Pakistan, WB develop $285m recovery package
Sources in the Economic Affairs Division said that the executive board of the Washington-based donor agency was going to approve the Khyber-Pakhtunkhwa and Fata emergency recovery project on November 2.
The package includes $250 million in soft loans by the WB and $35 million from the multi-donor trust fund that was set up for the rehabilitation of war-affected areas. Donors have pledged $130 million to this fund thus far. A portion of this package will also be utilised for reconstruction in areas affected by floods.
The project will be initiated in the districts of Malakand division, Swat, Shangla, Buner, Lower and Upper Dir and the two tribal agencies of Bajaur and Mohmand in Fata. The army launched an offensive in Malakand earlier to root out terrorists which resulted in the largest internal displacement in the country and cost $1.8 billion.
The need assessment report of the WB, which the government has not made public yet, identifies poverty, under-development and illiteracy as the reasons behind terrorism in Pakistan.
Of the package, $180 million is supposed to be utilised for providing cash grants to vulnerable and poor households in areas affected by militancy. The component will be financed by a soft loan of $145 million and a $35 million grant from the donors’ trust fund.
The cash grant will be utilised to mitigate the adverse impact of conflict by providing targeted support grants to the poorest and the most vulnerable households that have been affected by the militancy.
“The cash grants will assist households in re-establishing and preparing themselves for the post-crisis long-term rehabilitation programme by covering basic consumption and any other short-term basic needs,” notes a WB document.
These monthly cash transfers will be provided for six months to each eligible household selected through an objective targeting mechanism which combines proxies for poverty and vulnerability like displacement status and losses directly linked to the crisis.
The package also promises targeted cash grants for flood recovery and human development projects at an estimated cost of $85 million.
Moreover, stakeholders are planning to give conditional cash transfers estimated at $68 million which will be used to encourage behaviour that promotes human development by requiring registered households to comply with core responsibilities such as sending their children to primary school to ensure the continuity of cash assistance. An amount of $20 million will be spent on monitoring and implementation of the project.
The government of K-P has estimated that approximately 250,000 households have been affected by the floods and are eligible for cash grants. It has been decided to cover 200,000 households under the National Disaster Relief Programme, a collaborative programme amongst the federal and provincial governments.
The first phase of the programme is underway and covers 100,000 households. The programme will support approximately 50,000 more households with one-time flood recovery grants not covered under the programme.
Published in The Express Tribune, October 20th, 2010.
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