The grant is to support the Afghan government in expanding the power supply to boost economic growth.

ADB deputy country director for Afghanistan Shanny Campbell said: “Increased access to efficient and sustainable energy sources can help Afghanistan to meet its economic growth aspirations.

“The assistance signed, will support the government’s national energy supply programme, which aims to expand power supply to boost economic growth and income opportunities.”

The country’s energy demand is increasing by almost twice its economic growth rate, the bank said, with 20 out of 34 Afghan province not connected to the power grid supply.

The project will extend the national grid connectivity into Eastern province while strengthening the Northeast power system.

The grant will be financed through the Afghanistan Infrastructure Trust Fund (AITF), which is administered by ADB, and the project is part of an overall $1.2bn energy supply improvement programme.

Following years of conflict in Afghanistan, the country has had to rebuild its public financial management from scratch.

The International Monetary Fund has praised the country for its progress on its reform objectives and provided a $6m for the introduction of fiscal and financial reforms, and anti-corruption measures.