ADB approves $250 million loan to boost public-private partnerships in Pakistan

The Asian Development Bank (ADB) has approved a $250 million policy-based loan to help Pakistan enhance its infrastructure and services through public-private partnerships (PPPs). This initiative aims to create a sustainable investment environment conducive to fiscal stability and inclusive economic growth.

ADB’s Promoting Sustainable Public-Private Partnerships Program is designed to support the Pakistani government in implementing policies that foster strategic and fiscally responsible PPPs.

“This program is part of our comprehensive and integrated package of public sector management support that balances the country’s fiscal consolidation and growth objectives,” said ADB Director General for Central and West Asia Yevgeniy Zhukov. “The program will help the Government of Pakistan create an environment that is conducive to strategic, fiscally affordable PPPs that will bring the country closer to its development goals.” 

The program aims to enhance Pakistan’s capacity to manage PPP infrastructure investments by establishing a stronger legal and institutional framework for public investment management and financial management of PPPs.

Key reforms will include the implementation of an integrated PPP policy, which will facilitate efficient infrastructure planning and promote sustainable development practices. These practices include climate risk screening and gender considerations in project feasibility assessments and PPP contracts.

“Mobilizing private finance through PPPs can help to bridge the financing gap in public sector infrastructure projects—which is vital,” said ADB Economist Sana Masood. “This program will help ensure PPPs in Pakistan are structured correctly and implemented effectively in order to deliver more efficiency, innovation, and value for money.”

In addition to the $250 million loan, a $700,000 technical assistance grant is supporting the program’s preparation and implementation. In December 2023, ADB approved an additional $950,000 to support PPP pipeline identification, capacity building, and sector strategy development.

Pakistan, a founding member of ADB since 1966, has received over $52 billion in loans, grants, and other financing from ADB to support inclusive economic growth and enhance the country’s infrastructure, energy and food security, transport networks, and social services.

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