The Asian Development Bank (ADB) has approved a $250 million policy-based loan to aid the Government of Pakistan in fostering sustainable investments in infrastructure and services through public–private partnerships (PPPs). This initiative aims to create a conducive environment for fiscally responsible PPPs, ultimately promoting inclusive economic growth in the country.
According to a press release, ADB’s Promoting Sustainable Public–Private Partnerships Program supports the implementation of government policies designed to enable fiscally affordable PPPs. The program is part of ADB’s comprehensive support package for public sector management, which balances Pakistan’s fiscal consolidation and growth objectives.
“This program is part of our comprehensive and integrated package of public sector management support that balances the country’s fiscal consolidation and growth objectives,” said ADB Director General for Central and West Asia Yevgeniy Zhukov. “The program will help the Government of Pakistan create an environment that is conducive to strategic, fiscally affordable PPPs that will bring the country closer to its development goals.”
The program aims to increase the absorptive capacity of PPP infrastructure investments by enhancing the legal and institutional framework for public investment management and public financial management related to PPPs. This includes the implementation of an integrated PPP policy to ensure efficient infrastructure planning and the promotion of sustainable development practices. Key reforms will address climate risk screening and gender considerations in project feasibility assessments and PPP contracts.
“Mobilizing private finance through PPPs can help to bridge the financing gap in public sector infrastructure projects—which is vital,” said ADB Economist Sana Masood. “This program will help ensure PPPs in Pakistan are structured correctly and implemented effectively in order to deliver more efficiency, innovation, and value for money.”
To support the program’s preparation and implementation, a $700,000 technical assistance grant has been allocated. Additionally, in December 2023, ADB approved another $950,000 to support PPP pipeline identification, capacity building, and sector strategy development.
Pakistan, a founding member of ADB, has received over $52 billion in public and private sector loans, grants, and other forms of financing from the bank since 1966. These funds have been crucial in promoting inclusive economic growth and improving the country’s infrastructure, energy and food security, transport networks, and social services.
ADB remains committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific while continuing its efforts to eradicate extreme poverty. Established in 1966, ADB is owned by 68 members, with 49 from the region.
