What's new

International loans / Grants Updates


Pakistan seeking $4.2bn from Saudi Arabia: reports

  • Development comes amid dwindling foreign exchange reserves
Reuters | BR
December 8, 2022

Pakistan is seeking $4.2 billion from Saudi Arabia as its foreign exchange reserves have fallen sharply, broadcaster ARY News reported on Thursday, citing sources.

Pakistan's Finance Ministry did not immediately respond to a Reuters request for comment.

The development comes as the South Asian country faces dwindling foreign exchange reserves. According to the weekly report, foreign exchange reserves held by the State Bank of Pakistan (SBP) clocked in at $7.5 billion.

Earlier, Dr Ali Awadh Asseri, former ambassador of Saudi Arabia to Pakistan, had said Riyadh is committed to averting Islamabad’s current economic crisis worsened by the recent floods and to the $20 billion investment in refinery, petrochemical complex, mining and renewable energy projects in the country.

“The Saudi leadership is committed to $20 billion dollars investment in refinery, petrochemical complex, mining and renewable energy projects in Pakistan. But there is also tremendous scope for Saudi public and private investment in other sectors such as textiles, sports, leather goods and surgical equipment,” Dr Asseri said.

Last week, Kingdom of Saudi Arabia (KSA) extended term for a $3 billion deposit in the SBP to support the Pakistani economy.

The Saudi Fund for Development (SFD) in September confirmed the rollover of $3 billion deposit with Pakistan for another one year. The amount was deposited by the SFD for one year in December 2021 under an agreement between SFD and the State Bank to build the depleting foreign exchange reserves of Pakistan.

“In implementation of the directives of the Custodian of the Two Holy Mosques, King Salman bin Abdulaziz Al Saud - may Allah protect him; the Saudi Fund for Development (SFD) extended the term for the deposit provided by the Kingdom of Saudi Arabia in the amount of 3 billion dollars to the State Bank of Pakistan,” the SBP had said then.

ADB approves $554m flood assistance package for Pakistan

Tahir Sherani
December 12, 2022

The Asian Development Bank (ADB) announced on Monday that a $554 million financing package, including new and reallocated funds, had been approved to support recovery and reconstruction efforts in Pakistan following in the aftermath of devastating floods, and to strengthen the country’s disaster and climate resilience.

“The financing, which includes a $475m loan and a $3m technical assistance grant from the ADB, and a $5m grant from the government of Japan, will support the restoration of irrigation, drainage, flood risk management, on-farm water management, and transport infrastructure in the flood-affected provinces of Balochistan, Khyber Pakhtunkhwa, and Sindh,” the press release said.

“The ADB’s Emergency Flood Assistance Project will also incorporate climate and disaster resilience measures into the design of the infrastructure. ADB has repurposed an additional $71 million from existing loans to support the government’s flood-response efforts,” it added.

ADB Central and West Asia Director General Yevgeniy Zhukov said the floods were a “devastating reminder” of Pakistan’s acute vulnerability to climate change.

“This project will help to rebuild critical infrastructure in affected areas and restore rural livelihoods,” Zhukov said.

The ADB noted that Pakistan suffered unprecedented heatwaves from April to June, followed by the catastrophic flooding.

A post-disaster needs assessment conducted by the government and development partners, including ADB, estimated total damage and losses at more than $30 billion and recovery and reconstruction needs at $16.3bn, it said.

“The loan will reconstruct about 400km of roads; about 85 km of the N-5, the country’s busiest national highway; and about 30 bridges. It will also help to restore and upgrade irrigation and drainage structures including canals and on-farm water facilities to restore livelihoods, and strengthen flood risk management structures to mitigate future risks to agricultural land, communities, and assets,” the press release said.

ADB Principal Transport Specialist Zheng Wu said that citizens were expected to fall into poverty in the aftermath of the floods while food insecurity would also increase.

“In close coordination with the government and other development partners, this project will provide crucial support to restore agriculture and other priority infrastructure to support socioeconomic recovery from floods,” he said.

Funded through the Japan Fund for Prosperous and Resilient Asia and the Pacific, the $5m grant will support staple crop cultivation in Balochistan and provide at least 60,000 farm households with higher quality, certified rice seeds for increased productivity over 54,000 hectares of land. The grant will also support women’s livelihoods in agriculture by providing farming equipment.

The $3m technical assistance grant will support the implementation of the project and the preparation of an ensuing flood risk management investment.
UAE rolls over existing $2 billion loan to Pakistan, with additional $1billion..
Pakistan will this week receive a new $700 million loan from #China to help shore up its foreign exchange reserves, the country's finance minister said on Wednesday, in another step to help the South Asian nation recover from an economic crisis.

The credit facility, made through the state-owned China Development Bank will boost Pakistan's forex reserves by about 20% and comes as the country is thrashing out a deal with the International Monetary Fund (IMF) to unlock funds from a $6.5 billion bailout.

"This amount is expected to be received this week by State Bank of Pakistan which will shore up its forex reserves," Finance Minister Ishaq Dar said on Twitter.
By improving the institutional framework for Integrated Water Resources Management (IWRM), the project will improve the capacity of Sindh to better cope with floods and droughts.

It will also help in the allocation of increasingly scarce water resources among competing uses such as agriculture, urban, and the environment. The promotion of climate-smart agriculture will contribute to the reduction of greenhouse gas (GHG) emissions and contribute to mitigation goals.

The $98 million project that also be additionally funded with $194 million non-concessional credit from International Development Association (IDA), having the total commitment of $292 million, will increase agricultural water productivity in Selected Farmers’ Organisation (SFO) command areas, improve integrated water resources management, and contribute to restoring crop production by small- and medium-sized farmers hit by the 2022 floods.

Saudi Arabia signs $240m loan agreement to support Mohmand Dam

Tahir Sherani
April 7, 2023

Saudi Arabia signed a $240 million loan agreement with Pakistan on Friday to support the Mohmand Multipurpose Dam Project, according to a statement issued by the Ministry of Economic Affairs.

The agreement was signed by Sultan Abdulrahman Al-Marshad, CEO, Saudi Fund for development (SFD) and Kazim Niaz, Federal Secretary for Ministry of Economic Affairs. Saudi Ambassador to Pakistan Nawaf bin Said Al-Malki was also present on the occasion.

The statement said this loan represents a strong partnership between Saudi Arabia and Pakistan in promoting sustainable development and achieving the sustainable development goals (SDGs).

Mohmand Multipurpose Dam Project is a major hydropower complex that will contribute to Pakistan’s energy security, increase sustainable water supply for agriculture and human consumption, and improve resilience to floods.

The statement noted that the project is expected to enhance water and food security, and improve the standard of living for people in Khyber Pakhtunkhwa, where almost 80 per cent of the population resides in rural areas, boosting the region’s socioeconomic development by creating employment opportunities and reducing poverty levels.

It added that by using renewable energy sources, the project will generate 800 MW of electricity production capacity, contributing to Pakistan’s energy security. In addition, the storage of 1.6 million cubic meters of water will support sustainable agricultural practices, enable irrigation of 6,773 hectares of new land, and increase the total cropping area from 1,517 hectares to 9,227 hectares in the province, facilitating agricultural activities.

Co-financed by the SFD, OPEC, Islamic Development Bank, and the Kuwait Fund for Arab Economic Development, the project aligns with SDG-2 (Food Security), SDG-6 (Clean Water), and SDG-7 (Clean Energy) and embodies SDG-17 (Partnerships for the Goals).

During the agreement signing ceremony, the CEO of SFD said this initiative is an extension of the fund’s continued support for development projects and programmes in Pakistan since its inception. He also highlighted the significance of joint cooperation between development funds, as evidenced by this project.

For his part, Dr Niaz expressed his sincere appreciation and gratitude to the Kingdom of Saudi Arabia for its unwavering support towards the development sector in Pakistan through the SFD.

Pakistan is set to receive another $300 million on Friday from the Industrial and Commercial Bank of China Ltd (ICBC), the last of three disbursements, Finance Minister Ishaq Dar confirmed. Pakistan has already received $1 billion from the institution.

“Out of Chinese Bank’s ICBC approved facility of $1.3 billion (which was earlier repaid by Pakistan). State Bank of Pakistan (SBP) would receive back third and last disbursement today in its account amounting to $300 million,” said Dar on Twiter.

This will “shore up forex reserves of Pakistan,” he added.

Of the $1.3 billion, the ICBC gave Pakistan the first tranche of $500 million on March 4 while the second disbursement, also of $500 million, was received two weeks later on March 18.

The latest development comes on the same day Dar announced that the UAE has confirmed to the International Monetary Fund (IMF) that it will provide support of $1 billion to Pakistan.

The UAE’s commitment was one of the requirements the IMF said it needed in order to move ahead on a months-long delayed bailout package to shore up the country’s struggling economy.

Meanwhile, Saudi Arabia last week had also told the IMF it will provide $2 billion in financing to Pakistan, according to a finance ministry official.

Months of political and economic turmoil, worsened by crippling floods last year and record inflation, has put Pakistan among countries facing a debt crisis.

Talks with the IMF for a delayed $1.1 billion loan tranche, part of the bailout agreed in 2019, have dragged on for months and foreign exchange reserves have fallen to less than four weeks of imports.

China last month rolled over a $2-billion loan, providing relief during Pakistan’s acute balance of payments crisis.

In line with the agreement between the Government of Pakistan and a program aimed at addressing the severe floods that struck the country last summer and promoting a climate-resilient Pakistan, the World Bank's Board of Executive Directors has granted $213 million in financing. This funding will be utilized to enhance livelihoods, essential services, and risk protection in communities affected by the floods in 2022, with a particular focus on #Balochistan Province.

Najy Benhassine, the World Bank Country Director for Pakistan, expressed the organization's commitment to closely collaborate with the Government of Balochistan in order to support the affected communities. The support will encompass assistance in restoring livelihoods, rehabilitating irrigation systems, and improving flood protection infrastructure.

The primary objective of this endeavor is not only to rebuild livelihoods but also to bolster the resilience of the population against potential climate-related disasters and natural hazards in the future. This project is part of a comprehensive rehabilitation and resilient reconstruction program, which has been mutually agreed upon by the authorities to address the aftermath of the floods.

World Bank approves $200mn for newly-merged areas of KPK

  • The latest funding is part of a programme agreed with the government to respond to last year's floods
June 14, 2023

The World Bank’s Board of Executive Directors on Wednesday approved $200 million in financing to strengthen state capacities in the newly-merged areas of Khyber Pakhtunkhwa, including investments for post-floods rehabilitation and reconstruction.

As per the statement, the funding is part of the programme agreed with the Pakistani government to respond to the devastating floods, which hit the country last year.

Last year, record monsoon rains in south and southwest Pakistan followed by glacial melt in northern areas triggered flooding that impacted nearly 33 million people in the South Asian nation of 220 million, killing over 1,700 persons, while sweeping away homes, crops, bridges, roads and livestock.

World Bank shared that Khyber Pakhtunkhwa Rural Investment and Institutional Support Project (KPRIISP) is the first phase of a multiphase programmatic approach that aims to increase access to resilient and reliable basic services for rural households in the newly merged areas of Khyber Pakhtunkhwa.

“KPRIISP aims to address development gaps in rural areas that are among the poorest in the country, directly benefiting around 5.5 million people by extending public service delivery systems, investing in basic infrastructure like water supply and sanitation, and boosting agricultural productivity and livelihood opportunities,” said Najy Benhassine, World Bank Country Director for Pakistan.

“It will also support post-floods reconstruction and rehabilitation, while strengthening resilience to such climate-related shocks, particularly in the Newly Merged Districts of the Province.”

The World Bank said that the KPRIISP will support the extension of state systems to deliver public services in the Newly Merged Districts as well as investments in critical and basic rural infrastructure.

“It will also support emergency reconstruction and rehabilitation of flood protection infrastructure damaged by the 2022 floods.

“In addition to investments in critical infrastructure, this new project will provide conditional grants to village councils to finance local infrastructure priorities in line with community preferences and women’s priorities,” said Anna O’Donnell, Task Team Leader of the project.

“It will also ensure that communities are involved in participatory planning, budgeting, monitoring, and improving social accountability systems, while focusing on institutional strengthening and capacity building of village councils.”

Last month, World Bank had approved $213 million in financing for Balochistan aimed at improving livelihoods and essential services and enhancing risk protection in communities affected by the 2022 floods.

World Bank approves $46mn financing for KPK’s healthcare sector

The World Bank’s Board of Executive Directors on Friday approved $46 million in financing for the Khyber Pakhtunkhwa Citizen Centered Service Delivery Project.

The funding will support both supply and demand side interventions to improve health service delivery in the province, as well as the operations of citizen-centric administrative facilitation centers in the Newly Merged Districts, read a statement by World Bank.

“The project will support the government in expanding the provision of Child Wellness Grants targeted at mothers, provided they attend health awareness sessions”, said Najy Benhassine, World Bank Country Director for Pakistan. “It will also help improve access to quality child health-related services.”

The World Bank said nearly 300,000 children under the age of two will benefit from Child Welfare Grants (CWGs).

Under the project, to mitigate the financial barriers associated with the use of these services, families of these children will receive Rs12,500 (approximately $45), spread over five visits, for attending the health awareness sessions and growth monitoring of their child.

“The project will also support the Khyber Pakhtunkhwa Government in adoption of the one window operation model of the Citizen Facilitation Centers (CFC) to promote essential service delivery to the local population,” read the statement.

It added that the CFCs, in addition to provision of Child Wellness Grants, offer vital services to the local communities such as registration services including recording of birth, death, marriage, divorce, family registration etc. 560,000 individuals will be utilizing the services provided at the CFCs.

“The project will facilitate the transition of the program to the province of Khyber Pakhtunkhwa, bridging the continuity of the activities under the 40 CFCs already established with the support of the Federal Government,” said Amjad Zafar Khan, Task Team Leader for the project.

Back in May, the World Bank’s board approved $213 million in financing to improve livelihoods and essential services and enhance risk protection in communities affected by the 2022 floods, with a focus on the Balochistan.
Finance Minister Ishaq Dar on Tuesday said the Kingdom of Saudi Arabia (KSA) has deposited $2 billion in the State Bank of Pakistan’s (SBP) account.
This inflow has increased the forex reserves held by SBP and will accordingly be reflected in the forex reserves for the week ending 14 July 2023”.

World Bank board approves $100mn for ‘Punjab Family Planning Program’

  • Project aims to provide timely access to quality family planning services free of charge
The World Bank’s Board of Executive Directors on Thursday approved $100 million for the Punjab Family Planning Program, as it seeks to increase the utilization of family planning services in the country’s largest province.

As per a statement, the program will provide timely access to family planning services free of charge.

It will also institutionalize quality of care across the family planning services delivery system, and support public information and advocacy campaigns so that more families are made aware of the benefits of family planning, the World Bank said.

“This important program aims to achieve universal access to reproductive healthcare and to raise the usage of family planning methods in Punjab to 60% by 2030,” Najy Benhassine, World Bank Country Director for Pakistan, was quoted as saying in the press release.

“This is critical for Pakistan’s development, as excessive population growth rates hampers development, slows the accumulation of human capital, and contributes to keeping families in poverty,” he said.

China bank has rolled over $600m loan: PM​

By Staff Reporter
lJul 19, 2023

ISLAMABAD: Prime Minister Shehbaz Sharif has said that the Exim (Export-Import) Bank of the all-weather friendly country, China, has rolled over another $600 million for Pakistan, which helped to further increase the country’s foreign exchange reserves.

Top Bottom