Pakistan, ADB sign loan agreement worth USD 1.3 billion

Pakistan signed an agreement with the Asian Development Bank for a loan worth USD 1.3 billion to support the cash-strapped country's public finances and shore up its slowing economy.

On Friday, the bank said it has approved a USD 300 million policy-based loan that will help Pakistan to address financial sustainability, governance, and energy infrastructure policy constraints in country's energy sector.

Under the deal, the ADB will provide the loan to help stabilize the foreign exchange reserves of the country.

Pakistan is facing a serious economic crisis with short supplies of foreign currency reserves and stagnating growth in recent years. The ADB loan comes just days after investment rating agency Moody's changed Pakistan's outlook from negative to stable.

Since assuming power in August 2018, Prime Minister Imran Khan has been appealing to close allies like China and Saudi Arabia to provide loans to reduce the size of the bailout package that Islamabad sought from the International Monetary Fund (IMF).