Pakistan signs $320.16m AIIB loan for N-5 highway reconstruction

ISLAMABAD: Pakistan and the Asian Infrastructure Investment Bank (AIIB) on Tuesday signed a $320.16 million loan agreement for the reconstruction and rehabilitation of the N-5 highway, according to an official statement.

The project will cover key sections of the National Highway (N-5), which passes through Sindh, Punjab and Khyber Pakhtunkhwa and is described in the statement as a backbone of Pakistan’s transport network.

The loan agreement was signed by Muhammad Humair Karim Kidwai, secretary of the Economic Affairs Division (EAD), and Konstantin Limitovskiy, AIIB’s chief investment officer for public sector and project and corporate finance (global) clients. Federal Minister for Economic Affairs Ahad Khan Cheema was present at the signing ceremony.

A separate project agreement was also signed between the AIIB and the National Highway Authority (NHA).

Officials highlight infrastructure and connectivity goals

According to the statement, Cheema praised Pakistan’s longstanding partnership with the AIIB and said the bank had remained a dependable development partner for the country.

He said the N-5 project would help reinforce Pakistan’s resilient infrastructure and would also contribute to regional connectivity, trade activity and economic growth.

Kidwai also appreciated the partnership with the AIIB, saying the bank had consistently remained a strong and reliable partner for Pakistan. He said the N-5 project would further strengthen bilateral cooperation, deepen mutual trust and support the country’s sustainable infrastructure network.

The statement said the N-5 corridor is of major importance because it links key parts of the country, supports regional connectivity and contributes to sustainable infrastructure and economic activity nationwide.

AIIB underscores strategic importance of project

Limitovskiy highlighted what the statement described as strong development cooperation between Pakistan and the AIIB. He emphasised the strategic significance of the N-5 project, saying the route forms part of an international transport corridor.

He added that reconstruction work on the N-5 would be carried out using modern, green and climate-resilient design standards, along with state-of-the-art infrastructure aimed at improving efficiency, sustainability and long-term durability.

The agreement adds to ongoing cooperation between Pakistan and international financial institutions on infrastructure and recovery-related projects. The N-5 is one of the country’s most important road links, and the latest financing is intended to support the rebuilding and improvement of critical stretches of the highway.

The official statement did not provide a timeline for the start or completion of the reconstruction work, but it said the project is intended to strengthen transport infrastructure serving multiple provinces and to support broader economic connectivity.