ISLAMABAD: The European Investment Bank (EIB) and Pakistan’s government on Wednesday signed a €60 million loan agreement, the first between the two sides in a decade, to support the delivery of clean drinking water in Karachi, the EU said in a statement. 

The Karachi Water Infrastructure Framework, approved in August this year by the EIB, will finance the rehabilitation and construction of water treatment facilities in Pakistan’s most populous city of Karachi to increase safe water supply and improve water security. 

The agreement was signed between the two sides at the sidelines of the 15th Pak-EU Joint Commission in Brussels, state broadcaster Radio Pakistan reported. 

“Today, the @EIB signed its first loan agreement with Pakistan in a decade: a €60 million loan supporting the delivery of clean drinking water for #Karachi,” the EU said on social media platform X. 

Radio Pakistan said the agreement reflects Pakistan’s commitment to modernize essential urban services and promote climate-resilient infrastructure.

“The declaration demonstrates the continued momentum in Pakistan-EU cooperation and highlights shared priorities in sustainable development, public service delivery, and climate and environmental resilience,” it said. 

Karachi has a chronic clean drinking water problem. As per a Karachi Water and Sewerage Corporation (KWSC) study conducted in 2023, 90 percent of water from samples collected from various places in the city was deemed unsafe for drinking purposes, contaminated with E. coli, coliform bacteria, and other harmful pathogens. 

The problem has forced most residents of the city to get their water through drilled motor-operated wells (known as ‘bores’), even as groundwater in the coastal city tends to be salty and unfit for human consumption.

Other options for residents include either buying unfiltered water from private water tanker operators, who fill up at a network of legal and illegal water hydrants across the city, or buying it from reverse osmosis plants that they visit to fill up bottles or have delivered to their homes.

The EU provides Pakistan about €100 million annually in grants for development and cooperation. This includes efforts to achieve green inclusive growth, increase education and employment skills, promote good governance, human rights, rule of law and ensure sustainable management of natural resources.