World Bank warns Pakistan’s diversion of Balochistan housing funds could deepen poverty

Islamabad: The World Bank has expressed serious concern over the decision to redirect funds meant for a multi-billion-rupee resilient housing programme for flood-affected families in Balochistan towards infrastructure projects, warning that the move could deepen poverty and increase disaster-related vulnerabilities, Dawn reported.

In a detailed communication to the federal authorities, the World Bank cautioned that withdrawing housing assistance from eligible families could cause existing socio-economic vulnerabilities to worsen over time, according to Dawn.

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The bank said 84 per cent of the eligible beneficiaries are classified as ultra-poor and vulnerable. Around 28 per cent earn less than USD 30 a month, while another 26 per cent earn between USD 31 and USD 70. Dawn reported that 39 per cent of beneficiaries are tenants, 37 per cent are daily-wage workers and eight per cent are small farmers.

The World Bank noted that these households generally have limited savings, poor access to formal credit and few productive assets, leaving them with little ability to withstand economic or natural shocks.

World Bank Country Director Boloromaa Amgaabazar raised the concerns following meetings with Pakistan's federal planning minister and other officials. The discussions followed a decision to cap housing support at 62,966 first-tranche beneficiaries as of June 22 while subsidy assistance was limited to 97,000 households, Dawn said.

According to the media outlet, the World Bank warned that the decision had left 119,049 verified and eligible households without identified financing support.

The bank also expressed concern over the public announcement of the decision before a joint communication strategy had been finalised. Dawn reported that 66,120 exclusion-related grievances had already been registered in the project's grievance management system by the agreed cut-off date.

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World Bank Country Director Amgaabazar called for every complainant to be individually informed of the decision, with written confirmation or verifiable proof of communication shared with the bank.

The World Bank warned that excluded families could be pushed into a cycle of deeper poverty and rising disaster risks. Families may be forced to divert money from food, healthcare and education to repair temporary shelters, while taking on debt or selling productive assets, Dawn reported.