ISLAMABAD, Aug 30: International donor agencies and financial institutions want the new government to introduce 'major changes' in policies to address issues pertaining to poverty alleviation, employment generation, illiteracy and sustained GDP growth.

Sources in some donor agencies told Dawn on Monday that if there was increased emphasis on tackling the challenges facing the country then donors could "consider enhanced annual assistance" for Pakistan.

"There is a very large programme of donors and financial institutions which needs effective implementation by the new prime minister for accelerating the much-needed governance reforms and improving the services relating to health, education, poverty reduction, and population welfare," a source said.

He called upon the new prime minister to go for the overhauling of ministries dealing with economy to achieve desired results. "We can consider additional fiscal assistance, provided the slow reform process is expedited by Mr Aziz who now enjoys all powers," he said.

Talking to this correspondent, Asian Development Bank's resident representative Marshuk Ali Shah said the country was still facing formidable challenges, including a target of 8 per cent GDP growth rate, improving human development indicators and rehabilitating the social and economic infrastructure.

"Mr Aziz would have to focus on increasing the Public Sector Development Programme," he said. "Also," the ADB local chief said, "the new government needs to move to the second generation reforms relating to judiciary, civil service, devolution and police."

He said the new prime minister should pay more attention to effective utilization of funds. "Pakistan needs intense utilization of funds to alleviate poverty and generate more jobs for thousands of educated youth," he said. Another source said time had come to move away from "micro to macro-level reforms" by adopting long- and short-term policies.

Clarification