ADB pledges $10bn lifeline for Pakistan’s railways and mining sectors

WEB DESK: The Asian Development Bank (ADB) has greenlit a major five-year lending strategy for Pakistan, worth an estimated $10b to $12b (£7.9b–£9.5b), aimed at stabilising the nation’s economy and revitalising its crumbling infrastructure.

The Country Partnership Strategy (CPS) for 2026–2030 was approved unanimously by the ADB board, notably receiving backing from the Indian Executive Director, who supported the plan despite raising concerns regarding Pakistan’s governance and debt sustainability, according to the Express Tribune.

Modernising rail and tapping mineral wealth

A cornerstone of the new roadmap is the long-awaited overhaul of the Main Line-I (ML-I) railway project. This primary transport artery, which saw previous funding plans with China stall due to debt concerns, is now set for a radical transformation.

The ADB intends to fund upgrades to tracks, signalling systems, and stations to create a modern transport corridor. Beyond the rails, the lender is pivoting toward Pakistan’s untapped “critical minerals” including copper, barite, and chromite.

Despite vast deposits, the mining sector currently contributes a mere 2.4pc to the national GDP. The ADB plans to modernise geodata systems and improve regulatory frameworks to help the country transition from basic extraction to high-value mineral chains.

Tackling poverty and economic roadblocks

The five-year plan arrives at a critical juncture for Pakistan, where poverty levels have soared to 45% and wealth inequality remains stark, with the bottom half of the population earning just 13pc of the national income.

To combat this, the ADB has outlined three primary pathways: enabling private sector growth, advancing social inclusion, and enhancing climate resilience. A specific $500m allocation has been earmarked to reform pension systems and develop capital markets.

However, the lender warned that persistent challenges remain, citing a “burdensome” business environment and the heavy footprint of over 200 state-owned enterprises, which account for nearly half of the country’s GDP.