DESCRIPTION:

Design of a US$ 120 Value Chain investment program in Southern Punjab for ADB. The project aimed at assessing the agro-economic conditions (environment and climate change) and investment climate constraints influencing the future growth, employment and poverty status of three districts within the Southern Punjab wheat and cotton zones: Bahawalpur, Bahawalnagar and Rahim Yar Khan. The focus of the assignment was, therefore, on analysis of the overall economic conditions within which private sector development is taking place, with a particular emphasis on identifying the binding constraints to growth being faced by smallholders and the landless in particular. As part of the diagnostic work, an investment climate survey was conducted among 533 business enterprises, small holders and landless.

 

This diagnostic combines a number of elements, including incorporation of survey results from a mini-investment climate survey conducted among 533 business enterprises, small holders and landless to identify the key binding constraints that inhibit growth at the district, sub-sector and households levels.  The results of the survey are striking: indicating that (i) macroeconomic instability (largely inflation) (ii) the high costs of finance (ii) lack of access to finance (iii) corruption and high business transaction costs and (v) poor security fundamentally restrict entrepreneurial activity, minimize business adaptation, create a high risk high cost business environment that limits graduation from the informal to formal sectors, and in the process guarantees that small scale, low productivity, low value added activities dominate the entire economic profile.

 

ACTIVITIES UNDERTAKEN:

Growth Diagnostic work and assistance to the Government of Punjab in the development of a US$120 million investment climate support program focused on SME development, value enhancement, business development support and micro-finance in support of economic diversification. Investment climate survey among 533 business enterprises, small holders and landless to identify the key binding constraints that inhibit growth at the district, sub-sector and households’ levels in the three project districts of Bahawalpur, Bahawalnagar and Rahim Yar Khan. Conduct of focal group discussions were conducted with key stakeholders and key informants both within Bahawalpur and the project districts over the survey period.

 

OUTCOME:

Bankable US$120 million investment program supported by a full Value Chain Assessment and economic growth diagnostic and survey.

 

PROJECT DETAILS: