ADB Provides $340 Million to Complete Afghan Ring Road | Asian Development Bank

ADB Provides $340 Million to Complete Afghan Ring Road

News Release | 17 January 2011

MANILA, PHILIPPINES - The Asian Development Bank (ADB) and Afghanistan's Minister of Finance on Tuesday signed two agreements totaling more than $340 million that will lead to the completion of Afghanistan's vital Ring Road and to improvements in the power sector.

The agreements were signed in Kabul by Minister of Finance Omar Zakhilwal and Robert Rinker, ADB's Afghanistan Country Director.

A $340 million ADB grant will fund construction of 233 km of road connecting the towns of Qaisar, Bala Murghab, and Laman in northwestern Afghanistan. The road is the last section of a 2,700 km Ring Road that will connect Afghanistan's major cities. The grant comes in addition to the $450 million ADB has already committed or spent on the Ring Road, and brings ADB's total assistance to Afghanistan's roads, railways and airports to more than $1.07 billion.

"This investment into the last section of the Ring Road will foster greater regional cooperation, linking Afghanistan with itself and with Central Asia, South Asia, and the Middle East," said ADB Director General for Central and West Asia Juan Miranda. "This road makes Afghanistan a transit rather than a cushion country, and will create jobs, improve trade, and bring greater security."

Mr. Zakhilwal and Mr. Rinker also signed a $1.5 million technical assistance agreement for the development of a power sector master plan. The assistance, financed on a grant basis by the Japan Fund for Poverty Reduction (JFPR) funded by the Government of Japan, will help Afghanistan pinpoint deficiencies in its power sector, prioritize rehabilitation needs, and identify major potential load centers.

ADB is the largest development partner in Afghanistan's energy sector, with approximately $700 million worth of committed and planned loans and grants to rebuild power networks. These include $36 million in financing to construct a 420 km portion of the North East Power System which connects the power grids of Afghanistan with Uzbekistan, and $35 million for a similar transmission line now under construction that will link Afghanistan's power grid with neighboring Tajikistan.