Pakistan is receiving$1.5 billion loan from the Asian Development Bank under the Public Private Partnership mode to upgrade infrastructure during 2016. The total co-financing of the bank stands at $1.050 billion including $400 million grant commitments from DIFD. The bank has also provided $95 million as trade finance support for the private sector investments. Infrastructure is the basic requirement for the promotion of trade, business and industrial activities and Pakistan still has a long way to go in this sector. However, loans become bane instead of boon for the nation when money is misappropriated or wasted away because of unnecessary delays, corruption and mismanagement during the execution of projects. The priority areas of the bank include establishment of Natural Disaster Risk Management Fund and its operationalisation during the year. The Asian Infrastructure Investment Bank will also be involved for assistance to launch the M4 Project, covering Shorkot-Khanewal section near the route of the China-Pakistan Economic Corridor. The bank is also likely to explore opportunities for co-financing from other sources, including through Islamic Financing.
The ADB has given range of its ceiling for providing assistance and the government is also seeking loan to overhaul the energy sector and promote growth through budgetary support. But delay in taking timely decision is the root cause of most of the problems in this country. Finance Minister Ishaq Dar is very keen to get foreign loans without realizing that how he will handle finances in a situation when loans are piling up and what will be his strategy if the PML-N government comes to power again in the next general elections.The government should focus on direct or indirect investment from local and foreign investors for which a developed infrastructure is the basic requirement. If the government opts for developing infrastructure through borrowed money, it should also ensure that the projects are completed on time and corruption is effectively curbed. According to the government sources, the ADB’s new strategy will target six sectors, including energy, transport, agriculture, natural resources and rural development.
The bank will help rehabilitate power transmission and distribution systems as well as construction and rehabilitation of highways and provincial roads connected to the economic corridor.The bank will also provide assistance for the development of water infrastructure in Balochistan, Khyber Pakhtunkhwa and Punjab. One hopes that the sincere efforts of the government would bring positive changes in the lives of the people, but dumping loan money in the corrupt system will serve no purpose. The government should also develop a mechanism to leave little room for the corrupt elements to carry out their nefarious activities.
