The Public Private Partnership Authority Act, 2017 enabled the creation of the Public–Private Partnership Authority (P3A) with an enhanced regulatory mandate to promote private investment in public infrastructure and the provision of related services at the federal government level. After the promulgation of the PPP act, the P3A was formally established in June 2018. From the outset, the P3A has endeavored to build its portfolio of PPP projects. Nevertheless, progress has been challenging, and the few projects that have been initiated encountered difficulties in achieving commercial and/or financial closure.

Considering the government’s intention to use PPPs extensively for infrastructure development and for meeting its climate commitments, it is crucial to improve the institutional design and efficacy of PPPs methodically within the broader public investment management framework. The government has taken key measures including the approval of an integrated PPP policy to ensure consistency, awareness, and alignment with sector priorities; the approval of secondary legislation; and the implementation of standardized procedures to streamline project identification, preparation, and implementation processes, including climate risk screening and gender considerations in project feasibility assessments and PPP contracts. The P3A is steadily emerging, and it's crucial for its leadership and staff to receive training in PPP fundamentals, covering areas such as project screening, planning, development, procurement, and financing.

The AP3F TA project complements an existing ADB program requested by the Government of Pakistan as policy-based lending (PBL) to be disbursed over two subprograms. The core objective of the program is to strengthen the governance framework and enabling environment for PPPs at the federal government level by strengthening the (i) policy, legal, and institutional frameworks for public investment management (PIM) and public financial management (PFM) in connection with PPPs; and (ii) national and sectoral infrastructure planning and PPP project preparation.