Japan has pledged Non-Project Grant Aid (NPGA) amounting to around $33 million to supplement efforts being made for structural adjustment for overcoming economic disparities and difficulties. The Ambassador of Japan, Chihiro Atsumi, and Sibtain Fazal Halim, Secretary, EAD, signed official Exchange of Notes (E/N) on their respective governments' behalf for an amount of three billion (3,000,000,000) yen, (approximately $33 million) as Non-Project Grant Aid (NPGA).
Non Project Grant Aid is a mode of budgetary support used by developing countries to supplement structural adjustment efforts and to overcome economic disparities and difficulties. Addressing the signing ceremony, Sibtain Fazal Halim said that the grant was a firm commitment of relations between Pakistan and Japan, and it would supplement government efforts to revive the economy.
He said that Japan is a major contributor in Multilateral Development Fund for FATA and has been playing a key role in socio-economic development of Pakistan. "The pledged amount will be disbursed within a few days," he said, adding that the grant would be used for importing goods and machinery from Japan, such as oil, medicine, fertiliser, tractors, etc.
He said that Japan was the second largest donor to Pakistan and in the Friends of Democratic Pakistan/Donor Conference held in Tokyo in April 2009 it had committed $1 billion, out of which about 30 percent is in grant aid mode--both project and non-project. "Besides the yen loan assistance for projects, Japan will extend $150 million first time as budgetary support to Pakistan," he added.
"Pakistan values government of Japan's assistance in the fields of education, health, energy, environment, disaster management in general and laud this grant, in particular," the Secretary said, adding that the Japanese assistance in economic co-operation has played a vital role in the development of the social sector with specific focus on human resource development and poverty reduction.
Chihiro Atsumi said that the NPGA would be used for importing goods and machinery from Japan such as oil, medicine, fertiliser and tractors etc. "Pakistan will then deposit all the proceeds from sales or lease of imported items and machinery in local currency as the Counter Value Fund (CVF) which is expected to be utilised for economic and social development in Pakistan, such as construction of schools, scholarship for university students and distribution of medicines among low-income groups," he added. He said that the Fund would help in eliminating poverty from Pakistan. He noted that Japan had announced $1 billion assistance in donor conference that would help launch development projects in the areas bordering Afghanistan.
The NPGA is an important assistance that can be delivered quickly, and represents the long-term commitment of Japan for the development of Pakistan as well as for the stability of the region. "Pakistan is our core friend and we will continue to support it to bring development and prosperity in country," he added. He said that Japan had asked Pakistan to identify areas to extend further support.
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