Human, climate crises to get funds

ISLAMABAD:

The World Bank announced on Tuesday that it would channel most of its multibillion-dollar annual lending towards the two biggest crises of Pakistan – low human development and worsening climatic conditions, marking a shift from infrastructure and budget support-centric programmes.

In an interaction with media persons, World Bank Country Director for Pakistan Najy Benhassine said that the $1.3 billion worth of bank-funded flood reconstruction projects in Sindh had significantly improved social indicators and those schemes were being completed at a faster pace.

The new country partnership strategy would mainly focus on addressing serious issues of child stunting, out-of-school children, climate resilience and clean energy transition, he said.

The country partnership strategy is the guiding lending document of the bank, which determines the areas of financing during the implementation period.

The World Bank's local office head said that the new strategy would focus on six major areas. The World Bank is on an average giving $2 billion to Pakistan, although its current fiscal year's financing pipeline is drying up.

Benhassine said that the new areas of funding would be child stunting, education, climate resilience, clean energy transition including air pollution, budget support and improving business climate. Majority of these initiatives fall in the provincial domain and will be completed with their support.

Over 26 million children are out of schools in Pakistan and the country also sustained losses of $16.4 billion during the last catastrophic floods. However, the allocation of resources for these two areas remains poor.

The country director acknowledged that developing countries needed more concessional financing to fight climate change.

Responding to a question about the next loan envelope, Benhassine said that it was not clear as the next round of concessional financing pledges would take place in December.

The World Bank provides a combination of concessional and expensive funding and the country-specific quotas are determined on the basis of various social and economic indicators.

After the 2022 floods, the World Bank committed $2 billion by reprioritising its existing financing envelope. About $1.3 billion worth of five projects have been financed in Sindh, mainly for reconstruction of roads and housing infrastructure.

Planning Minister Ahsan Iqbal said last week that reprioritisation of the already available financing for flood-related projects had impacted other schemes.

Benhassine agreed that the repurposing of funds did impact some projects but he said that the World Bank still protected health and education-related schemes in Pakistan.

The World Bank's two major initiatives – the $500 million infrastructure reconstruction project and another $500 million for housing reconstruction – are nearing completion, said Kamran Akbar, Senior Social Development Specialist at the World Bank.

He said that out of the $1 billion, $816 million had already been disbursed and once all the five projects were completed in Sindh, about 13 million people would benefit from the schemes.

About 2.1 million housing units will be reconstructed in Sindh and money will be directly transferred to the bank accounts of beneficiaries. He said that 935,000 bank accounts had already been opened, which was also helping to expand financial inclusion in the province.

According to the International Labour Organisation, about one million job opportunities had been created under the housing reconstruction project, said Akbar.

The second infrastructure reconstruction project is focusing on the rehabilitation of damaged infrastructure and providing short-term livelihood opportunities in the selected areas of Sindh affected by the 2022 floods. The money is also being used for building flood embankments to avoid catastrophe of the 2022 scale.

Bilal Khalid, a disaster expert at the World Bank, said that about 1.7 million people would benefit from the rehabilitated infrastructure, which included flood protection works, roads, water supply and drainage schemes.

He said that out of the three outlets of Manchar Lake, two regulators namely Aral Head Regulator and Danister Tail Regulator had been remodeled to enhance the cumulative discharge capacity from 37,000 cusecs to 83,500 cusecs, an increase of 225%.

There was a plan for the rehabilitation of 143 flood-affected roads having a total length of 828 kilometres, said Bilal.

He said that it would benefit five million rural people, as 73 roads had been rehabilitated to resilient standards, and remaining roads would be completed by December 2024.

But a similar project in Balochistan has not yet kicked off. The World Bank had also approved $213 million worth of flood rehabilitation project in Balochistan.

The purpose of the project was to improve livelihoods and essential services and enhance flood risk protection in the selected communities affected by the 2022 floods.

According to initial estimates, about 250,000 to 280,000 housing units were planned to be reconstructed in Balochistan, however, so far only 104 bank accounts have been opened, said Kamran Akbar.

He said that the World Bank was currently in the process of revalidating the damaged homes and that was why the project was suffering.