ISLAMABAD, March 1: The military and its growing corporate interests are hampering poverty reduction efforts and effectiveness of bureaucracy and judiciary in Pakistan.

This has been stated in the Country Assistance Plan (CAP) of the United Kingdom's Department for International Development (DFID) for Pakistan that was launched here on Tuesday by British High Commissioner Mark Lyall Grant on behalf of DFID Minister Gareth Thomas. He suggested that economic management should be done only economists.

The DFID would spend about 70 million pound (Rs8.9 billion out of total Rs27 billion) in Pakistan during the current financial year and would increase the assistance to 90 million pound in 2007-08.

The CAP said the government had made a number of public commitments to poverty reduction but analysis showed that there were powerful and deep-rooted obstacles like the structure of land ownership, the skewed distribution of income and wealth and differences based on kinship, ethnicity, religion and gender.

Responding to a question, the high commissioner said the role of military in economic fields had been increasing in the last 28 years. He stressed that the economists in Pakistan should, like in the UK, be involved in the corporate business instead of government or any of its arms including military.

The DFID said corruption also remains a major problem in both public and private sectors, although there has been a noticeable improvement in the government's efforts to acknowledge and deal with it.

Audit institutions, including the public account committee, are weak, but have made some progress in the recent years. This means that a vital parliamentary check is now in place.

Talking about poverty reduction priorities, the DFID said most poor people live in rural areas and depend largely on agriculture for their livelihood. Many people living on or just below the poverty line are vulnerable to unexpected events such ill health, crop failure, environmental degradation, natural disasters and changes in volatile international markets.

Unemployment and weak governance are a growing source of social disaffection. Stronger economic growth, which is more evenly distributed, is needed to lift more of the poor out of poverty, the DFID said.

Talking about devolution programme, the DFID said the programme was protected under the constitution until 2009 though, as with any thoroughgoing local government reform, it is likely to take longer to bed down completely.

"Helping to build a consensus in Pakistan around the opportunities it offers for improving life for ordinary Pakistanis is a vital challenge for all tiers of government", it added.

The DFID would focus on three strategic outcomes under the CAP which includes greater accountability of the state to its citizens, improved delivery of education and health and population services to the poor and increased incomes for the poor.