The Asian Development Bank’s (ADB) $15.1 billion Country Assistance Programme (CAP) for Pakistan during 2020–2024 has been rated “highly satisfactory” by its Independent Evaluation Department (IED), with overall performance deemed successful.
The evaluation, covering 113 sovereign and three non-sovereign projects, found that the CAP effectively supported Pakistan’s economic management, governance, social protection, and disaster resilience. However, limited progress was noted in reducing circular debt in the energy sector and expanding access to affordable housing.
The CAP assessment, conducted under new 2024 review guidelines, measured ADB’s engagement across four criteria: relevance, efficiency, effectiveness, and sustainability. While the programme aligned well with Pakistan’s Vision 2025 and ADB’s Strategy 2030, some targets under the 2021–2025 Country Partnership Strategy (CPS) remain unmet.
ADB support helped lower the annual flow of circular debt in the power sector from Rs450 billion in FY2019 to Rs83 billion by 2024. However, the CPS target of reducing it to Rs50 billion by 2025 is unlikely to be achieved. Structural challenges persist, including reliance on imported fuels, tariff adjustment delays, and low collection rates.
In the housing sector, the mortgage-to-GDP ratio improved from 0.25% to 0.3%, still short of the 0.4% target. Pandemic-related disruptions and the 2022 floods also impeded progress on education and health goals. Health expenditure averaged 1.2% of GDP during the period, falling below the CPS benchmark of 3%.
Despite these setbacks, the CAP exceeded expectations in several key areas. All operations completed during the review period were rated effective or highly effective. Achievements included meeting targets for tax revenue growth, export expansion, and climate resilience.
ADB also adapted quickly to Pakistan’s evolving needs during multiple crises—COVID-19, macroeconomic instability, flooding, and political transitions—by applying a flexible mix of financial tools and maintaining a strong implementation track record.
The programme’s efficiency was also rated highly. Sovereign operations achieved an average disbursement rate of 125% and an average time of 22.4 months from approval to disbursement, outperforming ADB’s portfolio-wide benchmarks.
Delays in legislative amendments affected efficiency ratings in some cases, though roughly one in eight completed projects were rated efficient or highly efficient.
The review concludes that while ADB’s CAP significantly contributed to Pakistan’s development efforts, sustained reforms and targeted investments are needed to meet the most difficult development goals in the coming years.
