ISLAMABAD: The Asian Development Bank (ADB) said on Thursday that it will provide $2.5 billion in fresh loans to Pakistan, including $1.5 billion by the end of the year, but the government must first get an IMF good economic health certificate.
According to a statement released by the Ministry of Finance, “the ADB recommended further support of $2.5 billion for the next fiscal year, from which $1.5 billion to $2 billion might be available in the current calendar year.”
Following a meeting between Minister of State for Finance and Revenue Dr. Aisha Ghous Pasha and ADB Country Director Yong Ye, the statement was released.
The ADB has suggested that it might lend $1.5 billion under the Counter-Cyclical Finance Facility and another $400 million via energy sector policy loans, according to sources in the finance ministry.
To qualify for extra funding from the ADB, Pakistan must fulfill several criteria. The facility was created to assist member countries in dealing with the issues faced by the Covid-19 epidemic.
On May 3, the ADB board authorized the Counter-Cyclical Finance Facility, with Pakistan receiving a combination of concessional and commercial financing. However, the ADB board’s acceptance of the $1.5 billion loans would be conditional on Pakistan’s debt burden being sustainable and the country’s fiscal policies not being irresponsible – two factors that will necessitate urgent efforts to satisfy.
The minister of state was informed of the ADB’s portfolio and national plan by the country director. It was said that the ADB was committed to assisting in the reform of SOE governance and regulations, as well as the establishment of a women-inclusive finance sector, and PPP frameworks.