ISLAMABAD: Asian Development Bank (ADB) on Tuesday approved $300 million emergency assistance loan to strengthen Pakistan’s public health response to the COVID-19 pandemic.
Under the agreement, the Government of Norway will provide $5 million to NDRMF from the unused resources of the Pakistan Earthquake Fund. The funds would further strengthen financing for natural disaster risk reduction and preparedness in the country.
As per ADB, Norway’s assistance for NDRMF will be administered by the bank.
The loan tranche is critical for the finance ministry as official foreign currency reserves have started depleting. In the last one month, forex reserves held by the State Bank of Pakistan have come down to $18.36 billion – a net reduction of $722 million. The loan proceeds would have been used to provide a cushion to the central bank’s foreign currency reserves besides meeting budget financing needs.
The fund represents the tripling of a package announced just a month ago, which the ADB decided to boost as the scale of the contagion’s impact has mushroomed.
Nearly simultaneous shutdowns across the global economy, with workers ordered to hunker down at home against the virus, have set the stage for a deep recession.
