ISLAMABAD: Pakistan is incurring average annual losses exceeding $2 billion due to climate-related disasters, which are compounding existing poverty challenges, according to the Asian Development Bank’s (ADB) Annual Report 2024 released on Thursday.
“Pakistan is among the most climate-vulnerable countries in the region, facing disaster-related losses averaging over $2 billion a year. Women and other vulnerable communities are especially impacted,” the Manila-based lender stated.
To strengthen Pakistan’s disaster resilience, ADB approved a $500 million policy-based loan in 2024 aimed at enhancing disaster risk management capabilities. This programme supports risk mapping, modelling, and improved financing mechanisms involving both public and private sectors. It also marks the first time ADB’s contingent disaster financing facility is being used in Central and West Asia, enabling quick financial responses to disaster events.
Supporting Social Protection and Poverty Reduction
In addition to disaster resilience efforts, the ADB allocated $330 million to broaden the scope of a grassroots social protection initiative, aiming to reach 9.3 million beneficiaries, with a special focus on poor women and their families. The funding is designed to:
- Improve household targeting for poverty assistance
- Offer conditional cash transfers for children’s education
- Expand access to health and nutrition services, particularly for women, girls, and children in disaster-affected regions
The report also highlights persistent socio-economic challenges in Central and West Asia, noting that countries like Pakistan, Afghanistan, and the Kyrgyz Republic continue to grapple with high poverty and limited access to basic services.
Urban Challenges and Sustainable Development
Pakistan’s rapidly growing urban population is facing deteriorating living conditions due to inadequate infrastructure, limited public services, poor urban planning, and the mounting impact of climate change. In response, ADB released a report in 2024 proposing a new urbanisation model to help make Pakistani cities more sustainable and livable.
The report emphasizes:
- Strengthening urban planning strategies
- Leveraging public-private partnerships for urban services
- Improving the financial health of municipal bodies
- Implementing gender-responsive budgeting and spending
Boosting Green Industry and Foreign Exchange
ADB also approved a $41.2 million non-sovereign loan to SAFCO Venture Holdings Ltd. for establishing a sustainable aviation fuel (SAF) facility in Sheikhupura. This plant will produce 200,000 tonnes of SAF annually, using by-products from a nearby biodiesel refinery.
Key benefits include:
- Reducing carbon emissions by up to 85%
- Exporting 100% of production—mainly to the EU
- Generating much-needed foreign exchange for Pakistan
ADB’s Commitment to the Region
As of 2024, ADB’s total loan portfolio for Pakistan stands at approximately $20.8 billion, including about $4.59 billion in undisbursed loans, representing around 10% of Pakistan’s total external debt.
Regionally, ADB committed $24.3 billion from its own resources and secured an additional $14.9 billion in co-financing with development partners to address complex challenges across Asia and the Pacific.
“With our enhanced financial capacity and strategic direction, ADB is translating promises into tangible outcomes,” said ADB President Masato Kanda. “We’re investing in cleaner energy, efficient transport, and stronger social protection, education, and healthcare systems to create inclusive and sustainable growth.”
