ADB to Lend $7.528 Billion to Pakistan for Development Projects

The Asian Development Bank (ADB) has decided to lend $7.528 billion to Pakistan in lieu of the development projects over the next three years.

The regional development bank rolled out its Country Operation Business Plan (COBP) 2019-21 for Pakistan in which it suggested sovereign lending program valuing $7.582 billion for the next three years.

The program included $5.37 billion worth of regular Ordinary Capital Resource (OCR) lending and $2.158 billion worth of Concessional COR Lending (COL). The latter includes a carryover worth of $600 million from the last month.

As for the non-lending program for 2019-2021, it is $21.7 million and includes transaction technical assistance for several pipeline projects.

Break Down of Pipeline Projects

The plan allocates $2.245 billion for the energy sector in terms of the ADB loan financing, which makes 29.8 percent of the total pipeline for 2019-2021.

The total pipeline involves a multi-tranche financing facility for Hydropower Development Project for Water and Power Development Authority (WAPDA), Transmission Strengthening (tranche 1) for National Transmission and Despatch Company (NTDC), and support for the Turkmenistan-Afghanistan-India Gas Pipeline Project.

The bank has designated around $1.394 billion of loan financing for the transport sector, which constitutes 18.5 percent of the total pipeline. It includes the Sindh Hyderabad Southern Bypass Project and the Sustainable National Highway Project.

The ADB’s plan has also propositioned support for the revival of Pakistan Railways aiming at the improvement of sector sustainability along with looking out for non-conventional financing arrangements.


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Furthermore, the bank has allocated $794 million for agriculture, rural development, and natural resources (10.6 percent of the total pipeline).

The pipeline includes the Kurram Tangi Water Resources Project, the Greater Thal Canal Irrigation Project, and the Smaller Cholistan Water Resource Development Project.

As for water and other urban infrastructure and services, the loan financing allocation amounts to $470 million, which is 6.2 percent of the total pipeline. The pipeline is about a cross-sector project readiness facility for Punjab and the Punjab Cities Improvement Project.

The bank has also propositioned $2.4 billion in loan financing to the finance and public sector management sectors, making it 31.9 percent of the total pipeline.

Regarding the education and health sectors, the pipeline includes $225 million in loan financing, i.e., 3.0 percent of the total pipeline.

That breaks down as $175 million for projects in secondary education in Sindh and improving workforce readiness and skills development in Punjab in addition to the $50 million project to improve healthcare services quality in Khyber Pakhtunkhwa (KP).

New Projects

This COBP also proposes new projects like trade and competitiveness program (subprogram 1) in 2019, infrastructure financing and PPPs in 2021, financial markets development in 2020, and the second phase of Benazir Income Support Program in 2020.

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