The Asian Development Bank (ADB) has sanctioned a $330 million loan to Pakistan aimed at upgrading its outdated power grid. This initiative is expected to enhance the transmission of hydropower from northern regions to major urban centers, addressing chronic energy shortages and inefficiencies. Pakistan, home to 250 million people, has been grappling with frequent power outages, escalating electricity costs, and a burgeoning circular debt in the power sector, which has reached 1.7 trillion rupees ($5.9 billion). The ADB stated that the investment will facilitate the transfer of up to 3,200 megawatts of clean energy from hydropower plants in the north, thereby reducing reliance on imported fuels and improving energy security. Emma Fan, ADB’s Pakistan director, emphasized the project’s role in accelerating the country’s transition to a more affordable and sustainable energy mix. This loan follows a $250 million disbursement in November 2023 for expanding the high-voltage transmission network in Punjab and Khyber Pakhtunkhwa provinces. Additionally, the ADB approved a $410 million package in August for the development of Pakistan’s Reko Diq copper and gold mine. Pakistan’s heavy dependence on external borrowing was evident in 2023 when it narrowly avoided default, thanks to a $7 billion IMF bailout that unlocked further loans from friendly nations.