EU and Pakistan sign €65m deals for investment and energy

Pakistan and the European Union have signed three grant agreements worth a combined €65 million, equivalent to around Rs20.64 billion.

The package will launch three programmes focused on attracting foreign investment, improving energy access in rural areas and strengthening legal and business systems.

The agreements were signed by EU Ambassador to Pakistan Raimundas Karoblis and Economic Affairs Division Secretary Muhammad Humair Karim.

The funding comes under the EU’s Multiannual Indicative Programme for 2021-2027 and covers several major development priorities for Pakistan.

The new package is expected to support economic development while also addressing challenges linked to energy access, investment and access to justice.

Three major programmes included

The first programme, called the ‘Global Gateway Development Facilitation for Pakistan’, focuses on improving the country’s investment environment.

It will work on areas including the tax system and the government’s long-term financial planning.

The main aim is to make Pakistan’s investment environment more attractive and help create conditions for greater foreign investment.

The second programme focuses on energy and natural environment resilience in Khyber Pakhtunkhwa.

It will support renewable energy access in rural communities that are not connected to the national electricity grid.

The programme will also provide training designed to attract private investment and increase private-sector participation in the province’s energy sector.

The third initiative will support the rule of law and business environment in Pakistan.

It will build on previous assistance and focus on improving access to police, prosecution services, courts and legal aid in Khyber Pakhtunkhwa and Balochistan.

Focus on investment and business environment

The Global Gateway programme is particularly focused on creating a stronger environment for investment.

Improving tax-related systems and long-term financial planning can help provide investors with greater clarity about the business environment.

The programme is therefore linked to Pakistan’s wider efforts to attract foreign capital and strengthen economic activity.

The EU has been using its Global Gateway initiative to support investment and development projects in partner countries.

For Pakistan, the latest agreement connects investment support with reforms in areas such as taxation and financial planning.

The package does not represent a single cash payment for general government spending. Instead, the €65 million is being provided through three specific grant programmes with separate development objectives.

Also Read:48 dead after consuming alcoholic drink, what really happened?

Renewable energy focus in Khyber Pakhtunkhwa

The energy programme is aimed particularly at communities that remain outside the national electricity grid.

It will support renewable energy solutions for rural areas while also helping develop skills needed to attract private investment.

Greater private-sector involvement could help expand energy-related activity in areas where traditional grid connections remain limited.

The programme also includes a focus on natural resource management and building a more resilient energy sector.

This part of the package is important for rural communities because improved access to electricity can support households, businesses and other local activities.

Officials have also highlighted the need for sustainable management of natural resources alongside energy development.

Rule of law programme covers four provinces

The third programme will have a wider geographic focus.

In Khyber Pakhtunkhwa and Balochistan, it will work to improve public access to police, prosecution, courts and legal aid services.

In Punjab and Sindh, the programme will support the wider use of alternative and commercial dispute-resolution mechanisms.

Such mechanisms can allow businesses and other parties to resolve certain disputes without relying entirely on lengthy court proceedings.

The programme is also expected to involve the judiciary, legal professionals, universities and the business community.

The stated objective is to improve the overall business environment and make the provinces more suitable for European and other foreign investors.