$400m loan to tackle Pakistan’s ‘chronic energy crisis’
The Government of Pakistan has been given a $400 million (£237.8m) loan to help tackle the country’s “chronic energy crisis”.
Its economy has been destroyed as a result of power shortages which are estimated to have slowed GDP growth by at least 2% a year, according to the Asian Development Bank (ADB), which is providing the cash.
The Government of Pakistan is in the process of implementing the ‘National Power Policy’ in a bid to help resolve the problems.
ADB’s reform programme will support the overhaul of existing tariffs and subsidies as the government plans on cutting the latter by 2016, except for low income consumers. It will also back reforms to reduce power losses and encourage more private sector involvement and improving transparency in the sector.
Klaus Gerhaeusser, ADB Director General for the East Asia Department said: “The loan is part of an assistance program which will underwrite reforms needed to make the energy sector affordable, reliable, sustainable and secure. This in turn will accelerate industrial activity needed to boost economic growth and help create jobs, which are key to reducing poverty levels.”
