Pakistan PRSC I

closed

This Poverty Reduction Support Credit Project (PRSC) will support the implementation of the Government's Poverty Reduction Strategy Paper (PRSP), which focuses on: accelerating economic growth, while maintaining macro stability, by improving governance and devolution, and investing in human capital, but targeting the poor. It will contribute to sustaining rapid growth by a) creating fiscal discipline, and reducing public debt, towards maintaining macroeconomic stability; b) improving expenditure management; and c) reducing the business environment costs. The PRSC will also support improvements in governance through reforms in financial management, procurement, and other anti-corruption and public accountability institutions, in addition to the civil service reform, particularly in devolution, i.e., through the transfer of increased resources to lower levels of government. The PRSC program will support accelerated progress in human capital, by focusing on measures that are the responsibility of the federal government, namely, strengthening national sector policy in health and education; improving the public expenditure framework for health and education; and, promoting increased data generation, monitoring of outcomes, and program evaluation. The PRSC will further support improvements in Pakistan's safety nets, so as to improve targeting, and ensure that the poor and vulnerable are covered. While risks exist, the project's sustained, and deepened policy dialogue, and the support to capacity building of key government institutions, will far outweigh those risks.