Pakistan signed a 475 Million Dollar loan agreement for flood relief with the Asian Development Bank (ADB), the country’s economic affairs minister said on Thursday, taking the total for the year to $2.7 billion with the agency.
Floods caused by abnormal monsoon rains and a melting glacier submerged huge swathes of the country earlier this year and killed nearly 1,700 people, the majority of them children and women.
Minister Ayaz Sadiq said the concessionary ADB loan was signed at the rate of 1% for a period of 40 years.
“The impression that’s being spread is that God forbid, Pakistan is going to be bankrupt, or it is in financial crisis. There is nothing like that,” Sadiq said in a recorded message.
“Had there been such a situation, the ADB wouldn’t have signed these loans with us today.”
Pakistan is struggling to meet its external financing obligations in the face of low foreign exchange reserves that are barely enough to cover a month of imports. It is also beset by decades-high inflation.
The country has been trying to approach allies to seek financial support, and a ninth review of the International Monetary Fund for a 2019 bailout program has been pending since September.
Earlier The report shared by the ADB highlighted that floods have brought more destruction than earthquakes in Pakistan and every year natural calamities claim an average of 863 lives in the country.
The natural calamities have increased poverty in the country after floods destroy the harvest, homes, and other infrastructure. “There is only a limited insurance of harvest in Pakistan and only 272,000 farmers have got their harvest insured,” it reported.
It highlighted that floods further devastate underprivileged districts, increasing the poverty levels in those areas. The report shared that most of the people below the poverty line live in Balochistan, Sindh, and Khyber Pakhtunkhwa.