ISLAMABAD (Web Desk) — The Asian Development Bank (ADB) and the Agence Francaise de Development (AFD) have approved over $400 million in loans to support Pakistan’s efforts to provide a more reliable and secure energy sector. The $300 million in ADB assistance, the third such loan under the Sustainable Energy Sector Reform program, brings the bank’s total financing to $1 billion since 2014. AFD will add €100 million in cofinancing.
Xiaohong Yang, ADB’s Country Director for Pakistan and Tariq Mahmood Pasha, Secretary Economic Affairs Division (EAD) for the Government of Pakistan, signed the ADB loan agreement. Finance Minister Mohammad Ishaq Dar witnessed the signing at a ceremony today in Islamabad.
“Pakistan’s ambitious energy reform program demonstrates the government’s commitment to improve the reliability, sustainability, and affordability of the energy sector,” said Ms. Yang. “Maintaining the momentum for reform will help ensure that all Pakistanis have access to electricity, while keeping the economy on an inclusive, sustained growth path.”
Under the program, Pakistan has embarked on a substantial reform initiative that will reducing energy subsidies and adjust tariff policy, improve sector performance and open the market to private participation, and increase accountability and transparency. The reform measures aim to address financial viability and reduce costs to taxpayers. Specific measures include recently agreed legislation that will improve governance through more clearly defined roles for both the government and the energy sector regulator, and reduce debt levels in the energy sector.