ISLAMABAD, Jan 24: Seventy-two per cent people in four districts of the NWFP are living below the poverty line with only about 41 per cent income coming from agriculture.

In view of the situation, the centre has approved Rs3.7 billion special funding at a request of the provincial government to alleviate poverty in Swat, Buner, Shangla and Malakand Agency.

Official sources told Dawn on Wednesday that a new project had been conceived to alleviate poverty in the vulnerable areas by enhancing household incomes and living standards of the rural poor in the NWFP.The project is a multi-sector area development initiative aiming at reducing rural poverty in the NWFP. It particularly aims to increase incomes of small land holders, tenant farmers and the landless. The focus is also on women’s human resource development and improvement of their income earning potential. At the same time, by assisting to create a semi-permanent structure to support village development and by providing capacity building assistance and training support, the project is expected to contribute to institutional reforms for devolution of powers at the local level.

Sources said that out of the Rs3.7 billion special funding, Rs2.6 billion was likely to be extended by the Asian Development Bank to finance about 70 per cent of the project cost. The NWFP government will make available Rs967 billion separately.

The project covers an area of 9740 square kilometres, with a population of 3.2 million including urban segment of about 8 per cent. A large population of the area directly or indirectly depends on agriculture.

Sources said international donor agencies had asked the government to increase social sector funding to put some meaningful dent on the widespread poverty in Pakistan.

The World Bank and the Department for International Development (DFID) of the United Kingdom had earlier asked Pakistan to significantly increase social sector spending because over 38 million people, out of 160 million, were living below the poverty line.

The two agencies have promised to double their poverty related funding from $460 million to $933 million annually with a view to reduce poverty in the country.The government often claims that there has been 10 per cent reduction in poverty from 35 per cent to 25 per cent during the last few years. But it concedes that poverty and unemployment are some of the big challenges that need to be tackled.

Sources said the donor agencies did not agree with the government’s claim. The World Bank believes there has been some 5 per cent reduction in poverty and it has informed Pakistani authorities about its views.

A new Country Assistance Plan, the sources said, would be developed over the coming months to set a framework for using extra resources, with consultations starting in Pakistan very soon.