US ASSISTANCES FOR THE FLOOD-HIT

TARIQ AHMED SAEEDI
(feedback@pgeconomist.com)
Oct 4 - 10, 20
10

Last two months were painfully memorable chapter in the Pakistan's history since historical floods unravelled devastating impacts to the normal life in depth and breadth throughout the country, affecting directly 20 million people, wiping out infrastructure, and dealing a severe blow to the major income earning sector of the country. Loss to agriculture sector is enormous since large tracts of standing crops have been submerged in the water. The World Bank and Asian Development Bank are yet to come up with actual assessments of the flood losses, but initial estimates of damages reveal there will definitely be a significant drag on the national wealth build-up of which has already slowed down because of underperforming sectors dampened by precarious law and order situation and highly uncertain political milieu.

War on terror has left no stone unturned to make economic progress and social fabrics perniciously vulnerable to mild shocks, giving birth to unending incidents of terrorist attacks and thereby making security scenario decidedly fragile. Economic vulnerabilities surface across the board and so does threats to national uprightness. Government's priority to strengthen external defensive lines results in underfeeding of civic lives. The costs Pakistan has incurred due to war on terror runs in billions of dollars. If only estimate of International Monetary Fund that extrapolated 80 billion dollar aggregate losses to Pakistan's economy in the aftermath of war on terror since 9/11, was kept under consideration, one can surmise economical pressures economy of Pakistan is sustaining at present. This amount perhaps does not price in indirect costs arising out of social disturbances and political agitations as a result of the country becoming chief ally of war waged by US-led clique in the country's neighbourhood; in fact that is creeping in to its own soil now. Otherwise, the monetary loss would turn out in half annually of what IMF estimated. A renowned parliamentarian from ruling party put this monetary loss to 50 billion dollar a year.

A last straw on the camel's back is the floods that compel economic managers to apply massive reshuffling on the budgetary allocations and subsequently development spending for the current fiscal year is realigned and more harsh taxes are on its way to put fuel to price hikes of consumer goods and services. The floods, which caught the state machinery by surprise, triggered redirection of funds from ongoing projects to the rehabilitation of flood affectees, advocated the imposition of upcoming flood surcharge, and intensified the urgency of withdrawal of general sales tax exemption given to the exporting and other sectors. A range of medicines are also said to be affected by this withdrawal.

Reconstruction of flood-torn areas and infrastructures will be the biggest challenge for the administration as billions of dollars are estimated to be required in order to bring things to normal.

Many countries around the world reacted generously to the call of United Nations to help Pakistan in this testing time and meet enormous costs of rehabilitating people survived and rendered homeless due to the floods. Several nations pledged million of dollars as contributions to flood relief funds and promised to dole out funds toward reconstruction acclivities. United States of America that is leading war against militants in Afghanistan and tribal belts in Pakistan is also looking after the flood relief activities closely in rural locations of the country since a gap left by the US in flood reliefs means soft corners anti-American forces would carve out in the hearts and minds of people. It was also reported that US would likely to redirect huge 7.5 billion dollar aid package it allocated for the developments in its war associate Pakistan to reconstruction of flood-devastated infrastructures. Kerry-Lugar bill that was singed into Act by US President Barack Obama to earmark this amount for the south Asian country, a chief ally in international war against militants and that has sustained human causalities and billion of dollar losses due to the war, is aimed at to develop energy, water, and agriculture sectors. If the fund is properly utilised, the abovementioned sectors that are wrecked heavily by the floods will get to timely reconstruction.

USAid Chief Rajiv Shah reportedly said that United States might transfer funds from aid package to flood affected activities. He however did not specify exact figure. Agency's update says approximately 70 per cent of 21 million dollar committed to provide financial assistances to flood-affected agriculture sector of Khyber Pakhtunkhwa would be financed from Kerry-Lugar-Berman Enhanced Partnership with Pakistan Act. US Agency for International Development (USAid) will chip in additional five million dollar for the programme majorly aimed at food security.

"Providing the wheat seed will help ensure farmers can maintain the normal plant and harvest cycle," USAid Mission Director Bob Wilson said. "As the floods recede, similar programming will support additional farmers in other flood-affected areas of Pakistan."

As per the agency's figures, so far United States has transferred 261 million dollar emergency humanitarian assistance.

Indian origin administrator of USAid had also requested the government of Pakistan to ensure proper utilisation of funds. He also reportedly satisfied with the government meeting commitments of proper utilisation. USAid has also instituted Transparency International-administered hotline to monitor misuse of flood relief funds in Pakistan. The aid agency has sidelined three million dollar for five-year for anti-fraud hotline to record misuse of its funds and keep surveillance over its funded-activities in the country.

Beside monetary supports toward flood relief efforts of local and international teams, US has also provided boats, bridges, helicopters, and other supplies to Pakistan. Such in-kind helps are of 40 million dollar monetary worth, according to USAid.