Japan may pledge $1 billion to Pakistan

Japan is considering pledging up to $1 billion to Pakistan over the next two years at an international donors conference, a report said Thursday.

Kyodo news said the pledge was to be made Friday, when Japan hosts the one-day conference.

Foreign Ministry official Daisuke Nakanishi refused to confirm the amount Japan will pledge, but said Tokyo will contribute "a significant amount" of the total.

Pakistan is hoping to get as much as $6 billion in pledges during the conference, but Japanese officials have said they expect the figure to be closer to $4 billion and have warned against inflated expectations.

Japan has also stressed that the conference will try to steer away from getting too involved in issues that are more closely associated with Afghanistan, but acknowledged that there is a growing awareness the two often overlap and can be hard to deal with separately.

The conference is scheduled to be divided into two main sessions, one focusing on coordinating political support for Pakistan's economic reforms and the second to delve more deeply into specific pledges.

Japan, which is hoping its role as host will bolster its international clout, says the conference, supported by the World Bank, will be attended by about 25 backers, including the United States, China and Saudi Arabia. A tally of pledges is expected to be announced at the end of the meeting.

Japan provided Pakistan with 48 billion yen ($480 million) in development assistance in 2008.

The meeting, the first of its kind for Pakistan, is separate from Washington's plans to give Pakistan $1.5 billion in aid for the next five years, and a $7.6 billion bailout granted by the International Monetary Fund in November to avert the country's most recent balance-of-payments crisis.

The troubles of Pakistan's one-year-old, pro-Western government are deep.

As part of the IMF deal, Pakistan has been asked to reduce its fiscal deficit and to tighten its monetary policy.

But the central bank forecast this month that economic growth for the year through June will slump to between 2.5 percent and 3.5 percent, far below the 5.5 percent the government has projected _ and too slow to create enough jobs for its fast-growing population of about 170 million people.

The government has had to slash its development budget and is resisting calls to tax the narrow landowning elite that dominates its politics. Industry is also hampered by severe power shortages that are not expected to ease until next year at the earliest.

Economic improvement in Pakistan is seen as a key not only to preventing the expansion of poverty, but also to slowing the growth of terrorism, which depends on the poor to fill its ranks.