ADB-AFD provides $300 million for financing the Sustainable Energy Sector Reforms Program
The Asian Development Bank (ADB) and Pakistan signed on 16th June for provide $300 million for financing the Sustainable Energy Sector Reforms Program in Pakistan.
The ADB, which approved the loan on 15th June, was represented by Country Director Xiaohang Yang who signed the agreement with Secretary Economic Affairs Division , ministry of finance Pakistan Tariq Pasha.
The assistance of $300m from the ADB, which is the third loan under the Sustainable Energy Sector Reform Programme, brings the bank’s overall financing to $1 billion since 2014. As the co-finance partner of the programme, the French Development Agency AFD will contribute $100m to the project.
Under the programme, Pakistan will embark on a reform initiative that will reduce energy subsidies and adjust tariff policy, improve sector performance and open the market to private participation, and increase accountability and transparency.
The ADB and AFD are committed to supporting the government’s strategy to solve the energy crisis in the country and to fight climate change in line with Vision 2025 — Pakistan’s compre-hensive plan for economic growth.
AFD in Pakistan
AFD has been operating in Pakistan since May 2007. AFD Group’s Establishment Agreement, which sets out the conditions for its activities in the country, was signed on 2 December 2008.
AFD’s financing in Pakistan mainly focuses on “green energy”: energy efficiency and hydropower. AFD is today one of the five leading donors in the energy sector and plays an important role in the definition of Pakistan’s energy policy.
Since the beginning of its activities in Pakistan, AFD Group has committed a total of 236 millions of euros in the country:
- AFD: EUR 175.5m in sovereign subsidized loans, EUR 12m in non-sovereign loans and EUR 2.9m in grants.
- PROPARCO (AFD’s private sector financing arm): EUR 45m in loans.