In the wake of increasing food shortage, the Asian Development Bank (ADB) has earmarked 25 percent of resources for Water Financing Program (WFP) for the period from 2006 to 2010 in five countries, Pakistan, India, Indonesia, Philippines and Vietnam.
A report released by ADB showed that about 80 percent of the bank's budget for water operations would be utilised on water sector. According to the report, to improve water management system, along with supplying safe drinking water, ADB lending program under the WFP to Pakistan was approved $1.5 billion over 3 years, from 2006 to 2008. But the report does not give any clue about the lending from the bank for 2009-2010.
Pakistan has a long history of developing its water infrastructure, but the expansion of water sector investments is hindered by lack of capacity for sector planning and strong management to take on new projects. The report says that it was due the frequent disagreement among the federal and four provincial governments over the best way to proceed.
The report shows that Pakistan is home to the largest contiguous irrigation system in the world. Irrigated land is responsible for about 80 percent of agricultural production. Agriculture represents 25 percent of Pakistan's gross domestic product, employs over 50 percent of the rural labour force, and provides 60 percent-70 percent of exports. The Indus River canal system not only supplies agricultural water but is also a primary source of rural, municipal, and industrial supply.
Yet the irrigation system urgently needs rehabilitated along with stronger institutional arrangements. The rate at which groundwater resources are being tapped is unsustainable; the coverage, quality, and reliability of urban water supply are grossly inadequate, especially in light of the burgeoning urban population; and urban wastewater treatment is nearly non-existent.
Pakistan's drainage network collects agricultural drainage along with mostly untreated municipal and industrial effluent and expels it into rivers. ADB's assistance to Pakistan in the water sector, therefore, puts an emphasis on capacity building. For example, the technical assistance (TA) grant, Water Sector and Irrigation Development, will help develop a TAP in collaboration with the Government suitable for financing by ADB or other donors.