The FINANCIAL — The Asian Development Bank (ADB) has approved a new country partnership strategy (CPS) with Pakistan for 2015-2019 with a provisional assistance package of at least $1.2 billion a year on average, which will focus on infrastructure upgrades and institutional reforms.
“The main challenge in Pakistan is to deliver higher, sustained, and inclusive growth to cut poverty and create productive jobs for the growing labor force,” said Werner E. Liepach, Country Director at ADB’s Pakistan Resident Mission. “The thrust of the new partnership will be to support the government to improve connectivity, productivity and access to markets and public services.”
The financial assistance package will target six sectors—energy; transport; agriculture, natural resources and rural development; water and other urban infrastructure and services; public sector management; and the finance sector. The bulk of the assistance is earmarked for infrastructure improvements in the power, transport, agriculture, and urban services sectors, according to ADB.
Pakistan is on track to achieve the Millennium Development Goal for cutting income poverty but it is off track on several targets, and development overall remains uneven and below potential. Efforts to reduce and restructure fiscal deficits should continue to provide more space for development spending on infrastructure or social services.
Under the new CPS, in collaboration with other development partners, ADB will support the rehabilitation of power transmission and distribution systems, the construction and rehabilitation of highways and provincial roads connecting to the National Trade Corridor, and water infrastructure upgrades in parts of Balochistan, Khyber Pakhtunkhwa and Punjab. It will help rehabilitate the Indus Basin Irrigation System and invest in bus rapid transit systems in Karachi, Peshawar and Punjab. ADB’s non-sovereign operations will target select investments in clean, renewable power sources to boost energy security.
ADB will help strengthen the regulatory environment to encourage more public-private partnerships, and will assist the Benazir Income Support Program to expand its outreach to an additional 2.4 million women beneficiaries. Support will be given to improve access to finance for women and other underserved groups, and to help small and medium-sized enterprises tap trade credit and other financial products and services.
Given Pakistan’s vulnerability to natural disasters, and rising threats from climate change, ADB will help establish a government-owned disaster risk fund to mitigate risks and enhance resilience to natural disasters, and to ensure swift responses after calamities.
ADB, based in Manila, is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, it is owned by 67 members – 48 from the region. In 2014, ADB assistance totaled $22.9 billion, including cofinancing of $9.2 billion.