PRSP shows mixed results

Annual Progress Report 2005-06 of Poverty Reduction Strategy Paper 2005-06 (PRSP) shows mixed results. There are achievements in many fronts, yet several challenges persist. The annual report of Finance Division states that government is aware of the challenges which will be addressed in PRSP-II, which is expected to be finalised this year.
PRSP report says that there are many challenges ahead to reduce poverty. High sustained economic growth is required for longer period to achieve the Millennium Development Goals (MDG) and PRSP targets by 2015.
Though there is a sharp decline in rural poverty, the report says. To reduce the gap, there is need to broaden the inclusiveness of economic growth to reduce income inequality level in the country. More targeted interventions are needed, to further alleviate poverty in the rural areas, it emphasises.
The report further says that gender gap in literacy, especially in primary school enrolments, still persists and adds that district-level variations are quite high in literacy. It focuses on challenges like child immunisation, pre- and post-natal consultation and water supply and sanitation.
However, the report states that unemployment rate has declined from 8.3% in 2001-02 to 7.7 percent in 2003-04 and claims further reduction to 6.5 percent during July-March 2005-06. The poverty has declined from 34.46 percent in 2001-02 to 23.9 percent in 2004-05, but has accepted that income inequality has increased marginally.
The report says that initialisation of PRSP has appreciably helped in poverty reduction and unemployment in both urban and rural areas.
The expenditure incurred by PRSP is in line with Fiscal Responsibility and Debt Limitation act 2005. They have increased by 37.4 percent in FY06 with respect to FY05 to Rs 434.6 billion. It further adds, increase in PRSP expenditures as percentage of GDP increased from 3.8% in FY05 to 5.6% in FY06.
The report says, to achieve universal primary education by 2015, there is a trend of spending largest proportion of pro-poor expenditures on education and largest proportion of education expenditure on primary education.
It also intends to increase direct transfers from Rs 13.7 billion upward to facilitate more beneficiaries to cater the needs of all the poor needy persons in the country. It has already catered 5,363 thousands poor through micro-financing, Zakat, EOBI, and Baitul Maal funds etc.
The annual report has emphasised strengthening of monitoring and evaluation (M&E) system, though it has benefited a lot in assessing the progress of PRSP. It says, "it has provided a good base, but the evaluation component needs to be strengthened".