Business

ADB to provide $6b for infrastructure projects in Pakistan

Along with the 660-megawatt Jamshoro power plant, the funds will be used for several hydroelectric dams

Afp May 12, 2015

Secretary Economic Affairs Division Saleem Sethi in a meeting with ADB Vice President Wencai Zhang in Islamabad on Tuesday. PHOTO: PID

KARACHI: The Asian Development Bank on Tuesday approved a $6 billion loan to help build up Pakistan's dilapidated power network and other key infrastructure, Islamabad said.

Among the projects to be financed by the ADB are a 660-megawatt Jamshoro Coal Power Project, while funds will also be allocated for projects related to health, education and highway construction including Hassanabdal-Havellian and Gojra-Khanewal Motorways.

"(The ADB) agreed to finance US$6 billion for the next five years in Pakistan," an economic affairs ministry statement said, adding that the funds would help Pakistan tackle a long-running electricity crisis.

Along with the 660-megawatt plant, the funds will be used for several hydroelectric dams that will each generate between 100 and 300 megawatts.

Read: Pakistan's economy has improved, says IMF

Pakistan is expected to see accelerating economic growth in the coming years, with the International Monetary Fund forecasting 4.1 per cent expansion this fiscal year, followed by 4.5 per cent growth next year.

Ratings agency Standard and Poor's meanwhile has upgraded the country's credit rating outlook from stable to positive.

Read: S&P upgrades Pakistan’s credit ratings

But electricity provision continues to be a massive problem.

Pakistan faces an annual power shortfall of around 4,000 megawatts in the peak summer months of June and July when temperatures can reach 50 degrees Celsius (120 Fahrenheit) in the country's centre.

COMMENTS (11)

Philosiraptor | 9 years ago | Reply Too late, US. You had 7 decades to develop Pakistan now China decided to help you are throwing bones here.

jay | 9 years ago | Reply @Parvez: Pakistan can say " NO " to loans ! but the question is can it ? Pakistan is like a baby always sulking .

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khan420 | 9 years ago | Reply PM Sharif inaugurated the Hassanabdal-hevallian motorway a few months back, and the funds have been secured now ! what kind of political stunt was that?

Fact check | 9 years ago | Reply @Parvez Stop blaming others for Pakistan's miseries. And don't be so thankless. If it were not for the aid and loans given by donor countries, Pakistan would have collapsed long ago. Pakistanis should learn to live within their means rather than begging from others all the time and then complaining as well.

salman | 9 years ago | Reply WB, ADB should fund Bhasha Dam and that's all. No $$$ required for all the mentioned projects in the article. Bhasha Dam is the mother of all the projects which we desperately need.

ajeet | 9 years ago | Reply Looks like religion of peace and economies don't go together. Muslim countries can only survive if they have oil.

Singh | 9 years ago | Reply If you check archive of ET, you will be surprise how often these statement is printed before about same project or hydro. Gullible Pakistani public buy this everytime.

fahim | 9 years ago | Reply shameful to see how much loan this govt has taken... we already had a loan burden of 70 billion USD... in the last 2 years atleast another 10-15 B was added... then the shrewd chinese came and provided 15 B more loan with 18% interest.. now another 6 B loan from ADB... who will repay these back? common people with their taxes.. with zero facility... when the economy is going downhill every day.... time to leave this place

Woz Ahmed | 9 years ago | Reply @Parvez Not sure how we can blame the west for our own corrtupt leaders and system. The Chinese loans or government backed FDI is more a concern for me, obviously we expect pilferage, but at least we will be required to have global bids for the work, the IRR will be one we set, not like the 18% required by China on its power plants. About $35 billion of the economic corridor is for power plants, so nearly $7 billion a year will need to be repatriated for the. Life of the plant. Apparently our GDP will increase by 2% a year if power outages end, that's $5 billion on a $250 billion economy. ADB money carries interest typically of 1-2% . Chinese built, South Punjab solar farm has a charge of 19 rupees per kWh,UAE and India pay 6 U.S. Cents.if we build solar with ADB money, we can get power for 6 cents or less. Admittedly, the whole economic corridor is opaque, few know the details, such as where the materials,equipment and labour will come from, transit charges, life of the contracts, let alone the route Nonetheless, the positive mood in the country is priceless.

pak47 | 9 years ago | Reply PTI trolls on their way here :)

Parvez | 9 years ago | Reply More money for our leaders to loot and plunder ........ while the nation slips further down the poverty slope. This is how the ' west ' will eventually destroy Pakistan.

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