Asian Development Bank (ADB) has approved assistance packages to help Pakistan to undertake key reforms in the power sector.
This included funding to ensure energy delivery to industrial and private consumers, and to build two vital power generation plants in Sindh Province.
The Jamshoro Power Generation Project, which on completion in 2018, will add 1,300 megawatts (MW) to the country's electricity grid. Reliability of the power distribution network is also being enhanced through the investment of $167.2 million to upgrade 284 grid stations.
The World Bank also approved a financing package from the International Development Association (IDA) to help expand hydro-electricity generation in Pakistan through the development of the Dasu Hydropower Stage-I Project (DHP-I).
The package consists of an IDA Credit of $588.4 million and an IDA Partial Credit Guarantee (PCG) of $460 million to help mobilize commercial financing for the project. DHP-I would have 2,160 megawatt (MW) hydropower plant on the main Indus River, which can be expanded to 4,320 MW in future with less additional cost.
The government kept itself bound with its timelines related to energy projects, however undue sit-in by two political parties in August 2014 and disastrous flood witnessed by Kashmir region in September 2014 became significant hindrance.
Many planned engagements with multilateral and bilateral donors were delayed, most importantly the visit of President of China was rescheduled.
Floods delayed NeelumJhelum hydropower which is now expected to be complete in 2016.
During the recent visit of President of China, Pakistan and China signed 51 Memorandums of Understanding (MoUs) relating to diverse aspects of bilateral relations, including the Pakistan China Economic Corridor and series of energy projects.
Thus almost $15.5 billion worth of coal, wind, solar and hydro energy projects will come online by 2017 and when mature will add 10,400 megawatts of energy to Pakistan's national grid.
The energy issue is top priority of the government and intend to fulfill its commitments realizing the fact that good governance and regulation will contribute to a sustainable, affordable and reliable energy system.
The government is sincerely committed to add electricity generation of 10,400 megawatts to Pakistan's national grid by 2017-18 along with reduction in the cost of generation and transmission losses.
Under the vision 2025, the government is committed in power generation to 45,000 MW with provision of uninterrupted, affordable and clean ,energy for all.
Thus the government is encouraging private investment to achieve power generation mix through development of indigenous energy resources particularly hydel, coal, shale gas, etc. to achieve zero load-shedding along with the reduction in average electricity rates Social Safety Nets.
The government is fully committed to follow a sustained poverty
reduction strategy and allocate a minimum of 4.5 percent of GDP to social and poverty related expenditures. The government prioritized 17 pro-poor sectors through the Medium Term Expenditure Framework (MTEF) in the PRSP-II.
Expenditure on pro-poor sectors in 2010-11 stood at 13.24 percent of GDP. In 2011-12, these were 11.55 percent of GDP and in 2012-13, 13.10 percent of GDP.
During 2013-14, total expenditures for these sectors were slightly increased and amounted to Rs. 1,934.095 billion, which was 14.16 percent of GDP.
During July-December of the current fiscal year 2014-15, Rs. 667.47 billion expenditures have been made in these sectors.
BISP is continuing to eradicate extreme poverty through provision of cash transfers. Present government has not only continued the Benazir Income Support Programme (BISP) but has also increased the cash grant to Rs. 1200/ month and then to Rs 1500/month and also increased BISP budgetary allocation to Rs. 97 billion in 2014-15 from Rs. 75 billion in 2013-14. Total expenditure of BISP during the current fiscal year is projected to cross Rs. 90 billion.
The number of BISP beneficiaries is expected to increase from 4.6 million in 2013-14 to 5.0 million by the end of this financial year. BISP is expected to enroll 500,000 children in school during the current financial year under its Waseela-e-Taleem initiative.
The government has increased the monthly stipend under the Waseela-e-Taleem initiative to Rs. 250 per month per child from Rs. 200. Pakistan Poverty Alleviation Fund (PPAF) also provides assistance in microcredit, water and infrastructure, drought mitigation, education, health and emergency response interventions.
During the period of July 2014 to March 2015, Pakistan Poverty Alleviation Fund has managed to disburse an amount of Rs. 9.8 billion to its various on-going projects.
Under the 18th constitutional Amendment, the subject of Zakat has been devolved to the Provinces/Federal Areas.
A total amount of Rs. 4778.18 million is distributed in bulk amongst the provinces and other administrative areas for the year 2014-15.
Pakistan Bait-ul-Mal (PBM) is also making efforts for eradication of poverty by providing assistance to destitute, widows, orphans, invalid, infirm and other needy persons through different initiatives.
During July 2014 to March 2015, Pakistan Bait-ul-Mal (PBM) has managed to disburse an amount of Rs. 2.28 billion to its core projects.
Environment
Sustainable use of resources and environmental concern has become increasingly important.
The inability to address the situation will result in extremely high environmental and economic cost in future.
Environmental factors are changing drastically and if left unchecked, pollution and environmental degradation will pose a monumental threat to social and economic growth of the country.
Pollution on a wide scale is damaging the land, water, and air as unchecked economic activity has decreased the availability of fresh water resources along with clean air.
Air & Water The key factors responsible for air pollution in Pakistan are rapidly growing energy demand due to relatively higher population growth rates, fast growing transport sector, unplanned infrastructure, and widespread use of lowquality fuel and above all are the alarming level of particulate matters (PM10 and PM25).
National Impact Assessment Program (NIAP) conducted by Pakistan Environment Protection Agency is aimed to contribute to sustainable development in Pakistan through strengthening the environmental impact assessment process introducing Strategic Environmental Assessment (SEA) in national development planning.
According to Pakistan Council of Research in Water Resources (PCRWR), the majority of the population in the country is exposed to the hazards of drinking unsafe and polluted water from both surface and ground water sources.
To address this issue of national importance, federal government through PCRWR has implemented several national water quality monitoring and surveillance activities.
Access to an adequate supply of water is also one of the absolute priorities of Vision 2025.
Top five goals for water security are:
- Increase water storage capacity, applicable to the requirements of each province in line with defined strategic needs and international benchmarks: from currently 30 days to 45 days by 2018, and 90 days by 2025.
- Invest in proven methods and technologies to minimize wastage (e.g. in the agriculture sector), promote conversation and gain efficiencies through rationalization of pricing.
- Enable more effective allocation with direct reference to national & provincial priorities and related social and economic considerations.
- Establish institutional mechanisms e.g. a National Water Commission to effectively manage all resources of water (surface, subsurface,rain) and their sectoral and regional allocations - Provision of access to a minimum baseline of suitable water to every person in Pakistan.
Solid Waste & Sanitation The absence of a proper solid waste disposal system and huge amount of uncollected waste poses great threat to the public health. Only 30 percent of solid waste quantities generated are generally collected by government services.
The recommendations that can be considered regarding solid waste management are:-
- Raising awareness about consequences caused by solid waste pollution.
- Collective role of government sector, NGO's, Private sector for solid waste management.
- Legislation should be done which would be effective and find ways to implement its effectively application of 3 Rs (Reduce, Recycle and Reuse) concept in solid waste management system.
- House to house collection of solid waste should be organized. - Littering of solid waste should be prohibited in cities, towns and urban areas. Proper segregation would be vital for scientific disposal of waste.
- Developing legal framework and national guidelines for solid waste management that includes waste management and basic recycling rules.
Sanitation is one of the basic necessities of human life as it saves lives, resources and let human being live with dignity.
In order to build the momentum and accelerate the progress on sanitation and hygiene in the country, Pakistan Conference on Sanitation (PACOSAN) was held in February, 2015.
Pakistan government is committed to save its children from death, living with disabilities or not achieving their potential physical and mental growth to compete with other nations in the world.
Forest Under Millennium Development Goals (Goal-7) Pakistan had committed to increase forest cover to 6pc by the year 2015, which could not be achieved mainly due to financial constraints of federal and provincial governments.
Slow Overseas Development Assistance (OSA) from bilateral or multilateral sources impedes government policies and plans to bring additional lands under tree cover.
The developing countries need uninterrupted flow of pledged financial resources from developed countries to adapt to a changing global climate and reduce carbon emission to boost forest growth. However, in order to increase the forest cover, significant programs of forestation are operational in the country.
Climate Change Further to national Climate Change policy-2012, its framework for implementation is developed keeping in view the current and future anticipated climate change threats to Pakistan's various sectors.
Numbers of measures are in focus to address both mitigation and enhancing various ongoing efforts and initiating new activities such as Adaptation Strategies, Mitigation Strategies, Clean Development Mechanism and Nationally Appropriate Mitigation Actions.
Green Climate Fund (GCF) is the future financial mechanism for the United Nations Framework Convention on Climate Change (UNFCCC). Ministry of Climate Change has started readiness activities.
The Ministry is foreseeing to tap the GCF at an appropriate level.
Technology Needs Assessments (TNA) is a systematic approach for conducting technology needs assessments in technological means for both mitigation and adaptation.
It also provides processes and methodologies for uncovering gaps in enabling frameworks and capacities for formulating a national action plan to overcome them as part of overall climate change strategies.
Project proposal of Pakistan?s Second National Communication (SNC) on Greenhouse Gases (GHG) emission has been finalized and the same is under process with the United Nations Environment Program (UNEP) for funding.
United Nations Conference of Parties on Climate Change (COP-21) to be held in Paris in December 2015 is supposed to produce a global agreement to cut greenhouse gas (GHG) emissions. It is likely to bring a Protocol with binding commitments on developing countries such as cutting down or at least slowing down their GHG emission.
Outlook:
Given the above macro stabilization achievements, it is expected better energy supply that with import of LNG likewise, some energy related fast track projects under CPEC are expected to be completed during next fiscal year.
Based on these two factors, it is assumed that improved energy availability will play significant rule in the industrial growth during next year.
The better energy supplies completed with historically low discount rate would encourage the private sector investors to expand their business and maximize capacity utilization.
This will have a direct impact on investment to GDP ratio.
The performance of industrial sector has not been impressive this fiscal year as it missed the growth target.
It is expected that the industrial sector will grow on the back of better energy supply and planned investment under CPEC.
The LSM will also benefit from the backward and forward linkages of huge infrastructure projects under CPEC and increasing demand for housing triggering sharp demand for iron, cement and related construction industries.
Besides, private sector investment is expected to rise with improved energy availability, improving security situation and economy's stabilised international standing.
The PSDP funding on real sector particularly agriculture, industry will further supplement the growth. The government on this score has already initiated number of agriculture related initiatives to help this sector which is the backbone of our economy.
Global Development:
The global economic environment appears poised for a change for the better with the recent sharp fall in the international prices of crude petroleum, which is expected to boost global aggregate demand, and the sharp recovery in the US economy in the face of gradual withdrawal from monetary accommodation.
Following the global crisis of 2008, the global economy came under a cloud of uncertainty and the prolonged weakness in the euro area, particularly since 2011, led to the often revising global growth.
Compared with the June 2014 Global Economic Prospects, global growth was revised down by 0.2 percentage point in 2014 to 2.6 percent, 0.4 percentage points to 3 percent in 2015.
Downward revision are primarily due to a major GDP decline in Russia (from +0.8 to -3.5 percent) and moderate declines in the Euro Area (1.6 to 1.4 percent), Japan (1.1 to 0.6 percent), and Brazil (1.5 to 0.5 percent).
Upward revisions include the United States (2.6 to 2.9 percent), Mexico (2.8 to 3.5 percent) and India (5.5 to 5.9 percent).
High income countries are likely to see growth of 2.2 percent in 2015-17, up from 1.8 percent in 2014, on the back of gradually recovering labor markets, ebbing fiscal consolidation, and still low financing costs.
In developing countries, as the domestic headwinds that held back growth in 2014 ease and the recovery in high-income countries slowly strengthen, growth is projected to gradually accelerate, rising from 4.4 percent in 2014 to 4.8 percent in 2015 and 5.4 percent by 2017.