ADB committed to ‘meaningful’ projects in Pakistan

ISLAMABAD: Asian Development Bank (ADB) on Monday expressed commitment to work closely with Pakistan to develop more meaningful projects aligned with the country’s needs and regulatory frameworks.

In a virtual meeting with Minister for Economic Affairs Khusro Bakhtyar, ADB’s newly-appointed Director General of the Central and West Asia department Yevgeniy Zhukov acknowledged the country’s commitment to reform process and economic recovery.

The minister appreciated ADB’s role as a trusted development partner of Pakistan especially in terms of the quality of the portfolio and support keeping in view the emerging needs of the country that includes ADB’s timely support to fight the COVID-19 pandemic.

“Despite challenges posed by COVID-19 and worldwide contraction, the key economic indicators are showing encouraging results owing to the government’s strong commitment for the structural reforms,” he said in a statement.

Both sides discussed and agreed to expand cooperation in the areas of trade and competitiveness, social protection, public private partnership, operationalisation of the Exim Bank, and domestic resource mobilisation.

They agreed to continue discussing ways to deepen ADB and the country’s development partnership and ensure effectiveness of the ongoing portfolio. In January, ADB unveiled a new five-year loan program worth $10 billion to help Pakistan restore economic stability and growth, enhance people’s wellbeing, create jobs, and expand economic opportunities.

The announcement came a day after the World Bank’s assurance about support to Pakistan’s priority development objectives under an estimated $12 billion loan program starting from the next fiscal year. The framework is nearing the completion stage and expected to have the final approval by May or June.

The ADB didn’t mention size of the new loan it was estimated at approximately $10 billion before the coronavirus wave. The new program, which was previously for 2020-24, was on hold during the last year of uncertainty amid the global economic slump. ADB committed $1.48 billion in loan per annum for corona vaccine and other purposes, and total lending would cross $10 billion mark over the five-year period.

ADB said the pandemic interrupted the macroeconomic recovery in Pakistan, resulting in a sharp contraction in growth, a rise in public expenditures, and a loosening of monetary policy to mitigate the health and economic impacts.

ADB’s assistance over the next 5 years prioritises support for improving economic management, building resilience through human capital development and social protection, and boosting competitiveness and private sector development. The restoration of ADB and World Bank loan programs vividly indicates that Pakistan is in good terms with the International Monetary Fund, which has resumed its suspended extended fund facility of $6 billion.