ISLAMABAD, Nov 24: The Asian Development Bank has firmed up its plan to offer $2 billion assistance to Pakistan in 2005 and 2006, its Resident Representative in the country Marshuk Ali Shah said on Wednesday.

"This two-year funding line is very important and it will strengthen the government's resource mobilization position," he told Dawn. He said the new funding line included a $302 million road project for the NWFP and a $130 million resource management programme for Balochistan.

He expressed the hope that the government would improve its implementation strategy so that the benefits of the assistance could reach the common man as quickly as possible.

In this regard, he mentioned the ADB's governance reforms programme for the country's legal, judicial and police departments. "There is a need for consistent effort for smooth implementation of the programme to realize the objectives of our assistance," he said.

Mr Shah said improved Pakistan-India relations could help enhance trade and investment activities in the region. He referred to the ADB's 'Country strategy and programme update 2005-06', which said: "If India-Pakistan relations continue to improve, it will present a major opportunity to enhance sub-regional cooperation in trade, commerce and other areas, which would contribute to higher growth rates and reduction in poverty among all member countries of the South Asian Association of Regional Cooperation".

In addition to exploring possibilities of supporting cooperation among Saarc countries, the ADB would continue to support several ongoing and proposed regional initiatives to strengthen Pakistan's cooperation prospects with Afghanistan and Central Asia, it said.

"While security issues remain a concern, the improved political situation in Afghanistan offers new opportunities for cooperation with countries to the west," the update said.

It said progress on governance and ADB-supported institutional reforms, particularly in agriculture and public utilities, was slow and at times subject to reversal.

Given the constraints on public sector resources and capacity, the private sector needed to play an important and growing role in infrastructure development to realize the country's vision for higher growth, it said.

The ADB would provide assistance for the development of a strategy to determine the role of the private sector in the financing, construction, operation and maintenance of infrastructure through public-private partnership; the creation of policy, regulatory and institutional frameworks to support such partnerships; and the development of pilot partnership models for specific projects, it said.

The bank would explore the use of ordinary capital resources lending against government guarantees, risk mitigation guarantees, swaps and other products that supported availability of long-term private sector financing for infrastructure projects, it said.

Under the private sector development strategy, the ADB would continue to provide direct assistance to private sector entities through investment, lending and guarantees, principally to projects in power, water, transport, and oil and gas sectors, it said.