Pakistan Seeks ADB Help to Tackle Power Sector Debt, Lure Private Investors

The federal minister for Power has asked the Asian Development Bank (ADB) to help the country manage mounting power sector debt and restore private investor confidence, as the government pushes ahead with plans for a competitive electricity market and an increasingly renewable-heavy grid. Federal Minister for Power Sardar Awais Ahmed Khan Leghari made the request in talks with an ADB delegation led by Leah Gutierrez, director general for Central and West Asia. He flagged financing constraints, including challenges related to rupee cover and high upfront project costs, as key obstacles to reform. Leghari said the government is engaging local investors through the Pakistan Business Council to unlock investment in power transmission and improve market visibility. He noted that Pakistan has aligned transmission planning with the Indicative Generation Capacity Expansion Plan (IGCEP) and has eliminated surplus capacity deemed unnecessary for future demand projections. Reiterating a policy shift, Leghari said the government will not procure additional power under the old model and is instead moving toward a competitive electricity market. He pointed out that Pakistan has already transitioned about 20 gigawatts to clean energy, but stressed that this shift happened without dedicated financing or adequate funding for grid stability. Despite limited support, the transition had continued, he said, adding that coordinated efforts and sufficient financing are now critical to keep the grid stable as renewable generation expands. The minister also highlighted the Energy Surplus Package, which is aimed at boosting electricity demand and increasing private-sector offtake in order to improve utilization of existing capacity and ease financial stress in the system. Seeking ADB’s support, he underscored the need for assistance on debt repayment challenges and for confidence-building measures to bring private investors back into the sector. He said a feasibility report tailored for investors would be presented soon and disclosed plans to roll out smart meters through private participation under a public-private partnership model, with a focus on technology integration and efficiency gains. Gutierrez, on her first visit to Pakistan in her current role, welcomed deeper engagement with the Power Division and expressed ADB’s interest in supporting smart metering initiatives. She pointed to the bank’s experience with PPPs and technology integration and indicated ADB’s willingness to back Pakistan’s Integrated Energy Plan and act as a transitional adviser on PPP frameworks. She added that ADB’s sovereign and non-sovereign operations run on a single platform, allowing the bank to offer end-to-end solutions for complex sector reforms.