ISLAMABAD: The Asian Development Bank (AfDB) approved two political loans and projects worth $ 685 million for reforms of Pakistan’s energy sector and improvement of health and civic facilities.
As part of the first loan, the Manila-based lending agency will provide a loan of $ 300 million to support financial, technical and governance reforms to strengthen the country’s energy sector and improve its financial sustainability, a. AfDB said in a statement released Friday.
The financing is part of the second sub-program of the AfDB’s Energy Sector Reform and Financial Sustainability Program, which aims to improve governance of the Pakistani energy sector and reduce and manage the cash flow deficit accumulated along the chain. electricity supply, known as circular debt. The first $ 300 million funding sub-program was approved in December 2019.
“This program will help facilitate public and private sector investment across the energy sector value chain through key policies and integrated planning and help expand renewable energy production,” said Yevgeniy Zhukov, Director AfDB General for Central and West Asia.
Asian lender approves $ 300 million for energy sector and $ 385 million for five KP cities
The statement said the disruption caused by the Covid-19 pandemic has strained the finances and supply chains of Pakistan’s energy sector, slowing the pace of sector reforms initiated by the government in 2019. The losses suffered by SOEs that have impacted energy sector circular debt, along with pandemic relief measures, have put unprecedented pressure on energy sector liquidity and finances.
The reforms under the AfDB program will help make the country’s energy sector more financially viable by addressing inefficient tariffs and subsidies, high production costs, system losses and lack of integrated planning. The program also aims to improve energy infrastructure and professionalize the management of energy entities to improve their performance, AfDB said.
The reforms under the AfDB program will help make Pakistan’s energy sector more financially viable by addressing inefficient tariffs and subsidies, high production costs, system losses and lack of integrated planning. The program also aims to strengthen energy infrastructure and professionalize the management of energy entities to improve their performance.
“The AfDB continues to work with development partners to advance critical energy sector reforms and implement a roadmap for a competitive electricity market,” said Joonho Hwang, AfDB Director for energy for Central and West Asia. “Ultimately, these reforms will help improve the quality and reliability of electricity supply for the benefit of all – commercial, domestic, urban and rural consumers.”
Project for five KP cities
The second loan worth $ 385 million aims to improve the quality of life and community health in five cities of Khyber Pakhtunkhwa – Abbottabad, Kohat, Mardan, Mingora and Peshawar.
The KP Towns Improvement Project will help build two drinking water supply treatment facilities, three wastewater treatment facilities and rehabilitate dysfunctional tube wells among several other important sub-projects.
More than 3.5 million people will benefit from improved access to clean and safe water, reliable and integrated waste management and sanitation services, green urban spaces and eco-friendly urban facilities. gender equality, according to the AfDB statement, adding that about 150,000 households will benefit from new connections to water supply systems and have installed smart water meters in their homes.
With its rapidly growing urban population, the KP “is increasingly exposed to health risks due to the deterioration of municipal services and the impacts of climate change,” the Asian Bank said, adding that this project will help to meet these challenges of urban centers thanks to strong climatic growth. -resilient urban infrastructures combined with access to reliable services for the benefit of people, the environment and support for sustainable development.
“This project used the AfDB’s project preparation finance facility to ensure that the detailed engineering design, warranty appraisals and other essential preparatory work were completed in advance – a first for the region of Central and Western Asia. This will ensure that the transformative benefits of this project will flow to the people of Khyber Pakhtunkhwa province more quickly, ”Zhukov said.
The AfDB will provide a loan of $ 380 million and a grant of $ 5 million, while the Asian Infrastructure Investment Bank will provide co-financing of $ 200 million, subject to the approval of its board of directors. administration. With funding of $ 65 million from the Government of Pakistan, it is the AfDB’s largest urban project (equivalent to $ 650 million) in the country.
The AfDB loan includes more than $ 106 million for climate change adaptation and mitigation, the bank’s largest climate finance contribution to an urban project in 2021, reaffirming its commitment to help its member countries by development to fight against climate change.
Posted in Dawn, le 11 December 2021