International loans / Grants Updates

[ghazi52]

ADB approves $385mn financing for KPK's urban development project

• Financing will help to construct two clean water supply treatment facilities, three sewerage treatment facilities, and will rehabilitate dysfunctional tube wells

BR Web Desk
10 Dec 2021


The Asian Development Bank (ADB) on Friday approved $385 million in financing to help improve the livability and community health of five cities in Pakistan’s Khyber Pakhtunkhwa (KPK) province.

In a statement, ADB said that the Khyber Pakhtunkhwa Cities Improvement Project will help to construct two clean water supply treatment facilities, three sewerage treatment facilities, and will rehabilitate dysfunctional tube wells among several other important subprojects in the cities of Abbottabad, Kohat, Mardan, Mingora, and Peshawar.

"ADB will provide a $380 million loan and a $5 million grant, while the Asian Infrastructure Investment Bank (AIIB) will provide cofinancing of $200 million, subject to approval of their board of directors," the statement added.

Together with $65 million in financing from the Government of Pakistan, this represents ADB’s largest urban project ($650 million equivalent) in Pakistan.
ADB’s loan also includes more than $106 million for climate adaptation and mitigation, the bank’s largest climate financing contribution in any urban project in 2021.

“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 gender-friendly urban facilities. About 150,000 households will gain new connections to water supply systems and have smart water meters installed in their homes,” ADB said.

The project will help address the challenges of climate change and deteriorating municipal services of urban centers in KPK.

“Large urban projects are often delayed due to their inherent complexity and competing interests in limited urban space,” ADB Director General for Central and West Asia Yevgeniy Zhukov said.

Days ago, ADB approved a $603 million results-based lending programme to strengthen and expand social protection programmes in Pakistan.
Using conditional cash transfers, the programme will support the implementation of Ehsaas, Pakistan’s national social protection and poverty reduction strategy.

Under the Integrated Social Protection Development Program, the ADB will provide a regular loan of $600 million and a $3 million grant from the Asian Development Fund, and will administer a $24 million grant from the Education Above All Foundation.

 

[ghazi52]

Govt contracted $15.32bn foreign loans in FY21: report

Khaleeq Kiani
December 14, 2021


ISLAMABAD: The government contracted $15.32 billion worth of new foreign loans from multilateral institutions and commercial banks during the previous fiscal year (2020-21) — almost 47 per cent higher than $10.45bn a year earlier.

With these additional loan agreements, the incumbent government contracted a total of about $34.17bn in its first three years in power, according to the ‘Annual Report on Foreign Economic Assistance 2020-21’ released by the Ministry of Economic Affairs. Total foreign loan disbursements stood relatively higher at $35.1bn during the three years.

The data showed that Pakistan contracted $8.41bn in the fiscal year 2018-19, followed by $10.45bn in 2019-20 (up 24pc), and $15.32bn in 2020-21 (up 47pc).

With this, Pakistan’s external public debt stood at $85.6bn as of June 30, 2021, showing a net increase of about $7.7bn (10pc) compared to $77.9bn as of June 30, 2020. By the end of June 2019, the external public debt amounted to $73.4bn.

The report explained that a higher commitment during the last fiscal year was made “to mitigate the pressure on the current account deficit, strengthen foreign exchange reserves, enhance external debt servicing capacity and provide requisite financing to water sector development”.

With $4.675bn, WB emerged as the largest multilateral development partner

The report noted that out of $15.32bn new agreements during the previous fiscal year, $6.97bn worth of financing agreements were signed with multilateral development partners, $4.66bn with foreign commercial banks, and $187 million with bilateral development partners.

In addition, the government also borrowed $2.5bn from international capital markets through Eurobonds and $1bn from the State Administration of Foreign Exchange (SAFE), the Chinese government’s foreign exchange and international trade agency, as a deposit.

Of these, an amount of $2bn (or 13pc of the total commitments) was earmarked by multilateral development partners as programme financing to broaden and deepen the financial system, improve fiscal management and regulatory framework to foster growth and competitiveness in Pakistan.

Among the multilateral development partners, the World Bank emerged as the largest development partner in terms of new commitments ($4.675bn), followed by $952m from the Islamic Development Bank, $902m from the Asian Development Bank (ADB), and $326 from the Asian Infrastructure Investment Bank.

Besides, $4.66bn (30pc of the total) was arranged from foreign commercial banks. An amount of $4.19bn (27pc of the total) was contracted for project financing and $952m (or 6pc of the total) for commodity financing.

Energy and power were the key priority sectors for new loan agreements during the 2020-21 fiscal year, with a total share of 35pc out of the total committed project financing of $4.19bn.

Rural development and social welfare emerged as second priority with a share of 23pc of the total project financing, followed by governance 18pc, finance and revenue 7pc, education 5pc, agriculture 5pc, and transport and communication 4pc.

Published in Dawn, December 14th, 2021

 

[ghazi52]

Pakistan, ADB sign agreements worth $1.5bn for various projects

Tahir Sherani
December 22, 2021

Economic Affairs Division Secretary Mian Asad Hayaud Din (R) and Asian Development Bank (ADB) Country Director Yong Ye shake hands during the signing of the agreements on Wednesday. — Photo via ADB Twitter

The federal government and the Asian Development Bank (ADB) on Wednesday signed six agreements amounting to $1.543 billion to finance projects related to the energy sector, urban infrastructure, social protection, roads and water resources, the Ministry of Economic Affairs in a statement.

The agreements were signed by Economic Affairs Division Secretary Mian Asad Hayaud Din and ADB's Country Director Yong Ye in Islamabad. Minister for Economic Affairs Omar Ayub Khan witnessed the signing.

Giving a breakdown of the agreements, the statement said they included a $300m policy-based loan to support financial, technical and governance reforms to strengthen the country's energy sector, $385m to improve urban infrastructure in five cities of Khyber Pakhtunkhwa, $235m to dualise a 222-km Shikarpur-Rajanpur section of the Indus Highway and $603m to strengthen and expand the Ehsaas programme.

In addition, agreements were also signed for two project-readiness facilities — a $5m loan for Kurram Tangi Integrated Water Resources Development Project and a $15m loan for phase two of the KP Cities Improvement Investment Project.

The economic affairs minister "expressed deep appreciation" for the ADB and thanked its president, senior management and board of directors for their "continued and enhanced financial support towards reforming energy sector, improving road networks, enhancing social protection and developing sustainable cities in Pakistan".

Khan said the $385m urban infrastructure project would help the provincial and city governments in KP to improve the liveability of five cities — Abbottabad, Kohat, Mardan, Mingora, and Peshawar — and benefit 3.5m people. Under the project, work would be done on providing water supply, sewerage, solid waste management and green infrastructure, according to the statement.

The loan would also provide institutional support to improve the performance of municipal corporations in the five cities with a focus on gender-friendly services, it added. The project also supported the government's development priorities and Prime Minister Imran Khan's vision of Clean Green Pakistan, the ministry stated.

The ADB would also finance $235m for the second phase of the Central Asia Regional Economic Cooperation (CAREC) Corridor Development Investment Programme under which the Shikarpur-Rajanpur section of the Indus Highway would be widened to a four-lane carriageway. The section traverses Sindh and Punjab on the western side of the Indus River via Kandhkot, Kashmore and Rojhan, according to the ministry's statement.

"The dualisation of Indus Highway (N-55) will not only boost local economic activities but also promote intra [and] inter-regional trade and movement of people by improved connectivity and reduced travel time. The section will be equipped with bus shelters, trauma centers and rest areas as well as road safety facilities," the statement quoted the minister as saying.
Regarding the Integrated Social Protection Development Programme, Khan said it would support the government's Ehsaas programme, including social protection and poverty reduction schemes.

"Kurram Tangi Integrated Water Resources Development Project is one of the top priority projects in the erstwhile FATA (Federally Administered Tribal Areas) which includes the construction of a dam with water storage facility, hydropower generation and construction and upgrading of irrigation system covering 140,000 hectares."
The project would help in increasing agricultural production and improving the country's food security situation.
The minister reiterated the federal government's commitment to helping all provinces, as well as, Gilgit-Baltistan and Azad Jammu and Kashmir in achieving inclusive development and sustainable growth, the statement said.
Speaking on the occasion, ADB Vice President Shixin Chen noted that the government "continued to make progress" in implementing comprehensive economic, fiscal and structural reforms, despite the challenging situation created by the Covid-19 pandemic.
He also appreciated Pakistan's vaccination campaign against the coronavirus. The ADB had earlier this year approved a $500m loan for Pakistan to help it procure Covid-19 vaccines.
Meanwhile, ADB Director General Eugene Zhukov assured that the Bank would continue supporting the government's development projects and it "stands committed to support Pakistan for a green, resilient and sustainable recovery".
"The financial support will strengthen Pakistan's economy and reduce the risk of external economic shocks," ADB Country Director Yong Ye said.

 

[ghazi52]

Pakistan, World Bank ink $195mn agreement to improve electricity distribution

BR Web Desk
23 Dec 2021

Pakistani authorities signed a financing agreement of Electricity Distribution Efficiency Improvement Project (EDEIP) worth $195 million with the World Bank on Thursday. The financing will support Pakistan in improving electricity distribution and implementing energy sector reforms to increase service quality for consumers.

The agreement was signed by Secretary Economic Affairs Division Mian Asad Hayaud Din on behalf of the Government of Pakistan. Operations Manager World Bank Anjum Ahmad signed the agreement on behalf of the World Bank, stated Radio Pakistan.The objectives are to improve operational efficiency in targeted areas of three electricity distribution companies, including HESCO, MEPCO and PESCO; and achieve progress on the power sector reform agenda.

The Electricity Distribution Efficiency Improvement Project (EDEIP) will help distribution companies improve operations to manage the electricity supply more efficiently and increase the reliability of the electrical grid.

Days ago, the ADB approved financing worth $195 million for EDEIP. The project focuses on cost-saving interventions to increase revenue collection and reduce losses, and on modernising operations by employing technology and information systems.

The project will also invest in climate-resilient infrastructure, particularly grid stations and transmission lines, which are critical to distribution and utility services.

“The long-term financial viability of the power sector depends on improving the efficiency of electricity distribution companies that deliver electricity to consumers,” Najy Benhassine, World Bank Country Director for Pakistan stated then.

“These efforts will improve the operational and financial performance of select distribution companies to improve their bankability and ultimately, generate more private sector participation.”

The EDEIP will support institutional reforms to improve governance and transparency and will develop systems and practices to improve managerial performance and compliance with regulatory requirements. In addition, the project will help build the technical capacity of the distribution companies by providing training programmes, tools, and equipment to improve staff performance in key utility operations.

 

[ghazi52]

Govt Received $39.7 Billion Foreign Loans in its Tenure

The government has incurred $39.7 billion in foreign loans and grants during its tenure of 40 months.

The Ministry of Economic Affairs Division has compiled its performance report under the PTI regime in this regard. The PTI government has availed $39.7 billion loan and grants from August 2018 to November 2021 from external sources.

On the other hand, the report states that the PTI government has paid $29.815 billion as external debt servicing from August 2018 to October 2021. Repayments data for November could not be included in the report

 

[Pakistan Space Agency]

PTI Government Year-1 (August 2018 - July 2019)
Pakistan borrows record $16b in just one year
(PTI Government borrowed $13.6 billion out of $16 billion)

PTI Government Year-2 (July 2019 - July 2020)
In FY20: Govt gets over $13b in foreign loans

PTI Government Year-3 (July 2020 - July 2021)
PTI Govt obtains $14.3 billion more foreign loans in FY21

 

[Flight of falcon]

PTI Government Year-1 (August 2018 - July 2019)
Pakistan borrows record $16b in just one year
(PTI Government borrowed $13.6 billion out of $16 billion)

PTI Government Year-2 (July 2019 - July 2020)
In FY20: Govt gets over $13b in foreign loans

PTI Government Year-3 (July 2020 - July 2021)
PTI Govt obtains $14.3 billion more foreign loans in FY21

Wow Einstein……

looks like Dar trained you…

how much loan was paid back ???
Especially the high interest loan your daddy borrowed ?

 

[ghazi52]

The International Monetary Fund’s (IMF) Executive Board has given its stamp of approval on Pakistan’s sixth review of the Extended Fund Facility (EFF), said Finance Minister Shaukat Tarin in a tweet on Wednesday night, a development that paves way for the next tranche of the $6-billion programme.


"I am pleased to announce that IMF Board has approved the 6th tranche of their programme for Pakistan," he tweeted. An IMF statement on Pakistan's sixth review has yet to be issued.

The development comes after the Washington-based lender had made a staff-level agreement in November last year.
Completion of the review has now made available SDR 750 million (about $1,059 million), taking total disbursements under the EFF to about $3,027 million.

Pakistan and the IMF had reached a staff-level agreement on November 21, 2021. The agreement was subject to approval by the Executive Board, following the implementation of prior actions, mainly on fiscal and institutional reforms.

One of the prior actions was passage of the State Bank of Pakistan (SBP) (Amendment) Bill, 2021. The bill was passed by Senate on Friday. Another prior action was the withdrawal of sales tax exemptions to the tune of Rs343 billion, which the government enforced through the Finance (Supplementary) Act, 2022 from January 16, 2022.

 

[ghazi52]

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World Bank approves $435m for affordable housing projects in Pakistan​

Web Desk
11 Mar, 2022

ISLAMABAD – The World Bank on Friday approved a $435 million package to increase access to affordable housing and in support of mortgage finance for low-income people in Pakistan.

The board of executive directors of the US-based financial lender approved the package. Pakistan Housing Finance project, the Punjab Urban Land Systems Enhancement project, and the Punjab Affordable Housing Program will get the funds under this package.

The move aimed to empower low-income families to own a residence while it also help improve land tenure rights.

World Bank Country Director for Pakistan Najy Benhassine, said: “Affordable and accessible housing is in high demand in Pakistan, which is home to over 200 million people and is the most urbanized country in South Asia.”

Benhassine added that these projects will contribute to addressing housing needs by leveraging the private sector and by facilitating access to mortgage options for those who currently cannot access financing to buy a home. They will also strengthen property rights and increase the supply of climate-resilient, affordable housing developments
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The international financial institution said Punjab Affordable Housing Program will get $200 million as the project will aim to facilitate nearly 77,000 people, particularly low-income households, in the country’s most populous region Punjab.

Furthermore, the package will encourage private financing for mixed-income housing developments.

A sum of $85 million will be spent to “expand access to affordable mortgages to increase homeownership among low-income households” through Prime Minister’s Mera Pakistan, Mera Ghar Housing Scheme
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[ghazi52]

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ADB approves $300mn loan for Pakistan’s capital market development​

• Lender says country's equity markets lack depth in terms of the number of investors that access it and the number of companies raising capital, while Pakistan’s bond market is almost completely dominated by government borrowing

BR Web Desk
22 Mar, 2022

The Asian Development Bank (ADB) on Tuesday approved a $300-million loan to further develop Pakistan’s capital markets, and promote private investment in the country.

The latest funding is part of the second sub-programme of ADB’s Third Capital Market Development initiative, and aims to catalyse institutional investor demand and increase the range of alternative financial instruments such as derivatives and commodity futures that are available to investors, accoriding to the ADB statement.
“For several years, ADB has been Pakistan’s lead development partner in supporting the evolution of its capital markets,” said ADB Director General for Central and West Asia Yevgeniy Zhukov.

“By making the country’s capital markets more robust and strengthening government debt management, this new program will also help to mobilise more domestic resources which support the government’s efforts to finance sustainable growth and respond effectively to crises.”

ADB said that the programme support will strengthen market stability and attract investor capital to Pakistan.

“These include structural reforms within the Securities and Exchange Commission of Pakistan (SECP) that will improve governance and regulatory capacity. It supports measures that will strengthen the government debt market and enhance market surveillance systems that facilitate information exchange,” read the statement.
ADB was of the view that Pakistan’s finance sector, which is dominated by banks lacks diversification which increases the risk of the country not being able to withstand financial shocks and periods of uncertainty.

It added that the country’s equity markets, that is the Pakistan Stock Exchange (PSX), lack depth in terms of the number of investors that access it and the number of companies raising capital, while Pakistan’s bond market is almost completely dominated by government borrowing.

“These reforms will help to mobilise financial resources for productive investment, especially by the private sector, and help facilitate economic growth by developing the bond and equity capital markets,” said ADB economist Sana Masood.

“This will help reduce the cost of financial intermediation and help stabilize systemic vulnerabilities in the bank-dominated finance system.”

Days ago, ADB Vice-President Shixin Chen concluded a five-day visit to Pakistan during which he met with Prime Minister Imran Khan, key ministers, and other senior government officials.

Official sources, who attended these high-level engagements, informed Business Recorder that financial assistance to the tune of $8.7 billion from the ADB is in the pipeline during the next three years.......
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[ghazi52]

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Repayment of syndicated loan facility from China: SBP reserves fall massive $2.915 billion​

• SBP says rollover of this syndicated facility is being processed and expected shortly

BR Web Desk
31 Mar, 2022

Reserves held by the State Bank of Pakistan (SBP) decreased by a massive $2.915 billion, falling to $12.05 billion, revealed data released by the central bank on Thursday.

"This decline reflects repayment of external debt, including repayment of a major syndicated loan facility from China," said the SBP. "The rollover of this syndicated facility is being processed, and is expected shortly."

Meanwhile, total liquid foreign reserves held by the country stood at $18.55 billion. Net foreign reserves held by commercial banks stood at $6.5 billion.

Pakistan's foreign exchange reserves have been under pressure since December last year. While the country has been looking to build its foreign currency reserves on the back of loans, remittances, and higher exports, foreign direct investment continues to be an area of concern for policymakers.

On the other hand, the rupee continues to remain under pressure against the US dollar, and hit yet another record low on Thursday.


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[ghazi52]

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After China, UAE has also rolled over $2 billion credit facility for a year. The payment of $2 billion was due in March 2022.

The rollover will help to ease pressure on forex reserves and domestic currency devaluation.

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[ghazi52]

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The United States (US) announced on Friday to commence a four-year $23.5 million project in Pakistan to steer efficiency in the power sector.

The project aims to increase the share of green energy in Pakistan’s energy mix, United States Agency for International Development (USAID) Mission Director Julie A Koenen said in a statement.

The US government, through the USAID, is partnering with the Pakistani government to launch a four-year $23.5 million power sector improvement project to address climate change and increase the share of green energy in Pakistan’s energy mix.

Through technical assistance to the government and private sector, the project will also improve the management and operations of power transmission and distribution systems, increasing the financial viability, reliability, and affordability of Pakistan’s power system.

“The US looks forward to advancing the partnership with Pakistan to build a clean, efficient, and reliable electricity generation sector, laying a foundation for sustainable and inclusive growth,” Koenen said at the launching ceremony.

“Through this new initiative, USAID will partner with the government of Pakistan to support the transition to a truly competitive wholesale power market.”

“This will increase private sector participation in an open and transparent manner and support our shared energy reform goals,” she added.

Private Power and Infrastructure Board (PPIB) Managing Director Shah Jahan Mirza praised the USAID for its strong partnership, innovation and sustained cooperation in supporting Pakistan’s transition to clean energy.

He looked forward to continuing the partnership to improve Pakistan’s power sector performance.

The prolonged US-Pakistan partnership has witnessed the construction of various dams and transmission lines in the country besides responding to humanitarian emergencies and combatting shared challenges like the Covid-19 pandemic, climate change and water vulnerabilities.

To expand Pakistan’s energy supply, the US and Pakistan have jointly built three dams – Gomal Zam Dam in South Waziristan, Satpara Dam in Gilgit Baltistan, and Golen Gol Hydropower Project in Chitral (Khyber Pakhtunkhwa) – adding 143 megawatts of electricity to the national grid.

Both countries have rehabilitated the Mangla and Tarbela dams, three thermal power plants and connected more than 860 megawatts of commercially-funded wind and solar projects to the national grid.

The power sector of Pakistan is currently dealing with a number of issues, including rising electricity prices, electricity theft and circular debt.

The previous governments had made all-out efforts to overcome power sector issues but they had been unable to address them.

Power distribution companies are also dealing with a number of issues related to power theft, which has resulted in circular debt.

There are several companies in K-P, Sindh and Balochistan where losses were high and recovery was too low to plague the entire energy chain.

During the previous government of PTI, circular debt had almost swelled to Rs2.5 trillion.

When the PTI government took power in 2018, the PML-N government left the circular debt at Rs1.6 trillion.

To enter into a deal to reduce electricity rates, the PTI government paid independent power producers (IPPs) around Rs200 billion.

Poor governance in the provinces of K-P, Balochistan and Sindh resulted in increased electricity losses and theft, which contributed significantly to the growing circular debt.

The power sector’s inefficiencies also caused problems in the oil and gas sector, which had a circular debt of around Rs1.5 trillion.

The liquefied natural gas (LNG) was another fuel that led to piling up circular debt in the oil and gas sectors.

At present, Pakistan State Oil (PSO) was to receive Rs272 billion from Sui Northern Gas Pipelines Limited (SNGPL) on account of non-payment of dues against LNG supply.

The previous government of PTI diverted all LNG to domestic consumers during the winter season to overcome the gas crisis. This trapped the energy companies in LNG circular debt.

SNGPL claimed that it had to receive over Rs100 billion from domestic consumers. However, recovery of gas bills has been an issue due to lack of legal framework in place.

The PTI government passed a bill related to weighted average cost of gas (Wacog) from parliament. But that bill had been challenged in court and the Sindh government had also become a party in that case.

The Sindh government claimed that it would compromise their gas allocation quota.

Published in The Express Tribune, April 23rd, 2022.

 

[ghazi52]

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Struggling with current account challenges and foreign exchange reserves, the ousted PTI government borrowed about $15.4 billion in foreign loans in the first nine months (July-March) of the current fiscal year, more than 70pc higher than the foreign loans it received in the comparable period last year.

The Ministry of Economic Affairs on Thursday released the foreign debt bulletin for July-March period of the current fiscal year.

Pakistan Tehreek-e-Insaf (PTI) has returned $ 29 billion loans in the last three years which was taken during the past N-League tenures. $12.2 billion loans paid last year while $ 12.5 billion was to be paid current Fy22.

 

[ghazi52]

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ADB disburses $1.31bn in loan, grants to Pakistan​

Amin Ahmed
April 26, 2022

ISLAMABAD: The Asian Development Bank (ADB) disbursed loans and grants amounting to $1.31 billion to Pakistan in 2021, comprising $0.30bn in programme lending, $1.01bn from project lending and $3 million from grants.

Total outstanding balances and undisbursed commitments of ADB’s non-sovereign transactions in Pakistan as of Dec 31, 2021 was $441.31m, representing 3.14 per cent of ADB’s total private sector portfolio, the fact sheet on Pakistan says.

According to the ADB annual report released on Monday, ADB committed $22.8bn from its own resources in 2021 to help Asia and the Pacific tackle the immediate effects of the Covid-19 pandemic and promote a green recovery.

The $22.8bn committed in 2021 includes loans and guarantees, grants, equity investments, and technical assistance provided to governments and the private sector. In addition, ADB mobilised $12.9bn in co-financing.

Under the country’s partnership strategy 2021–2025, ADB will support Pakistan’s development priorities by focusing on improving economic management, building resilience, and boosting competitiveness and private sector development.

ADB’s assistance for domestic resource mobilisation, financial inclusion, and energy sector reforms will support macroeconomic management. Financing for workforce readiness and health will help build resilience. Support for infrastructure and urban sector investments will improve rural connectivity and urban municipal services. Improving access to finance and supporting public-private partnerships will boost competitiveness and private sector development to return the economy to a sustainable growth trajectory.

ADB will also help the country prepare for digital transformation through policy improvements, public institution strengthening, and relevant infrastructure investments.

Published in Dawn, April 26th, 2022