addition to extending the tenor of the loan, IFC’s financing would have a demonstration effect among the local financial institutions who may be encouraged to consider providing longer term financing to this sector.

Value added advice: A relationship with IFC will allow the Institute to develop linkages with other education institutions across the world for student/faculty exchange programs, curriculum development, etc. IFC will share its knowledge of best practice in the industry to help IoBM improve its operations. As a part of its role, IFC may consider providing technical assistance for curriculum development for its proposed Environment Management Program and for enhancing leadership skills of its senior management.

This is a Category B project according to IFC’s Procedure for Environmental and Social Review of Projects because a limited number of specific environmental and social impacts may result which can be avoided or mitigated by adhering to generally recognized performance standards, guidelines or design criteria. The review of this project consisted of appraising technical, environmental and social information submitted by the project Sponsor; and visits to IoBM’s existing campus in Karachi. The following potential environment, health and safety and social aspect of the project were analyzed:

- site selection, acquisition, development and permitting;
- quality and sustainability of potable water supply;
- handling and disposal of hazardous and non-hazardous wastes;
- liquid effluent management; air emissions;
- occupational health, safety and hygiene;
- workplace conditions and employee training programs during construction operations;
- life and fire safety in the design, construction and outfitting of new and existing facilities; and
- systematic management of quality, environmental issues, and occupational health and safety.