ISLAMABAD, 2 May 2005 — Pakistan plans to invest a massive $41 billion in mega projects that will generate a good deal of business for its foreign trading partners and domestic producers. These plans were unveiled recently at the 2-day session of bilateral and multilateral donors, clubbed together in Pakistan Development Forum (PDF), formerly known as the World Bank’s Aid-To-Pakistan Consortium.
PDF members committed several billion dollars assistance right here. Islamabad expects to get sizeable funding from International Financial Institutions (IFIs) and bilateral donors within the next few weeks.
Pakistan has indicated investments required for the next three years — fiscal 2006 to 2008, and beyond. These include $33 billion for the water sector until 2025. Of this, $12 billion will be invested in the next five years, Ashfaq Mahmood, secretary, Ministry of Water & Power informed the PDF. Within five years, it will build, two large dams and reservoirs costing $6.3 billion. Expanding irrigation will cost $4.6 billion & drainage, flood control & land reclamation $717 million.
Several new power generation facilities will be established to meet additional electricity demand of 7,880 megawatts (mw) by 2010 and a total of 20.120 mw by 2015. The present installed capacity is 19,540 mw. The southern province of Sindh requires $5.7 billion for its infrastructure development, housing and road network, while the Southwestern province of Baluchistan needs $1.0 billion to improve its water facilities.
The donors and the Ministry of Finance (MoF) appear optimistic over availability of funding for the projects discussed at PDF.
Dr. Salman Shah, adviser to the prime minister on finance, informed the PDF “GoP will double funding of its Public Sector Development Program (PSDP) — currently Rs.202 billion — $3.37 billion. It will raise money from higher donor funding, public-private partnership for mega projects, and from the capital market.
Prime Minister Shaukat Aziz, said, “Pakistan is all set to achieve 7-8 percent growth rate but faces tremendous challenges in the social sector, rising prices, high oil prices, growing import bill and escalating credit demand, that indicates the economy is heating up.” “We are making a headway on the poverty front...The government policies are geared toward high growth, infrastructure and private sector development, improvement in service delivery, and good governance, aligned with the Millennium Development Goals (MDGs)... Our future growth strategy rests on five pillars: Water security, energy security, infrastructure development, human capital development, and second-generation reforms.
