Govt clinches $324m WB, ADB loans

ADB’s $200m to improve infrastructure in Sahiwal, Sialkot

ISLAMABAD: The World Bank (WB) and Asian Development Bank (ADB) have approved new loans worth $324 million for supporting conflict-hit people in tribal areas and improving delivery of services in Punjab, indicating continuation of project financing for Pakistan even in difficult times, it was learnt on Friday.

The boards of Washington- and Manila-based global lenders approved the loans over the past two days.

These are the first loans approved by both lenders after the announcement of new South Asia policy by US President Donald Trump.

Although President Trump had indicated cutting US aid to Pakistan, his speech also gave rise to fears that Washington might also use its influence on multilateral lenders to squeeze the country. Although both loans were approved for project financing, it remained to be seen if the WB and the ADB would continue budget financing for Pakistan or not.

A letter of comfort on good health of Pakistan’s economy from the International Monetary Fund is a prerequisite for seeking budget financing from the WB and the ADB, which will bring the US into play.



The WB approved $114 million on Thursday to significantly expand support for families affected by militancy, improve child healthcare and establish systems for emergency response safety net in the Federally Administered Tribal Areas (FATA).

On Wednesday, the ADB’s board of directors also approved a $200 million loan for improving urban infrastructure and urban delivery of services in Sahiwal and Sialkot in Punjab. The project is expected to improve the quality of life of more than 1.4 million people in these two cities.

The WB loan is in addition to $75 million credit it approved in 2015 under FATA Temporarily Displaced Persons (TDP) Emergency Recovery Project. Beneficiaries of the project are displaced families from five FATA agencies – North Waziristan, South Waziristan, Orakzai, Kurram and Khyber, according to a hand-out issued by the WB’s office in Pakistan on Friday.

It said that $114 million additional financing would help expand support to 326,000 eligible displaced families, up from 120,000 under the original project.

It will raise the number of participating families with children under 2 years of age to 300,000, up from 64,000 families benefiting from the Child Wellness Grant under the original project.

The new financing will also expand child health services to all 15 One-Stop Shops in these tribal agencies.



The displaced people in fragile or conflict situations needed livelihood support when they left their homes and upon their return as well, said Illango Patchamuthu, the WB’s Country Director for Pakistan. He said that the financing would ensure that the returning families had the means to start their lives anew.

The Early Recovery Package consists of two cash grants, a one-time Early Recovery Grant of Rs35,000 per family; and a Livelihood Support Grant of Rs16,000 per family in four monthly instalments.

The Child Wellness Grant offered to both TDP and non‐TDP families is provided in three equal instalments of Rs2,500 each, conditional on families attending periodic health awareness sessions on nutrition, hygiene, and immunisation.

The WB approved the recovery project to support families affected by Operation Zarb-e-Azb. Pakistan had estimated the total cost of the operation at $1.9 billion, with the rehabilitation cost of $800 million.

ADB loan

The ADB loan for Punjab Intermediate Cities Improvement Investment Project is expected to benefit millions of people in Sahiwal and Sialkot.

The urban infrastructure in Punjab remains inadequate as less than half of the province’s residents have access to piped water supply while poor public transport and inadequate street management is hampering economic activities. The project will strengthen the two cities’ water supply systems through the installation and rehabilitation of 114 boreholes and tube-wells, 20 water pumping stations and nearly 350-kilometer of water pipes.