While addressing a press conference, AIIB representatives Laurel Ostfield and Chief Economist revealed to media that four projects are under considering with $100 million Karachi Bus Rapid Transit Project, $402 million Rawalpindi Ring Road Project, $400 million Lahore Water and Wastewater Management Project and $160 million for the Karachi Water and Sewer Services Project. However, they also pointed out that there is overall perception of uncertainty of policies and the country is facing large current account deficit.
Laurel Ostfield said that AIIB''s Board of Directors has approved USD 100 million for the National Motorway M-4 Project and USD 300 million for Tarbela 5 Hydropower Extension Project.
"We are working to identify projects with high levels of readiness and that help address the needs associated with ageing water and transmission infrastructure," Laurel Ostfield further said, adding, "Our focus will also remain on projects that can be carried out on a sound economic basis and contribute towards Pakistan''s long-term economic development."
Principal Economist AIIB, Dr Jang Ping Thia while giving the briefing on Asian Infrastructure Finance report said that there is an enormous infrastructure investment opportunities across Asia, including Pakistan, despite current market uncertainty and short-term challenges. An increase in borrowing costs is expected in the next 12 months due to interest rate pressure and monetary policy announcements by the Pakistani central bank. The report notes that currency volatility could also affect project financing.
As governments grapple with the need for macroeconomic stabilisation and sustaining a high-level of infrastructure investment to meet growing demands, AIIB is developing strategies to help its members respond to short and long-term challenges in infrastructure development.
"Our focus on Pakistan demonstrates that during times of macroeconomic uncertainty, multilateral development banks such as AIIB can help reinforce sound public infrastructure investment," he said. "Our report argues that MDBs will play a critical role in mobilising private capital not just through co-financing but also to improve project preparation and reduce project risks. This is why AIIB will remain a vital infrastructure partner for Pakistan."
The AIIB is a multilateral development bank with a mission to improve social and economic outcomes in Asia. Headquartered in Beijing, it began operations in January 2016 and has now grown to 93 approved members worldwide.