Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/322162 
Authors: 
Year of Publication: 
2025
Series/Report no.: 
WIDER Working Paper No. 37/25
Publisher: 
The United Nations University World Institute for Development Economics Research (UNU-WIDER), Helsinki
Abstract: 
This paper rethinks development finance in Tajikistan through the lens of fiscal sociology, arguing that sustained reliance on foreign aid and external borrowing may weaken state-society trust and erode institutional legitimacy. Anchored in the political economy of development finance, the paper explores how alternative financing strategies, such as tax reform, diaspora bonds, thematic bonds, and blended finance, interact with domestic institutions, investor confidence, and citizen perceptions of fiscal fairness. While external flows have financed essential infrastructure and social programmes, they have also limited incentives for domestic resource mobilization and weakened public accountability. Issues of debt sustainability increasingly constrain long-term planning, while climate finance is emerging as both a challenge and an opportunity for diversifying development funding. Drawing on policy analysis and secondary data, the paper shows that financial instruments succeed not only through technical design but through their ability to reinforce the fiscal social contract. Tajikistan's case illustrates that without improvements in governance, transparency, and citizen engagement, even well-structured innovations in development finance may fail to gain traction. The findings offer practical insights for low-income countries seeking to reduce aid dependency while building more credible and inclusive systems of public finance.
Subjects: 
Tajikistan
development finance
debt sustainability
domestic resource mobilization
climate finance
JEL: 
F34
F35
H63
O19
Persistent Identifier of the first edition: 
ISBN: 
978-92-9256-596-1
Document Type: 
Working Paper

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