The head of the United Nations High Commissioner on Refugees (UNHCR) mission in Afghanistan Peter Nicklaus acknowledged what he termed 'the biggest mistake' ever made by the entity he serves: "we thought if we gave humanitarian assistance then macro-development would kick in ... it's the income that counts, the livelihood. In very simple terms we need to find jobs for the people coming back." He further clarified that "you can build five roads to a village and the farmers will benefit because they can go to the next town to sell their vegetables. But the returnee (the Afghan refugees) doesn't benefit at all. He has nothing to sell in the market." Pakistan's situation is markedly different from Afghanistan given that Pakistan has Internally Displaced Persons (IDPs) yet many parallels can be drawn. Pakistan has been subjected to a massive number of IDPs due to the ongoing military operations as part of the ongoing war on terror as well as forced displacements due to massive floods in 2010 as well as in 2011. Additionally, there are no reliable estimates of displaced persons in Balochistan but rough estimates indicate that around 40,000 Baloch have been forced to flee their homes while 100,000 Punjabis and Hazara Shias have fled Balochistan and their numbers continue to rise. In 2009, the number of IDPs peaked at 3 million (comparable to Afghan refugees in Pakistan after the Soviet invasion). The next year, the numbers were around one million. However, these numbers were offset by new displacements. In effect, the problem is more acute than one would imagine. The government has given some cash payments to some category of IDPs but its own severe cash flow problems has deterred it from extending assistance on the scale required to ensure that the IDPs are completely rehabilitated. Unlike Afghan refugees, the bulk of our IDPs (flood victims and after military operations have ceased) can return to their homes and pick up the threads of their interrupted lives through some cash injections. However, those who have lost their all, cannot do so. The federal government would, no doubt, point to the Benazir Income Support Programme (BISP), designed to extend humanitarian assistance to the poorest of the poor, as a pro-poor strategy. The government extended 35 billion rupees under the BISP last year and intends to extend 50 billion rupees this year. However, allocation on BISP as well as annual allocation to run the BISP secretariat represents money that, given the poor state of our macroeconomic indicators, could have been better spent on micro finance whereby the poor could be extended interest-free loans or loans at low interest rates. This would have implied economic activity, increasing employment opportunities and the recipient may be a one-time borrower as he/she would no longer require state assistance. President Zardari, together with his economic team, has been stating that the country needs trade and not aid. In his speech at Garhi Khuda Bukhsh on the fourth death anniversary of Benazir Bhutto, he defended his government's decision to trade with all countries (oblique reference to criticism against extending the MFN status to India). Few would challenge the efficacy of this policy thrust, though many would challenge the government's failure to provide a level-playing field to our manufacturers (including exporters) in terms of availability of energy and credit. Be that as it may, the government must realise that micro-finance is akin to trade in terms of impact while the BISP handouts are akin to aid that will neither raise employment opportunities nor indeed ensure that the recipient would at any time in future become self-sufficient and not require state handouts. Copyright Business Recorder, 2011
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