Islamabad: The Asian Development Bank (ADB) Vice President, Wencai Zhang on Thursday indicated that the lender may be considering extending out a loan of $2b annually for the next three years contingent on the preparedness of the projects.
He is on a visit to Pakistan for evaluating the financial requirements of the country from the year 2018 to 2021. Zhang added that due to delays and cost overruns, the final tranche of disbursements were getting impacted. He said that during financial year 2016-17, ADB had given $1.8b to Pakistan which could have reached $2b if there hadn’t been a delay in the execution of two projects.
After noting that the policy-based lending for reforms in Pakistan has been very successful, the Asian Development Bank (ADB) has assured the government that it would explore more areas including governance and public-sector enterprise reforms to provide further assistance to the country.
Zhang called on the Finance Minister, Ishaq Dar on Thursday. He was accompanied by ADB’s Country Director for Pakistan, Xiaohong Yang, and former Country Director, Werner Liepach.
The vice president said that development cooperation has expanded between Pakistan and ADB during the last few years, which has resulted in impressive levels of approvals and disbursement of aid from ADB to Pakistan in FY 2016-17.
He said that ADB is interested in learning more about the government’s new initiatives, including the Pakistan Development Fund (PDF) and the Pakistan Infrastructure Bank (PIB), with a view to potentially collaborate on them with the government.
The vice president said that the ADB’s recent experience of policy-based lending for reforms in Pakistan has been very successful.
Both sides agreed to identify further areas where reforms are required, which may be good for policy based lending. The areas that are being explored in this regard include governance and public sector enterprise reforms. He reiterated ADB’s commitment to supporting development initiatives in Pakistan
The finance minister appreciated the role of ADB as a development partner for Pakistan. He congratulated the vice president on ADB’s 50th Anniversary, and appreciated the latter’s visit to Pakistan to celebrate the anniversary.
He appreciated contributions of former Country Director, Werner Liepach, and the progress made in a short time by current Country Director, Xiaohong Yang.
The minister said that after having achieved macroeconomic stability, the government is now focused on achieving higher, sustainable and inclusive economic growth. He said that federal PSDP of Rs 1,001 billion for FY 2018 is over three-times higher than federal PSDP for FY 2013.
He highlighted that provincial transfers have increased significantly due to increase in tax collections during the last 4 years, and as a result, the provinces are in good fiscal shape. He said that both ADB and the government must work together to further strengthen this relationship.
He appreciated ADB’s interest in participating in the government’s initiatives, such as PDF and PIB, which will enable mobilization of resources for further infrastructure projects in the country.
The minister said that the government will continue to work closely with development partners on initiatives aimed at improving the quality of lives of the people of Pakistan.
At the conclusion of the meeting, the finance minister conveyed his regards to President ADB, Takehiko Nakao.
