Pakistan and the Asian Development Bank (ADB) have signed two major financing initiatives worth a combined $730 million, aimed at strengthening the country’s power transmission network and accelerating reforms in state-owned enterprises (SOEs). The agreements are expected to address critical infrastructure bottlenecks, reduce stress on the national power grid, and improve governance and operational efficiency across key public sector institutions.
According to an official statement issued on Thursday, the newly signed initiatives include a second power transmission strengthening project valued at $330 million and an accelerating SOE transformation programme amounting to $400 million. Together, these measures are designed to support Pakistan’s broader economic reform agenda by addressing long-standing challenges in the energy and public sector domains.
Earlier this year, Pakistan and ADB had also signed an agreement to provide $200 million in financing to support improvements in the country’s power distribution system. That earlier support focused on network upgrades to reduce losses and enhance service reliability. The latest agreements build on this ongoing cooperation, reflecting ADB’s continued engagement in Pakistan’s infrastructure and governance reform efforts.
Speaking on the occasion, Ministry of Economic Affairs Secretary Muhammad Humair Karim acknowledged the Manila-based lender’s consistent role in supporting Pakistan’s development priorities. He noted that the power transmission strengthening project would enable the reliable evacuation of 2,300 megawatts of electricity from upcoming hydropower projects. The initiative is expected to ease congestion on existing transmission lines, improve system stability, and enhance the grid’s resilience during contingency situations.
Karim emphasised that strengthening the backbone of the national transmission system is critical for ensuring energy security and supporting future power generation projects. By addressing capacity constraints and overloading issues, the project aims to reduce disruptions and improve overall efficiency within the power sector, which has long been a key concern for Pakistan’s economy.
In addition to energy infrastructure, the accelerating SOE transformation programme is designed to improve operational efficiency and governance within state-owned enterprises. Karim highlighted that the programme would place particular focus on the National Highway Authority, while also supporting broader reforms aimed at transparency, sustainability, and performance management across SOEs nationwide.
The secretary described both initiatives as transformative, stating that the transmission project would help secure Pakistan’s energy future, while the SOE programme would strengthen institutional performance and public sector accountability. These reforms are seen as essential for reducing fiscal pressures, improving service delivery, and enhancing investor confidence in Pakistan’s economy.
ADB Country Director for Pakistan, Emma Fan, also welcomed the agreements and appreciated the government’s commitment to implementing the initiatives. She underlined the importance of the power transmission project in reinforcing Pakistan’s energy infrastructure and supporting long-term economic growth. Fan noted that strengthening transmission capacity is a critical component of ensuring that power generation investments translate into reliable electricity supply.
Regarding SOE reforms, Fan stated that the transformation programme comes at a critical juncture for Pakistan and would further strengthen ongoing reform efforts. She emphasised that improving governance and efficiency in state-owned enterprises is essential for sustainable economic development and effective public resource management.
The latest agreements follow ADB’s approval last month of two loans totalling $330 million for the construction of a transmission line between Islamabad and Faisalabad, one of Punjab’s major industrial hubs. That project is intended to support industrial growth by improving power supply reliability in a key economic corridor.
Taken together, these initiatives reflect a deepening partnership between Pakistan and ADB, with a focus on addressing structural challenges in the energy sector and public enterprises. The $730 million financing package is expected to play a significant role in supporting economic stability, infrastructure resilience, and institutional reform in the years ahead.
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