ISLAMABAD: The Asian Development Bank (ADB) and the French Development Agency (AFD) have approved loans worth over $400 million to help Pakistan improve reliability and sustainability of the energy sector.

The assistance of $300m from the ADB, which is the third loan under the Sustainable Energy Sector Reform Programme, brings the bank`s overall financing to $1 billion since 2014.

As the co-finance partner of the programme, the AFD will contribute $100m to the project.

The agreement was signed by ADB Country Director Xiaohong Yang and Secretary of the Economic Affairs Division, Tariq Mahmood Pasha, on Friday.

`Pakistan`s ambitious energy reform programme demonstrates the government`s commitment to improve the reliability, sustainability and affordability of the energy sector,` said Ms Xiaohong. `Maintaining the momentum for reform will help ensure that all Pakistanis have access to electricity, while keeping the economy on an inclusive, sustained growth path.

Under the programme, Pakistan will embark on a reform initiative that will reduce energy subsidies and adjust tariff policy, improve sector performance and open the market to private participation, and increase accountability and transparency.

The reform measures aim to address financial viability and reduce costs to taxpayers.

`As the co-financing partner in the reforms project, the AFD is committed to promoting green energies in Pakistan through investments in low-carbon-emission energy generation in line with the Paris Agreement, approved by the parliament of Pakistan, said Jacky Amprou, AFD country director for Pakistan.

The ADB and AFD are committed to supporting the government`s strategy to solve the energy crisis in the country and to fight climate change in line with Vision 2025 Pakistan`s comprehensive plan for economic growth.

The plan aims to increase power generation, provide uninterrupted electricity to all and improve demand management.