Pakistan

Pakistan receives $500 million from ADB for climate resilience

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Digital Desk

2 years ago

ISLAMABAD: Pakistan on Thursday received $500 million from the Asian Development Bank (ADB) under the Climate Change and Disaster Resilience Enhancement Programme (CDREP), the central bank confirmed.

The amount will be reflected in the State Bank of Pakistan’s (SBP) foreign exchange reserves next week — set to be released on December 5, 2024 — and will help boost the country’s import cover and stabilise the currency, the SBP said in a statement.

Meanwhile, the foreign exchange reserves increased by $131 million on a weekly basis, clocking in at $11.42 billion as of November 22. While total liquid foreign reserves held by the country stood at $16.08 billion.

Last month, the Asian Development Bank (ADB) approved a $500 million policy-based loan aimed at supporting disaster risk reduction and climate resilience in Pakistan

“The policy-based loan will strengthen Pakistan’s institutional capacity for planning, preparedness, and response to climate-induced disasters. The loan program will increase inclusive investment in disaster risk reduction and climate resilience, and support the scale-up of disaster risk financing using a risk-layered approach,” the Philippines-based said.

The program supports enhanced capacity for disaster risk mapping and modeling for investment and development decisions. It enhances coordination for disaster monitoring and response.

“It supports enhanced planning and prioritization of gender-sensitive and resilient public investments, including integrated flood risk management and nature-based solutions,” the Philippines-based said.

Apart from funding for climate and disaster resilience, the bank also approved a technical assistance grant of $1 million for Pakistan to support the implementation of the program.

According to the Asian lender, the program will support the establishment of a solidarity fund to facilitate the uptake of risk transfer solutions such as agriculture insurance. The program also supports shock-responsive social protection to deliver cash assistance in the event of a disaster.

As per the ADB report, Pakistan is one of the most vulnerable countries to climate change and disasters in Asia and the Pacific as average losses exceed $2 billion per year. The bank report added that women and other vulnerable groups were disproportionately affected by climate change and disaster events.

Pakistan, in November, also launched its first National Climate Finance Strategy (NCFS) to tackle the growing challenges of global warming with a strategy of mobilising funds for climate mitigation and adaptation efforts. The strategy focuses on increasing climate-related investments, attracting international financing, and enhancing domestic financial systems.

Digital Desk