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Pakistan signs a $1.5 billion credit arrangement with ADB

According to Yong Ye, ADB’s Country Director for Pakistan, the projects signed today demonstrate ADB’s strong commitment to Pakistan’s post-pandemic recovery and sustainable development. Pakistan and the Asian Development Bank (ADB) signed six financing loan agreements worth $1.544 billion on Wednesday.

Omar Ayub Khan, the Minister of Economic Affairs, was present at the loan signing event. Pakistan’s Secretary Economic Affairs Division (EAD) Asad Hayauddin and ADB Country Director for Pakistan Yong Ye signed the agreements.

Also read: Pakistan’s GDP growth forecasts have been downgraded by the World Bank

“The projects signed today mark ADB’s strong commitment for Pakistan’s post-pandemic recovery and sustainable development. Pakistan and ADB will continue working together to improve economic management, build resilience, boost competitiveness and private sector development,” said Yong Ye, ADB’s Country Director for Pakistan, in a statement.

EAD and the ADB signed loan agreement worth $603 million for integrated social protection development programme (BISP Ehsaas). Earlier in December, ADB approved a $603 million results-based lending programme to strengthen and expand social protection in Pakistan.

“Under the Integrated Social Protection Development Program, ADB will provide a regular loan of $600 million and a $3 million grant from the Asian Development Fund, and will administer a $24 million grant from the Education Above All Foundation,” the ADB said in a statement then.

The statement further said that by using conditional cash transfers, the program will support the implementation of Ehsaas, Pakistan’s national social protection and poverty reduction strategy.

Meanwhile, another project worth $300 million was also signed to support financial, technical, and governance reforms to strengthen Pakistan’s energy sector and improve its financial sustainability.

The ADB approved the funding for the said program earlier this month. The financing is part of the second subprogram of ADB’s Energy Sector Reforms and Financial Sustainability Program, which aims to improve the governance of Pakistan’s energy sector and reduce and manage the accumulated cash shortfall across the power supply chain known as circular debt.

Also read: TPL Corporation and Bank of Punjab Long Term Investment and Construction Financing Loans.

The first subprogram in the amount of $300 million was approved in December 2019.

Today, the EAD and the ADB also signed a loan agreement of $385 million for Khyber-Pakhtunkhwa Cities Improvement Investment project.

The Khyber Pakhtunkhwa Cities Improvement Project will help construct two clean water supply treatment facilities, three sewerage treatment facilities, and will rehabilitate dysfunctional tube wells among several other important subprojects in the cities of Abbottabad, Kohat, Mardan, Mingora, and Peshawar.

More than 3.5 million people will benefit from improved access to clean and safe water, reliable and integrated waste management and sanitation services, green urban spaces, and gender-friendly urban facilities. About 150,000 households will gain new connections to water supply systems and have smart water meters installed in their homes.

They also signed another loan agreement of $235 million for the Central Asia Economic Transport Corridor Development Programme (Tranche 2).

The ADB and the EAD also signed loan agreement of $15 million for KP Cities Improvement Project (PRF II). Another loan agreement of $5 million was also signed between the EAD and the ADB for Kurram Tangi Integrated Water Resources Development Project.

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