July 26, 2007	Thursday	Rajab 10, 1428

ISLAMABAD, July 25: The Asian Development Bank (ADB) on Wednesday disbursed the first tranche of its new $400 million funding to Pakistan which would be used to rebuild the houses razed in the October 2005 earthquake.

The concessional loan, approved by the ADB Board of Directors in June, is part of the bank’s $1billion commitment for loans and grants to assist Pakistan in the reconstruction and rehabilitation of the earthquake-affected areas. It is being released in two tranches of $200 million each.

The first tranche was transferred on July 17 to reimburse part of the government’s already significant $621.5 million expenditure on reconstruction of houses. The second tranche of $200 million will be released in six months, on the completion of performance targets jointly agreed upon by the government of and the ADB.

According to local ADB office, the loan is intended to help the government meet its deadline of May 2008 for completing the reconstruction of 585,000 rural homes, compliant with seismic safety requirements.

“The winter of 2007 will be the last for most displaced people before they move into new houses,” said Peter Fedon, country director for ADB’s Pakistan Resident Mission.

“For the 30,000 people who have been living in tents for almost two years, and the 3.5 million living in temporary or semi-permanent shelters while permanent houses are being built, the past two winters have been extremely difficult. Housing reconstruction is the most urgent of the overall needs in terms of minimising the prolonged suffering of affected people.”

Loan proceeds will be directed via the Ministry of Finance to the Earthquake Reconstruction and Rehabilitation Authority which in turn will provide bank payments to individual homeowners to buy materials and rebuild or repair their own homes, in accordance with approved earthquake-proof designs.

Families whose homes were destroyed are receiving Rs175,000 in four instalments; those whose homes were damaged are receiving Rs75,000 in two instalments; and those whose homes suffered minor damage are receiving a single payment of Rs25,000. About 6,000 households whose land was destroyed by quake-triggered landslides will receive Rs75,000 to buy new land.

Around 96 per cent of households have already received second instalments.

“Housing in particular is a prerequisite for livelihood regeneration and subsequently economic recovery. Without addressing the shelter issue first, reconstruction and rehabilitation efforts would be ineffective,” Mr Fedon said.