ISLAMABAD, Feb 24: The Asian Development Bank (ADB) has decided to offer $186.7 million to Pakistan to help undertake an extensive "Balochistan Road Development Sector Project" for which a loan agreement is expected to be signed in Manila on Wednesday.
Sources in the ADB office told Dawn that the bank's Country Director Marshuk Ali Shah has reached Manila to sign the loan agreement with Pakistan's Ambassador to Philippines.
The bank would also tentatively discuss new development projects worth about $1 billion for 2005. Earlier, the ADB had approved $900 million funding for 2004. "But the details of 2005 funding will be discussed and finalised by July-August this year", the source said.
According to the details, the Balochistan road project will improve connectivity and allow better access in the province, and build the capacity and systems for suitable road sector development specially in road maintenance.
The project will also improve the efficiency of the national highway, including one major border crossing that passes through Balochistan, and forms part of the priority road transport corridor linking Pakistan, Afghanistan and Central Asia together.
However, a latest ADB document made available to Dawn, said that there involved risks to the project including start-up delays, commitment to institutional changes at Communication and Works Department (CWD), progress on reform at National Highway Authority, adequacy of road maintenance at federal and provincial levels and commitment to cross-border development.
The objectives of the project are to reduce poverty and support pro-poor economic growth by enhancing access of rural populations to economic opportunities and social services by improving the provincial road network; improving trade facilitation and efficiency of the priority road transport corridor linking Pakistan, Afghanistan and central Asia together; and providing essential institutional support and capacity building at CWD.
The total cost of the project is estimated at $267.3 million, out of which the ADB will provide $186.7 million. All procurements will be carried out in accordance with ADB's "Guidelines for Procurements" to reportedly avoid corrupt practices in the project.
The main quantifiable benefits of the project consist of savings in vehicle operating costs and passenger time. The economic internal rates of return for the selected two national highways are 33.7 percent and 40.4 percent respectively.
The project will reduce poverty by enabling the poor to participate in economic opportunities and enhancing their access to social services and creating additional economic opportunities for the poor by stimulating economic growth.
Project beneficiaries will comprise the poor who will have increased access to economic opportunities and human development services because of improved national highways and provincial roads.