ISLAMABAD: Deputy Prime Minister of the Russian Federation, Alexey Overchuk, arrived in Pakistan on Wednesday on a two-day visit accompanied by a high-level delegation, the foreign office said.
Islamabad last year started purchasing Russian crude oil at a discount as high prices caused by geopolitical tensions have caused fuel prices to more than double in Pakistan. Pakistan also received its first shipment of liquified petroleum gas from Russia last September, marking Islamabad’s second major Russian energy purchase.
“Deputy Prime Minister Overchuk will hold meetings with the President, the Prime Minister and the Deputy Prime Minister/Foreign Minister of Pakistan,” Radio Pakistan said on Tuesday about the Russian deputy PM’s Islamabad visit.
In a statement, Foreign Office Spokesperson Mumtaz Zahra Baloch said Pakistan and Russia enjoyed “cordial relations based on goodwill, amity and trust, which is reflected in the multi-faceted bilateral cooperation including in trade, energy and connectivity.”
Energy imports make up the majority of Pakistan’s external payments and discounted imports from Russia offer a respite as Islamabad faces an economic crisis. It is targeting 100,000 bpd of imports from Russia, compared with the total 154,000 bpd of crude it imported in 2022, in the hopes that will lower its import bill, address a foreign exchange crisis and keep a lid on inflation.
However, the benefits are being offset by increased shipping costs and lower quality refined products compared with the fuels produced with crude from Pakistan’s main suppliers, Saudi Arabia and the United Arab Emirates.
As a long-standing Western ally and the arch-rival of neighboring India, which historically is closer to Moscow, analysts say the crude deal would have been difficult for Pakistan to accept, but its financing needs are great.
Russian deputy prime minister arrives in Pakistan on two-day visit
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Russian deputy prime minister arrives in Pakistan on two-day visit
- Islamabad last year started purchasing Russian crude oil at a discount
- Pakistan also received first shipment of LPG from Russia last September
Pakistan, ADB sign $730 loan agreements to boost SOE reforms, energy infrastructure
- Both sign $330 million Power Transmission Strengthening Project and $400 million SOE Transformation Program loan agreements
- Economic Affairs Division official says Transmission Project will secure Pakistan’s energy future by strengthening national grid’s backbone
KARACHI: Pakistan and the Asian Development Bank (ADB) on Thursday signed two loan agreements totaling $730 million to boost reforms in state-owned enterprises (SOEs) and energy infrastructure in the country, the bank said.
The first of the two agreements pertains to the SOE Transformation Program worth $400 million while the second loan, worth $330 million, is for a Power Transmission Strengthening Project, the lender said.
The agreements were signed by ADB Country Director for Pakistan Emma Fan and Pakistan’s Secretary of Economic Affairs Division Humair Karim.
“The agreements demonstrate ADB’s enduring commitment to supporting sustainable and inclusive economic growth in Pakistan,” the ADB said.
Pakistan’s SOEs have incurred losses worth billions of dollars over the years due to financial mismanagement and corruption. These entities, including the country’s national airline Pakistan International Airlines, which was sold to a private group this week, have relied on subsequent government bailouts over the years to operate.
The ADB approved the $400 million loan for SOE reforms on Dec. 12. It said the program seeks to improve governance and optimize the performance of Pakistan’s commercial SOEs.
Karim highlighted that the Power Transmission Strengthening Project will enable reliable evacuation of 2,300 MW from Pakistan’s upcoming hydropower projects, relieve overloading of existing transmission lines and enhance resilience under contingency conditions, the Press Information Department (PID) said.
“The Secretary emphasized that both initiatives are transformative in nature as the Transmission Project will secure Pakistan’s energy future by strengthening the backbone of the national grid whereas the SOE Program will enhance transparency, efficiency and sustainability of state-owned enterprises nationwide,” the PID said.
The ADB has supported reforms by Pakistan to strengthen its public finance and social protection systems. It has also undertaken programs in the country to help with post-flood reconstruction, improve food security and social and human capital.
To date, ADB says it has committed 764 public sector loans, grants and technical assistance totaling $43.4 billion to Pakistan.
