US envoy warns Pakistan of shortfall in funding for flood recovery efforts
KARACHI, Pakistan — The world will be able to fund only around 25 percent of the tens of billions of dollars needed to rebuild Pakistan after the floods, and its government will have to make up the shortfall, the US envoy to the country warned yesterday.
Richard Holbrooke said America would place no conditions on its assistance to the country, but warned that Congress might not be generous if it felt that Pakistan was not taxing its own citizens enough.
Pakistan’s rich have traditionally not paid much tax on their income or their property, either because they evade taxes or are exempt. The country’s collection rates are among the lowest in the world.
Critics have pointed to this shortage of revenue in recent weeks as Pakistani leaders have sought international aid. The country’s economy is surviving on international assistance, and the floods are expected to slow economic growth further.
“I don’t want to withhold money they need, but I think we have to be clear that the Congress is going to be reluctant to give money if the money is filling in a gap because people are not paying taxes,’’ said Holbrooke during a visit to Karachi.
Monsoon rains triggered massive floods six weeks ago that spread across the country and still continue in parts of the south. Some 8 million people have been made homeless in what Pakistani and UN officials have said is one of the largest humanitarian disasters in living memory.
The United Nations said last week that it had received $310 million toward its initial emergency appeal, although private and bilateral donations bring the global total committed for Pakistan flood aid to roughly $1.1 billion. On Sunday, donor nations are meeting in New York to appeal for more.
America has given more than $260 million for flood relief and has provided 30 military helicopters to evacuate people and deliver food and supplies.