ISLAMABAD, Feb 15: The Asian Development Bank is seeking firm assurances from Pakistan regarding continuity in the economic and governance reforms to qualify for the new assistance to be offered in 2003.
Informed sources told Dawn here on Saturday that the government was likely to face difficulties in obtaining the $100 million instalment in 2003, out of $350 million Access to Justice Programme loan, in case the reform agenda was not implemented in letter and spirit.
The sources said the bank wanted the strengthening of judicial accountability in all the four provinces for which it had earlier disbursed $150 million under the Access to Justice Programme in 2002.
However, the new instalment due in 2003, would only be available after the authorities gave a firm assurance to the bank that the government would implement the wide-ranging economic and governance reforms. These reforms were considered vital by the ADB for economic growth, macroeconomic stability, institutional reforms and improved public sector and corporate governance for sustained reduction in the level of poverty in the country.
The sources said that the ADB officials had written letters to all the four chief ministers and the economic affairs division to review the reform process. In this regard, the bank has also prepared a new briefing paper to be launched after a meeting with the chief ministers and the EAD secretary.
The briefing paper particularly called for undertaking a reform process in the agriculture sector, including imposing tax on agriculture income.
The sources said that the bank would launch early childhood development project on Monday at the EAD for which a grant of $500,000 would be extended by the Japanese government.
The ADB which plans to offer $1 billion in 2003, has asked the government to allocate more funds for poverty alleviation. While the bank appreciates that Rs161 billion had been allocated for development purpose and on poverty alleviation during the last three years, it also expects the government to direct the provinces to make available more resources for effectively meeting the poverty reduction targets. The ADB envisages an overall lending level of $2.4 billion for the 2003-2005 period through a country strategy programme (CSP).
The focus of the CSP is to support poverty reduction in Pakistan through specific interventions in the areas of good governance, sustainable pro poor growth with emphasis on rural areas and employment generation.
Poor governance has been identified by the ADB as the prime cause of poverty in Pakistan. The bank maintains that poverty in the country is still increasing which requires more serious efforts to be made both by the federal and provincial governments. It particularly believes that poverty in the rural areas is increasing rapidly which needs careful handling by the new government.
As of Dec 31, 2002, the ADB’s assistance to Pakistan in the form of 191 public sector loans totalled $12.36 billion, of which $8.7 billion had been disbursed. In addition, the ADB has provided $100 million for 252 technical assistance projects.
About 52 per cent of the total assistance provided by the ADB has been through the concessional Asian Development Fund window.