PESHAWAR, April 20: The NWFP would get US$90 million second tranche of the World Bank loan under its structural adjustment credit (SAC) programme in May, according to official sources.
Senior government functionaries said that negotiations between the two sides were in the final stages and a memorandum of understanding (MoU) between the government of NWFP and World Bank would be signed in the near future following approval by the Bank's board of directors.
The regional competent forum of the lending agency, said the sources, had already granted approval for the release of the second tranche to the NWFP, while the matter would be placed before the Bank's board of directors in the near future for the final approval.
"The province is likely to get the SAC-II funding somewhere in May," said a finance manager of the province. The sources said that a World Bank mission, involving senior representatives and subject specialists, would start visit of the provincial capital from April 22 for a series of meetings to be held with administrative heads of the departments concerned of the provincial government.
The World Bank loan meant to provide budgetary support to the province in implementing its three-year roll-over multi-sectoral reforms programme involves zero mark up and negligible service charges. While the exchange risk cover is being taken care by the federal government.
The sources said that in their separate meetings with the government departments' representatives, the mission members would discuss and finalize bench marks each of the department concerned would be set to accomplish during the course of implementing SAC-II.
Accomplishment of the SAC-II bench marks would provide basis to the provincial government to qualify for the third and final tranche of the World Bank to support SAC-III.
The expected release of the second tranche for SAC-II to the province would come with a delay of more than five months as in his budget speech on June 16, last, the provincial minister for finance, planning and development Siraj-ul-Haq had hinted at getting the second instalment of the World Bank loan in November 2003.
However, the provincial government's inability to allay the World Bank's reservations viz-a-viz various issues covered under the loan agreement and deficiencies recorded in implementing reforms in certain sectors covered under the agreement between the two sides caused the delay.
Besides, the World Bank's precondition of revamping the NWFP government's annual development programme for the current financial year for the continuation of its funding line to the province also delayed the second tranche. The first tranche of $90 million had been released to the government of NWFP in July 2002 for the execution of SAC-I in the 2002-03 financial year.
