The Asian Development Bank (ADB) has approved $330 million in loans to Pakistan for the Second Power Transmission Strengthening Project, aimed at expanding the national transmission network and enabling the evacuation of low-cost renewable and hydropower to major load centers.
The project calls for constructing a new 500-kilovolt, approximately 290-kilometer transmission line and upgrading critical grid infrastructure feeding Islamabad and Faisalabad. These investments would address longstanding constraints in Pakistan’s north–south power corridor, enabling the transfer of up to 3,200 megawatts of clean energy from hydropower plants in the country’s north. This would help reduce reliance on imported fuels, improve energy security, and support Pakistan’s transition to a more affordable and sustainable energy mix.
The initiative supports Pakistan’s broader power sector reforms and contributes to state-owned enterprise reforms by solidifying institutional, financial, operational, and governance improvements of the National Grid Company of Pakistan Limited (NGCPL) on its pathway to a modern grid operator. The NGCPL will serve as the executing agency for the project.
ADB’s financing package comprises a $285 million loan from its ordinary capital resources and a $45 million concessional loan. This financing would help NGCPL expand and modernize transmission assets, strengthen institutional capacity, improve financial management, and advance public outreach and gender equity initiatives.
“This project represents ADB’s strong partnership with Pakistan and our shared commitment to accelerate clean energy transition and integration, and to achieve a resilient and sustainable energy sector,” said ADB Country Director for Pakistan Emma Fan. “By expanding transmission capacity and enabling the delivery of low-cost hydropower, the project aims to improve access to clean energy in the power mix, reduce system costs, and support Pakistan’s long-term and sustainable economic development,” she added.
The Second Power Transmission Strengthening Project aligns with Pakistan’s National Power Policy 2021, Vision 2025, and Pakistan’s Nationally Determined Contributions 2021, emphasizing energy security, climate resilience, affordable clean power, and sustainable development. The new infrastructure would also lower technical losses, enhance grid reliability, and support the financial sustainability of the energy sector.