MANILA: The Asian Development Bank (ADB) on Friday approved a $100 million loan for a highway project in Pakistan that will mark its first co-financing with the Asian Infrastructure Investment Bank (AIIB).

According to press release issued on Friday, AIIB will provide a $100 million loan subject to its board approval later this month. The United Kingdom’s Department for International Development (DFID) has also committed a $34 million grant for the project.

ADB President Takehiko Nakao said that “This is a historic milestone for ADB and AIIB as we jointly aim to meet the pressing infrastructure needs in Asia and the Pacific region. The project has strategic value to Pakistan as it supports north-south connectivity, new trade, and business opportunities, which will boost jobs and cut poverty.”

He also termed the project as an integral part of the Central Asia Regional Economic Cooperation (CAREC) corridors.

ADB and AIIB have been preparing projects for co-financing since last year. A memorandum of understanding for collaboration was signed by Nakao and AIIB President Liqun Jinat the time of ADB’s Annual Meeting in Frankfurt, Germany in early May.

This project will fund the remaining 64-kilometer (km) long four-lane section of the M-4 National Motorway connecting Shorkot and Khanewal in Punjab province. The project constitutes a key part of a 1,800 km CAREC transport corridor linking the port city of Karachi in the south, to major primary production and population centers including Lahore, Faisalabad, Islamabad and Peshawar, and on to Torkham on the northern border with Afghanistan.

ADB, based in Manila, is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth, and regional integration.