Pakistan is expected to secure a new loan of approximately $380 million from the World Bank to support critical reforms in its power sector. According to available details, the funding will be used to improve electricity infrastructure and address long-standing challenges that have weakened the country’s energy system. The World Bank has highlighted several major issues affecting Pakistan’s power sector, including electricity theft, weak bill recovery, system losses, and transmission constraints, all of which have contributed to inefficiency and financial strain.
The proposed project is part of a larger initiative with a total estimated cost of around $700 million, with additional financial support expected from the Asian Infrastructure Investment Bank and the Islamic Development Bank. The primary goal of this program is to strengthen and modernize Pakistan’s electricity network, making it more reliable and efficient for both consumers and industries. This is especially important as the country continues to face frequent power outages and rising energy demand.
One of the key components of the project includes the development of a 500 kV transmission line from Matiari to Rahim Yar Khan, which is part of a long-term energy plan spanning from 2026 to 2035. This transmission line is expected to improve power distribution across regions and reduce bottlenecks in the system. In addition, the project will incorporate modern solutions such as battery storage systems to enhance energy stability and support the integration of renewable sources in the future.
World Bank Warns: Pakistan’s High Import Tariffs Stifling Industrial Growth
The initiative also includes technical assistance aimed at reforming institutions like the National Transmission and Dispatch Company (NTDC). These reforms are expected to improve operational efficiency, governance, and overall performance within the sector. By addressing both infrastructure and management issues, the project aims to create a more sustainable and dependable electricity system.
Overall, this potential loan represents a significant step toward improving Pakistan’s energy security. By investing in infrastructure upgrades and institutional reforms, the country hopes to ensure a more reliable power supply, reduce losses, and support economic growth in the long term.
