The US and Pakistan on Tuesday signed an agreement under which Islamabad will get $ 53 million over the next five years for poverty reduction programmes.

Visiting US Assistant Secretary of Commerce William H Lash III, USAID/Pakistan Director Mark S Ward, Pakistan's Finance Minister Shaukat Aziz and Secretary, Economic Affairs Division, Waqar Masood Khan signed the agreement on behalf of the two governments.

"The new partnership between the two governments will bring micro-credit and micro-finance business support services, especially for women, to previously un-served and under-served areas of Pakistan," a US embassy statement said.

The agreement will also make micro-credit available to micro-entrepreneurs who need loan amounts larger than current micro-credit programmes allow but not enough to make them "bankable clients" with commercial banks, it said.

The programme will also focus on increasing the availability of and access to micro-credit for women borrowers. The new agreement will provide merit and financial need-based scholarships for poor students to obtain undergraduate degrees in business and other disciplines form leading Pakistani universities.

In addition, USAID will help improve agricultural practices, especially in drought-stricken areas and create new market linkages for small-scale rural farmers, the statement said.