The Asian Development Bank (ADB) has approved a $10 billion loan program for Pakistan.

The loan will be disbursed over a period of five years. The purpose of the loan is to assist Pakistan in meeting the economic and social challenges posed by Corona.

As per details, the ADB will provide the loan between 2021 and 2025. Out of the total loan program, $6.3 billion is expected to be disbursed over the next three years.

However, the approval and disbursement of the loan program will depend on Pakistan's ability to meet the conditions and process the loan documents in a timely manner.

A quarter of the total loan will be at a discounted interest rate of 2 percent, while Pakistan will have to pay the London Interbank Offer Rate plus 0.5% on the remaining amount of the loan.

The ADB said that the pandemic had interrupted the macroeconomic recovery in Pakistan, resulting in a sharp contraction in growth, a rise in public expenditures, and a loosening of monetary policy to mitigate the health and economic impacts.

“As with many countries in the region, Covid-19 has affected Pakistan, revealing the extent to which the population is exposed to economic and social vulnerabilities,” said ADB Director General for Central and West Asia Eugene Zhukov.