June 13, 2002	Thursday	Rabi-us-Sani 1, 1423

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WASHINGTON, June 12: The $500 million second structural adjustment credit announced for Pakistan by the World Bank on Tuesday is meant to support the continued implementation of the country’s poverty reduction strategy, according to details available here.

The credit, extended under the International Development Association framework, follows a similar but smaller ($350 million) loan given in June last year and should be seen as part of increased aid flows from international financial institutions, including the WB and the International Monetary Fund, and the developed states following Pakistan’s decision to join the post-Sept 11 coalition.

The project implementation document that forms the background to the new credit points out that Pakistan’s poverty reduction strategy aims to promote economic growth as one of its key elements and seeks to change the composition of expenditure to create fiscal space for social sectors.

The document notes that among the priorities is improvement of the the delivery system of basic education, preventive health care, and family planning.

It also outlines the need to reduce the vulnerability of the country’s poor by increasing opportunities through access to credit, redistribution of public lands, implementation of community-based infrastructure programmes and direct cash transfers to the neediest.

This second tranche represents the WB’s main instrument of backing Pakistan’s medium-term programme of reforms and implementation of the agreed country assistance strategy. It is interest-free and has a 35-year maturity period.