PAKISTAN: ADB approves loan for Kashmir development

[ This report does not necessarily reflect the views of the United Nations]

ISLAMABAD, 28 Dec 2004 (IRIN) - The Asian Development Bank (ADB) has approved a US $57 million loan for a multi-sector rehabilitation and improvement project, aimed at improving the physical and social infrastructure in Pakistani-administered Kashmir.

"Our interventions are basically in five areas including roads, education, health, power supply and water and sanitation," Shaukat Shafi, a project implementation officer at ADB's country branch, told IRIN in the Pakistani capital, Islamabad, on Tuesday.

The five-year project is the ADB's first intervention to support the local government of Pakistani-administered Kashmir in tackling urgent needs in the basic social service delivery sector.

"Apart from these, we are also doing some institutional training and capacity building of different departments," Shafi added.

The ADB loan covers 75 percent of the total cost of $76 million, while Islamabad will contribute $19 million towards the project. The Muzzaffarabad-based Planning and Development Department (PDD) is the coordinating agency for the entire project.

"Investment under the project, together with the needed strengthening of related public agencies, are expected to provide the basis for sustainable economic growth, improve the well being of about 3.4 million people, and help reduce poverty in the state," said an ADB press statement, quoting Shakeel Khan, an Urban Development Specialist at the Manila-based multilateral funding agency.

With respect to health services, none of the eight district hospitals have proper emergency departments. Every year about 4,000 people die and a greater number suffer from some kind of disability because of poor facilities. At the same time, important departments such as paediatrics, gynaecology and surgical theatres lack basic essential equipment.

The ADB-funded project will support the provision of diagnostic facilities and needed medical equipment, in addition to rehabilitating various wards and constructing hostels for nurses and doctors.

According to the PDD, about 80 percent of schools have no safe drinking water and sanitation facilities, while the water supply networks and water treatment plant in all the districts' towns are in a poor condition. This causes cases of typhoid, hepatitis, cholera, and other gastrointestinal water-related diseases.

In education services, the project will rehabilitate and reconstruct the buildings of nearly 150 primary, middle and high schools of Pakistani-administered Kashmir.

Local authorities require a large number of bridges to link rural communities in the hilly terrain to nearby urban centres, according to PDD. The ADB project will also help in building suspension bridges and foot bridges to increase access to livelihood opportunities and social services.

Additionally, the project, due for completion in 2010, will support improvements in the power distribution network, replace transformers and procure maintenance tools.

Besides, the local government has developed its own 10-year Perspective Development Plan (PDP) 2001-2011 to improve the low levels of communication and social services.

The ADB has also approved a loan of $250 million for a similar physical and infrastructure development project in Indian-administered Kashmir, with an additional $108 million coming from the government of India and Kashmir's state government.

The ADB project will restore existing infrastructure facilities and services in two key areas of urban and transport sectors in the state. The urban sector component will cover water supply and drainage systems while the transport sector component will finance the rehabilitation of roads and bridges throughout the state.

The ADB, in its first major intervention by a multilateral aid agency in recent times, has approved two similar projects for both the Indian and Pakistani sides of Kashmir, ensuring to some extent that the security situation will improve in the area.

The two countries, Pakistan and India, have maintained a cease-fire across the diving Line of Control (LoC) since last year.

Meanwhile, the foreign ministers of the two countries on Tuesday concluded in Islamabad a two-day meeting focusing for the first time on the disputed state of Jammu and Kashmir. Both sides have agreed to carry on a wide-ranging peace process started early this year, with more talks on Kashmir and other issues in the months ahead.

Kashmir has remained a source of tension between India and Pakistan since both countries gained independence in 1947.

[ENDS]