‘Friendly’ support: FoDP yet to deliver on two-year-old pledges
Since April 2009, FoDP – a group of 17 states and multilateral donors – has released $1.5 billion of the initially pledged $6.2 billion that were to be given by June 2011. On April 17, the nation states joined hands in Tokyo, Japan, to support democracy and compensate the losses that Pakistan has suffered as a frontline state in the war against militancy. Later, the amount was reduced to $5.4 billion. Official sources said that a break-up of the released money shows that only 17 per cent, which amounts to $926.1 million, was disbursed through public channels while $596 million were given through international non-governmental organisations.
Sources said that all the money was released during the last financial year and six months into the current one, the government has not received any money. It has budgeted almost $1 billion to be received during the current financial year.
According to sources, some donors have already informally conveyed to Islamabad to not pin its hopes on the FoDP and have shifted the focus to flood-related assistance, which has also been linked to a transparent mechanism of utilising aid.
They added that the donors seemed to have lost sympathy because of the back-to-back crises in Pakistan and are also irked by Pakistan’s non-serious attitude towards carrying out major economic reforms.
Sources said that, of the remaining $3.8 billion, some countries have indicated that they will sign agreements amounting to over $800 million. These agreements may be signed by France, Italy, Japan, Saudi Arabia and the Islamic Development Bank. Nevertheless, this money is unlikely to be disbursed till June 2011.
At the FoDP forum, the US had committed $1 billion and has disbursed $438 million so far. Out of that, an amount of $315 million was released through government channels.
“The US has informed that $123 million have been disbursed against non-government programmes but the government has no record of this release,” sources said.
But, the US is now clubbing the FoDP pledges together with the $1.5-billion Kerry-Lugar Act. “The Kerry-Lugar-Bremen vehicle will be used to disburse the money committed in Tokyo,” the US embassy’s spokesperson Alberto Rodriguez told The Express Tribune.
Japan had also committed that it will provide $1 billion in two years and has released $264 million so far. Out of that $170 million were disbursed through the government.
Iran had committed $330 million but has not released any amount yet. It has signed an agreement to finance part of the $55-million electricity import project from Tehran, the only commitment that was written in black and white. Turkey promised to give $100 million but has disbursed only $10 million in grants. The money has not been disbursed through the government.
South Korea pledged $200 million but has not released anything. It has signed a $3-million eye care mobile vans venture but, if materialised, it will be executed by a Korean agency.
Saudi Arabia pledged $700 million and has released $304 million so far. Sources said Saudi Arabia may release at least another $280 million.
The World Bank had committed $300 million but has withheld the entire amount due to Islamabad’s inability to carry forward energy and tax reforms. The Islamic Development Bank, which had committed $250 million, has given a $26-million loan. Pakistan has refused to accept a $125-million loan due to stringent conditions.
The Asian Development Bank promised to give $300 million in two years but has only given $100 million due to a failure in implementing power sector reforms and initiating corporate sector legislation.
The European Union had committed $640 million and has delivered just $119.5 million from non-government channels.
Published in The Express Tribune, January 9th, 2011.
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