SBP receives $1.3 billion from Asian Bank for economic reforms

SBP receives $1.3 billion from Asian Bank for economic reforms

KARACHI: State Bank of Pakistan (SBP) has said that it received $1.3 billion from Asian Development Bank (ADB) on Monday night.

In a tweet message, the central bank confirmed the transfer of $1.3 billion from the ADB.

Earlier in the day Minister for Economic Affairs, Muhammad Hammad Azhar witnessed the signing of two loans programme amounting to US $1.3 billion between the government of Pakistan and the ADB for economic reforms.

The loan agreements were signed by Secretary, Economic Affairs Division, Dr Syed Pervaiz Abbas and Ms Xiaohong Yang, Country Director, Asian Development Bank (ADB).

Under Special Policy-Based Loan (SPBL) Facility, Asian Development Bank has committed to providing US $1 billion for Economic Stabilization Programme.

This programme aims at improving exchange rate management, strengthen public financial management to mobilize more revenues, restore allocated efficiency of scarce public resource, address the power sector pricing issues and reduce the social impacts of macroeconomic stability measures by improved targeting and transparency of existing social protection programmes.

Out of total US $1.3 billion loan, US $ 300 million is allocated to Energy Sector Reforms and Financial Sustainability Program (Subprogram 1).

It will address issues regarding energy shortfalls, technical lacuna’s and policy related shortcomings in Pakistan’s energy sector.

The programme will help to secure financial sustainability by controlling new accumulation of circular debt; strengthen governance by rationalizing competitive market road-map, separation of policy and regulatory functions in hydrocarbons sector, appointment of appellate tribunals, implementation of multi-year tariffs and un-bundling of gas sector and reinforce infrastructure improvements through integrated planning to facilitate public and private sector investment across the energy supply chain.

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