Contrary to the govt claims, the pledges made at the Geneva Conference will take time to materialise 

On January 9, 2023, Pakistan and the United Nations co-hosted an International Conference in Geneva with the objective of securing international financial support for the reconstruction and rehabilitation of the areas and people affected by the devastating floods that brought havoc to parts of the country in August 2022. The Conference titled ‘Climate Resilient Pakistan’ brought together the international community to reaffirm solidarity with flood-affected Pakistanis, to review their recovery needs, and to identify the kind of support required to reconstruct and rehabilitate the damaged infrastructure.

The response of the donor community at the Conference remained encouraging towards Pakistan’s needs. Taken as a whole, these commitments totaled more than $10.5 billion, from both bilateral and multilateral partners. Further announcements for in-kind support were made by a number of delegations.

The 2022 floods came at a time when Pakistan had been facing an unprecedented political instability against the backdrop of a dire economic crisis. The donor countries, the United Nations and international humanitarian organisations came to Pakistan’s help in the early relief phase following the devastating floods. However, against the appeal for $816 million in urgent funds for Pakistan, it received only $262 million i.e. around 32 percent of the target amount.

For the recovery phase, the Government of Pakistan led a Post-Disaster Needs Assessment (PDNA), which was prepared with the support of a Core Group of partners comprising the Asian Development Bank, the European Union, the United Nations Agencies, and the World Bank Group. The PDNA estimate for the recovery needs of the country stood at over $16 billion.  Housing, agriculture and livestock, as well as transport and communication sectors were most hit by the floods. The worst-affected was Sindh province, followed by Balochistan, Khyber Pakhtunkhwa, and Punjab. Based on the PDNA, the Core Group supported the government in developing a Resilient Recovery, Rehabilitation and Reconstruction Framework (4RF). The 4RF provides an overarching structure for planning, financing, implementing and monitoring Pakistan’s resilient recovery, and rehabilitation and reconstruction efforts.

As regards to the recovery phase of the people and areas affected by these floods, the organisation of the Geneva Conference in collaboration with the United Nations is only the first part of the process. The realisation of the pledges and commitments by bilateral as well as multilateral donors and the evolution of mechanisms for disbursal and distribution of these funds within the country will depend upon the follow up actions and coordination between the relevant government institutions in the coming months.

Due to a highly polarised internal political situation, different opinions and assessments are quite visible about the outcome of the Geneva Conference and its financial pledges. The federal government has described the event as a resounding success of its efforts to undertake an internationally supported rehabilitation and recovery programme of the flood-affected areas. But the political opposition has continued to challenge the government’s contentions and raises several questions about the nature of pledges and their capacity to impact a country’s balance of payments equation.

Out of the total amount pledged on January 9, the biggest component of $7.2 billion was announced as loan by four multilateral institutions. These include $4.2 billion by Islamic Development Bank (IDB), $2.0 billion by the World Bank, $1.0 billion by the Asian Infrastructure Investment Bank (AIIB) and $1.5 billion by the Asian Development Bank. These funds are normally not provided in a single go but in stages which may span over a period of at least 2-3 years.

Another $1.72 billion has been earmarked by bilateral donors. The bilateral pledges include $1.0 billion by Saudi Arabia, $345 million by France, $100 million by China, $ 93 million by the EU, $88 million by Germany, $77 million by Japan, $10 million by the United Kingdom and $2.0 million by Azerbaijan. The experience suggests that the bilateral assistance, or a part of it, is generally in the form of grants. However, the timing of the provision of funds and whether the assistance is provided in kind or in liquid funds would depend upon further engagement with the donor country.

The bulk of the assistance coming through multilateral donors will be allocated to projects mutually identified by the Pakistan government and the donor institution in the flood affected parts of the country. The speed with which actual disbursement can take place depends upon the efficiency of the relevant government departments in fulfilling the procedural formalities, and if things are properly coordinated the flow of funds can start relatively quickly during the current year. However, it is important to note that the provision of project assistance for flood recovery and rehabilitation cannot be seen as a tool to plug the country’s huge current account deficit or boost foreign exchange reserves.

In the past two decades, Pakistan has been through some major natural catastrophes. When Pakistan was hit by a massive earthquake in October 2005, the international community was quick to respond and provide adequate funds to the government for rehabilitation and reconstruction phase. Then during the devastating floods in 2010, donors again came up with their timely help and support. Later, some donors had concerns about the lack of efficiency of the procedures and mechanisms for spending of funds earmarked for the reconstruction and rehabilitation by the relevant government authorities.

The situation this time is more challenging. The donor countries and institutions are already quite fatigued under the impact of pressure from the economic depression caused by years of Covid-19 pandemic, and more recently by the Ukraine war. Therefore, while the initial pledges of more than $10 billion have been made by the donor countries/institutions at the Geneva Conference, the actual disbursement of these funds on the projects to provide relief to the vulnerable people affected by the floods may take more time to arrive, depending on the follow-up and coordination by the government. Though this is quite challenging due to the deepening divisions inside Pakistan’s internal politics, fast exacerbating economic situation and gaps in governance particularly coordination between federation and the provinces at this critical juncture, the nation expects that politicians can help create conditions for the effective recovery of flood affected areas of Pakistan.

The writer is a former ambassador of Pakistan to Afghanistan