ISLAMABAD, June 7: The Asian Development Bank has agreed to “re-negotiate” its loaning arrangements with Pakistan in the light of the development strategy spelled out in the budget 2006-07 in order to offer an all time high $1.5 billion annual assistance in 2006.

Informed sources told Dawn on Wednesday that the ADB has indicated to help complete mega developing projects in the water sector, infrastructure, urban development, roads and transport through its increased annual lending level for Pakistan.

Since Pakistan could not timely forward the details of various development projects for approval to the ADB board of directors, not much of the funding was released during the first five months of 2006.

Sources said now the bank officials have asked Pakistan to furnish the details of new development projects which needed to be supported during the remaining over six months period of this year.

Pakistan, sources said, has been removed from the South Asian region and included in West Asia and Central Asia Department about two weeks ago. But this “management change” is not expected to delay disbursement of funding to Pakistan during the second half of 2006. The annual lending level, sources said, will remain unchanged despite the fact that both sides will renegotiate afresh various development projects.

Sources said that the ADB has also indicated to provide additional assistance for social sector projects and governance related subjects.

So far funding for national highway development programme ($180m), Karachi mega city project ($10m), FATA rural development programme ($42m) and technical assistance for rural development programme ($5m) have been approved by the bank.

“But the bank has said that it needs to finalise and offer the full amount of $1.5bn by December this year for which Pakistan will have to accelerate the process of negotiations by timely submitting the new development projects”, a source said.

He added that the bank wanted to maintain the annual lending level for Pakistan. He expressed hopes that these new negotiations will start within next few weeks time.

However, sources said the bank continued to insist that Pakistan must ensure an efficient judicial system, improve law and order situation and allocate more funds for education, health and poverty alleviation.

It also urged the government to promote good governance with a view to effectively meet the challenge of poverty and unemployment.