MABAD - The Asian Development Bank (ADB) Thursday signed an agreement with Pakistan for investing $650 million in the country for the reconstruction of infrastructure damaged by the devastating floods last year and the loan is under Flood Emergency Reconstruction Programme.
The financial assistance provided under the Flood Emergency Reconstruction Project (FERP) would be used for rebuilding damaged national and provincial road networks, irrigation systems, and flood protection structures, launching economic and livelihood activities. Acting Secretary Economic Affairs Division and Rune Stroem, Country Director, Asian Development Bank (ADB) has signed the agreement. It might be mention here that Asian Development Bank last month (March) had already approved the said $650 million in emergency assistance loans to help Pakistan rebuild vital infrastructure destroyed during last years floods
The break up of $650 million showed that the $600 million of FERP resources comes from Ordinary Capital Resources (OCR) with a 32-year term, an eight-year grace period and interest set in accordance with ADBs LIBOR-based lending facility. Meanwhile, $50 million equivalent will be tapped from ADBs concessional Asian Development Fund, which will have a repayment term of 40 years, with a 10-year grace period, and interest charges at 1 per cent per annum. Asian Development Bank (ADB) would also provide $4 million grant for capacity building technical assistance to strengthen implementation and oversight of the project.
'Rebuilding the roads, irrigation and flood protection structures will help resume economic activities and secure livelihood of farmers, and protect all other facilities from future disasters. This investment is designed not just to rebuild what has been damaged but to build it to a better standards, said Rune Stroem, ADBs Country Director for Pakistan.
The loan would reconstruct over 790 km of national highways and 800 km of provincial roads and bridges to safer, higher standards. It will also upgrade flood protection embankments and other drainage infrastructure in 1.5 million hectares of agricultural land. Along with quickly restoring damaged infrastructure, the project will aim to build back better.
Rune Stroem further said, In view of the scale of destruction and corresponding difficulties people have been facing, the rebuilding tasks got to be accomplished as early as possible. We look forward to work closely with the Government of Pakistan and provincial agencies for a speedy and effective implementation of the project ensuring earliest recovery for millions of affected people.
Acting Secretary EAD, also spoke on the occasion and said that last years floods had caused damages of about $10 billion and has devastated huge infrastructure adding that the ADB assistance would help rebuild the infrastructure of the country.
In addition to the above, Asian Development Bank (ADB) as a part of its overall post-flood support increased the trade finance facility to Pakistan by $500 million, providing extra cover to emergency imports and exports during the reconstruction period, and also contributed $3 million grant to enable National Disaster Management Authority to respond to existing and future emergencies and disasters in an effective manner.