Japan gives $260m loan for power sector: Dawn

ISLAMABAD: Japan has extended a soft loan of $260 million (23.3 billion yen) to Pakistan for the National Transmission Lines and Grid Stations Strengthening Project, which will cost Rs29.339 billion.

This is the first Japanese loan under the Official Development Assistance (ODA) based on the Pakistan Donors’ Conference hosted by Japanese government in April 2009 where a maximum of $1 billion in aid was pledged over a period of next two years.

Notes to this effect were signed and exchanged between Ambassador of Japan Chihiro Atsumi and Secretary Economic Affairs Division Sibtain Fazal Halim here on Wednesday.

The exchange of notes was followed by the signing of the loan agreement by EAD Additional Secretary Hassan Nawaz Tarar and the Chief Representative of Japan International Cooperation Agency (JICA) in Pakistan, Tomoharu Otake.

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Pakistan to receive $780 million loan for energy efficiency: Energy Efficiency News

The Asian Development Bank (ADB) is to lend Pakistan $780 million to support energy efficiency projects aimed at stabilising power supplies and reducing reliance on fossil fuels.

The country currently suffers from regular and lengthy power cuts because of the gap between its energy supply and demand.

The multitranche financing facility will release funds in tranches to support the Pakistani government’s 10-year energy efficiency investment plan.

The funds will initially support short to medium term energy efficiency projects such as the replacement of incandescent light bulbs with compact fluorescent lamps.

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WB okays $300m for Pakistan’s projects: The News

KARACHI: The World Bank has approved two projects worth $300 million to help Pakistan strengthen its social safety nets and improve higher education.

While fighting a Taliban insurgency in the northwest, Pakistan is struggling with a weak economy and over a third of its people live in poverty.

The World Bank said $200 million was being allocated for the Pakistan Social Safety Nets Development Policy Credit to establish an effective framework.

“Pakistani households are highly vulnerable to income shocks, and existing social assistance programmes cover only a very small fraction of the poor,” Yusupha Crookes, the country director for Pakistan, said in a statement received on Friday.

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World Bank to consider US$250Mln loan for Pakistan: Pakistan Times

ISLAMABAD: A session of the World Bank’s Board of Directors will consider the proposal of granting US$ 250 million loan to Pakistan on September 10 in Washington.

Sources in Economic Affairs Division say that the session would also consider giving US$150 million for the Benazir Income Support Program.

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The Debt Trap: IMF, World Bank and Pakistan: Economistan

14th August, a day we celebrate as our independence day is fast approaching amidst ever worsening financial condition and ever growing debt burden. The tradition of taking debt for stimulating growth in our economy was started in early years of Pakistan but these debts have today become a bane rather than a boon for our beloved homeland. As Pakistan entered 21st century, its Public debt exceeded 90% of its GDP, over 600% of its annual revenues, and debt servicing accounted for over half of current revenues. In 2001, Pakistan was the only country in South Asia to be classified as a severely indebted country by the World Bank.

Historically, the Government of Pakistan has faced budget deficit since 1947. Early debts were taken during Ayub regime for building dams and industrialization. It was only during this time that this money acquired from abroad was utilized correctly. However, situation changed after this era and with the loss of East Pakistan and much of our economy after 1971 the events took drastic turn. During the later era’s decisions to acquire debts and to increased budget deficit were influenced by political needs rather than economic priorities. Another huge problem that Pakistan faces even today is the continuation of policies especially positive economic reforms which are often reversed only because they were introduced by a political rival while Pakistan’s government expenditure has been increasing constantly in last four decades.

Such uncontrolled expenditures mainly started during Zia era when foreign aid started to flow in due to Afghan war. The 11 years era of General Zia can be considered worst era of Pakistan’s history not only due to it’s political and socio-cultural disasters it yielded which Pakistanis are still facing today but also due to it’s economic policies. During Zia era the total national debt grew at an average rate of 17.7%. The influx of foreign aid did little to help the debt situation as it soared to 630 billion rupees. In fact One contribution to this was the costly non bank borrowing, e.g. from national saving schemes, and the ratio of debt to GDP kept rising. Interest payments on debt also rocketed to about 28 percent of revenues....

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WB to give $134.68m to Pakistan: The Nation

ISLAMABAD (APP) - The Government of Pakistan here on Friday signed two agreements with the World Bank amounting to US$ 134.68 million for financing projects in different sectors, namely: Third Partnership for Polio Eradication Project (US$ 74.68 million) & Social Safety Nets Technical Assistance Project (US$ 60 million) in Economic Affairs Division (EAD).
The agreements were signed by Farrakh Qayyum, Secretary, EAD on behalf of the Government of Pakistan and Yusupha B. Crookes, Country Director on behalf of the World Bank.
The overall objectives of these projects are to help the Government of Pakistan in enhancing the efficiency and productivity of sectors like Health & Social Welfare. The terms and conditions for the Education Sector Credits will remain as per the World Bank standard i.e. maturity period of the credit is 35 years having a grace period of 10 years.
Government of Pakistan has to pay service charges @ 0.75% and commitment charges @ 0.5% per annum.
The projects details are: The Third Partnership for Polio Eradication Project (US$ 74.68 million) and the objective of the project is to assist the Recipient in its efforts under its Polio Eradication Initiative (PEI) to eradicate polio from its territory.
The project consists of Procurement, supply and use of OPV for the purpose of immunizing children under five (5) years of age under the Supplemental Immunization Activities (SIAs).

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WB committed $1.7bn in FY09 for Pakistan: Daily Times

Staff Report

ISLAMABAD: The World Bank committed $1.7 billion in fiscal year 2009 (FY09) to help Pakistan cope amid the global economic crisis, the institution’s highest ever year-on-year support to the country. This represents an increase of $1,064 billion over FY08.

A World Bank statement issued here said that the Bank’s financial support and technical assistance to Pakistan focused on helping the country maintain economic stability, steer the economy back onto a higher growth path and help the government to put in place the systems and procedures to realize its vision to adequately and effectively protect the poor from economic shocks.

“Pakistan has faced daunting challenges over the past year, including a domestic macroeconomic crisis, a global recession, political turmoil and serious security challenges,” said Yusupha Crookes, World Bank Country Director for Pakistan. “The tripling of our support during a time of need demonstrates our commitment to promote growth and stability in Pakistan. The focus of our assistance has been to ensure the country’s poorest and most vulnerable citizens are shielded from the major adverse impacts of these external shocks. Pakistan should also not lose the momentum in seeking to build the capability of its citizens especially the poor and our support puts considerable emphasis on supporting government to continue its efforts in this regard.”

Key to the Bank’s program in Pakistan is scaling up existing programs that are delivering results. For example, the Bank approved $250 million for the Pakistan Poverty Alleviation Fund (PPAF), a program the Bank has supported since 2000. During this time, PPAF has facilitated the formation of 80,000 community organisations and provided 1.9 million micro-credit loans and 16,000 community infrastructure schemes.

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ADB Approves US$500 Mln Loans For Pakistan To Encounter Crisis: Bernama

MANILA, June 26 (Bernama)-- The Asian Development Bank (ADB) said Friday it has approved two loans to Pakistan totalling US$500 million to assist the government with its macroeconomic stability efforts and fund a targeted safety net programme for the poor.

The first loan, US$150 million, from ADB's Special Fund will target a Benazir Income Support Programme (BISP) -- a cash transfer programme focusing on poor women, China's Xinhua News Agency reported the ADB as saying in a statement.

Under the scheme, the female head of qualified families receives 1,000 rupees (US$12.3) per month to help defray the rising cost of food and other household expenses, the Manila-based development bank said.

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Pakistan to receive $2.3 billion by June: Tarin: PakWatan

ISLAMABAD, Pakistan will receive $2.3 billion from US and other donors before end of June, Advisor to Prime Minister on Finance Shaukat Tarin told a news conference here on Friday. Giving details of his meetings at Japan, Libya, US and with International Monetary Fund (IMF) at Dubai, he said.

The World Bank, Asian Development Bank, and US would release $600 million, $800 million and $900 million respectively, whereas International Development Bank (IDB) will give $23 million. He said that Pakistan's delegation had convinced the IMF during the review of March quarter in Dubai for allowing an increase in fiscal deficit by next fiscal year.

This fiscal space was required owing to decline in revenue on account of negative growth by large-scale manufacturing (LSM) and shrinking import as both contributed 60 percent and 40 percent respectively to the revenue. He said that the IMF allowed increment in fiscal deficit by 1.2 percent (from 3.4 to 4.6 percent in the next fiscal year) which would enable Pakistan to use Rs 180 billion as a short-term measure to increase industrial productivity.

He said that IMF was told that Friends of Pakistan (FoP) pledges would not cater Pakistan's urgent need of short-term growth and this could only be possible through increase in fiscal deficit. The advisor said that IMF was satisfied with performance of Pakistan economy and would soon release $840 million tranche.The board meeting in mid-June will recommend release of the tranche, he said, adding that Pakistan budget figures for next fiscal year were also discussed in the Dubai meeting.

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