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World Bank approves $500 million loan to Pakistan

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The World Bank has approved loan to Pakistan for energy sector reform in the country reeling under frequent power cuts. The loan scheduled to be issued in April. WB’s approval will also pave the way for the sanctioning of a $400 million loan by the Asian Development Bank(ADB) next week and a $50 million grant by Japan.

Amount : $500 million

worldbank

World Bank Loan :

  • The loan will be utilised for budget financing, unlike project loans that are used for creating assets.
  • The WB and the Asian Development Bank (ADB) had decided to give $2 billion to Pakistan for energy sector reforms under a medium-term programme. The programme was part of $10 billion that the international lenders had agreed to provide over a period of three years.
  • The amount included $6.6 billion bailout package of the International Monetary Fund.In May last year, Pakistan received $1 billion as first tranche from both the international financial institutions.

Highlights

  • The government also agreed to submit the Energy Efficiency and Conservation Bill to the parliament and agreed to set up the Central Power Purchasing Agency (CPPA) Guarantee Limited.
  • Pakistan will also produce 40,000 MW of electricity through nuclear power plants by 2050 to overcome frequent outages.

Key points :

  • World Bank Headquarters :Washington D.C,US
  • World Bank President : Jim Yong Kim
  • Pakistan Capital, Currency : Islamabad, Pakistan Rupee
  • Pakistan PM : Nawaz Sharif