ISLAMABAD, PAKISTAN- The Asian Development Bank’s (ADB) Board of Directors has approved a $800 million multitranche financing facility (MFF) to help enhance regional connectivity and trade in the Central Asia Regional Economic Cooperation (CAREC) corridors in Pakistan.
The investment program will expand Pakistan’s regional connectivity links while helping to improve road traffic efficiency. Road networks in Sindh, Punjab, and Khyber Pakhtunkhwa will be rehabilitated and upgraded with the MFF’s first tranche, worth $180 million in 2017. The second and third tranches, worth $260 million and $360 million, respectively, are expected to be approved in 2019 and 2021.
“Pakistan’s unique geographic location—at the crossroads of Central Asia, the People’s Republic of China, and South Asia—provides a unique potential and opportunity for the country to become a regional transport and trade hub,” said Dong-Soo Pyo, ADB’s Director, Transport and Communications Division, Central and West Asia Department.
“The investment program will help the Government of Pakistan realize this potential, improving trade and connectivity in the CAREC corridors with the long-term goal of achieving inclusive growth and sustainable development in mind,” he said.
Pakistan’s trade has been centered on sea traffic while transit trade through the country remains limited as poor and costly transport and cross-border infrastructure and services hinder the realization of this untapped potential. Upgrading the country’s current 263,000 kilometers (km) of road while ensuring transport safety will be critical to the country’s export competitiveness as well as overall economic growth.
The MFF will upgrade and rehabilitate a total of 747 km of road along the CAREC corridor. The investment program will also focus on strengthening the capacity of the National Highway Authority to conduct due diligence work for subsequent tranches as well as to implement each tranche project under the MFF as designed.
ADB, based in Manila, is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, ADB is celebrating 50 years of development partnership in the region. It is owned by 67 members—48 from the region. In 2016, ADB assistance totaled $31.7 billion, including $14 billion in cofinancing.
Source: Asian Development Bank