The Asian Development Bank is emerging as a major
partner in Pakistan's economic development because of its continued
assistance or large number of projects as well as under technical
assistance committed to Pakistan in the form of 191 public sector loans
totaled $12.36 billion out of which $8.7 billion had already been
The ADB provided a total amount of $3.2 billion,
which covered a broad range of economic reforms from 1999 to 2002. The
successful implementation of the reforms process encouraged the bank to
progressively increase its assistance to Pakistan's development efforts.
This was illustrated by a record amount of $1.41 billion approved by the
ADB for different projects/programme in 2002 alone which was the largest
amount of loan assistance offered so far by the ADB to any country.
Recently the ADB agreed to provide $250 million for Gwadar-Chaman road
project, which will provide access to Afghanistan and the Central Asian
States. Another 150 million dollars have been committed for construction
of roads in the NWFP including the tribal belt apart from $40 million
exclusively for provision of infrastructure in the tribal areas.
Addressing a press conference jointly with Shaukat
Aziz, Advisor to the Prime Minister on Finance and Economic Affairs, the
visiting Director General of South Asia Development of the Asian
Development Bank, Yoshihiro Iwasaki declared that Pakistan has
successfully implemented the agreed economic reforms during the past
three years. He also affirmed that the Bank would continue its
assistance to Pakistan for sustaining the development efforts on a broad
front, including the process of poverty reduction in the coming years.
Shaukat Aziz describe the Asian Development Bank as a partner in
Pakistan's economic development and expressed the hope that annual
assistance from the ADB would increase to one billion dollars from the
existing average of $800 million for launching the second phase in the
ongoing economic reforms. Yoshihiro Iwasaki also emphasized that the
target of reforms should now be promotion of greater measure of
participation by the private sector because, in his view, capital
investment in development activity would have to be generated
increasingly in the private sector.
Speaking on the occasion D.G. ADB, said "we are
going lack with complete satisfaction over the achievements of Pakistan
as far as economic reforms are concerned and hope that the reforms would
continue so that Islamabad should consolidate its present level of
economic achievement". He said that his bank will continue
providing Pakistan with a soft loan of about $800 million till 2005 as
part of Poverty Reduction Strategy of the Bank. He hailed the last three
years economic policies of President General Pervez Musharraf and was of
the view that, the new Prime Minister Mir Zafarullah Khan Jamali would
take up the same reforms for the betterment of the people of Pakistan.
"We will fully cooperate with the democratic government of Mir
Zafarullah Khan Jamali", he added.
He said that over the past three years, Pakistan has
embarked on a series of wide ranging economic and governance reforms,
which are to be implemented over the medium term. These reforms are
critical to ensuring economic growth, macroeconomic stability,
institutional reforms, and improved public sector and corporate
governance, for sustained reduction in the level of poverty in the
country. ADB has supported this significant reforms effort through
enhanced levels of assistance and sectoral reforms and targeted
investment projects with the objective of poverty reduction and
employment generation, totaling more than 3.2 billion over the 1999-2002
period, of which 2.2 billion dollars was provided through policy based
lending operations, he said.
The principal sector reform programs included Trade,
Export Promotion Industry Programme (TEPI), approved in March 1999 for
300 million dollars, Micro-finance Sector Development Programme,
approved in December 2000 for 150 million dollars, Energy Sector
Restructuring Programme (ESPRL), approved in December 2000 for 355
million dollars, Agriculture Sector Programme Loan II, approved in
December 2001 for 350 million dollars, Access to Justice Programme,
approved in December 2001 for 350 million dollars, Decentralisation
Support Programme, approved in November 2002 for 300 million dollars,
Rural Finance Sector Development Programme, approved in December 2002
for 250 million dollars, and the Financial (Non blank) Markets and
Governance Programme, approved in December 2002 for 266 million dollars.
Earlier, in November 1997, the capital Markets Developments Programme
had been approved for 255 million dollars.
As of 31 December 2002, 57 public sector loans (43
project loan and 14 programme loans) covering 51 projects were under
implementation in Pakistan, of these, the Pakistan Resident Mission (PRM)
directly administered 18 projects besides two co-financed projects, for
a total of 20 projects in the public sector. In addition, 52 TAs were
under implementation of which PRM was directly administering 7 TAs.
During 2002, the stabilization of the political
situation in Afghanistan offered new opportunities to explore sub
regional efforts with the neighbouring countries in the west
(Afghanistan) and the north (Central Asian States). In this context, two
sectors were actively pursued to provide the necessary opportunity
transportation and energy. In transportation, the Government supported
the inclusion of two road projects with sub regional dimensions. The
first, the Balochistan Road Development Sector Project, (the preparatory
technical assistance for which was approved in July 2002) will connect
the Balochistan road network to the borders of Afghanistan and the major
deep-sea port of Gwadar in Pakistan. The second, the north West Frontier
Province Road Development Sector Project. (The preparatory technical
assistance for which will be processed in 2003) will connect the NWFP
road network to Balochistan and to Tajikistan. In the energy sector, a
major effort was put in Project.
In 2001, 2001 ADB also initiated the preparation of a
new medium term Country Strategy and Program (CSP) for Pakistan for the
period 2002-2006. This was finalised and approved by the ADB Board in
May 2002. The CSP envisages an overall lending level of $2.4 billion for
Pakistan for the 2003-2005 period. The focus of the CSP is to support
poverty reduction in Pakistan through specific interventions in the
following three area; supporting good governance; employment generation;
and inclusive social development with a major focus on good governance.
The CSP also addresses crosscutting concerns related to gender
environment, regional cooperation, and private sector development.
The CSP was preceded by a comprehensive Poverty
Assessment for Pakistan, undertaken by PRM during 2001 in consultation
with the government, civil society, and other stakeholders. The
assessment, titled. "Poverty in Pakistan: Issues, Causes and
Institutional Responses", was published in August 2002, and
received extensive coverage in the national print and electronic media.
The ADB Director General agreed with Mr. Shaukat Aziz
that target of future programme of ADB should be on promotion of greater
measures of participation by private sector. The situation now demanded
that capital investment in development activity must be generated
increasingly in the private sector.
There can be no two opinions that while financial
assistance from the Asian Development Bank and other multilateral
institutions mainly targets development of social sector and rural
development programmes, the contribution of private investment is
essential for the development of a wide range of productive sectors. The
second base of reforms, therefore, would be expected to take care of
necessary policy measures for the widening of investment activity in the
private sector including the inflow of foreign investment. However, the
ADB official emphasized that the ongoing structural reforms, including
good governance in the public and corporate sectors, must be adhered to
by the new government in order to achieve the desired results on the