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Netherlands: Pakistan's trade partners.

The Netherlands has maintained development cooperation relations with Pakistan since 1962. An annual development budget of some 60 million guilders (30 million dollars) is available, although this sum may vary slightly from year to year. This stable relationship reflects Pakistan's status in the Dutch development cooperation programme; it is one of the ten "programme countries" with which the Netherlands cooperates most closely.

From many years now the Netherlands has earmarked 1.5 per cent of its net national income (that is, approximately 1 per cent of its gross national income) for development cooperation. This makes the Netherlands one of the few countries which not only meet the United Nations' recommendation on the proportion of national income to be allocated for development cooperation, but actually contributes more. The recommended proportion is 0.7 per cent of gross national income.

While in the early years of Dutch-Pakistani development cooperation the main emphasis was placed on supplying goods, project aid has become increasingly important over the years. Since 1987 no activities have been funded through loans. The Netherlands now supplies Pakistan with funds in the form of grants only.

Some 30 per cent of the annual budget is spent on goods-generally artificial fertiliser. About one quarter is used for co-financing through international organisations; this means that various projects organised in Pakistan by such institutions as the World Bank or the Food and Agriculture Organisation (FAO) are funded by the Netherlands.

After deducting 30 percent for goods supplies and approximately 25 per cent for co-financing, rather less than half of the Netherlands' budget for development cooperation with Pakistan is left for other projects. These are organised on a bilateral basis. As a large number of countries are involved in contributing towards Pakistan's development, the Netherlands has decided, following consultation with the Pakistani authorities, to focus cooperation on particular sectors of the economy and particular regions of Pakistan. As regards the sectors, the Netherlands directs the main thrust of its support towards the structural improvement of rural living conditions, small-scale industry and institution building. The bulk of Dutch development cooperation is aimed at the regions of Balochistan and North West Frontier Province, although some small-scale industrial projects in the Punjab are also undertaken.

Rural Development

Integrated rural developments is the key to bringing about structural improvement in rural living conditions. The concept involves not only agriculture and animal husbandry, but a multitude of interlinked factors which combine to shape rural life. Examples of projects of this nature in Pakistan include the following: - Pate Groundwater Development a well creation project aimed at improving agricultural production; - Social Forestry in Malakand, a reforestation project with marked social aspects; - Groundwater Investigation in North West Frontier Province, a project aimed at helping the authorities to chart the available groundwater resources; - The Aga Khan Rural Support Programme, a rural development programme implemented by a non-governmental organisation, the aim being to help villagers to improve their own lives both technical and financial terms.

Small-scale Industry

The purpose of small-scale industrial projects is to enhance the expertise and the income of small-scale entrepreneurs. Those projects which receive Dutch support therefore place particular emphasis upon the transfer of technology, raising productivity and strengthening the position of industry in rural areas. Examples of such projects include the following: - Pak Holland Metal Project in North West Frontier Province, aimed at small-scale entrepreneurs in the metal industry; - PSIC Credit Facilities in the Punjab, a project which provides small-scale industrial entrepreneurs with credit facilities and information; - Metal Punjab MIDC, which involves the transfer of knowledge about the production of surgical instruments.

Institution Building

Institution building is a form of cooperation whereby donor countries help to improve standards in educational establishments and government institutions. Projects through which the Netherlands is helping Pakistan in this respect include the following: - The Fauji Fertilizer Training Centre, which trains people for employment in the fertiliser industry; - The ADBP Agricultural Training Centre, which trains mobile credit officers; - Human Resources Development, which supports the Manpower Division in the field of data collection and research; - The Social Accounting Matrix, which assists the Pakistan central statistics office with the national accounts; - Agricultural research and information activities in cooperation with Peshawar Agricultural University; - Animal Husbandry: aid to an establishment for the training of animal husbandry instructors.

Topics of Particular Interest

Among development cooperation activities with those countries with which the Netherlands maintains the closest ties including Pakistan it is generally possible to identify topics of particular interest to which the Netherlands devotes special attention.

One of these topics is that of women and development. Care is taken to consider the potential impact of each project on women. Special projects to improve the position of women are also undertaken. Examples include the Matric Education Project, an educational project aimed specifically at women, and the Secretariat Training Programme. The Netherlands is also supporting a project known as Craft Development for Women in the Punjab.

In the field of sanitation, the Netherlands is backing the large-scale Quetta Sewerage and Sanitation Project, which aims to provide the town of Quetta with a system to sewers and sanitary facilities. This project links up with rural development, in that it involves purifying sewage for use in irrigation. Humanitarian aid falls outside the normal relationship between the donor and the recipient of development aid. Through a special programme the Netherlands is supporting the refugees who have sought refuge in Pakistan over the last few years.

Finally, it is worth mentioning that some 20 Pakistan nationals travel to the Netherlands each year to take short course, most of which are at postgraduate level. They are thus able to acquire further expertise in their own professional field, enabling them to work more efficiently in Pakistan.
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Publication:Economic Review
Date:Apr 1, 1990
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