Asian Development Bank (ADB) has provided much-needed relief to Pakistan by approving USD 1.5 billion in finance to the government of Pakistan. This money will be utilized to provide social protection, increase food security, and create employment for the people affected by the recent floods and global supply chain disruptions amid the Ukraine crisis, according to an ADB press release received by WealthPK.

The ADB will release the loan money under its “Building Resilience with Active Countercyclical Expenditures” (BRACE) Program early by next week. This money will be included in the fund for the government’s USD 2.3 billion countercyclical development expenditure program. The purpose of the program is to provide relief to poor people against external shocks like the Ukraine crisis, according to the press release.

News of the approval was also shared by the Minister for Finance and Revenue Ishaq Dar through his twitter handle. He tweeted, “Asian Development Bank’s Board has approved today BRACE facility of USD 1.5 bllion for Pakistan. Agreement signing and release of funds will take place in the week beginning on Monday 24^th October 2022.”

“Pakistan’s recovery from the Covid-19 pandemic has been impeded by external shocks,” said ADB Director General for Central and West Asia Yevgeniy Zhukov. “Business costs and living expenses have surged, affecting millions of Pakistanis, especially the poor and vulnerable. ADB’s program will help the government manage the impacts of high prices, increasing food insecurity, slowing business activity, and reducing income for vulnerable groups, many of whom are also reeling from the devastating floods.”

ADB’s money will be highly instrumental in the implementation and completion of the government’s countercyclical development expenditure program. This program has been specially designed to help the poorest of the poor in times of exogenous shocks to the economy. Government will be working to advance gender empowerment, climate change adaptation and other inclusive policies. All of these measures have increased in importance after the recent floods.

ADB’s financing will also help to expand the number of families receiving cash transfers under Benazir Income Support Program (BISP) from 7.9 million to 9 million. The number of children enrolled in primary and secondary schools will also be increased. Health coverage will also increase based on geographic divides and nutritional supplies for pregnant and lactating mothers and children under 2 years of age.

“The program is part of a comprehensive and well-coordinated package of support. It will help the government deal with the impact of the immediate shocks to the economy, while, in parallel, continue the structural reforms that are necessary to improve the country’s medium- to long-term macroeconomic prospects,” said ADB Director for Public Management, Financial Sector and Trade, Tariq Niazi. “We are working closely with the International Monetary Fund and other development partners to ensure that our support through policy dialogue, technical assistance, and program lending is well-coordinated and that, ultimately, we are able to help the government improve Pakistan's resilience to shocks.”

“ADB’s USD 1.5 billion countercyclical support is part of a significant response package to support people, livelihoods, and infrastructure in Pakistan in the wake of the recent floods which have affected over 33 million people and caused extensive damage to infrastructure and agriculture,” he added.

Credit : Independent News Pakistan-WealthPk