ISLAMABAD, Oct 25: The Asian Development Bank (ADB) has approved a technical assistance grant of $290,000 to assist the government to formulate a national transport policy.

According to a press release issued here on Monday, the grant is being provided under the Japan Special Fund financed by the Japanese government.

Transport is an important sector of Pakistan's economy, accounting for 10 per cent of gross domestic product and about 20 to 25 per cent of the annual public sector developmental programme.

The government attached top priority to transport sector and considered it a prime engine for economic growth and poverty reduction. Strategic investment in this sector is necessary for Pakistan to benefit from regional opportunities for cooperation in trade and commerce.

The transport sector, however, is currently constrained by key issues that include preservation of existing assets, project prioritization, portfolio management and adequate and stable funding.

The government has made several attempts in the past to articulate a transport policy that encompasses all sub-sectors.

ADB country director in Pakistan M. Ali Shah said: "The present technical assistance will build on such previous efforts to enable the government to formulate a comprehensive national transport policy that represents the interests of all stakeholders elicited through a consultative process."

Senior Transport Specialist and mission leader Hasan Masood explained: "The transport policy will provide an enabling environment to address key transport issues, including distribution of multimodal shares and financing needs with the active participation of the private sector."

The communications ministry is the executing agency for the technical assistance and will be responsible for overall coordination with other ministries and the ADB.