The Asian Development Bank (ADB) has pledged to provide Pakistan with $2 billion in annual loans, with half of the amount offered at concessionary rates. This financial support is crucial as Pakistan faces difficulties in securing affordable credit due to its declining credit ratings.
During his visit to Pakistan, ADB President Masatsugu Asakawa reaffirmed the bank’s support across several sectors, including public-private partnerships, climate resilience, domestic resource mobilization, women-inclusive finance, and energy reforms. Of the $2 billion annual commitment, $1 billion will be provided at a concessional interest rate of 2%, significantly lower than the typical 5% interest rates of IMF loans.
This financial package, part of a broader four-year plan totaling $8 billion from 2024 to 2027, offers Pakistan a much-needed respite from high borrowing costs, which have reached unsustainable rates of up to 11%.
Asakawa also inaugurated the ADB’s new resident mission building in Islamabad, symbolizing the bank’s strong partnership with Pakistan. He held discussions with Economic Affairs Minister Ahad Cheema and Prime Minister Shehbaz Sharif, commending Pakistan’s macroeconomic reforms and stabilization efforts. Moving forward, the ADB will focus on enhancing Pakistan’s climate resilience, investing in sustainable development, and building climate-smart infrastructure.
