NationalVOLUME 15 ISSUE # 06

Loans for youths

Prime Minister Imran Khan has launched a new programme under which young men and women will be provided with loans to set up businesses. It is yet to be seen how the scheme will be different this time, because all such programmes failed in the past and promoted corruption in society instead of creating desired results.
Prime Minister Imran Khan has set aside a sum of Rs100 billion for his government’s flagship initiative “Kamyab Jawan Programme,” under which youths would be provided with loans to set up their own businesses besides creating education and skill development opportunities for them. Over Rs25 billion has been allocated for women. Loans of up to Rs100,000 will be interest-free while those ranging between Rs100,000 and Rs500,000 in two other categories would be provided at low interest rates. The programme aims to benefit one million young people. The loans will be distributed on a priority basis in 45 underprivileged districts.
According to Prime Minister Imran Khan’s own admission, the government had launched the project despite facing a severe financial crunch. Critics say the government should have launched a better programme in the current situation to provide meaningful relief to the common people, instead of a scheme which has failed miserably in the past. When the Pakistan Tehreek-i-Insaf (PTI) was in opposition, it had termed former Prime Minister Nawaz Sharif’s Youth Loan Scheme an initiative to launch his daughter Maryam Nawaz in politics and promote corruption among youths. The time proved the PTI’s apprehensions right. The same apprehensions are being expressed today about the PTI’s loan scheme, which critics say will also prove right in future.
The PTI government claims to uphold merit in the scheme. Under the programme, Rs10 billion will be spent on the development of skills among youths. It plans to provide placements and apprenticeship to 25,000 people and smart laboratories will be set up for distance learning and at least 200 teachers would be sent abroad for training. The programme will also arrange internships through which 25,000 young people would be connected with industries. Over 500 laboratories will be set up in seminaries for skill-based learning.
The government has also announced the creation of a National Youth Development Foundation as a networking group for youngsters across the country so they could coordinate for employment opportunities and find out about job openings from each other. Through the “Youth Entrepreneurship Scheme”, the government will provide subsidised business loans to young aspiring entrepreneurs for the promotion of the small and medium-sized enterprise (SME) sector. The “Skill for All Programme” will impart technical and vocational training to 150,000 youths, both in conventional and high-end technological trades. The “Startup Pakistan Programme” will train potential young entrepreneurs to help them conceive, incubate, and mature their business plans through access to digital incubation platforms. The “Green Youth Movement” will provide small grants to Pakistani youths to come up with economic innovative solutions to tackle climate challenges. The plan envisions the planting of 10 billion trees. The “Internship Programme” will be for undergraduate and postgraduate students to facilitate them in participating in the private sector. The “Jawan Markaz”, a one-stop solution for youth-related issues at the grass-roots level, will not only provide access to sports and other youth engagement activities but also offer career counseling, mentoring and access to a host of digital services.
This is not the first scheme that has been launched in the name of empowering the youth. Successive governments have undertaken similar ventures in the past, with varying degrees of success. More recently, the Nawaz Sharif administration had introduced a similar, multipronged initiative — the Prime Minister’s Youth Loan Programme — shortly after coming to power in 2013, promising to provide subsidised loans cumulatively amounting to Rs100b to the youth over a period of five years. In fact, the PTI youth project borrows generously from the previous government’s initiative. However, the earlier scheme could achieve very limited results because of several political, financial and administrative factors. Less than a quarter of the total funds allocated for disbursement in five years could be lent, mostly to applicants from the PML-N stronghold of the Punjab.
Early this year, the United Nations Development Programme (UNDP) allocated $30 million to mainstream the marginalised youth in Pakistan. It led to the envisioning of the “Kamyab Jawan Programme’ by the PTI. Critics say such schemes were also launched in the past but failed because of their political motives. A major factor of their failure was the lack of interest by banks for fear of bad debt. The PTI has promised to maintain fairness and uphold merit in the programme, but it is almost impossible in Pakistan. No plan in Pakistan can be free from political interference.
Analysts say Prime Minister Imran Khan’s comment at the launch of the programme that the last 12 months had been “the worst time” of his political career had shaken the confidence of people in his government. There are many similarities between the loan programme of the PTI and the scheme launched by the last PML-N government. The similarities included interest-free loans, youth training, a skills development scheme as well as emphasis on concentrating on less developed areas. Maryam Nawaz, daughter of the then Prime Nawaz Sharif, headed the programme. She had to resign from the post after a court ruling and criticism by the opposition. The multi-billion scheme failed to provide desired results. The PTI still accuses Maryam Nawaz of corruption of billions of rupees in the programme. Critics say the PTI should also ready itself for similar allegations on its loan scheme in future.