First Competitive and Inclusive Tajikistan DPO

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The objectives of the First Competitive and Inclusive Tajikistan Development Policy Operation Program for Tajikistan is to support the authorities in their efforts to (a) further open the economy to competition and create favorable market conditions for private sector development; and (b) strengthen the efficiency, transparency, and accountability of the public sector for better service delivery. This first DPO (DPO1) consists of a 50 million dollar International Development Association (IDA) grant. It follows the successful reengagement operation in 2023, the Resilient and Sustainable Tajikistan DPO, reflecting the authorities’ continued demand for World Bank Group (WBG) support to advance structural reforms for economic growth and closely aligned with WBG’s support for Rogun Hydropower Plant (HPP). The Rogun HPP is a transformational large project that will become the main pillar of Tajikistan’s electricity system and has a significant potential to contribute to decarbonization of electricity systems of Central Asian countries. The new DPO series supports the implementation of Tajikistan’s National Development Strategy 2030 and is aligned with the Country Partnership Framework (CPF). The DPO series also supports reforms to strengthen public services delivery and to create a more inclusive economy. Specifically, it supports: further strengthening of the TSA program by improving its coverage and introducing activation mechanisms for the unemployed; implementation of a new rule-based formula to allocate subnational resources for education to ensure more adequate and equitable resourcing; commencement of reporting on budgetary resources received by frontline health and education service delivery units; and introduction of transparency in the use of public resources from revenues from the Rogun HPP, maximizing the developmental impact of the project through the establishment of a Benefits Sharing Program to use part of the revenues from electricity sales to increase pro-poor spending.