Japan to loan ¥5 billion to Pakistan
7:46 pm, June 06, 2014
Japan will provide ¥5 billion in low-interest loans to Pakistan in order to help the country improve its electric power infrastructure.
The Japan International Cooperation Agency and the Pakistani government signed the deal in Islamabad on Wednesday.
JICA will provide the loans in a cofinancing program with the Asian Development Bank, which will put up $400 million, and the World Bank, which will lend $600 million.
Pakistan will be the second Asian country to receive JICA soft loans for electric power projects, following Sri Lanka.
Pakistan regularly suffers daily blackouts of up to 12 hours. The country is unable to fund improvements to its power supply infrastructure because government subsidies keep electric rates low.
The cofinancing program is designed to help Pakistan set government subsidies and electric rates at adequate levels and reduce power generation costs.