WASHINGTON, DC, July 1, 2010 -- The World Bank today approved a credit worth US $146 million for the second phase of the Pakistan Barrages Improvement Project to rehabilitate and modernize the Jinnah Barrage, and to improve irrigation and water management.
Pakistan has enjoyed good economic performance in recent years, emerging as one of the fastest-growing economies in Asia, with rising per capita income and improved social indicators. Agriculture being the backbone of Pakistan's economy, employs 50 percent of the labor force( directly or indirectly) and earns 600 percent of export revenues. The agriculture sector contributes around 25 percent of GDP. Pakistan's agriculture system is wholly dependent on irrigation- irrigated land supplies more than 90 percent of agricultural production.
"Improvements in basic infrastructure including water supplies are critical to improving human development outcomes," John Wall, World Bank Acting Country Director for Pakistan. "With growth there has been an increase in demand for better infrastructure. However, Pakistan's infrastructure platform needs significant investment in order to support Pakistan's growth and service delivery goals."
Punjab Barrages Improvement Phase II Project aims to strengthen and modernize Jinnah Barrage and affiliated works to enable reliable and uninterrupted supply of water for over 2.1 million acres of farmland benefitting about 600,000 farm families for irrigation and domestic water users; and to build the capacity of Punjab Irrigation and Power Department's ( IPD) in water resource management and irrigation system management.
"The development and management of water resources of the Indus Basin is a huge challenge, requiring very high levels of administrative engineering and scientific capability. While there has been progress, the current irrigation and drainage system suffers from deteriorating infrastructure and weak governance," said Masood Ahmad, World Bank Lead Water Resources Specialist and Project Team Leader. "To reduce volatility to growth, Bank support will include rehabilitation of barrages and continued capacity development at the regional and federal level for managing water resources."
The World Bank has a long history of partnership and collaboration with Pakistan and has supported more than 48 operations in irrigation, drainage, water resources development and the power sector. Jinnah Barrage is one of the highest priority barrages in the Indus System as it provides a bridge over the Indus River to link the roads between the Khyber Pakhtoonkhwa and Punjab provinces.
The credits from the International Development Association (IDA), the World Bank's concessionary arm, have 40 years to maturity with a 10-year grace period; they carry a service charge of 0.75 percent.