June 29, 2003	Sunday	Rabi-us-Sani 28,1424

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ISLAMABAD, June 28: The Asian Development Bank (ADB) has decided to offer additional $110 million to Pakistan during 2003.

“Earlier, the ADB had offered $150 million for the development of small and medium enterprises but now we have decided to increase the amount to $200 million and similarly funding for development of roads in Balochistan has been increased from $100 million to $160 million,” said the bank’s country director for Pakistan, Marshuk Ali Shah.

Talking to Dawn, he said that the funding during the year would reach approximately $1 billion, which was quite substantial compared to China and India.

However, he said the government needed to improve the performance of some state run enterprises, specially the Water and Power Development Authority (Wapda) and the Karachi Electricity Supply Corporation (KESC), to qualify for more financial assistance from international donor agencies.

The government, Mr Shah said, would have to take strong measures under its new financial improvement plan to remove the huge line and distribution losses of the power utilities. “Their losses are increasing and it is a matter of concern for the donors,” he said.

He termed allocation of Rs53 billion in the budget as subsidy for Wapda and the KESC unjustified.

Responding to a question, he said Privatization Minister Dr Hafeez Shaikh has taken an initiative to privatize the KESC within the year.

He said a strategic investor and a better operator was needed to improve the KESC’s performance.

In reply to a question, he termed the $3 billion economic and defence package offered by the United States “quite encouraging” and said it would help attract American investment.

“Pakistan needs a higher level of US investment,” he said and expressed the hope that the Bush administration would facilitate its investors in this regard.

The US package, Mr Shah said, was an endorsement of the recovery of the economy and the reform agenda initiated over three years ago.

He said there was macroeconomic stability in Pakistan and the financial support announced by the US would help improve the human resource development programme. “Most of the economic assistance by the US will be in the shape of grants and for debt retirement,” he said.

About the approval of the draft fiscal responsibility and debt reduction ordinance, 2003, he said it was encouraging that the government wanted to be fiscally responsible.