Pakistan signs $772mn flood loan deal with ADB

 Pakistan has signed a $772 million loan agreement for flood relief with the Asian Development Bank (ADB), taking the total loan for the year to $2.7 billion with the agency.

Ayaz Sadiq, the minister for economic affairs, and Yevgeniy Zhukov, the director general of the ADB, reportedly saw the signing of five loans totaling $772.6 million for irrigated agriculture projects, skill development, and flood rehabilitation across Pakistan.

Floods caused by abnormal monsoon rains and a melting glacier submerged huge swathes of the country earlier this year and killed nearly 1,700 people, the majority of them children and women.

According to Minister Ayaz Sadiq, the 1% interest rate for a 40-year term was agreed upon for the ADB loan.

https://twitter.com/PakistanADB/status/1603280043056168962?

The impression that’s being spread is that God forbid, Pakistan is going to be bankrupt, or is in financial crisis. There is nothing like that,” Sadiq said in a recorded message.

“Had there been such a situation, the ADB wouldn’t have signed these loans with us today.”

Pakistan's low foreign exchange reserves, which are just enough to cover a month's worth of imports, are making it challenging for the country to pay its external financing obligations.

On October 26, Asian Development Bank (ADB) transferred a $1.5 billion loan to Pakistan, quoting SBP sources