SOE Reforms and Sindh Coastal Resilience: ADB approves $540m for Pakistan

By Commerce Reporter

ISLAMABAD: The Asian Development Bank (ADB) has approved two significant projects worth a total of $540 million to support Pakistan’s state-owned enterprise (SOE) reforms and enhance climate resilience in Sindh’s coastal districts.

The financing package includes a $400 million results-based loan for the Accelerating SOE Transformation Program, aimed at addressing long-standing governance and performance issues within Pakistan’s public enterprises. This marks ADB’s first results-based loan focused exclusively on public sector management reform in Pakistan.

“The SOE reform program is designed to enhance governance and optimize the performance of Pakistan’s commercial SOEs, which are crucial for the country’s economic stability and growth,” said ADB Country Director for Pakistan, Emma Fan. She highlighted that the initiative would prioritize the restructuring and commercialization of the National Highway Authority, one of Pakistan’s largest and most complex SOEs.

ADB’s support for Pakistan’s reform agenda over recent years has led to key milestones, including the passage of the SOE Act and Policy in 2023, the creation of a central monitoring unit, and the implementation of public service obligation agreements aligned with global best practices. The results-based approach is expected to drive improvements in institutional capacity, digitalization, road safety, and financial sustainability. A complementary technical assistance grant of $750,000 will further aid the program’s implementation.

Additionally, ADB has approved a $140 million concessional loan for the Sindh Coastal Resilience Sector Project, which will focus on the disaster-prone districts of Badin, Sujawal, and Thatta. The project aims to protect over 500,000 people, safeguard 150,000 hectares of farmland, and restore 22,000 hectares of forest.

Aligned with national and provincial climate strategies, the initiative is expected to reduce greenhouse gas emissions, enhance biodiversity, and improve food security. The Green Climate Fund is co-financing the project with a $20 million grant and a $20 million concessional loan.

“The coastal communities in Sindh face increasing vulnerability to severe natural hazards,” Ms. Fan noted. “This project will protect livelihoods, strengthen food security, and empower women to play a central role in resilience planning and implementation.”

The project, which will be implemented by the Sindh Irrigation Department and Sindh Forest and Wildlife Department, will combine water infrastructure upgrades, nature-based solutions, and improved coastal management. Community-based resilience planning will be a central focus, with at least 25% of funds dedicated to women-led or women-implemented initiatives.

This project complements efforts by the International Fund for Agricultural Development (IFAD), which is also supporting livelihoods in these districts, creating a more integrated approach to tackling the challenges faced by the coastal communities of Sindh.