Japan's Official Development Assistance White Paper 2009
Section 2 Assistance for Pakistan's Efforts to Stabilize the Economy and Eradicate Terrorism
1. Significance of assistance to Pakistan
After Pakistan conducted nuclear tests in May 1998, many donors, including Japan, scaled down their assistance to Pakistan. Foreign investment as well as remittances from Pakistanis living overseas also decreased. As a result, the economy worsened in Pakistan. However, in response to Pakistan's decision to take counter-terrorism measures in coordination with the international community following the terrorist attacks in the United States on September 11, 2001, Japan decided in October of that year to discontinue the measures it had taken to date that reduced Japan's assistance to Pakistan (suspension of grant aid and ODA loans for new projects, excluding emergency and humanitarian assistance and grant aid for grassroots projects). Furthermore, based on Japan's Country Assistance Program for Pakistan formulated in February 2005, Japan has provided assistance to Pakistan for the development of economic and social infrastructure, such as electricity, transportation, and agricultural infrastructure, as well as assistance in the area of basic human needs, such as education, health and medical care, and water supply and sanitation. The assistance provided by Japan to Pakistan after the terrorist attacks in the United States from FY2001 to FY2008 has amounted to approximately 105.9 billion yen in ODA loans, approximately 56.8 billion yen in grant aid, and approximately 13.1 billion yen in technical assistance.
Pakistan plays a vital role in the international community's efforts to eradicate terrorism. The stable development of Pakistan as a "moderate and modern Muslim state" is crucial in light of the country's contribution to the peace and stability of the neighboring region, including Afghanistan, and of the entire international community. At present, Pakistan, in addition to counter-terrorism measures, faces a serious economic situation. Pakistan's own efforts will be essential to resolve these challenges, and at the same time, it is important for the international community to come together and support these efforts.