ISLAMABAD: The federal government has decided to review portfolios of all development projects funded by multilateral donor agencies in order to save the millions of dollars which are charged to the country in the form of high interest rates and in some cases penalties against delay in completion of projects.

The Economic Affairs Division (EAD) being the responsible ministry for assessment of requirements, programming and negotiations of external economic assistance is commencing portfolio review meetings starting from Wednesday.

Minister of State for Economic Affairs Hina Rabbani Khar will chair the portfolio meetings to be held in Islamabad and Karachi.

All on-going projects funded by the Asian Development Bank and the World Bank will come up for review and decisions will be taken on removing bottlenecks in the way of completion of these projects.

Decisions will also be taken to strengthen the bridge between the executing and implementing agencies for the smooth completion of projects.

The government has observed that the delay in completion of projects mainly occur during sub-contracting works involving various government agencies. This is the ‘grey area’ where the government has to take serious measures, the official said.

At the Islamabad review meeting, multilateral donors funded projects in Azad Kashmir, programme loans sought by the ministries of finance, industries, food and agriculture and Planning Commission will come up for review, sources said adding that the projects of National Highway Authority (NHA) will also be discussed.

In the first phase, all on-going development projects funded by the ADB will be reviewed, followed by the World Bank-aided projects.

The sources said the ratio of poorly implemented projects is not too many but these were costing high to the government.

There are several projects which have been completed in time and were producing good results. The project implementation ratio in the Punjab is better than other provinces, he said.

The review of project portfolios will be completed within a week, and as per schedule, the review meeting on November 2, in Karachi will cover projects in Sindh and Balochistan. The projects of Punjab and NWFP will be reviewed at the Islamabad meeting.

Sources said there will be separate review of projects in the power sector.

The World Bank committed $1.7 billion in the fiscal year 2009 to help Pakistan cope amid the global economic crisis, the institution’s highest ever year-on-year support to the country. During the last four years (2006-2009) the bank has approved 30 projects of total $3.7 billion for Pakistan.

A record lending programme by ADB in 2008 included a $1.87 billion disbursement and $1.2 billion in newly approved assistance.

As of Dec 2008, there were 62 ongoing sovereign loans amounting to $5.08 billion in net loan amount for infrastructure, social sectors, governance, and earthquake rehabilitation in the four provinces and at the national level. Under implementation were 31 ongoing technical assistance projects worth $61.93 million.

ADB’s Country Programme Strategy (CPS) projects have planned assistance of $4.4 billion during 2009–11 and an annual average lending of almost $1.5 billion.