ISLAMABAD, Jan 29: The Asian Development Bank (ADB) has agreed not to oppose subsidy to the agriculture sector to further improve the agriculture production of the country.
“We will not oppose any subsidy to be offered to the agriculture sector so long it is targeted and meaningful,” said the visiting Director-General of South Asian Department of the ADB, Mr Yoshihiro Iwasaki.
Speaking at a joint news conference with Prime Minister’s Advisor on Finance Shaukat Aziz, Iwasaki said here on Wednesday that the ADB had decided to support the broad economic objectives of the government, including subsidy to farmers.
Mr Aziz told reporters that the government was extending farm subsidy within certain parameters to help the farmers.
The Director-General of ADB said that his bank was considering providing $250 million for improving the road network in Balochistan to link Pakistan with Central Asian States via Afghanistan.
Initially, he said, $150 million would be provided for improving road network in Balochistan and the project would be completed in the next three years.
When asked about the role of the Afghan government, he said he had just returned from Kabul after having discussed various road projects with the Karzai government. “And I tell you they are very much supportive of the road network to be stretched from Balochistan and the NWFP into Afghanistan,” he said.
The ADB official said that the Pakistan government had made a remarkable progress in terms of achieving macroeconomic stability and largely improving balance of payments position.
“Our hope is that the new government will implement wide range of reforms to specially achieve the objectives of good governance and decentralization,” Iwasaki said.
He was of the view that if the new government continued implementing financial sector reforms, things were bound to improve greatly in Pakistan.
“Pakistan is entering into a second phase of reforms,” he said, adding that while the world economy was still sluggish, Pakistan’s economy was on the path of a great recovery.
He hinted at the possibility of increasing the ADB assistance for 2003 from $800 million to $1 billion to accommodate the maximum number of development projects.
“Our hope is that the ADB would be offering $1 billion for the calender year 2003,” the advisor on finance said.
Mr Iwasaki said that the ADB was considering offering substantial funds for expanding the network of the Khushhali Bank. The bank had earlier disbursed $150 million for the Khushhali Bank.
“We are finalizing details for the expansion programme of the bank and would soon be letting you know about the exact amount to be sought from the ADB,” the advisor on finance added.
Mr Iwasaki said there was an enormous potential for developing better trade and economic relations between China and Pakistan specially after Beijing’s entry into the World Trade Organization (WTO).
Responding to a question, Mr Aziz said that the ADB was offering substantial financial assistance particularly for promoting small and medium enterprises (SMEs), social and industrial sectors.
“The ADB is also expected to provide $150 million provincial Structural Adjustment Credit (SAC),” the advisor on finance said, adding that the ADB was an important partner of Pakistan.