ISLAMABAD: The government has signed a $330 million loan agreement with the Asian Develop­ment Bank (ADB) to support the Integrated Social Protection Development Programme (ISPDP).

The agreement, signed here on Saturday, aims to scale up poverty reduction and human dev­elopment initiatives while strengthening climate change responsiveness.

Economic Affairs Secre­tary Dr Kazim Niaz and ADB Country Director Emma Fan signed the agreement on behalf of their respective sides.

The programme builds on the ongoing ADB-fun­ded programme for stren­gthening and expanding social protection systems in the country through the Benazir Income Support Programme (BISP).

The institutional capacity of BISP, the country’s fla­g­ship social protection agency, will be enhanced to transition to adaptive and climate-resilient soc­ial protection. This will inc­lude improving access to education pathways for children and youth from low-income families and increasing access to health services and nutrition supplies for beneficiaries who are in disaster-prone areas.

Speaking at the signing ceremony, Mr Niaz highlighted the importance of the additional financing from concessional len­ding agency for enhancing institutional capacity and improving access to education and healthcare, particularly among women, adolescent girls and children from low-income families.

He expressed gratitude for ADB’s continued support in this regard.

Ms Fan reaffirmed the bank’s commitment to supporting the government’s objectives in strengthening social safety nets. She stated that the additional financing would help achieve the programme’s objectives of inclusive growth, poverty reduction skills development, and healthcare access for vulnerable populations.

The signing of the loan agreement marks a significant step forward in enhancing social protection systems in Pakistan.

The 2025 fiscal budget allocates additional resources to expand social protection, including a higher budget for the flagship social protection programme.

The government’s commitment to targeted subsidy reforms and replacing cross-subsidies with direct BISP support are crucial steps to improve the efficiency and effectiveness of social safety nets in Pakistan.

Despite these accelerated investments in social protection, constraints remain in policy and administrative coordination between federal and provincial governments, institutional capacity, data and delivery systems in provinces, and the limited benefit level of social protection programmes, the ADB has pointed out in a report.

The Ministry of Poverty Alleviation and Social Safety provides an opportunity to streamline social protection scheme across the government’s different programmes.

However, the leading social protection programmes continue to operate through federal mechanisms, notwithstanding the Constitution’s provincial mandate for social protection.

Only two provinces, Punjab and Sindh, have started implementing social protection programmes through the established social protection authorities.

However, the ADB said that institutional capacity in poverty targeting and service delivery needs to be strengthened to achieve transformative change in human capital and productivity.

The report said the country required adaptive and shock-responsive social protection, with data systems, financing mechanisms, and a portfolio of programmes to increase the capacity of vulnerable households to cope with and recover from disasters and climatic shocks.

Published in Dawn, December 15th, 2024