ISLAMABAD: The Asian Development Bank on Friday said it had approved $540 million in financing to accelerate reforms concerning state-owned enterprises (SOEs) in Pakistan and increase disaster resilience in the coastal areas of its southern Sindh province. 

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 PIA, have relied on subsequent government bailouts over the years to operate. 

Pakistan has announced it would privatize its loss-making SOEs as part of a deal agreed with the International Monetary Fund (IMF) in exchange for a financial bailout package. 

“The Asian Development Bank (ADB) has approved two projects totaling $540 million to accelerate state-owned enterprise (SOE) reforms in Pakistan and enhance disaster resilience in the coastal districts of Sindh,” the ADB said in a statement on its website. 

The bank said the financing comprises a $400 million results-based loan for the Accelerating SOE Transformation Program for Pakistan and a $140 million concessional loan for the Sindh Coastal Resilience Sector Project (SCRSP). 

ADB Country Program Director for Pakistan Emma Fan said the SOE reform program seeks to improve governance and optimize the performance of commercial SOEs. 

“The program will also prioritize restructuring and commercialization of the National Highway Authority, one of the largest and most complex entities within Pakistan’s SOE portfolio,” she said. 

Meanwhile, ADB said the SCRSP aims to strengthen disaster resilience in Sindh’s vulnerable districts of Badin, Sujawal and Thatta.

“The project is set to improve the lives of over 500,000 people, safeguard 150,000 hectares of agricultural land, and restore 22,000 hectares of forest in Pakistan,” the bank said.

Pakistan is recognized as one of the most vulnerable countries to climate change around the world, where 1,000 people were killed due to floods and landslides from torrential rains during this year’s monsoon season. 

WORLD BANK APPROVES $400 MILLION FOR WATER, SANITATION SERVICES

Separately, the World Bank announced this week it has approved $400 million for a new project to expand access to safe water, sanitation and hygiene services for around 4.5 million people in Pakistan’s most populous Punjab province, aiming to curb waterborne diseases and reduce long-term public health costs.

The Punjab Inclusive Cities Program (PICP) is the second phase of the World Bank-supported Pakistan Urban Water, Sanitation and Hygiene Services Multiphase Programmatic Approach. It will focus on rehabilitating water supply networks, sewerage systems and wastewater treatment plants, while expanding stormwater drainage infrastructure across 16 secondary cities in Punjab.

Punjab faces persistent challenges in providing safe drinking water and adequate sanitation, with many urban households relying on contaminated sources. Weak infrastructure and limited hygiene services contribute to high rates of waterborne diseases such as diarrhea, typhoid and hepatitis, which disproportionately affect children and low-income communities.

“Reducing child stunting is essential for Pakistan’s future. Through the Punjab Inclusive Cities Program, we are investing in safe water, sanitation, and hygiene services to break the cycle of malnutrition and disease that holds back so many children from reaching their full potential,” the World Bank quoted its Country Director for Pakistan, Bolormaa Amgaabazar, as saying in a statement.

“In collaboration with the Punjab Government, the program represents a significant step forward in improving urban infrastructure and strengthening local institutions, thereby laying the foundation for healthier communities and a more prosperous Pakistan.”

Child stunting is a form of chronic malnutrition in which a child is too short for their age due to long-term insufficient nutrition, repeated infections or poor health and sanitation conditions.

The project will also support solid waste management systems in Punjab to ensure sanitary waste disposal, with these services being extended to an additional two million people.

“The program complements infrastructure investments with capacity building and revenue generation, helping to ensure that service delivery is well sustained,” the statement quoted Senior Urban Specialist for World Bank Amena Raja as saying.

“It will also help Punjab’s cities better withstand floods and droughts, ensuring urban development is both environmentally responsible and resilient to climate change.”

The program will prioritize hiring women in decision-making roles, establish gender complaint desks and help them develop new skills. It also aims to mobilize private capital to support water and sanitation services in secondary cities of Punjab.