The Federal government is considering to divert to provinces Rs 100 billion earmarked under Public Sector Development Programme (PSDP) 2010-11 for early relief and rehabilitation of the flood affectees due to poor response from the world community, Business Recorder has learnt. The government had earmarked Rs 280 billion for federal component of PSDP 2010-11.
In addition, the government is mulling over availing two other options: (i) funds lying unutilised for the displaced persons (IDPs) of Malakand Division; and (ii) funds earmarked for Benazir Income Support Program (BISP). "The money for IDPs, lying unutilised can be used in flood hit areas of KP," sources said.
Pakistan has suffered a 2 percent loss in Gross Domestic Product (GDP), that is around 6 billion dollars. This loss is on account of loss of productivity in different sectors due to floods in addition to damage to infrastructure. According to initial estimates, agriculture sector alone has flood related loss of Rs 250 billion.
Asian Development Bank (ADB) and World Bank have launched Damage Needs Assessment (DNA) which will be completed on October 15, 2010. The government will be in a position to have a more credible loss assessment after completion of DNA.
Sources said that the government would require considerably more funds for rebuilding and reconstruction of flood-torn areas than it has available.
The Planning Commission has already started to rationalise projects. "Under rationalisation programme, new as well as slow moving projects will be deleted from PSDP to divert funding for reconstruction of flood-torn areas," sources noted.
Diversion of funds would enable the government to undertake relief and rehabilitation activities immediately without waiting for foreign financial commitments. Sources said that normal development funds'' allocations had already become irrelevant in some cases after the floods had swept away many projects in all provinces.
The allocation for People''s Works Programme (PWP)-1 stands at Rs 4.42 billion and Rs 30 billion for PWP-2 for current financial year 2010-11 to undertake development schemes of parliamentarians. The government had earmarked Rs 35 billion for PWP-1 and 2 in the budget 2009-10 for the development schemes of parliamentarians, which face no cuts under the directives of the prime minister. "But funds allocation for (WWP)-1 and 2 in current financial year''s budget may be diverted for rebuilding and reconstruction of flood-affected areas," sources added.
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