ADB Provides $100 Million to Fill Infrastructure Gap Through PPP in Sindh Province

ADB Provides $100 Million to Fill Infrastructure Gap Through PPP in Sindh Province

ADB Provides $100 Million to Fill Infrastructure Gap Through PPP in Sindh Province

The FINANCIAL -- The Asian Development Bank (ADB) and Pakistan signed a loan agreement for $100 million that will improve and strengthen the standards in the development and delivery of Public-Private Partnership (PPP) projects to increase investment in infrastructure and services in the Sindh province. 

Xiaohong Yang, ADB’s Country Director for Pakistan, Shahid Mahmood, Secretary Economic Affairs Division (EAD) for the Government of Pakistan, and Hasan Naqvi, Secretary Finance for the Government of Sindh, signed the agreement in Islamabad. Finance Minister Mohammad Ishaq Dar witnessed the signing ceremony.

The project will help establish a PPP Support Facility (PSF), a not-for-profit company with private sector-led management, to manage government support for PPPs in a fiscally responsible manner. The support will be mainly provided to PPPs through viability gap funding for mobilizing private sector investments in infrastructure, including social services. The project will help strengthen the Sindh government’s capacity to identify, develop, and implement projects with the private sector participation, bringing innovation, efficiency, and overall value-for-money, according to ADB.

“The project will build on ADB’s previous partnership with the Government of Sindh to strengthen the PPP framework and will draw from national and international best practices to support the provincial government’s policies for fast-track provision of sustainable infrastructure,” said Ms. Yang.  “After the successful completion of this project, ADB aims to continue supporting the PPP initiative in the province by replicating this model in the future to encourage a stream of PPP projects across various sectors.”

The Government of the United Kingdom, through the Department for International Development (DFID), is cofinancing the project through a $19.23 million grant (GBP14.74 million) and $4.75 million (GBP 3.64 million) technical assistance, both of which will be administered by ADB. The total cost of the project is $188.98 million, with the Sindh government contributing $65 million. The expected completion date of the project is mid-2022.

Sindh is Pakistan’s second most populous province and is the most urbanized, with about 52% of the people living in cities. Providing the crucial sea-port access and key industrial and business hubs, Sindh generates 32% of Pakistan’s gross domestic product. The project will support increased private sector financing in infrastructure investment and public services in Sindh province.