The World Bank approved a credit worth $300 million to assist Pakistan's efforts to respond to the loss of life and destruction wrought by the recent devastating floods. This support, which is part of the Bank's $1 billion commitment for Pakistan's floods recovery and reconstruction in this fiscal year, is fast-disbursing financing of critical flood-related imports.
Recent flooding in Pakistan, the result of extraordinarily heavy monsoon rainfall, has affected all the regions in the country and over 20 million people. Preliminary figures show that more than 1.8 million homes have been damaged or destroyed displacing over 8 million people. Relief and recovery requirements are enormous and have severely strained infrastructure, services, and financial resources.
"The credit is part of the first phase of the World Bank's strategy to assist with flood recovery in Pakistan," said Rachid Benmessaoud, World Bank Country Director for Pakistan. "The recent floods are of a magnitude and scale that would stretch the capacity and resources of any country and have adversely impacted communities that were already vulnerable."
The floods have led to a sharp increase in imports, such as food, medicines, tents, construction materials, machinery, and fuel. This operation will disburse the full $300 million against imports of these items. Given the vast immediate financing required to meet the early recovery needs of the millions of people affected by the floods, this credit was processed quickly using the Bank's emergency project processes.
"This is only the first step on a long road to recovery," said Hanid Mukhtar, Co-Task Team Leader. "We hope to ensure the immediate availability of critical supplies, especially fuel, needed for early recovery and restoration of affected lives and their communities."
Along with the Asian Development Bank (ADB), the World Bank is also supporting Pakistan by undertaking a Damage and Needs Assessment to estimate the damage caused by the floods and to identify immediate, medium and long-term reconstruction priorities.
The World Bank has a long history of partnership and collaboration with Pakistan and draws from experience during previous emergencies including the Pakistan Earthquake of 2005, the Earthquake in Haiti in 2010, and flooding in Nepal and India in 2008. The support is also assisted by the Bank's Global Facility for Disaster Reduction and Recovery (GFDRR). The credits from the International Development Association (IDA), the World Bank's concessionary arm, have 40 years to maturity with a 10-year grace period; they carry a service charge of 0.75 percent.-PR