ADB approves $540 million for two projects in Pakistan

ISLAMABAD: The Asian Development Bank (ADB) has approved $540 million for two projects in Pakistan to support public sector reforms and strengthen disaster resilience in coastal districts of Sindh.

Of the total, $400 million will be provided as a results-based loan for the SOE Transformation Programme, while a $140 million concessional loan has been allocated for the Sindh Coastal Resilience Sector Project.

According to an ADB statement, the SOE reform programme marks a significant step in addressing long-standing governance and performance challenges in Pakistan’s public sector institutions.

ADB Country Director for Pakistan Emma Fang said that the programme will play a key role in improving the performance of state-owned enterprises (SOEs) and supporting national economic stability.

She noted that priority will be given to restructuring large and complex institutions like the National Highway Authority along commercial lines. This is ADB’s first fully results-linked loan aimed at administrative reforms in the public sector.

The ADB has been supporting SOE reforms in Pakistan for several years, resulting in significant steps in 2023, including the implementation of the SOE Act and Policy, the establishment of a Central Monitoring Unit, and the issuance of Public Service Agreements.

The results-based approach will further enhance governance, institutional capacity, digitization, road safety, and financial sustainability.

In addition, the ADB has approved $750,000 in technical assistance to provide expert support and build capacity for effective implementation.

These measures aim to make public institutions more competitive and robust, promote private sector development, and support sustainable and inclusive economic growth in Pakistan.

Meanwhile, the Sindh Coastal Resilience Sector Project focuses on strengthening disaster resilience in vulnerable coastal districts such as Badin, Sajawal, and Thatta.

The project will benefit over 500,000 people, protect 150,000 hectares of agricultural land, and restore 22,000 hectares of forest area.

The project aligns with Pakistan’s National Flood Protection Plan IV, Sindh Climate Change Policy, and ADB’s Strategy 2030 objectives. It will also contribute to reducing greenhouse gas emissions, promoting biodiversity, and enhancing food security, forming part of ADB’s $40 billion target for transforming food systems by 2030.