ISLAMABAD, June 23: The World Bank on Monday announced to give $600 million to Pakistan by December 2003 as country’s economic experts found serious flaws in the Poverty Reduction Strategy Paper (PRSP) to be pursued in next three years.
Talking to reporters after a briefing to the parliamentarians on Poverty Reduction Strategy Paper (PRSP), the World Bank’s country director John Wall said this funding would comprise $200 million for Pakistan Poverty Alleviation Fund (PPAF) and $154 million for Highways Rehabilitation Project.
The remaining amount would be for capacity building of government institutions, Punjab education department and for reforms in the Central Board of Revenue (CBR).
Responding to a question on financial health of Wapda, John Wall said: “It is not in the hands of the Wapda. This giant utility is helpless since FATA billing, prices of furnace oil, and over-due government billings are not under its control.”
He said it required solid will to recover Wapda dues from FATA. “Overall I see very little improvement in Wapda. The issue of line losses seems to be out of hands and there has been no visible improvement,” he said.
Responding to a question on PRSP, the bank representative said the parliament should discuss the PRSP but it was not his concern whether or not it was approved by the parliament. “I would not give a political statement here but I believe that PRSP’s outcome would be better if it is discussed in the Parliament,” he added.
Earlier, during his presentation to the parliamentarians at the seminar organized by Pakistan Institute of Legislative Development and Transparency (PILDAT), he said thee PRSP should be country-driven, result-oriented, comprehensive, partnership oriented, and based on a long-term perspective for poverty reduction.
Shah Mehmood Qureshi, opposition leader in the National Assembly said that PRSP should not only be discussed but it should also be approved by the Parliament. He criticized the narrow focus of IFIs consultations. He said the achievement of stabilization has a cost, which is rise in poverty.
Dr A.R. Kemal, director, Pakistan Institute of Development Economics (PIDE), while speaking at the seminar said the emphasis of last government on IT and oil and gas sector to increase employment and alleviate poverty was misplaced because both the sectors did not contribute to poverty reduction.
He said the new figure of 31.8 per cent poverty is meaningless because its accounting method was incorrect. On the basis of previous line of calorie intake at 2550 calories, the poverty comes at 37.5 per cent, Dr Kemal said.
Unemployment has risen from 5.9 per cent to 7.8 per cent and the under-employment rate is at 13.1 per cent, he said, adding, if the GDP growth increases by 5 per cent annually then it cuts unemployment by 2 per cent, while labour class expands by 3 per cent annually.
Criticizing the approach adopted in PRSP, former Finance Minister Sartaj Aziz said that there were major lapses in the PRSP, which do not entail targets for poverty reduction.
He also called for enhancing allocation on development spending to Rs200 billion to reduce poverty and achieve higher growth. The PRSP should remain valid for 10 years and not for only three years. A parliamentary committee to monitor poverty should be set up, he said.
Under the IMF programme Pakistan is still obsessed with the fiscal stabilization and the same is reflected in the
PRSP. All the IMF required targets are discussed in detail, while investment, which must be enhanced now, has been simply ignored.
Sartaj said that he resisted for any tax on agriculture against IMF pressure for five years and the military government introduced GST on fertilisers in its first year.
