The New Nation - Internet Edition

Staff Reporter

The World Bank (WB) sees the prevailing state of emergency "as part and parcel" of the current Caretaker Government and does not find any problem in giving logistic support for relief and rehabilitation due to it.

The International lending agency announced an additional US$25 million support along with the US$250 million commitment it made in the immediate wake of cyclone. The WB will also release immediate budgetary support of US$100 million.

Visiting WB Vice President Praful C Patel made the new pledge at a press conference at Westin Hotel at Gulshan in the city yesterday. Agriculture and Environment Adviser Dr CS Karim also addressed the joint press conference when ERD Secretary Aminul Islam Bhuiyan and World Bank Country Director Xian Zhu were present.

"Seeing firsthand the devastation caused by Cyclone Sidr was shocking," said Patel of his visit to Kolapara Upazila of Patuakhali district. "More is needed, more is deserved by Bangladesh in the way of international community support, as the magnitude of the devastation is huge and the challenge of rebuilding the lives of the victims is formidable," he added.

The Caretaker Government is doing well in many respects and the WB has good relations with it," he said adding, "We do not wait for political development in Bangladesh, for the Cyclone response is needed today."

The WB official also urged the development partners of Bangladesh to support the disaster-prone country as it shifted into high gear to meet the challenges of future disasters and the likely increase in impact caused by climate change.

"The Government alone cannot deal with a problem of such enormous magnitude," he said appealling to both Bangladesh citizens and the international community to help the country out of its economic difficulties.

In the immediate aftermath of the cyclone, the WB offered up to US$250 million in assistance to cover immediate, medium-term and long-term needs. Fast-moving budget support of US$75 million was to have been available after the WB Board's approval by January but Patel said the scale of what he had seen during his visit had prompted him to recommend to the Board to increase that to US $ 100 million as a gesture of further support to reduce pressure on the current years (FY 8) budget.

An amount of US $ 50 million will be provided as grant from Global Disaster Reduction Fund. Of the total, US$ 50 million would be available by April next year to help people rebuild their livelihoods and remaining US4 125 million for supporting the long-term vision of disaster prevention and management as articulated by the Chief Adviser.

The WB official observed Bangladesh economy has been burdened by three adverse shocks of increase in international prices of oil, food and other commodities, twice floods in July-September and the destruction by Cyclone Sidr.

He said international price shocks alone are likely to inflict losses to the economy this year to the tune of US$ 1.6 billion, equal to 2.3 per cent of the GDP.

"Moreover, in the absence of any domestic price adjustments, rising oil and fertiliser prices are putting an inordinate fiscal burden on the FY08 budget," Patel noted.

He said the preliminary numbers on damages suggest that the magnitude of loss suffered by the economy due to two natural disasters is very large-floods causing over US$ 1 billion and cyclone probably over US$ 2 billion.

The World Bank, Patel said, may further increase its assistance once the needs-assessment mission submits its report by January.

Asked whether a democratically elected government could be effective to deal with the enormous rehabilitation work, Praful C Patel said, "We do not wait for political development in Bangladesh, for the Cyclone response is needed today."

He said, this Caretaker Government is not the same kind of the previous one. Tenure of this Caretaker Government is not limited to three months. It will stay in power for two years - nearly a half of the tenure of a regular political government. Development works cannot be suspended for so long

To another question, the World Bank official said he did not see any constraint on logistic support to relief and rehabilitation due to the state of emergency, which he said is part and parcel of formulating the current caretaker government.

Patel however said the issue of increasing the capacity of the administration needs to be addressed. He noted that the running of 46 ministries and the amount of job stretches the capacity of the caretaker government.

Adviser Dr CS Karim, however, said the capacity means the entire process starting from the decision-making to implementation. He said there is no problem with the decision-making process, but the implementation depends on bureaucracy.

"It is a constitutional question whether to increase the number of Advisers of the caretaker government," he told the press meet.

On climate change, a red-hot global issue of the day, Patel said the problem of greenhouse gas emissions put Bangladesh in a more difficult situation as the challenge now is natural disaster augmented by this phenomenon (climate change).

He said dialogue with India to deal with the climate change would be important as Bangladesh and India have 54 shared rivers calling for a shared vision of development.

"We need to integrate adaptation strategy into all policy- making and new infrastructure decisions," he told the journalists. The World Bank senior official said Bangladesh would be the first country to get benefit from global fund on climate change.

Asked if the WB has any plan to waive the loan interest or lower the interest rate, Patel replied in the negative. Bangladesh is not a debt-stressed country for getting debt relief and the government here did not ask for it, he said.

Patel, who met the NBR chairman during his 3-day visit, praised the National Board of Revenue drive to increase the revenue collection by 23 per cent this year. The NBR chairman informed him that it would go over 70 per cent next year if the current drive continued.