Public Disclosure Authorized THE WORLD BANK & Climate Change Unit South Asia Sustainable Development Department Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Report No. 81090-PK Pakistan Strategy Note 2012-2016
Report No. 81090-PK Pakistan Strategy Note 2012-2016 THE WORLD BANK & Climate Change Unit South Asia Sustainable Development Department
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3 Contents Acknowledgments.............................................................. 4 Abbreviations................................................................. 5 Introduction and Context........................................................ 6 Objective..................................................................... 7 Evolution of DRM Structure...................................................... 7 Role of International Development Partners.......................................... 8 Challenges in the DRM Sector.................................................... 8 Institutional Capacity and Clarity............................................... 8 Coordination............................................................... 9 Understanding Risk.......................................................... 9 Bank's Strategic Approach to Advance DRM......................................... 9 Targeted Support............................................................ 9 Current Engagements........................................................ 9 Planned Bank Engagement................................................... 10 Bank Partners in Understanding Risk........................................... 11 Leveraging the Bank's Comparative Advantage...................................... 12 Risks to the DRM Program...................................................... 12 Unclear DRM Roles and Responsibilities....................................... 12 Weak Government Capacity.................................................. 12 Ownership and Identification of Champions within the Government.................. 12 Figure 1: Targeted Bank Support to Government Priorities as Identified in the NDRMF....... 9 Figure 2: Timeline of DRM Engagement........................................... 11 Figure 3: Engagement with Bank Sector Teams...................................... 11
4 Acknowledgments This strategy note was prepared by a core team comprising Marc S.Forni, Haris Khan, Shiraz Ali Shah and Ahsan Tehsin. The authors are grateful to the peer reviewers of earlier drafts of this note, including Raja Rehan Arshad, Christoph Pusch and Niels B. Holm-Nielsen. The authors would like to thank Rachid Benmessaoud, Bernice K. Van Bronkhorsht, Francis Ghesquiere and Reynold Duncan for their guidance in finalizing this note. The authors also express their gratitude for the cooperation and support received from Bank colleagues, including, Inaam Ul Haq, Alanna Simpson, Javaid Afzal, Umbreen Arif, Sarwat Aftab, Muqaddisa Mehreen, Jack Campbell, Kelly Johnson, Ayaz Parvez, Sonam Velani, Suhaib Rasheed, Shabir Ahmad, Shahnaz Meraj and Samia Sardar.
5 Abbreviations ADB BDMP CBDRM DDMA DFID DRFI DRM EC ERC ERRA FFC GFDRR GoP JICA MDTF NDMA NDRMF NWG PDMA PDRP PHRD PID SDN UNDP USAID Asian Development Bank Balochistan Disaster Management Project Community Based District Disaster Management Authority Department for International Development (UK) Disaster Risk Financing & Insurance European Commission Emergency Relief Cell Earthquake Reconstruction and Rehabilitation Authority Federal Flood Commission Global Facility for Disaster Reduction and Recovery Government of Pakistan Japan International Cooperation Agency Multi-donor Trust Fund for KP, FATA and Balochistan National Disaster Management Authority National Framework National Working Group Provincial Disaster Management Authority Partnership for Disaster Resilience in Pakistan Policy and Human Resource Development Provincial Irrigation Department Sustainable Development Network United Nations Development Programme United States Agency for International Development
6 Introduction and Context Pakistan is vulnerable to a number of adverse natural events including earthquakes, cyclones, tsunamis, floods, and droughts. These risks are further exacerbated due to growing urbanization and shifting climatic patterns, resulting in extreme and unpredictable weather events. Pakistan has experienced a wide range of major disasters in the past 40 years. The country is one of the most flood-prone in South Asia, with a number of floods having caused significant damage, particularly in 1950, 1992, 1998, 2010 and 2011. In particular, the floods in 2010 and 2011 caused damages and losses amounting to US$10 billion and US$3.7 billion, respectively. Earthquakes events are frequent, with the last major one occurring in 2005 that killed 73,000 people and caused US$5 billion in losses. Most of Pakistan experiences low rainfall and as much as 60 percent of the country is classified as semi-arid to arid, with the most susceptible regions experiencing drought 2 or 3 years every decade. Recent droughts include those of 2000 and 2002, which severely impacted livelihoods and forced thousands to migrate. Additionally, 14 cyclones have occurred over the past 40 years, the last major event being Cyclone Yemyin in 2007, which caused damages amounting to US$537 million. A consistent and long-term demographic shift of the population to urban areas and regions has turned cities into the drivers of economic growth in Pakistan. However, growing urbanization has also led to a greater exposure and vulnerability of urban population to disaster risks. Increased urbanization has not necessarily been driven through systematic land-use and spatial planning or conformity to building codes. Climate change could increase Pakistan's vulnerability to disasters. Shifts in weather patterns can result in an increase in glacial melt, sea level rise along Pakistan's coast, and increased periods without precipitation. Glacial recession will also result in less water inflow to the Indus River Basin. These factors may lead to an escalation in the intensity and frequency of flash floods, as well as drought events that could compromise potable water supply, irrigation water and power generation. A lack of understanding, as well as limited action by the government on (DRM) in Pakistan, further exacerbates the challenges in the achievement of development goals. To achieve an acceptable level of resilience, policy-makers must clearly understand and manage the risks that contribute to a disaster. The level of disaster resilience should be measured not just through infrastructure built or services delivered, but also through lives saved and losses minimized during a disaster event,
7 Objective The objective of the Bank's DRM engagement is to support the Government of Pakistan's (GoP) priority for improved institutional clarity and capacity in DRM, and understanding of disaster risk to increase resilience. Increasing the capacity involves the streamlining of roles and responsibilities of institutions, and strengthening operating procedures and protocols with the aim to mitigate risk, as well as prepare for and respond to disasters events in a more coordinated manner. Increasing the understanding of disaster risk is expected to lead to mitigation measures to reduce disaster vulnerability.the first phase of this engagement is supporting the National Working Group (NWG) on Risk Assessments to reach consensus on understanding of physical and fiscal disaster risk. Increased understanding of vulnerable infrastructure and development would lead to the development of a road-map for a multi-year investment program to increase disaster resilience. Evolution of DRM Structure in Pakistan was historically governed by the Calamity Act of 1958. Following a number of disasters, including the major Kashmir Earthquake in 2005, the GoPmade concerted efforts towards establishing a holistic DRM framework. As a result, the National Disaster Management Ordinance was issued in 2006, which established an institutional framework to address DRM in the country, including the National Disaster Management Authority (NDMA). The Ordinance was later superseded by the National Disaster Management (NDM) Act in 2010. In the aftermath of the 18th Constitutional Amendment, DRM roles and responsibilities were devolved to the provinces, which has compounded the fragmentation and proliferation of DRM actors. Nominally leading provincial coordination, are the Provincial Disaster Management Authorities (PDMAs). However, the PDMAs generally lack the human and technical capacity to manage DRM activities, while they also lack financial resources and convening power. Furthermore, the devolution of authority has resulted in a more limited and unclear role of NDMA with regards tocoordination, technical assistance, and policy support. Compounding this confusion, there are a number of entities working on DRM with overlapping mandates at the federal level, including NDMA which falls under the administrative control of the Ministry of Climate Change; the Earthquake Reconstruction & Rehabilitation Authority (ERRA), the Cabinet's Emergency Relief Cell (ERC), the Federal Flood Commission (FFC), and other ad-hoc relief committees. This multiplicity of institutions is also present at the provincial level, which include, PDMAs, the Provincial Irrigation Departments (PIDs), Relief Commissioner's Office, and the Civil Defence and Rescue Services. Similarly, there are a number of legal parameters covering disasters and emergency situations that overlap between government agencies and tiers.
8 Role of International Development Partners Recurring disaster events in Pakistan over the last decade have resulted in increased donor interventions. However, these interventions are primarily targeted towards humanitarian and recovery activities, and are often perceived as investments in DRM. The existing engagement of donors in the sector is limited by minimal financial resources spread too thin across various themes. Lack of concentrated and material resources inhibits international partners from holistically addressing DRM in Pakistan. With regards to specific donors, the main actors are DFID, JICA, USAID and smaller nongovernmental organizations (NGOs). DFID is currently in the process of developing a DRM program in collaboration with the Bank team, with potential resources between US$15 and $50 million. JICA is developing a National Disaster Management Plan which is now at the consultation stage. USAID is preparing a Community based DRM program which it intends to implement through NGOs. In addition, the UN is engaged in a dialogue with the government on a potential program, for which funding sources are not yet clear. NGOs are also involved in limited community based programs. To help keep Government and development partners informed of developments in DRM, the Bank is part of the Partnership of Disaster Resilience in Pakistan (PDRP), which includes the Bank, ADB, JICA, UN, US, EC and DFID.Additionally, the Political Champions Group has been created to improve the visibility and focus on DRM in countries including Pakistan. The Group meets regularly on the sidelines of the Bank's Annual and Spring Meetings and comprises: the heads of UNDP, DFID, USAID, EC, JICA, and the VP of the SDN Network. Challenges in the DRM Sector Three key challenges impede action in DRM, including: i) weak institutional clarity and capacity; ii) limited effective coordination at the federal and provincial levels; and iii) lack of consensus and understanding of disaster risk to inform decision-making and guide investments to build resilience. Institutional Capacity and Clarity: The NDMA and the PDMAs are relatively new and weak organizations that have limited funding capacity to convene line ministries and other government agencies. The DMAs receive weak political support and are unable to engage with other sectors. A high-rate of turn-over and staffing issues are also persistent across all DMAs. The District Disaster Management Authorities (DDMAs) represent the weakest link in the institutional chain. Effectively, DDMAs are inter-departmental committees at the district level, and are seldom operationalized, other than when a disaster occurs. The capacity constraints are further exacerbated due to insufficient communications systems and network of support available at the national, provincial and local levels. Overall, institutional and technical knowledge to support mainstreaming DRM remains limited.
9 Coordination: The multiplicity of institutions at both the federal and provincial levels has created uncertainty and non-clarity regarding roles and responsibilities. The post-18th amendment context, and devolution of DRM responsibilities to the provinces, has further created confusion on the roles of NDMA and line ministries / agencies.this situation results in a lack of coordination which hinders effective development planning and disaster response. Understanding Risk: A comprehensive hazard and risk assessment is yet to be undertaken for the country. There is a lack of essential risk information such as baseline data and risk profiles for different geographic areas of the country, hampering policymakers from devising holistic DRM interventions. There is an absence of a standard methodology for risk assessments, as well as very limited collaboration between technical agencies. Furthermore the absence of a fiscal risk assessment has also led to the underestimation of fiscal impact on disasters. Overall, a lack of understanding of disaster risk hinders investment in resilience across sectors. Bank's Strategic Approach to Advance DRM Targeted Support: The Bank's approach to DRM is proposed to be selective and focused. It aims to support the top two government priority areas identified in the National Framework (NDRMF) and other policy documents: i) Institutional and Legal Arrangements and Capacity; and, ii) Hazard and Vulnerability Assessment. Figure 1 presents the proposed approach and detailed below is the Bank's current engagements to support the strengthening of these pillars. Figure 1: Targeted Bank Support to Government Priorities as Identified in the NDRMF Institutional and Legal Arrangements & Capacity Hazard and Vulnerability Assessment Training, Education and Awareness Community and Local Level Programming Planning Multi-hazard Early Warning Systems Mainstreaming DRR into Development Emergency Response Systems Capacity Development for Post Disaster Recovery Current Engagements: In line with the overall objective, the Bank's targeted support is currently focused on addressing two pillars of obstacles toward advancing DRM: i) improved institutional clarity and capacity; and, ii) increased resilience.
10 Under the first pillar, the Bank has the following projects under implementation: Balochistan Disaster Management Project (BDMP): The US$5 million grant has been funded through the Multi-Donor Trust Fund (MDTF) to strengthen the capacity of PDMA Balochistan to prepare for and respond to natural disasters. The project includes institutional strengthening of PDMA Balochistan. Strengthening Pakistan's Urban Disaster Response Capacity: The objective of this US$3 million grant, financed by Government of Japan's Policy and Human Resources Development (PHRD) fund is to develop appropriate methodologies and guidelines for assessing and subsequently enhancing the capacity of two municipal agencies to engage in disaster response. This activity is particularly important keeping in view the recurrent annual flooding disasters since 2010 in the country. Under the second pillar, the Bank has the following projects under implementation: Innovation in Risk Assessment and Financing: This US$2 million joint GFDRR and DFID grant aims at supporting the government in advancing the understanding of risk and developing financial protection strategies. The program will support the development of the country's data gathering, risk modeling and risk financing capacities. This is the first and only national engagement of the Political Champions group formed to raise awareness of the importance of DRM. Development of a Program for Hazard and Risk Assessment in Urban Areas: The objective of this US$500,000 GFDRR-funded activity is to increase the capacity for hazard and risk assessment in Pakistan. It will be implemented in two pilot cities and is designed to contribute to the creation of a replicable assessment framework for the country. Planned Bank Engagement: The Bank plans on further building on the activities under the two pillars to address existing weaknesses. Under the first pillar, the Bank would continue to support capacity building of DRM institutions, including the NDMA and PDMAs. This would also involve scaling up the Balochistan project to other provinces to strengthen DRM systems at the provincial level. Under the second pillar, the Bank plans on completing the ongoing initiative of understanding of physical and fiscal risk, which would lead to implementation of a disaster risk financing program, and the development of an investment program to reduce physical vulnerability through infrastructure investments. Figure 2 provides an overview of the DRM engagement over the course of this strategy (2012-2016):
11 Figure 2: Timeline of DRM Engagement 2012 2013 2014 2015 2016 - Balochistan DRM Project Approved - National Working Group on Risk Assessment (NWG) Notified - Understanding Risk Program Initiated - DRM Strategy Finalized - Training and Capacity Building of NWG - Disaster Fiscal Risk Assessment Completed - Initiate National DRM Institutional Assessment - Development of Risk financing instruments - Establishment of National Data Platform for Risk Assessment - Develop program to address institutional constraints in DRM at various tiers of Government - Development of national disaster resilience investment program based on results and recommendations of the NWG - National program to increase physical resilience to natural disasters Bank Partners in Understanding Risk: The DRM team is currently engaged with other Bank sector teams to improve the understanding and consensus of physical and fiscal risk. Key collaborations are bulleted below and Figure 3 provides an overview of this engagement. Collaboration with other sectors does not necessarily translate into the mobilization of extensive resources; rather it builds on the work of each other. Social protection: Collaboration in immediate recovery efforts, with potential DRFI support to manage the government's contingent liabilities. Finance and Private Sector Development: Joint effort to increase the capacity of catastrophe markets and agreed to speak with one voice to the relevant actors. This will be achieved through regular discussion and the sharing of analytical results to ensure a joined-up approach. Education: Collaboration in Sindh and Balochistan on resilient construction through the on-going education sector programs. Additional support may be provided through the Safe School Program, should these funds materialize for Pakistan Environment: Work to reach consensus within GoP on flood risk and streamlining flood response and agreed to advance understanding of flood risk together. GFDRR: The Understanding Risk program in Pakistan is viewed externally as the global flagship engagement for the Political Champions Group Figure 3: Engagement with Bank Sector Teams Addressing fiscal risk Social Protection support to disaster recovery FPD insurance analysis PREM fiscal impacts Addressing physical risk Education Support to safe schools Water flood risk assessment Urban Punjab risk management Health structural vulnerability and health systems
12 Leveraging the Bank's Comparative Advantage The Bank's broader experience in DRM ranges from preparedness and mitigation to responding to post-disaster recovery and reconstruction challenges in many countries. In Pakistan, the Bank is increasingly seen as an important player in DRM both by development partners and government, particularly on providing support for carrying out risk assessments and establishing risk transfer mechanisms. The Bank's comparative advantage in the DRM sector is derived from a combination of the following factors: i) technical capacity and global leadership on development and DRM; ii) capacity to provide financial resources to increase physical resilience to disasters; iii) ability to crowd-in soft resources from development partners due to fiduciary capacity and reputation as a leader in the field; iv) demonstrated convening power to bring together scientific communities, donors, civil society groups and government counterparts to address development challenges; and, v) ability to support the program with concessionary financial resources and innovative financing products. Risks to the DRM Program Several key risks for the implementation of the DRM program have been identified, based on current and past country and sectoral experiences. Unclear DRM Roles and Responsibilities: The absence of clarity of roles and responsibilities of government institutions is a major challenge to the DRM program. However, the program itself seeks to mitigate this risk through upstream activities such as development of procedures and protocols. Overlapping roles of multiple government agencies can also potentially lead to duplicity of the Bank's program vis-à-vis other donor-funded programs. However, this should be mitigated through the Partnership of Disaster Resilience in Pakistan. Weak Government Capacity: The DRM institutions at the federal, provincial and district levels are at a nascent stage of development and are faced with considerable capacity challenges. In turn, the weak capacity of these institutions contributes towards overall implementation risk of the Bank program. The project level activities of the DRM program will seek to mitigate this risk through provision of support for capacity building, particularly at the provincial level. Ownership and Identification of Champions within the Government: Since a recent paradigm shift has been experienced in the government's approach to DRM, it is critical to ensure that champions of change are identified within the government. The Bank has been, and will continue to remain, in a regular dialogue with the government at all levels, so that DRM continues to remain a priority for the government.