ISLAMABAD: The Islamic Development Bank (IDB) today approved a $252 million loan for Pakistan in order to bridge the financing gap for construction of Mohmand dam and support the vaccine procurements.
The regional bank approved the two separate loans and the agreement for $72.5 million lending for vaccine procurements was signed today in Islamabad.
The agreement was signed during the visit of Dr Muhammad Al-Jasser, the president of the Islamic Development Bank (IDB), who is in Islamabad on a four-day visit to attend the 17th Extraordinary Session of the OIC on Afghanistan. The IDB president called on Federal Minister for Economic Affairs Omar Ayub Khan.
The bank’s financing for the procurement of Covid-19 vaccine will help contain the its spread, according to an announcement by the Ministry of Economic Affairs .
Meantime, in a separate development on December 13, 2021, the IDB, also approved $72.5 million of funding to support Pakistan’s nationwide vaccination efforts in the face of the ongoing Covid-19 pandemic.
Under this approval, the country’s IVAC Covid-19 Vaccine Support Project – also co-funded by the World Bank and the Asian Development Bank – will receive $70 million from IDB as well as $2.5 million from IDB’s Islamic Solidarity Fund for Development (ISFD).
This comes in the framework of the second track (R2) of IDB Group’s $4.56 billion Strategic Preparedness and Response Programme (SPRP), specifically designed to support member countries with their health and economic recovery programme against the Covid-19 pandemic.
The funding will contribute to Pakistan government’s efforts in vaccinating 70% of the population (18 years and above) eligible for vaccination, including health care and frontline workers and other priority groups. So far, 40% of the eligible population has been vaccinated.
“Chaired by IDB President and Chairman of the Board Dr Muhammad Al Jasser, the Board of Executive Directors of the bank, on December 18, 2021, gave the green light to the allocation of $180 million to contribute to financing of the strategic Mohmand Dam and Hydropower Project in Pakistan’s Khyber-Pakhtunkhwa (KP) province,” according to the ministry.
Once completed, Mohmand Dam will be the fifth highest Concrete-Face-Rock-Filled Dam (CFRFD) in the world and will add 800 MW to the country’s installed hydropower capacity. It will also provide sustainable clean potable water to two million residents in Peshawar while boosting food security through vital support for irrigation and agricultural activities on 6,773 ha of new farmlands.
To date, Pakistan’s energy sector has received the largest share of IDB Group development interventions by absorbing 68.4% or about $9.3 billion of the group’s investments, the ministry stated.
The IDB’s financing for Pakistan is covering all the major sectors of economy such as energy, industry, agriculture, transport, health and financial services. The IDB president assured of strong commitment to further strengthening and expanding its partnership with Pakistan.
