By Staff Reporter
ISLAMABAD: The Asian Development Bank (ADB) has planned to lend up to $700 million in loans to Pakistan before year-end to help support flood-ravaged economy, a top official said on Thursday, taking the total funding to $2.2 billion post deluge.
“We are developing a package of $500 million to $700 million for immediate relief assistance, early recovery, rehabilitation, and reconstruction, which is in addition to $1.5 billion countercyclical support to mitigate the impact of rising food prices and other external shocks on the poor and vulnerable,” said Yevgeniy Zhukov, bank’s director general for central and west Asia at a virtual news conference. “We are trying to prepare a strong response to deal with the effects of the recent floods.”
Zhukov said the entire amount under the new package would be given via a combination of loans, grants, and concessional assistance. However, he didn’t spell out the terms of the assistance package.
“The package … we believe will be on attractive financial terms for the government of Pakistan,” the bank’s regional chief said.
The development lender initially approved a $3 million grant from Asia Pacific Disaster Response Fund for urgent relief and rehabilitation measures.
Record monsoon rains and glacier melt in the country’s northern mountains have triggered flash floods and rain-induced landslides that have killed over 1,600 people, sweeping away houses, roads, railway tracks, bridges, livestock, and crops. Huge areas are inundated, and hundreds of thousands of people have been forced from their homes.
The government says the lives of nearly 33 million people have been disrupted and floods are estimated to have caused about $30 billion in economic losses.
Zhukov said Pakistan’s continuous engagement with the IMF would help the country get $1.5 billion under the countercyclical Support Facility — a budget support instrument.
“If we talk specifically about the countercyclical facility, we indeed closely collaborate with the World Bank and the IMF so we do want Pakistan’s IMF program to be on track. This will facilitate our investments.”
Zhukov said findings of damage and needs assessment report to be prepared by a team of experts from World Bank, United Nations Development Program, and the ADB will guide the lender’s longer-term assistance plan strategy for Pakistan.
“We expect this assessment will be finalized in the mid of next month and the report would determine any further support for the flood-damaged economy.”
ADB regional chief said the lender “is considering provisions of funds to respond to the flood-related disasters by looking at various lending and ground modalities that provide affordable rates and conditions for Pakistan in current circumstances”.
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