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September 27, 2017

ADB approves $800mln financing for Pakistan’s regional connectivity, trade

Business

September 27, 2017

ISLAMABAD: Asian Development Bank (ADB) will provide $800 million multi-tranche financing facility to Pakistan to help it enhance regional connectivity and trade in the Central Asia Regional Economic Cooperation (CAREC) corridors, the bank said on Tuesday.

“The investment programme will expand Pakistan's regional connectivity links, while help improve road traffic efficiency,” Manila-based bank said in a statement.

It added that the road networks in Sindh, Punjab, and Khyber-Pakhtunkhwa will be rehabilitated and upgraded with the first tranche worth $180 million in 2017. The second and third tranches, worth $260 million and $360 million, respectively, are expected to be approved in 2019 and 2021.

"Pakistan's unique geographic location, at the crossroads of Central Asia, the People's Republic of China, and South Asia, provides a unique potential and opportunity for the country to become a regional transport and trade hub," said statement quoted Dong-Soo Pyo, ADB's director of Transport and Communications Division, Central and West Asia Department as saying.

"The investment programme will help the government of Pakistan realise this potential, improving trade and connectivity in the CAREC corridors with the long-term goal of achieving inclusive growth and sustainable development in mind."

Pyo said Pakistan's trade has been centered on sea traffic, while transit trade through the country remains limited as poor and costly transport and cross-border infrastructure and services hinder the realisation of this untapped potential, he added.

Upgrading the country's current 263,000 kilometers of roads, while ensuring transport safety, will be critical to the country's export competitiveness and overall economic growth.

The multi-tranche financing facility will upgrade and rehabilitate a total of 747 kilometers of roads along the CAREC corridor.

The statement said the investment programme will also focus on strengthening the capacity of the National Highway Authority to conduct due diligence work for subsequent tranches and to implement each tranche project under the facility as designed.

The Central Asia Regional Economic Cooperation, or CAREC, Program is a partnership of 11 countries (Afghanistan, Azerbaijan, People's Republic of China, Georgia, Kazakhstan, Kyrgyz Republic, Mongolia, Pakistan, Tajikistan, Turkmenistan, and Uzbekistan), supported by 6 multilateral institutions, working together to promote development through cooperation, leading to accelerated growth and poverty reduction.

Pakistan’s trade has been centered on sea traffic while transit trade through the country remains limited as poor and costly transport and cross-border infrastructure and services hinder the realization of this untapped potential.

Upgrading the country’s current 263,000 kilometers (km) of road while ensuring transport safety will be critical to the country’s export competitiveness as well as overall economic growth.

The MFF will upgrade and rehabilitate a total of 747 km of road along the CAREC corridor. The investment program will also focus on strengthening the capacity of the National Highway Authority to conduct due diligence work for subsequent tranches as well as to implement each tranche project under the MFF as designed.

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