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Submitted by Amin Mahmood on
A lot of funds are pouring in from international financial institutions including The World Bank but have failed to yield the desired results. A lot of soul searching is required. Merely contributing it to the massive corruption prevalent in the society does not provide the solution. A critical analysis is required of the corruption cycle in Pakistan, in general, and in South Asia in particular. It needs to be noted that this malady has spread in all directions as a result of which in the current scenario it is now affecting both the public and private sectors. Apparently, corruption has now evolved into a vicious circle in which a large section of the populace is involved, with a majority involved in the practice based on the somewhat logical, yet unethical, argument that they need to cover the financial loss incurred by them as a result of extending illegal gratification to third parties for getting their own 'work done' by indulging in malpractices for similar monetary-cum-financial benefits when it is their own turn. Hence, the Government Contractor in connivance with the Project Consultant (both of them selected through non-transparent criteria) more than recover their 'investment' in government officials, by ensuring inclusion of exaggerated item-rates while preparing Rate Analysis/tender documents. The equipment and materials supplier ensures his pound of flesh by providing below specification (many times used) items of poor quality and make, as branded and made in 'USA'/ 'Europe'. Further dividends are shared between the main contractor and the supplier, with the Consultant more than happy to vet such deals for either a monetary consideration or in order to consolidate his position as the 'right' consultant in the relevant quarters. In this chain of events no one is really interested in quality. As a result, the end product not only fails to perform for the designed period but also generally becomes a financial liability in the very first few years. More loans are obtained from DFIs and developed nations in the name of 'upgradation and rehabilitation' of the original project, actually meaning thereby that poor procurement resulted in the collapse of the original works twenty years before the actual design life. The financial system of the country is near to collapse due to such loans (originally meant for better causes). Direct and indirect taxes are time and again increased. Those who can escape through further corruption whereas the poorer sections become more burdened and life goes on for some and ends for some far sooner. It is very obvious that the procurement strategies adopted by the Bank have failed to yield the desired results here. With monitoring and evaluation of such projects and loans provided by DFIs etc. left to local agencies, esp. at the micro levels, this is bound to happen. Hiring more ineffective 'Consultants' aloof of South Asian realities is not the answer. A major review is definitely required of the respective strategies urgently and till suitable capacity building has been achieved locally, financial institutions need to involve themselves in M&E, even if a small part of the loan has to be sacrificed for putting into such use. Although, this is probably beyond the normal working of the DFIs, however, it is most essential if such financing is required to yield the desired results, as yet in reality typed in Project Initiation Reports only. Otherwise, the local perception of such loans being merely political tools keeps strengthening with time.