Catalog

Pakistan
ADB Review [ December 2006 - January 2007 ]

PAKISTAN Irrigated land is responsible for about 80% of agricultural production, and agriculture makes up 25% of the country's GDP, employs over 50% of the rural labor force, and provides 60–70% of exports

In Pakistan, the expansion of water-sector investments is hindered by the lack of capacity for sector planning and strong management to take on new projects, and the frequent disagreement among the federal and four provincial governments over the best way to proceed.

According to Katsuji Matsunami, a Director in ADB's Central and West Asian Department: "Sometimes it seems as if Pakistan is not one country, but several under a weak federal organization."

There is consensus about the critical need for increasing investment, but lack of trust among the four provinces over the allocation of water resources and toward the federal Government must be overcome for substantive progress.

The country has a long history of developing its infrastructure for water resources management, and is home to the largest contiguous irrigation system in the world. Irrigated land is responsible for about 80% of agricultural production. Agriculture represents 25% of Pakistan's gross domestic product, employs over 50% of the rural labor force, and provides 60–70% of exports. The Indus River canal system not only supplies agricultural water but is also a primary source of rural, municipal, and industrial supply.

Clearly, water resources are vital to Pakistan's economic well-being, and their improved management is vital to poverty reduction. There has been a longstanding call for better water resource management to exploit fully water's productive benefits, says Mr. Matsunami.

Yet the irrigation system urgently needs rehabilitated and 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 nonexistent. Pakistan's drainage network collects agricultural wastes along with mostly untreated municipal and industrial effluent and expels it into rivers.

Officials in Pakistan "are quite aware that they need major water-sector investments and institutional reforms", says Mr. Matsunami. He notes that there has been progress under the government of President Pervez Musharaff, and that the current Government has begun an ambitious program of governance, administrative, and economic reforms which have the potential to bring major benefits to the water sector. Motivated by the need for energy and water storage as the country posts economic growth rates above 8%, President Musharaff has also committed to the building of five new mega dams. Provincial governments have likewise shown a strong commitment to reforms and are undertaking major water sector investments.

ADB's WFP "is music to their ears," says Mr. Matsunami. There is interest in the new financing modalities, including the flexibility of the Multitranche Financing Facility (MFF), and there is talk of the need for greater private-sector participation.

Programmed lending under the WFP would raise loans to Pakistan to over $1.5 billion over the 3 years 2006–2008, from roughly the same amount in the 10 years ending in 2005.

To proceed, however, there needs to be greater capacity at the federal, provincial, and local levels for managing water resources; for designing and implementing projects; and better coordination among the provinces and the federal Government.

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 TA program in collaboration with the Government suitable for financing by ADB or other donors. The program will provide significant capacity development at the provincial and federal levels for investment planning, policy analysis, and water resources management. This emphasis on strengthening institutions and capacity development for water is fundamental to support the desperately needed sector investment and ensure it provides sustainable economic growth for all Pakistanis.

Read more about ADB's Water Financing Program 2006-2010

Go back to current issue

Email this to a friend