Asian Development Bank issues first Pakistan rupee-linked bonds

This file photo shows the logo of the Asian Development Bank (ADB) displayed outside its headquarters in Manila on Sept. 2, 2010. (AFP/File)
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Updated 18 November 2020
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Asian Development Bank issues first Pakistan rupee-linked bonds

  • Karakoram bond is an offshore bond denominated in Pakistan rupees and settled in US dollars
  • Pakistani PM's special adviser on finance terms the issuance as 'excellent initiative'

ISLAMABAD: Asian Development Bank (ADB) has raised Rs1.83 billion ($11.4 million) in a first issue of local currency “karakoram” bonds. 

A karakoram bond is an offshore bond denominated in Pakistan rupees and settled in US dollars. Before the karakoram bond issuance, the multilateral development bank of which Pakistan is a member had no local currency loans in the country.

The bonds were arranged by Citigroup Global Markets and sold to European asset managers and the international bond issue pays a 7.50 percent semi-annual coupon and matures in August 2023.

“It is anticipated that ADB’s local currency loans will be a boost to private sector development in Pakistan,” ADB said in a statement.

“The Pakistan rupee-linked karakoram bond floated by ADB is an excellent initiative. I am confident it will have significant mutually beneficial outcomes for Pakistan and ADB," Abdul Hafeez Shaikh, the Pakistani prime minister's special adviser on finance, said as quoted in the ADB statement.  

State Bank of Pakistan governor Reza Baqir congratulated the ADB team and affirmed his appreciation of the lender's support for Pakistan’s financial and economic development. 

“ADB’s inaugural issue of Pakistan rupee-linked karakoram bonds will help deepen the capital markets of Pakistan while channeling funding to vital economic sectors,” he said.


Sindh chief minister pledges compensation within two months after Karachi plaza fire

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Sindh chief minister pledges compensation within two months after Karachi plaza fire

  • Murad Ali Shah says government is working with Karachi chamber to help shopkeepers restart businesses
  • January fire that killed at least 67 brought safety of Karachi’s commercial buildings under sharp focus

KARACHI: Sindh Chief Minister Murad Ali Shah said on Friday compensation for shopkeepers affected by last month’s deadly Gul Plaza shopping mall blaze would be released within two months amid calls for improved fire safety regulations to protect commercial buildings in Karachi.

The fire at Gul Plaza in January killed at least 67 people and left more than 15 missing, triggering renewed criticism of lax enforcement of building codes and emergency preparedness in Pakistan’s largest city.

Authorities said the blaze spread rapidly through the multi-story commercial complex, complicating rescue efforts and raising questions about wiring, access routes and fire safety systems in older markets.

“The government in collaboration with the Karachi Chamber is actively working to help shopkeepers restart their businesses and aims to ensure that compensation is provided within two months so that the shopkeepers can buy inventories to restart their businesses,” the chief minister said while addressing the inauguration of the My Karachi Exhibition, an annual trade and consumer exhibition, according to an official statement.

He said temporary locations had been identified where shopkeepers could operate rent-free until reconstruction is completed, paying only basic maintenance costs.

Shah reiterated the Sindh administration’s commitment to provide Rs 10 million ($36,000) to the families of those who died in the fire, along with immediate relief of Rs 500,000 ($1,785) for affected shopkeepers.

He said Gul Plaza would be rebuilt within two years “in the same manner and with the same number of shops,” adding that the new structure would be safer and constructed “without a single square inch extra.”

Business leaders at the event called for stricter enforcement of fire safety standards across Karachi’s commercial districts, citing unregulated electrical wiring and poor compliance as recurring causes of deadly market fires.