Rebuilding cost may exceed $5.2bn: Preliminary assessment
By Khaleeq Kiani
ISLAMABAD, Nov 11: Multilateral donor agencies have estimated the preliminary relief and reconstruction cost of the devastating October 8 earthquake at $5.2 billion which is “likely to rise as more damaged areas are surveyed”.
This was announced here on Friday by Dr Salman Shah, adviser to the prime minister on finance and revenue, along with country heads of the World Bank, the Asian Development Bank and United Nations Development Programme as part of “Preliminary Damage and Needs Assessment Report”, prepared jointly by more than 12 international organisations and governments.
Pakistan will require more than $3.5 billion to restore and reconstruct the country. Besides, more than $97 million will be needed to revive livelihoods lost in the quake. These costs are in addition to the $1.6 billion the United Nations has estimated will be needed for relief efforts following the disaster.
Mr Shah said the report, which is a base document, would hold credibility worldwide because of its preparation by international organisations. It would be presented at the international donors’ conference to be held on Nov 19 in Islamabad. Representatives of more than 70 nations have been invited to the moot.
The earthquake destroyed 203,579 units of housing, damaged another 196,574 and left an estimated 2.8 million people in need of shelter, the report said. Private housing, with damages calculated at Rs61.2 billion ($1.03 billion), suffered the most extensive damage.
The report said the devastation in Azad Kashmir was much higher than in the NWFP. Of the total housing stock, 84 per cent was damaged or destroyed in AJK and 36 per cent was damaged or destroyed in the NWFP.
Of the total direct damage of Rs135 billion, a loss of Rs76.4 billion has been estimated in AJK and Rs56.4 billion in the NWFP. Similarly, indirect loss in AJK and NWFP has been estimated at Rs15.44 billion and Rs14.98 billion, respectively.
The loss of public and private assets (direct damage at book value) has been estimated at $2.3 billion and loss in income (indirect losses), estimated at $0.5 billion and the cost of short- and medium-term reconstruction of private and public assets estimated at $3.5 billion.
The transport, education, agriculture and livestock sectors also suffered sizable damage totalling Rs20.2 billion ($340 million), Rs19.9 billion ($335 million) and Rs12.9 billion ($218 million) respectively.
Of the $3.5 billion (Rs208 billion) reconstruction of lost assets and restoration of public services, a major portion of $1.6 billion (Rs92 billion) will be needed for housing reconstruction.
The report calls for encouraging the private sector and civil society engagement and coordination and coherent approaches to recovery during the development of a comprehensive recovery strategy.
Responding to a question, Mr Shah said an elaborate mechanism had already been put in place whereby the two agencies - Earthquake Relief and Reconstruction Authority and Federal Relief Commissioner - report directly to the prime minister on each development to ensure transparency in utilization of funds. Similarly, the entire procurement process is monitored directly and reviewed by the president and the prime minister.
About the impact of the earthquake on federal budget, he said it would depend on international support the government gets in the relief and reconstruction process.
He said there would be no adverse impact on overall GDP growth. However, according to the World Bank, fiscal deficit could increase by about half a per cent of GDP if remedial measures were not taken.
He said a total of $2.4 billion financial support had been pledged by the international community. This included about $1 billion from individual countries. Cash received so far during the entire relief operation stood at $200 million while a lot of assistance was in kind. He said all expenses, including fuel cost, become part of the overall assistance committed by foreign agencies and countries.
Some agencies and governments, he said, were directly sponsoring different projects like a village, a hospital or a school etc.
Experts from the local and national governments and international organisations such as European Union, the UK’s DFID, German GTZ and KFW, Japan’s JBIC and JICA, the USAID, WHO, FAO, Unicef, UNDP and other UN agencies also participated in the joint assessment.
