The official exchange of notes for the NPGA were duly signed and exchanged in Islamabad on Tuesday between the Ambassador of Japan in Pakistan, Chihiro Atsumi and Secretary of Economic Affairs Division, Sibtain Fazal Halim, on behalf of their respective governments.
The non-project grant aid is a mode of budgetary support used by developing countries to supplement economic structural adjustment efforts and to overcome economic disparities and difficulties.
The NPGA is an important assistance that can be delivered quickly, and represents the long-term commitment of Japan for development of Pakistan as well as for stability of the region.
The NPGA will be used for importing commodities and machineries from Japan, such as oil, medicine, fertiliser and tractors, etc.
Pakistan will then deposit all the proceeds from sales or lease of imported commodities and machineries in local currency as the Counter Value Fund (CVF).
The CVF is expected to be utilised for economic and social development in Pakistan, such as construction of schools, scholarship for university students and distribution of medication for low-income people.
Japan is the second largest donor to Pakistan. In the Friends of Democratic Pakistan (FODP) and donor conference held in Tokyo in April this year, Japan committed one billion dollars to Pakistan out of which about 30 per cent is in grant mode, both project and non project.
Besides, yen loan assistance for projects, Japan has agreed to extend $150 million for the first time as budgetary support to Pakistan.
A press release issued by the Economic Affairs Division says Pakistan values Japanese government’s assistance in the fields of education, health, energy, environment, disaster management in general and for this grant, in particular.
The Japanese assistance in economic cooperation has played a key role in the development of our social sector with specific focus on human resource development and poverty reduction, it says.
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