Pakistan and the European Investment Bank (EIB) on Wednesday formalized a €60 million financing deal aimed at improving access to safe drinking water in Karachi, marking the first lending agreement between the two in ten years, according to an EU statement.
Karachi continues to face severe water quality challenges. A 2023 study by the Karachi Water and Sewerage Corporation found that around 90 percent of water samples collected across the city were unsafe for consumption due to contamination by E. coli, coliform bacteria and other harmful pathogens.
The funding, approved by the EIB in August, will be channelled through the Karachi Water Infrastructure Framework and used to upgrade and expand water treatment plants in the country’s largest city. The project is intended to boost the supply of potable water and strengthen long-term water security.
Today, the 🇪🇺 @EIB signed its first loan agreement with 🇵🇰 Pakistan in a decade: a €60 million loan supporting the delivery of clean drinking water for #Karachi.#GlobalGateway in action.@KaroblisR pic.twitter.com/sxq1PIxeCH
— EUPakistan (@EUPakistan) December 17, 2025
The agreement was signed on the sidelines of the 15th Pakistan–EU Joint Commission meeting in Brussels, Radio Pakistan reported. The EU described the deal as a significant step in renewing financial cooperation with Pakistan.
State media said the loan underlines Pakistan’s push to modernise urban utilities and invest in climate-resilient infrastructure, while also reflecting broader Pakistan–EU alignment on sustainable development and environmental resilience.
