ISLAMABAD: Pakistan was the top borrower of the International Development Association (IDA) in fiscal year 2023, securing $2.3 billion in funding, the World Bank said in its annual report.
The bank helped Pakistan respond to devastating floods with nearly $1.7bn for five projects in the worst-affected Sindh province to build resilient housing, restore crop production, provide health services for mothers and children, and strengthen social protection and the local government’s disaster response capacity.
The document, titled “World Bank Annual Report 2023 — A New Era in Development”, states that the international institution approved $10.1bn in lending for 37 operations in the South Asian region during the fiscal year 2023 — $4.3bn in International Bank for Reconstruction and Development (IBRD) commitments and $5.8bn in IDA commitments.
IDA is the world’s largest multilateral source of concessional financing, offering development loans, grants, and guarantees to the poorest countries. It aims to facilitate economic growth, reduce poverty, and enhance the living conditions of impoverished populations.
WB says Islamabad secured $2.3bn in funding; okays $10bn for 37 operations in South Asia
According to the report, the World Bank also supported 61 advisory services and analytical products for eight countries. These provided technical advice on issues such as debt management, governance, job creation, social protection, air pollution and climate resilience.
Across the region, the bank focused on enhancing human capital resilience to minimise the effects of crises. This included building resilience against the impacts of a changing climate and natural disasters and promoting resilience in economy, markets, and society to ensure inclusive and sustainable development.
The report forecast that South Asia’s GDP is expected to grow 5.6 per cent in 2023 and to remain moderate at 5.9pc in 2024, following an initial post-pandemic recovery of 8.2pc in 2021. The region’s growth prospects have weakened due to tightening financial conditions, limited fiscal space and depleting reserves, contributing to large downside risks in most countries.
Poverty in region
The decline in poverty is expected to recover in line with economic growth, with the number of people living on less than $3.20 a day across the region forecast to be 754 million in 2023, lower than the estimates in 2019. South Asia is highly vulnerable to the impacts of climate change and natural disasters.
Over the past two decades, climate-related disasters have affected 750m people, more than half of people in the region. High inequality magnifies these impacts, as the poor, vulnerable, and marginalised bear the greatest burden of these disasters and have limited means to help them recover.
Across South Asia, the Covid-19 pandemic led to a collapse in human capital for millions of children and young people. Today’s students could lose more than 14pc of their future earnings, while today’s toddlers could see a 25pc decline in earnings when they reach adulthood. South Asia is confronting intensifying heatwaves, cyclones, droughts and floods. The changing climate could sharply diminish living conditions for up to 800m people.
In Punjab, which accounts for 73pc of Pakistan’s total food production, a $200m project is promoting climate-smart technologies and practices to improve water-use efficiency, build resilience to extreme weather, and increase small-scale farmers’ incomes.
Between April 2022 and June 2023, the World Bank approved 529 standalone and regional operations covering more than 110 countries across the four pillars of the framework, totaling $104.9bn, including $53.1bn under IBRD and $51.8bn under IDA. Of the total amount, $23.7bn was committed for countries affected by fragility, conflict and violence, and $2bn for small states.
The World Bank works closely with countries, the private sector, civil society and other multilateral institutions to confront these challenges and find lasting development solutions. Through the Global Crisis Response Framework, the World Bank has been responding at unprecedented levels to the converging crises, approving 322 operations in more than 90 countries for a total of $72.8bn in fiscal 2023. This includes $38.6bn from IBRD.
Under the first year of IDA20, the organisation committed $34.2bn for the poorest countries. To help these countries address the ongoing impacts of the Covid-19 crisis, the bank front-loaded financial resources in 2023, building on the momentum from 2022. The total climate finance amounted to a record high of $29.4bn, accounting for 40pc of total IBRD and IDA finance in fiscal 2023.
Published in Dawn, October 2nd, 2023