Valuing Environmental Costs in Pakistan:The Economy-wide Impact of Environmental Degradation Carter Brandon The World Bank October 1995

1. Report No. IDP - 164
SOUTH ASIA REGION
INTERNAL DISCUSSION PAPER
Valuing Environmental Costs in Pakistan:
The Economy-wide Impact of
Environmental Degradation
CarterBrandon
The World Bank October 1995
The findin2s.ititerpretations.andconclusionsexpressedin thispaperareentirelvthoseof theauthor(s)andshouldnotbe
attributed in artym-nner io the WNorldBank, to it's affiliated organinations.or to membersofit's Board of Executive
Directorsor the countries Thenrepresent

2. SOUTHASIAREGIONALSERIES
Title Author Date Originator
IDPIII HowCompositionof PublicExpenditure
AffectsCompetitiveness: TheCase of
Bangladesh K.Matim March 1992 P. Mitra(80419)
IDPI21 Labor RetrenchmentandRedundancv
CompensationinStateOsnned
Enterprises: TheCase of Sri Lanka A. Fiszbein December 1992 G. Nankani(84641)
IDP126 SomeGuidelinesfotrthe Appraisalof
LargeProjects W.Jack Februaty 1993 A. Estache(81442)
IDP109 ReformingHigherSecondaryEducation
in SouthAsia: The Case of Nepal H. Abadzi May 1993 H. Abadzi(80375)
IDP127 SomeLessons forSouthAsia from
DevelopingCountry Experiencewith
ForeignDirect Investment M.Fry June 1993 A. Estache (81442)
IDP129 Quasi-FiscalDeficits: Latin American
Lessonsfor South Asia C.A.Rodriguez August 1993 A. Estache(81442)
IDPI31 The Impactof RuralInfrastructureon
RuralPoverts LessonsforSouth Asia E.Goldstein June 1993 G. Nankani(84641)
IDPI34 Infrastructureand IndustrialPolicy in
SouthAsia: Achievingthe Transition
to aNew Regulator! Environment P.Seabright December 1993 A. Estache(84641)
IDP135 Taxationof Foreign Investmentin 3.Mintz
SouthAsia T.Tsiopoulos December 1993 A. Estache(81442)
IDP142 RegionalTradingArrangementsand
BeyondExploringSome Optionsfor
SouthAsia Theory.Empiricsand
Policy T.N. Srinivasan July 1994 G. Nankani (84641)
IDP146 Participationn theSouth Asia Region's
ProjectPortfolio: Towards Deuning
ConditionsforSuccess B.Parker August1994 G. Nankani (84641)
IDP153 Pakistan:Public Expenditurein Y. Choudhry
Agriculture R.Faruqee June 1995 J. Wall (85045)
IDP154 Unemploymentin SriLanka:
Sourcesand Solutions M.Prvwes July 1995 J. Wall (85045)
IDP157 Impactof EcononticandSector
inSouth Asia: AClient
Perspective V. Dubey December 1995 J. Wall (85045)

3. Background Paper for "Pakistan2010" Report
VALUING ENVIRONMENTALCOSTS IN PAKISTAN:
THE ECONOMY-WIDE IMPACT OF ENVIRONMENTALDEGRADATION
by Carter Brandon
Asia Environment and Natural ResourcesDivision
World Bank
October 31, 1995
This paper could not have been written withoutthe able research assistanceof Kirsten Hommann.
ASTEN,who compiledand analyzedmuch of the Pakistandata. I am alsogratefulfor additionalhelp
from Nalin M. Kishor on the calculationsfor air pollutionhealth impactsand the environment-growth
nexus:NadiniKhourion air and water pollution;MichaelSaddington,Ajit Bannerjeeand NormanJones
on forestry: MaureenCropper on health impact valuation:and JonathanColemanon data. Valuable
commentswere receivedfrom ShahrokhFardoust,JohnDixon,AlanWinters,and RashidFaruqeeof the
World Bank:and from Satya Yadavof IFPRI. This paper was firstdistributedby the World Bankin
Pakistanin May, 1995,and wasrevisedin October,1995. Anyshortcomingsremainthe responsibilityof
the author alone The paper's findings,interpretations,and conclusionsshouldnot be attributedto the
WorldBank.

5. RXECUTIVESUMMARY
This paper makes rough estimates of the total magnitude of economic costs associated with
environmental degradation in Pakistan. Quantification, even in a rough 'back-of-envelope' fashion,
helps show the magnitude of various environmental problems -- both in terms of each other and
relative to other issues of economic management. It shows fairly explicitly the cost of inaction, and
helps governments to target scarce resources for environmental management on interventions with
the highest rates of return.
Several of the priority areas discussed in Pakistan government's National Conservation Strategy
(1992) are analyzed in this paper: (a) urban degradation, including both air and water pollution, caused
by industrial, municipal and transport sources; (b) urban and rural water supply and sanitation issues; (c)
soil degradation; and (d) forest loss. One additional area of negative environmental impact -- the impact
of pollution on the growth of tourism -- is also included in the valuation exercise. Environmental costs are
measured in terms of health and productivity impacts. Environmental problem areas identified in the
NCS but =t included in this paper (for data and/or methodological reasons) are hazardous waste, loss of
fisheries, loss of biodiversity, and deterioration of the cultural heritage -- although preserving cultural
heritage is correlated with international tourism, which is included.
The low and high estimates of environmental damages are US$1.I - 2.1 billion per year, or 2.6
- 5.0% of GDP in 1992 values. The average is $1.6 billion, or 3.8% of GDP. Average values for the
estimated environmental impacts by sector are: health impacts of water pollution ($750 million, or
47% of the total); agricultural output loss due to soil degradation ($353 million, or 21%); health
impacts of air pollutton ($301 million, or 19%): loss of livestock carrying capacity due to rangeland
degradation ($128 million, or 8%): the cost of deforestation ($32 million, or 2%); and loss of
international tourism ($25 million, or 2%). Even though these estimates are conservative -- due to both
conservative assumptions and items not valued -- this magnitude of impact is comparable to estimates
made in other developing and transitional countries, such as 2.6 - 6.4% in India, 3.3% in Mexico. and
up to 5% in Eastern Europe. In contrast, estimates for OECD countries are typically less than 1-2%.
Unfortunately, since various country studies use different methodologies and include different sets of
environmental costs, the percentage figuresmay not be completely comparable.
This analysis has several important policy and investment implications. First, water sector
issues dominate the environmental issues facing Pakistan, in two ways: (a) water-related health impacts
have great economic costs (approximately $750 million per year), and (b) water-related losses in
agricultural productivity through water-logging and salinity problems lead to additional losses of $300
million per year. Combined, these two water management issues comprise 68% of the total negative
environmental tmpacts valued in the paper, and are the largest losses for any one sector in Pakistan.
Second. health impacts due to both water and air pollution have great economic costs (about
$1 05 billion per year). The great majority of these costs are bome by Pakistan's poor, who are least able
to distance themselves from the effects of such pollution. Not all of these costs are immediate financial
costs, however, since they include the statistical value of premature deaths. Any efforts to reduce these
health impacts are highly progressive interms of their impact on the poor.
Third. the magnitude of environmental degradation (nearly 4% of GDP per year) is enough
to offset much annual growth reflected in traditional national accounts, indicating that traditional growth
measures are over-stated The magnitude of this estimate would be even higher if such problems as toxic

6. waste, biodiversiry. river and coastal resources, and the rapidly rising cost of providing clean water, were
included.
Fourth, many environmental issues -- including industrial pollution, rangelands, forestry,
biodiversity, and cultural property -- need attention, and the setting of proper priorities and sequencing of
mitigation measures requires careful analysis of the cost-effectiveness of various mitigation strategies. The
intent of priority-setting, however, is not to propose an all-or-nothing approach to one problem or
another, but to balance the cost-effectiveness of interventions. Since budgets are limited, investments in
"the environment." like in any other sector, should be approached with the objective of achieving the
highest rate of return possible.
Fifth, the trend for all of these costs is worsening, and will continue to do so unless
measures are taken to slow, stop, or even reverse the trend. These costs, therefore, represent the 'costs of
inaction.' Some scenarios show the extent of environmental degradation, expressed as percent of GDP.
increasing over time.
Finally, the most important policy and investment measures required to address the above
issues are: (a) expanded and reorganized provision of urban environmental services, including water,
sanitation, and solid waste services; (b) continued attention to irrigation water pricing and management,
including greater attention to system maintenance, in order to reduce the high impact of salinity and
water-logging on agriculture; (c) greater efforts to encourage land conservation measures, including
reform of land policy and resource tenure, research and extension on low-cost conservation
technologies, and pricing reform of agricultural products and inputs; (d) increased regulation and
enforcement of air pollution control standards, combined with some use of pollution taxes and other
market-based instruments in the industrial, power, and transport sectors; (e) increased regulation (and
enforcement) of industrial water pollution and hazardous waste generation; (f) reform of energy pricing
to encourage greater efficiency, including raising the cost of electricity for irrigation; (g) creation of
incentive structures to protect natural forests from degradation -- involving greater local management
and ownership; and (h) greater use of subsidy-removal and pollution-related taxes as part of ongoing
deficit reduction efforts.
This study identifies clear priority areas for doing more careful analysis, both on the extent
of environmental degradation and on the cost of mitigation. At stake are measurable savings in economic
well-being of several percentage points of GDP per year.

7. Table of Contents
1. Introduction
A. Overview and Relationship to the National Conservation Strategy
B. Scope of this Paper
I. The Economy-Wide Costs of Environmental Degradation
A. Approaches to Economic Valuation of Environmental Degradation
B. Air Pollution
C Water Pollution -- Public Health Impacts
D. Water Pollution -- Higher Incremental Costs of Water Supply
E. Industrial Pollution and Hazardous Wastes
F. Land Degradation -- Impacts on Agriculture and Livestock
G. Deforestation
H. Tourism
Ill. Summary of Results and Policy Implications
A. Summary of Results
B. Projected Future Environmental Costs
C. Policy Implications
Tabl
Air pollution:
1. Ambient Health Incidences and Health Costs due to Ambient Air Pollution Levels exceeding
WHO Guidelines
2. Detailed Air Pollution Worksheet for Karachi
3. Detailed Air Pollution Worksheet for Lahore
4. Health Cost Estimates and Remarks
5. Comparisons of Annual Health Costs Averted for Different Asian Cities
Water Pollution
6a. Burden of Water-Related Diseases in Pakistan, 1990
6b. Access to Clean Drinking Water and Sanitation, 1980and 1990
7. Calculation of Water-Related DALYs Reduced through the Provision of Clean Water and
Sanitation

8. 8. Extent of Soil Degradation in Pakistan
9. Annual Cost of Soil Degradation, type of degradation
10. Annual Cost of Production Lost due to Soil Degradation for Pakistan's for 5 Main Crops
II. Annual Production Lost due to Soil Degradation for 5 Main Crops (tons)
12. Area. Production, and Yield Data for Pakistan's 5 Main Crops
13. Yield Reducing Factors for Pakistan's 5 Main Crops, by type and severity of Land
Degradation
14. Estimated Degraded Area, by State, Crop, and Extent of Degradation
15. Rangeland Carrying Capacity and Impact of Rangeland Degradation
Deforestation
16. The Annual Cost of Deforestation
Total Annual Costs
17. Summary of Projected Annual Costs of Environmental Degradation. 1992-2010
Eu
I. PMI as a Function of City Population: Data from 35 Indian Cities (1991-92)
2. Incidence of Water-Related DALYs (as a function of Per Capita Income)
3. Rising Incremental Costs of Water Supply: The Average Cost of Water Supply, Current
Schense vs. Next Scheme
4. Pollution Load Trends for Pakistan
5. Industrial Growth Rates Plotted Against Subsectoral Pollution Intensities
6. Estimated Losses in Agriculture due to Land Degradation
7. Sumnsary of Major Annual Environmental Costs in Pakistan, 1992
References

9. VALUING ENVIRONMENTAL COSTS IN PAKISTAN:
THE ECONOMY-WIDE IMPACT OF ENVIRONMENTAL DEGRADATION
I. Intrnduction
A. Overview and Relationship to the National Conservation Strategy
I1. The purpose of this paper is to make rough estimates of the magnitude of economic costs
associated with environmental degradation. These costs are measured in terms of health impacts and
productivity impacts. Once quantified, the magnitude of various environmental problems can be better
understood -- both in terms of each other, and relative to other issues of economic management. This
allows a more informed debate on policy reform as it effects both economic and environmental concerns.
2. In conmmonwith most developing countries, Pakistan has serious environmental problems.
Rapid population growth (over 3% annual growth since the early-1970s) hasput enormous pressure on the
country's resource base. Environmental issues fall into two categories: (a) pollution issues, which are
largely urban and industrial in scope, and (b) resource management issues, which include water, soils,
forests, biodiversity. and coastal zone management issues. On the pollution side, urban air. water, and
solid waste problems are leading to significant health impacts, and the marine environment is severely
stressed by industrial pollutants. On the resource side, crop yields are declining on what were previously
some of the most productive soils because of soil erosion and salinity; forests have been depleted and
degraded for agricultural, livestock fodder and fuelwood: rangelands are increasingly becoming degraded,
some irreversibly, due to uncontrolled grazing of livestock; and the country's rich flora and fauna species
are being depleted, some of which now are in danger of extinction.
3. Pakistan completed its National Conservation Strategy (NCS) in 1992. and completed the
subsequent "Plan of Action - 1993-1998" the following year. Many of the key problem areas discussed in
the NCS are covered in the valuation analysis in this paper: (a) urban degradation, including both air and
water pollution, caused by industrial, municipal and transport sources; (b) urban and rural water supply
and sanitation issues; (c) soil degradation; and (d) forest loss.' One additional area of negative
environmental impact -- the impact of pollution on the growth of tourism -- is also included in the
valuation exercise. Three problem areas identified in the NCS = included in this valuation exercise are
protecting water bodies and sustaining fisheries, conserving biodiversity, and preserving the cultural
heritage, although preserving cultural heritage is correlated with international tourism, which is included.
B. The Nexus Between Growth and the Environment
4. Empirical investigations into the nature of the long term relationship between growth and the
environment have revealed that the nature of the relationship varies with the environmental problem being
considered. For example, it was found that in the case of clean water supplies and urban sanitation, the
problem declined with increasing income levels. For other environmental problems, such as air pollution
iThe NCS identifies14priorityareasfor action, includingboth investmentsandpolicymeasures. These are: (i)
maintainingsoils incroplands;(i) increasingirrigaiionefficiency;(iii)protectingwatersheds;(iv) supportingforestry
andplantation;(v) restoringrangelandsandimprovinglivestock;(vi)protectingwaterbodies andsustainingfisheries;
(vii)conservingbiodiversity;(viii)increasingenergyefficiency;(ix)developinganddeploymgrenewables;(x)
preventingandabating pollution,(xi)managingurban wastes:(xii)supportinginistiuionsfor commonresources:
(xiii) integratingpopulationandenvironmentprograms;and(xiv) preservingthe culturalheritage.

10. 2
(particulates and sulfur dioxide) and deforestation, it was found that the problem worsened up to a certain
income level but then improved as resources were invested in cleaner technologies and regulations were
strictly enforced. For these problems. therefore, experience indicates that there is at least a possibility of
"growing out" of them. Overall, experience has shown that technological progress and a better choice of
policies has enabled countries to develop in a less (environmentally) damaging manner than was observed
in many more developed countries in the '50s and '60s.
5. These empirical results thus suggested the possibility of positive links between growth and
the environment and led to a focus on policies that are good for both economic development and the
environment. Sonie examples of these policies are: (a) pricing policies for water and energy that
encourage conservation and reduce the resulting pollution; (b) clarifying property rights, particularly on
marginal agricultural lands and rangeland, to discourage overuse and encourage sustained use and
investments in conservation; and (c) targeted social programs in the areas of family planning, primary
education, environmental education, and rural poverty reduction. Adoption of these and other "win-win"
policies are the most efficient first step in improving both economic and environmental management.
Nevertheless, these policies are not always sufficient to address significant problems, such as water
pollution and some contributors to air pollution (such as transport and refuse buming).
6. These difficult problems generally have to be addressed through policies which do involve
tradeoffs between growth and the environment, at least in the short term. For example, controlling
emissions from factories and power plants could require levying pollution taxes, which would raise costs
and possibly reduce growth in the near future. Similarly, the need to financeand operate sewage and
water treatment facilities requires higher water charges, and stricter controls on pesticide use may involve
higher costs. However, these losses have to be balanced by the gains realized from reduced health and
property damage due to lower levels of pollution. In other words, the level of taxes should be set such that
the marginal benefits equal the costs: in the case of a tradeoff, the decision to implement an environmental
policy should be based on a careful cost benefit analysis. Decisions based on the cost benefit principle
would be growth maximizing withir the broader framework of environmental and economic sustainability.
C. Setting Enviromnental Priorities
7. Mitigating widespread environmental problems requires a broad array of actions, touching
on virtually every sector of the economy. Setting priorities across this wide range of problems and options
must be the first element in devising an effective and cost-effective strategy for addressing environmental
problenis. Priorities are ideally based on analysis of available data, valuation of the costs and benefits of
various types of interventions, assessment of the administrative burden of alternatives, and participatory
decision-making. This is clearly a daunting and politically difficult task, which is why a government
process whereby priorities are made explicit is not common.
8. Nevertheless, economic valuation of environmental damages has a definite place in the
setting of environmental priorities. Setting priorities is basically a process of ranking future actions, such
that the things to be done first will achieve the greatest gain relative to the available resources. Economic
valuation can help in the ranking of alternative policies and expenditures such that those with the highest
ratio of benefits to costs are implemented first. The benefits to society of mitigating environmental damage
due to a specific cause need to be compared with the economic and social costs of achieving that
mitigation. Thtere may exist inexpensive (partial and upgradable) measures that achieve significant
improvements and therefore have a high benefit-cost ratio. Partial solutions at a modest cost may be

11. 3
preferable to "permanent" but expensive measures that may have relatively low benefit-cost ratios. In
setting priorities for environmental management, it is the incremental benefit-cost ratios that matter.
9. Cost-benefit analysis of all environmental problems and all possible interventions is clearly
impossible in any country. If all social costs and benefits of each incidence of environmental
degradation were available, then "optimal" levels of intervention could be determined. However,
neither available data nor current methodologies allow this. This report focuses on the relatively narrow
task of pulling together currently available data on environmental problems in order to estimate the
economic cost of degradation in Pakistan. However, in order to complete the cost-benefit framework just
described, estimates of the cost of the measures required to mitigate or prevent environmental degradation
are also required. Such costs are often called control costs. Estimates of environmental control costs for
Pakistan are not included in this paper.2
11. The Economy-Wide Costs of Environmental Degradation
A. Approaches to Economic Valuation of Environmental Degradation
10. Two types of environmental costs estimated here: (a) public health impacts due to air and
water pollution, and (b) productivity impacts due to soil degradation. rangeland degradation,
deforestation, and reduced tourism. Not estimated are costs associated with fisheries degradation,
biodiversity loss, loss of cultural heritage, the long-term health effects of hazardous waste, and the higher
cost of providing clean water due to water pollution (see Section D, below). Box I illustrates the priority
environmental problems in Pakistan. and indicates the valuation methodology used to estimate the costs.
BOX I MAJOR ENVIRONMENTALCOSTSANDVALUATIONTECHNIQUES
Impactson health
Problem land/or production JMethod of valuation Assumptions/Commnents
Urbanair pollution Urbanhealthimpacts,esp. Incidenceof deathx Sourcesof urban air pollution
paniculates. SO2, NO,, statisticalvalueof life + includetransport. industry,
lead, andozone incidenceof sicknessx (cost energy, refuseburning, etc. No
of treatment+ lostwages) anemptto differentiateimpactby
source of pollution. Also, indoor
air pollutionis not included.
Waterpollution Urbanand ruralhealth Incidenceof deathx Sourcesof pollutioninclude
(healthimpacts) impacts,esp.diarrheal statisticalvalueof life + municipalwasteand industry. No
diseawes incidenceof sicknessx (cosI anemptto differentiateimpactby
of treatment + lostwages) sourceof pollution.
21norder to clarifythe terminologyused,the costsof environmentaldegradationare often calledbenefitsin
environmentalcost-benefitliterature,since thereductionin the costsassociatedwithdegradationbecome benefitsin
ihe benefitsstreamaccordedto investmentsin environmentalmitigation. The investmentsrequired,or control costs,
retain the term "costs."

12. 4
Waterpollution Higherincrementalcosts Projectedincreasedwater Difficulttoestimatewithout
(productionimpacts) forclean watersupply supplyrequirementsdue to detailedcity-specificstudyto
surfaceandgroundwater determinewhat share of supply
pollutionx higher shortagesare pollution-based,
incrementalsupplycosts. andestimatecostsof supply
Not estimatedin thisstudy. expansion.
Industrialhazardous Long-termhealthimpacts, Not estimatedinthis study. Althoughsignificant,thesehealth
waste esp.cancer impactsnot likely to be as large
as other air andwater health
impacts.
Soil andrangeland Lossof agriculmraloutput Agriculturaloutput x Soildegradationincludeserosion,
degradation and livestockcarrying marginalproductivityloss salinization,water-logging,and
capacity duetodegradation. Same lossof nutrients.
methodologyappliedto
rangelandsandlivestock.
Deforestation Lossof timberandof non- Forestreplacementcost Cost estimatesquite
timberecologicalservices. only. conservative,sinceseveral non-
timbervalues not included.
Coastalandmarine Unsustainableharvesting Notestimated inthisstudy. Lackof data.
resources of marineresources.
Lossof biodiversity Lossof use. option,and Not estimatedin thisstudy. Hardto valuewithoutdetailed
existencevalues. survey work.
Declinein tourism Lossof inernational Reduceddemanddue to Estimateskeptconservativein
tourismrevenues. highambientpollutionand theabsenceof surveywork.
_ touristhealth impacts. I
II. The most direct links between environmental degradation and public health are the links
between (a) air pollution and respiratory diseases, and (b) water pollution and such water-related diseases
as diarrhea, dysentery, cholera and typhoid. The results are divided into premature deaths (mortality) and
sickness (morbidity), some cases of which may involve hospitalization.3 The value of the premature deaths
is then based on the value of a statistical life, as determined using either a human capital approach (which
values an individual's life according to the net present value of his/her productivity) or a willingness-to-
pay approach (which measures the value society places on individual distinct from an individual's wage-
earningcapacity). The first of these approaches tends to give lower values than the second -- as reflected
in this paper by the range of values associated with premature mortality. In valuing the costs of morbidity,
three types of costs can be considered: (a) medical expenses; (b) lost wages: and (c) individual disutility
3Morbidityandnsortalityestimatescan alsobe aggregatedinto a singlehealthimpactmeasurecalled DALYs
(disabilityadjustedlifeyears). Thismeasureis used in the caseof estimatingwater pollutionhealthimpacts.
DALYsare a conibinationof: (a)discountedandweightedyears of life lostas a result of deathat agiven age; and
tb) disabilityas a result of morbidity,adjustedbyseverity(see World DevelopmentRepon 1993,pp. 26-7).

13. 5
(discomfort, suffering, and the opportunity cost of time). Only the first two categories are estimated here,
since they are more easily monetized than the third. This also keeps the estimates conservative.
12. The most direct linkages between environmental degradation and economnic output are
strongest where (a) soil degradation leads to lower agriculture and rangeland output (or, conversely,
higher input costs to offset the soil degradation); (b) deforestation leads to loss in forest resources to
alternative land uses with little economic value, (c) pollution of both surface and groundwater resources
leads to local and regional scarcities, with commensurate increases in costs; and (d) high ambient pollution
levels lead ro declines in tourism growth, reflected in the loss of international visitors and foreign
exchange. In addition to these direct linkages, there are indirect linkages in the form of downward
linkages (cotton milling and spinning, leather tanneries, etc.) and upward linkages (input production, and
equipment production and maintenance). These indirect linkages are not valued here, leading, again, to a
conservative estimates of the economic cost of degradation.
13. The following sections discuss each of the sectors being valued. In all cases, this paper uses
conservative assumptions, as noted, in order to not overstate the costs of degradation.
B. Air pollution
1. Extent of the Problem
14. Pakistan has seven cities of over one million people, and ambient air pollution levels exceed
WHO health standards in both Karachi and Lahore. Air pollution is worsening due to upward trends in
power consumption, industrialization, vehicle ownership and use, and refuse burning. Annual average
levels of total suspended particulates (TSP) in Karachi is at least 4 times as high as the WHO standard,
and in Lahore, 3 times the standard. Other main pollutants, such as S02 and NO, appear to be less
significant problems Unfortunately, no ambient air pollution level data is available for the other five cities
with over one million inhabitants -- Faisalabad, Gujranwala, Multan, Peshawar, and Rawalpindi -- so for
the purposes of this exercise. ambient concentrations were assumed to approximate the lower range of
ambient levels observed in Indian ctties of comparable size.
4
15. In termis of specific pollutants, TSP and PMI0 have been associated with both premature
mortality Ideath from respiratory illness and cardio-vascular disease) and increased morbidity (increased
prevalence of chronic obstructive lung disease, especially bronchitis, and to increased incidence of upper
and lower respiratory tract infections). Ozone contributes to incidences of respiratory hospital admissions.
restricted activity. asthma. eye irritation, and heart disease.5 Carbon monoxide (CO) reduces the amount
of oxygen carried by the blood, but dissipates rapidly in the environment and the effects are reversible.
High levels of atmospheric lead contribute to both hypertension and neurological damage, including IQ
loss, in children.
4An analysisof ambientair pollutionlevelsm 35 Indiancities, as a functionof populationandgeographiccity
size, yieldednositiple correlation. (RegressionresultsyieldR-squaresof less than0.05). For this study, ambient
levelsat the lower endof the rangeobservedin Indiancitieswas consideredto be conservative. A chartof the
relevantdata for PM10levels is showninFigure 1.
0sstro,pg. 28-33.and41-42

14. 6
16. The relative contributions of motor vehicles, industry and domestic sources to air pollution,
especially to particulate pollution, are not well studied in Pakistan. While estimates exist of total emissions
from each source, it is harder to determine the contribution of each source to ambient pollution levels. For
example, a recent study for Bombay, India, estimated the relative contributors to PMIO pollution (which
are particles less than 10 microns in diameter, which more easily penetrate the lung and are therefore
more relevant than TSP for human health):
- refuse burning 28%
- vehicle exhaust 25%
- resuspended road dust 17%
- fuel burned by residences 15%
- fuel burned by industry and power 12%
- other (including marine) 3%
The results show that refuse buming and vehicles combined are responsible for the majority of PMIO
emissions. and that a dual strategy to deal with both major sources would be preferable to a single
approach .
17. Since such emissions inventories do not exist in Pakistan, future study would assist in the
formulation of mitigation strategies. In tenas of vehicle emissions, however, it is known that because of
the absence of emissions regulations, lack of enforcement of motor vehicle fitness regulations, and the
owners' lack of capital to purchase replacements, vehicles stay on the road many years. Compared to the
United States. the average Pakistani vehicle emits 20 times as much hydrocarbons, 25 times as much
carbon monoxide, and 3.6 times as much nitrous oxides.
2, Analysic
18. The primary health impacts estimated here are those related to particulate matter, SO, NO
and lead. Unfortunately, there is no ozone monitoring in Pakistan to allow estimates of health impacts.
Similarly, due to the absence of data, the impact of indoor air pollution is not considered in this paper.
However, indoor air pollution, due to cooking and heating with biofuels, is potentially a large public
health factor in both urban and rural areas.
19. The health impacts of theseair pollution are most easily estimated through the use of dose-
responsefunctions drawn from epidemiological studies done around the world. A recent World Bank
review of such studies is used here as a basis for estimating the health impacts in Pakistan.
6
By using dose-
responsefunctions estimated in cities in more developed countries, the estimates derived here are likely to
be conservative: given the lower standard of living, nutrition, and health in developing countries, there is
a higher percent of the population in marginal health -- that would be more susceptible to negative health
impacts from air pollution.
60stro (op cit) is a recentreviewof studiesconductedprimarilyincities in developedcountries. There are
uncertainliesin applyingthe resustsdirectlyin cities indevelopingcountries.The World Bank is slartingcareful
epidemiologicalresearchin New Delhiinorder tobetter understandthe epidemiologicalimpactsof air pollutionin
developingcountry megacities.

15. 7
3 Result
20. The results obtained for Pakistan air pollution health impacts are summarized in Box 2,
which gives the reductions in morbidity and mortality estimated to occur if pollutant levels in Pakistan's
major cities were reduced to the WHO annual average standard (see Tables 14 for details). The total is
over 2,000 premature deaths avoided, over 6 million serious illnesses and hospitalizations avoided, and
over 400 million minor illnesses avoided. An economic valuation of these health impacts, using a lower
and upper statistical value of a life saved, suggests a monetary estimate of the loss of between $233 and
$368 million.7
Box 2 AnnualHealthIncidenceandCostsdue to Air PollutionLevelsExceedingWHO Guidelines
PhysicalImpacts Cost Valuation(USSmillions)
Premature Deaths 2,047 $18- ill
HospitalAdmissionsand Sickness
RequiringMedicalTreatment 6,410,000 $18 -30
Minor Sicknesses(including
RestrictedActivityDays and 418,000,000 $197-227
RespiratorySymptomDays)
Total $233-368
21. Two pollutants, PMIO and SO2, are responsible for 75-80% of the health impact damages
(see Tables 2-3), and both cause a broad range of sickness and some premature death. The remaining 20%
is contributed by the impact of high lead levels in Karachi. which has significant impacts on heart attacks,
hypertension, atid IQ loss in children. The impact of lead on children's IQ is estimated to be
approximately 2 million IQ points per year, valued at $40-74 million in foregone life eaming. In terms of
geographic incidence, Karachi accounts for 80% of the health costs. Lahore about 12%, and the
remaining 5 cities with over one million inhabitants, 8%.
22. Table 5 presents a comparison of urban air pollution among different Asian cities. Two
implications from this table are worth noting: (a) the per capita estimates of health costs for Karachi and
Lahore (of $25 atid $13 respectively) are in the same range as for other cities, excluding Jakarta and
Bangkok: and (b) a comparison of Karachi and Lahore with Bangkok (health costs of $274 per capita)
71nvaluingtiortality, it is assumedthatthe prematurityof deathaverages 10years (i.e., thoseindividualsaffected
wouldhavelived, on average, anadditional10years). The lowerestimateof the statisticalvalueof a lifeusesa
humancapitalapproach,and valuesonestatisticallife as equalto the discountedvalueof aten-year wage stream (see
Table 4a). Thisesimniateis $8,685/statisticallife. The higher estimateinvolvesconveningthe statisticalvalueof life
used by the US EnvironnmentalProtectionAgency-- basedon hedonicwage andcontingentvaluationstudies
conducted inthe US -- to the Pakistancontextbyapplyingthe ratioof nationalper capita incomes. The US value
used was $3 million,whichis at thelower endof the fullrange of $1.6 - $8.5 millionfoundin the US studies. The
convened Pakistanivalueis $54.217/statisticallife.

16. S
suggests how environmental costs could escalate with growth, if proper pollution control measures are not
undertaken.
C. Water PoUution - Public Health Impacts
I Extent of the Problem
23. In Pakistan today, contamination of water supplies in both rural and urban areas poses
significant problems, with much of the surface water outside of the mountainous areas being unfit for
human consumption. Water pollution has three major sources which can infect both surface and
groundwater: domestic waste water, industrial waste-water, and agricultural runoff. Water pollution from
domestic and human waste water is the most problematic, and the cause of many severe water-bome
diseases. The World Health Organization (WHO) estimates that between 25-30 percent of the diseases in
Pakistan are of a gastro-intestinal nature, and about 60 percent of infant mortality can be associated with
water-borne infectious and parasitic diseases. Major cities dispose some of their largely untreated sewage
into irrigation streams and used to irrigate crops, some of which are eaten raw. Sewage and waste water is
also channeled into rivers and streams without consideration of the rivers' assimilative capacity.
24. The other sources of water pollution are industry and agriculture. The major water polluting
industries are chemicals, textiles, pharmaceuticals, cement, electrical and electronic equipment, glass and
ceramics, pulp and paper board, leather tanning, food processing, and petroleum refining. Indiscriminate
use of agricultural chemicals has also resulted in the contamination of ground and surface water. The
health impacts of industrial and agricultural pollutants cannot be separated out easily from overall health
impacts, and no attempt is made here to do so. Trends in industrial pollution are discussed separately in
Section E. below.
2. Analysis
25. A review of 144 studies published by the WHO in 1991 found that improved water supply
and sanitation produced a median reduction in morbidity and mortality on the order of 25% for morbidity,
and 65% for mortality.' These health improvement factors are used here to estimate the reduction in the
incidence of water-related diseases achievable through feasible interventions in water, sanitation, and
hygiene. The causes of DALYs lost are complex and the interactions of water quality and quantity.
sanitation and hygiene in improving health in inadequately understood, due to the empirical problems of
observing actual practices and conditions.9 The incidence of water-related diseases on population groups
depends very much on the income level of the group: high income groups are more likely to have either
access to clean water supplies or the ability to resort to water purification or purchases of bottled water.
26. As showni in Table 6a. on the order of 3.27 million DALYs are lost each year in Pakistan
due to poor water quality, sanitation and hygiene. The specific diseases included in this ntrmber are
BS.A. Esrey,J.B. Potash,L. Robertsand C. Shiff, "Effectsof ImprovedWater SupplyandSanitationon
Ascariasis,Diarrhea, Dracunculaisis,HookwormInfection,Schistosomiasis,andTrachoma,"WHO, 199t.
sit is mucheasier, forexample, to makeassumptionsaboutthe exposureof apopulationto pollutedair than
exposuretopolluted water,since thereare many moreoptionsconcemingwatertreatmentandconsumptionthan
thereare forair.

17. 9
diarrhea. trachoma. intestinal worms, hepatitis, and the "tropical cluster" of diseases. Since there is no
data available from Pakistan on the actual incidence of these diseases, these estimnateswere made by fitting
detailed data on the burden of water-related disease in India and other Asian countries to Pakistan. First,
an empirical relationship was established between levels of national per capita GDP and the incidence of
water-related diseases (see Figure 2). Then, the actual incidence of the four main categories of water-
related diseases in Pakistan was estimated by applying an average distribution of water-related diseases
found in India and other Asian countries.
27. In order to quantify the achievable reductions in these DALYs due to the provision of clean
water and sanitatton. a methodology developed at the World Bank was applied.'° This methodology
involves several steps:
(a) Since available data on water-related health impacts in Asia comes in the form of DALYs, it
does not allow separate analysis of mortality and morbidity. Therefore, potential reductions
achievable in mortality (65%) and morbidity (25%) are combined into one reduction factor
to be applied to the current level of DALYs for water-related diseases. By using a weighted
average of the overall morality and morbidity components of these DALYs, it is estimated
that an overall reduction of 52.7% in DALYs is possible with the provision of safe water
and sanitation. This implies that 47.3% of the current level of water-related DALYs
represent a 'floor' below which overall public health will not improve under current
hygiene-related practices. The scenarios explored below all assume that hygiene improves
marginally with improved access to clean water and sanitation (see point d).
(b) A relationship is made between the incidence of DALYs among populations with safe water
and sanitation, and populations without:
P*R, + (1-P)-R_ = R,- (I)
where P is the proportion of population with adequate services in the form of safe water and
sanitation to have reduced water-related DALYs; Rw is the water-related DALYs lost per
thousand among those with clean water and sanitation; RW,is the water-related DALYs lost
per thousand among those without clean water and sanitation; and R, is the average water-
related DALYs lost per thousand overall. Since it is known that the total water-related
DALYs are 3.27 million, and the total 1990 population is 112.4 million, then R,
3.27/112.4* 1000. or 29. 1.
(c) As of 1990, 55% of the population in Pakistan had safe water, and 25% had adequate
sanitation (see Table 6b). Since these two numbers are very different, there is no single
value of P that captures the hygienic effect of having safe water and sanitation. Depending
on the relative importance of water vs. sanitation in reducing mortality and morbidity, P can
assume any value in the range of x1.55 + (1-x)*.25, where x is between 0 and 1. In the
estimates below, a value of x=0.9 (and P=.52) implies that water is relatively more
iniportant for disease reduction, and x=0.5 (and P=.40) that both water and sanitation are
equally important.
loEnvironnentalStrategyfor theMiddleEastandNorth Africa, February, 1995. SeeespeciallyAnnex5.

18. 10
(d) Another issue relates to the role of hygiene levels in determining the relation between Rw
and R.,, Evidence worldwide associates both higher hygiene levels and better access to
clean water and sanitation with higher literacy and income levels. This implies that hygiene
levels are lower among the population with lower safe water and sanitation provision rates,
since these rates and literacy are lower in rural areas. To address the positive correlation
between clean water and sanitation and hygiene, a hygiene factor h is introduced:
Rw = Rw,, .473 * h. (2)
where h < = 1. and where the relation .473 comes from step (a). H = I implies that the
poor are equally hygienic as those with better services, which is unrealistic. Values of h in
the range of 0.6 - 0.8 may be more realistic, and are used here to illustrate the likely range
of health improvements likely to emanate from improved services.
28. The value of the water-related mortality and morbidity can be estimated as was done for air
pollution impacts. Using the human capital approach, the statistical value of one DALY is equal to the
annual average productivity of Pakistani workers (since one DALY implies one year in which a worker
cannot work due to either sickness or premature death). This value is often adjusted for the age of the
DALY, where the value rises from birth to young adulthood, and declines after 50.1' Since the incidence
of water-related DALYs falls heavily on children under the age of 5, the lower estimate of the value of
one DALY (seeTable 7) is based on a weighted average of the average statistical value of life weighted
by the age distribution of water-related DALYs. The value assumed is $237 per DALY. A medium
estimate, $420 per DALY, assumes a constant statistical value of life across all ages. A higher estimate
uses $643 per DALY. based on a ratio of the US-EPA annualized value of life convened to the Pakistani
context by applying the ratio of national per capita incomes, weighted by the distribution of DALYs
across age brackets.
3. Results
29. Box 3 shows the results from solving equations (1) and (2), using existing data for Pakistan,
and values of x and h as mentioned (see Table 7 for details). If improved water and sanitation services
were provided to all portions of the population now under-served, therewould be an estimated reduction
of 1.43 to 1.96 million DALYs per year, or an average reduction of 1.70 million DALYs (based on the
average of the six scenarios shown in Table 7). The range represents a 44% to 60% reduction in the
current incidence of water-related DALYs in Pakistan. The estimated value of the DALYs reduced
through the provision of clean water and sanitation to all those who lack services is $340 - 1,262 million
per year, depending on the assumed value of one DALY (see above). If services were extended to only
half of those in need, then total DALYs would be reduced by about 26%, and the value of health savings
achieved would be between $232 - $631 million per year.
lThe actualweightingis based onthe curve presentedinthe WDR 1993,pg. 26-27.

19. II
Box 3 Annual Health Impactsand Damages Avoidedthrough the Provision or Clean Water and
Sanitation(seetext and Table 7 for details)
Valueof reducedDALYs
DALYsreduced(millions) (millionsUS$)
Lowest range (based on x=0.9,
] h=0.8) 1.43 $340- 922
Highest range (based on x=0.5,
h=0.6) 1.96 $465- 1,262
Average across six sets of
assumptions .70 $403- 1,093
D. Water Pollution - Higher Incremental Costs of Water Supply
30. Urban water supply systems require periodic expansion due to supply shortfalls. There are
several underlying reasons for supply shortages, including (a) urban growth, (b) income growth, leading
to higher per capita demand, (c) excess demand, due to under-pricing or low collection rates, and (d)
pollution, which constrains existing supplies. Examples abound of municipalities having to incur higher
supply costs in order to compensate for the cost of localized pollution: typically, either local surface water
supplies have become too polluted to be usable, or groundwater aquifers have become contaminated or
brackish.
31. A recent World Bank study 2 illustrates across a wide number of urban water supply projects
that a unit of water from the "next project" is often two to three times the cost of a unit from the current
project This is due to the need to pump water longer distances, use additional treatment, and/or invest in
water transfer schemes. The contribution of pollution to the need for more expansive -- and expensive --
water supply systems, therefore, is one of the components of the rising costs of water supply, and can be
directly attributed to the cost of environmental degradation. Figure 3 shows an indicative set of cities and
incremental water costs. but unfortunately does not include data for Pakistan.
32. There is not sufficient data at this time to estimate the incremental cost of rising water supply
costs, and to allocate some share of that incremental cost to pollution. However. given that public
investments in tmunicipaland industrial water supplies in developing countries constitute 5-6% of total
public investment, even a small cost factor associated with environmental degradation is likely to be
significant. Also, with the high rate of urbanization taking place in Pakistan, these costs are rising very
rapidly.
12Bhatia. 1994

20. 12
E. Industiial Pollution and Hazardous Wastes
33. No comprehensive data exists on either total industrial pollution loads (i.e., total pollution
output) or pollution intensities (pollution emitted per unit of output) in Pakistan -- a constraint to full
understanding of the extent and cost of the industrial pollution problem. Partially in response to this
constraint. the Industrial Pollution Projection System (IPPS) has been developed to provide an
approximate means to estimate trends in industrial pollution.'
3
The IPPS approach uses pollution
coefficients from U.S. manufacturing concerns for the year 1988, and applies them to industrial output in
developing countries. The system captures shifts in subsectoral output, but not shifts in technology, over
time.
34. Indicative trends for industrial pollution in Pakistan are shown in Figure 4. The six
pollutants shown are two indicators each of water pollution (BODs and suspended solids), air pollution
(SO2 and particulates). and toxic wastes (a composite index of various toxics emitted into the air, water, or
in solid wastes, and heavy metals). From 1963 to 1988, there were broad-based increases in pollution
intensities (the pollution emitted per unit of industrial output) for all major forms of pollution. This, in
turn, implies that total pollution output (i.e. pollution intensity multiplied by output) grew substantially
faster than Pakistan's underlying GDP.
35. Figure 4 shows that the two toxics indicators, total toxics and total heavy metals, grew 6- to
8-fold between 1963 and 1988, as compared with a 3-fold increase in the GDP. (All trends are shown as
indices, with 1963 = 100.) The two water-related pollutants show a wider range: BODs, or biological
oxygen depleting substances, rose 5-fold, while total suspended solids increased 11-fold. The two air
pollution indicators. PMIO and SO2 increased 8- to 10-fold. In all cases, the pollution indices are
increasing 2 to 3 times as fast as GDP. Pakistan falls in between the experiences of India and Southeast
Asia: in India, pollution output rose at about the same pace as GDP,'
4
but in the Southeast Asian countries
such as Thailand, Indonesia and Philippines, pollution grew at rates of 2 to 4 times GDP. In contrast,
however, Japanese toxic output fell by two thirds between the late 1960s and 1987.
36. It is not possible. given current data, to attribute adverse health impacts to industrial
pollution separate from municipal and transport-related pollution, since all contribute to the ambient
pollution levels observed and analyzed in the two preceding sections. For that reason, there is no separate
valuation done of industrial pollution. However, as clearly illustrated by the IPPS model, the absolute
growth in industrial pollutants emitted in Pakistan is proceeding at a very rapid pace -- probably far
exceeding the assimilative capacity of the environment. The adverse health and productivity impacts of
131PPS, 1994. Since IPPSestimatesare not directlybasedondata concerningindustrialtechnologiesor pollution
emissions, it is not knownif theymaybe biased lowor high. Theiraccuracy dependsonhowclosely acountry's
technologiesmirror U.S. technologiesin 1988. Also,since industriesare less regulatedin Pakistanthanin the U.S.,
pollutionintensitiesmay behigher in Pakistan. However,some Pakcistaniindustrialequipmentmaybe younger than
inthe U.S.. andthereforeinherentlycleaner. Itis not possibleto reconciletheseandother factorsat thepresent, so
theestimatespresentedhereare meanttobe indicativeonly.
140nly one categoryof pollutionin India-- totaltoxics-- seemsto haveincreasedfasterthan GDPover the past
25 years, and it was still only20-25%faster (andnot a multiple). The differencesin overallpollutiontrendsinIndia
andPakistanare coiifirmedin Figure 5. whichshowsthatgrowth rates inmost of the more pollutingindustrial
subsectors(shownat therightsideof the figure)were higher in Pakistanthanin India.

21. 13
industrial pollution are significant and are worsening. Furthermore, since the long-term health impacts of
toxic pollution are not estimated in this paper, this is another area where the economy-wide costs of
environmental degradation are clearly under-estimated.
F. Land Degradation - Impactson Agriculture and Livestock
1, Extent of the Problem
37. Land degradation, whether caused by water erosion, wind erosion, salinization,
waterlogging, nutrient loss, compaction, or overgrazing, is extensive in Pakistan (Table 8). Overall, in the
four states. some 26.5 million hectares (42%) of land has some degree of degradation, although this
estimate includes areas of non-arable and non-rangeland. Water erosion is undoubtedly accelerating
because of human activity, such as destmiction of natural vegetation by removal for fuel, timber and
forage, and cultivation on steep slopes. Similarly, while wind erosion occurs naturally, largely the result
of dry conditions and fast winds, human activities such as overgrazing, buming and felling of plants can
exacerbate the problem. Soil salinity and sodicity is one of Pakistan's most serious natural resource
problems, parttcularly as a result of long-term mismanagement of canal-irrigated lands. Almost eight
percent of soil in Punjab and up to 15 percent of soil in Sindh are affected by high levels of salinity.
Recent estimates of the extent of water-logging indicate that about 2 million hectares of the 16 million
hectares surveyed -- primarily in Punjab and Sindh -- have a watertable within 1.5 meters from the
surface. There has been modest improvement in the extent of water-logging since the problem was first
addressed in the 1960s.
38. Although data is lacking, much of the rangeland in Pakistan is threatened by overstocking,
overgrazing and overharvesting of the natural vegetation. One estimate is that more than 60% of the
natural grazing areas of the country have reached a production level which is less than a third of their
biological potential.15Some areas such as the Cholistan desert are virtually lost to sand dunes. In the past,
traditional practtce with respect to grazing rights and obligations helped in effective management of the
rangelands. Today, these practices and loyalties have broken down, and new community-based
management systems have not yet developed to address current degradation and livestock population
pressures.
2 Analysis
39. The primary on-site costs associated with soil degradation are reduced yields (at constant
input levels), and/or the down-grading of that land to crops of lesser net value. Off-site costs include
siltation of drainage canals, irrigation canals, or reservoirs, and changes in the hydrology of watersheds.
which can increase flood frequency or severity, or reduced availability in the dry seasons. The estimates
made here on the cost of degradation are based exclusively on reduced (on-site) yields, and thus are clear
under-estimates
i sWorld Bankdaia. 1991

22. 14
40. Experience elsewhere in the world shows that yield imnpactsfrom soil erosion become severe
in marginal lands and rain-fed areas (as much as 30-70% over several years).
t 6
However, it is difficult to
generalize about the impact of soil degradation on agricultural yields, since the soil-fertility contribution to
yield is mingled with, and' masked by, other production variables such as use of inputs (including labor),
seed types, and climatic conditions. Farmer responses to soil degradation vary widely: whereas in one
situation a farmer tnight use additional inputs to compensate for lower soil fertility, in another he might
use less inputs (due to lower responsiveness), shift to a different crop, or even leave the land fallow.
Nevertheless, for valuation purposes, this study uses as a basis for its impact analysis approximations of
negative yield impacts due to land degradation.
41. The analysis started with data on 12categories of land degradation, disaggregated by state.
The 12categories are light, moderate, and severe areas of water/wind erosion (1-3). salinity and sodicity
(4-6), waterlogging (7-9), and nutrient loss (10-12).' Then, for each of the five main crops, yield
reduction factors were estimated, using approximations drawn from: (a) various land degradation impact
studies from India and Pakistan, that cover land degradation in the form of erosion, soil salinity and
waterlogping, and (b) World Bank surveys of the national-level costs of land degradation in Africa and
the U.S. '(Unfortunately, no comparable survey of yield impacts was found for Asia.) Then, each type of
degraded land was pro-rated across the cropping pattem for each state, and the corresponding yield
reduction factor was applied to the product of (a) the eroded area for that state and (b) average crop
yields. The net result was to estimate the amount of production foregone due to underlying degradation.
by state, and by crop.2: This detailed analysis was done for the 5 main crops (paddy, wheat, maize,
cotton, and sugar cane), which account for three quaners of total output (by value). The impact of
degradation on all other crops was estimated by applying the average resulting from the more detailed
analysis.
42. For losses due to degraded rangeland, the approach was to estimate the share of Pakistan's
total livestock population that could live on natural rangeland, based on livestock nutrient requirements,
observed rangeland nutrient yields, and average rangeland utilization rates2 . Then, this carrying capacity
16M.G. Wolman, "SoilErosionandCrop Productivity: A WorldwidePerspective,"in Soil Erosionand Crop
Productivity, 1985.
l7Mian and Mirza(1993).
18"The Costsof Land Degradationfroma NationalPerspective:an Assessmentof AfricanEvidence", J. Bojo,
World Bank, Nov. 1994. This paperincludesa surveyof 12studiesthatcalculatednational-levelproductivityloss
(% per yearlas a functionof eithertons/haphysicalsoillossesor cm of soilloss. The productivitylosses appear
"wellclustered' in therangeof 1-5%incrop lossesper centimeterof soillost(pg. 16).
1sMargulis. pg. 8, whichsummarizesCrossonandStout.
2 OAnalternativeapproachtoestimatingthe impactof degradationis to placea valueonthe additionalinputs
requiredto compensatefor thesoil degradationand lossof nutrients. However,thereis no availabledata from
Pakistanthat providesadequatenutrient lossdata to allowsuch calculations. Datafrom Indiashows that, overall,
farmers usefewer inputson degradedlandthanonhigherqualityland -- whichsuggeststhat, over the mediumterm,
farmersdo not engage in nutrientreplacementstrategies.
21 Data istakenfrom "RangelandManagementin Pakistan,"by Dr. NoorMohamemad,InternationalCentre for
IntegratedMountainDevelopment.nodate. Rangelandproductionandcarryingcapacitiesare given for9 rangeland
areas (pg. 8); ijvestocknutrientrequirementsare givenfor 8 differentanimals (pg. 176-77). Livestockgross income

23. 15
was subject to reduction factors due to rangeland degradation. The estimated amount foregone represents
the value of rangeland degradation.
3. Result
43. The estimated agricultural productivity loss due to land degradation in Pakistan is $353
million per year (in 1992/93 prices), or 6.8% of annual production. Low and high estimates of the total
cost have been calculated by simply adding and subtracting 10%, for a range of $317 - 388 million per
year. The estimated losses for specific crops vary from 21% for paddy ($53 million), to 13% for wheat
($211 million). 11% for maize ($20 million), 2.5% for cotton ($63 million), and no significant yield
impact for sugarcane (see Tables 8-14). The estimated value of lost production on all other agricultural
crops is $7 million. Note that these estimates do not take into account hypothetical indirect production
losses in either upstream or downstream industries, such as agricultural inputs, cotton manufacturing, or
food processing.
44. For rangeland, the annual losses fall in the range of $90 million to $160 million per year,
based on a 20% to 35% decline over time in the carrying capacity of natural rangelands (see Table 15).
Even the upper end of this range is more conservative than the estimate cited above conceming the full
extent of current rangeland degradatton.
45. These estimates provide the current annualloss in agricultural output due to soil degradation
that may have taken many years to develop. (It is not possible to consider the immediateyield losses due
to land degradation in the previous year only.) This measure is not inappropriate, however, since soil
degradation is effectively irreversible for a given area within a short- to medium-term time frame. The
current (one-year-only) impact of past soil degradation actually undervalues the total loss resulting from
that degradation.
"Erosion-induced productivity loses are not confined to a terminal year. but accumulate over
touchor all of the intervening period. Consequently, knowledge of the effect of degradation
on costs in a terminal year is incomplete... The way to compensate for these deficiencies is
to calculate the present value of the annual productivity lOss."
22
If one assumes a 5% discount rate, the present value of Pakistan's agricultural losses due to
degradation amount to $9-10 billion. This large order of magnitude of total losses is the potential benefit to
be considered when contemplating investments in land conservation (see footnote 2). If the present value
of mitigation tnvestmentsis less than $9 billion, then the benefit-cost ratio would be greater than one, and
further feasibility analysis would be warranted.
estimates and degradation-related losses are derived using 1990/91 output data ('Pakistan Farm Income," Mtnistry of
Food, 1993).
22Crosson and Stout, cited in Margulis.

24. 16
G. Deforestation
I. Extent of the Problem
46. The International Union for the Conservation of Nature and Natural Resources (IUCN)
estimates that Pakistan's rate of deforestation is in excess of one percent per annum, with forests cut for
various uses, including for agriculture. fuelwood, and settlement. Deforestation is most severe in the
northem valleys. In addition, the influx of Afghan refugees in the westem border areas has placed
additional strains. Deforestation is also a problem in the densely populated Indus basin. The scrub forests
are also used for grazing, especially in the winter months, and this restricts the production of large
volumes of wood, while irrigated plantations are threatened by reduced water allocation. Many riverine
forests have deteriorated following the construction of upstream dams on the Indus river. Nationally,
about 50 percent of original riverine forests are estimated to have become degenerated beyond economic
viability. One key reason for the deterioration of the forests is the break-down of traditional institutions for
forest management, which in the past complemented and supported the actions of the forest officials.
2. Analysic
47. Forests provide a wide range of economic and environmental services. In addition to timber,
they provide (a) consumptive direct use values (firewood and a wide range of plant and animal non-timber
products); (b) nonconsumptive direct use values (recreation or ecotourism); (c) local indirect use values
(watershed protection. waterflow regulation, flood protection services, and soil retention);23 (d) global
indirect use values (carbon sequestration functions); and (e) option values (habitat for biodiversity, and
source of supply for future gene pools). By using the 'user cost' approach to forestry valuation, this study
only values the commercial timber that is depleted by deforestation, and does not assign values to the
other economic losses resulting from deforestation.
48. User cost represents foregone future income -- in this case, from the exploitation of a
renewable resource. The user cost approach uses the present value of the discounted stream of production
costs required to generate an area of forest equal to the area deforested. The replacement forest will be a
plantation forest witll a maximum of two or three tree species. not a natural forest with a more complex
ecosystem. Nevertheless, this approach captures the economic value of the timber lost through
deforestation.
49. Two methods are used to approximate the user cost: (a) replacement cost, and (b) market
value of the sustainable yield of the reforested land. The first approach uses plantation production cost
data taken from a recent World Bank appraisal of plantation forestry in Pakistan."
5
These costs have been
estimated to be indicative of reforestation costs in Pakistan. These costs do not take into account risk or
profit, and thus foms a lower bound estimate of the full replacement cost. (The annualized user cost is
23tBetween1980and 1988,the threemainreservoirs-- Tarbela, Manglaand Chasma-- lostabout 4.3% of their
combined livestoragecapacityto siltation. Another 7% is projectedto be lostby2000. (World Bank. 1992)
24This approachadaptedfrom "UserCost andDepreciation: APracticalComparisonof NaturalResource
AccountingMethodologies,"Sadoff, ENVDR, 1992. The depreciationmethodof valuationcouldalso be used.
2 sFrom the SAR to thc EnvironmestalProtectionandResourceConservationProject, May. 1992.

25. 17
defined as 10% of the present value of the 10-year cost stream required to reforest the deforested land.)
The second approach gives the upper bound estimate, and is calculated by multiplying the average price
for wood products,
26
by average yields by type of forest, by the area deforested (by forest type). This
estimate is the annual value of a sustainable forest yield.
3. Results
50. As shown in Table 16, the range of estimates for the replacement cost of Pakistan's
deforestation over the period 1980-90 is $28.4 - 36.1 million. The annualized present value of the user
cost approach yields the lower estimate, while the market value approach gives the higher estimate. These
estimates are comparable in the sense that the lower values consider only the direct cost of reforestation
efforts without considering profit or the risk of forest non-survival.
51. As stated above, the annualized value of production losses are a very conservative way to
measure losses due to soil degradation, since soil degradation is, over a 10-20 year time frame, largely
irreversible. Similarly, deforestation-related losses are largely irreversible over a ten-year period. The full
discounted value of the ten-year losses ranges from $600to $722 million, using a 5% discount rate. These
costs will grow higher over time. with continued deforestation and the absence of adequate maintenance of
existing forest areas.
H. Tourism
52. Tourtsm and travel is a small but measurable source of foreign exchange eamings in
Pakistan: tourism receipts from intemational travelers were $163 million in 199127, or 2.5% of total
exports. The trend in Pakistan's international tourism receipts has been flat or even slightly negative in
real terms since 1988, as it has been for the entire South Asia region. However, poor environmental
quality threatens any potential future growth in the industry, through the perceived negative health impacts
of ambient air and water, and the unpleasantness of environmental degradation in urban centers. An
impact of 10-20% per year reduction in international tourism revenues would be quite plausible. On the
basis of this assumed percentage reduction, the estimated foregone revenues are from $17 to $33 million
per year
111.Sunmmaryof Results and Policy Implications
A. Summtary of Results
53. While the total costs of environmental degradation and pollution are unknown, the above
calculations add up to a total of $1.6 billion per year, or 3.8% of GDP in 1992 (see Figure 7). The
breakdown Is as follows.
26The isdicativepricechosen. Rp. 50/ft
2
, or US$57/m
3
. isvery lowby intemationalstandards,but reflects local
prices forfirewood,poles. andother inferiorwoodproducts.
27World TourisnmOrganization Yearbook, 1993.

26. 18
Box 4 Sununary of Major Annual Envirommental Costs in Pakistan (1992)
Impacts on health Low estimate | High Estimate
Problem | and/or production L (millions US$) [ (millions US$)
Urban air pollution Urban health impacts $233 $368
Water pollution. health Urban and rural health $403 $1,093
impacts impacts, esp. diarrheal
diseases.
Water pollution, Higher incremental not estimated not estimated
production impacts costs for clean water
supply.
Industrial liazardous waste Long-term health not estimated not estimated
impacts, esp. cancer.
Soil degradation Loss of agricultural $317 $388
output.
Rangeland degradation Loss of livestock $93 $162
carrying capacity.
Deforestation Loss of sustainable $28 $36
timber supply
Coastal and msarine Unsustainable not estimated not estimated
resources harvesting of marine
resources.
Loss of biodiversity Loss of use, option, not estimated not estimated
and existence values.
Tourism Decline in tourism $17 $33
revenues.
Total Annual Costs $1,092 $2,080
Total cost as % of GDP 2.6% 5.0%
Average Cost - US$ $1,586
as % of 1992 GDP 3.8%

27. 19
54. Not only are these rough estimates, they should also be viewed as lower bounds, given the
exclusion of the many categories of costs noted in Box 4. The overall incidence of degradation, in terms
of 1992 GDP. is in the range of 2.6 - 5.0%, with an average estimate of 3.8%. This incidence is
comparable to estimates made in other countries, such as 2.6 - 6.4% in India, 3.3% in Mexico, up to 5%
Eastem Europe, and less than 1-2% in OECD countries. Since this valuation exercise is somewhat more
complete than some of the other studies, the percentage figures may not be completely comparable.
55. As mentioned in Section 1, the overall limitations of the "back-of-the-envelope" approach to
valuing environmental costs are very clear. The methodologies. data, and estimates of 'average' costs and
values are all subject to debate. For that reason, all assumptions have been made explicit, and the authors
invite updates to all data, methodologies, and estimates used herein. Also, categories of costs of
environmental impacts not even estimated here could be added in. The purpose of this exercise is to
establish the overall magnmjdiof costs, as the basis for assigning preliminary priorities for more detailed
policy and project analysis.
B. Projected Future Environmental Costs
56. A very preliminary estimate of future environmental damages was made for the year 2010.
The estimates were made by forecasting both future environmental costs and future economic output, on
the basis of assumed upper and lower growth rates for each (see Table 17). Growth in air pollution is
estimated to be 8-12% per year, based on projected urbanization rates exceeding 10%, projected transport
growth exceeding 10-15%, and power sector growth from 1980 to 1990 exceeding 7%. Water pollution
health impacts are estimated to grow 5-10% per year, based on continued high population growth, high
urbanization, and increased industrialization. Soil and rangeland degradation impacts are estimated to
grow 5-6% per year based on continued population growth and increased pressure on marginal lands.
Deforestation is projected to increase 3-5% per year, based on continued population growth, continued
demand for fuelwood, and increased pressure on degraded lands. Foregone income in intemational
tourism is projected to increase at the of 5-8% per year (which does not preclude underlying growth in the
tourism industry).
57. On the basis of these trends, the future total impact of environmental costs is estimated to be
4.2 - 7.9%, assuming a low rate of economic growth, and 2.9 - 5.4% assuming a higher rate of economic
growth.
2 8
It is noted that even in the best scenario, the economy would not simply 'grow out' of its
environmental damages -- and under most scenarios, the environmental costs get worse than 1992 levels.
These estimates are clearly 'back-of-envelope,' and do not assume any strong interventions on the part of
the Pakistan government to prevent the growth in environmental damages. If and when Pakistan makes a
more concerted effort to steni these costs, more detailed analysis will be required to estimate the reduced
magnitude of costs, and the impact on short-term growth, however slight, of improved environmental
management.
28The lower andhigher ratesof economicgrowth are basedon assumptionsused in the2010report, whichare (a)
basecase scenario,GDPgrowth of 5% for 1997-2005and 4.5% for 2005-2010;and(b)higher scenario,GDP
growth of 6.5% tfor1997-2005and 8% for2005-2010.

28. 20
C. PolicyImplications
58. This paper shows clearly that water sector issues dominate the environmental issues facing
Pakistan. First, water-related health impacts have great economic costs (approxitnately $750 million per
year). Second, water-related losses in agricultural productivity through water-logging and salinity
problems lead to additional losses of $300 million per year, and water-logging and salinity account for
85% of all agricultural productivity losses. Combined, these two water management issues comprise 68%
of the total negative environmental impacts valued in the paper, and are the largest losses for any one
sector in Pakistan.
59. Second. health impacts due to both water and air pollution have great economic costs (about
$1.05 billion per year). Not all of these costs are immediate financial costs, however, since they include
the statistical value of premature deaths. Economic and social savings gained through improved
environmental management are highly progressive, in that the beneficiaries -- in both urban and rural
areas -- are overwhelmingly poor, since the poor are less buffered from the health and income impacts of
water pollution. air pollution. and soil degradation, than the rich.
60. Third, the magnitude of environmental degradation (nearly 4% of GDP per year) is enough
to offset much annual growth reflected in traditional national accounts, indicating that traditional growth
measures are over-stated. The magnitude of this estimate would be even higher if such problems as toxic
waste. biodiversity. river and coastal resources, and the rapidly rising cost of providing clean water. were
included.
61. Fourth, many environmental issues -- including industrial pollution, rangelands, forestry,
biodiversity. and cultural property -- need attention, and the setting of proper priorities and sequencing of
mitigation measures requires careful analysis of the cost-effectiveness of various mitigation strategies.
Investments in "the environment," like for any other sector, should be approached with the objective of
achieving the highest rate of return possible.
62. Fifth, the trend for all of these costs is worsening, and will continue to do so unless
measures are taken to slow, stop. or even reverse the trend. These costs, therefore, represent the 'costs of
inaction.'
63. Finally. the most important policy and investment measures required to address the above
issues are:
(a) Expanded and reorganized provision of urban environmental services, including
water, sanitation, and solid waste services. Increased capital investment will surely be
required. Simultaneous reorientation of the sector towards cost recovery, service provision,
and service expansion, primarily through commercialization and/or privatization reforms, is
also required.
(b) Continued attention to irrigation water pricing and management, including greater
attentioni to system maintenance, in order to reduce the high impact of salinity and water-
logging on Pakistan's agricultural sector. Fundamental policy reform will be required to
achieve long-term solutions.

29. 21
(c) Greater efforts to encourage land conservation measures. There is no simple answer
here, and the required efforts may involve land policy and resource tenure reform, and
research and extension on low-cost conservation technologies. Also, pricing reform of
agricultural products and inputs (ranging from guaranteed procurement prices for
foodgrains, to artificial incentives for cash crops, to subsidized inputs) would have
fundamental impacts on land use, with related implications for land management and
conservation.
(d) Increased regulation and enforcement of air pollution control standards, combined
with some use of pollution taxes and other market-based instruments in the industrial,
power, and transport sectors. The industrialization process in Pakistan is proceeding in a
very pollution-intensive manner, partly because there are no real disincentives to pollution.
(e) Increased regulation (and enforcement) of industrial water pollution and hazardous
waste generation. Regulatory and market-based approaches -- both carrot (subsidies) and
stick (taxes) -- should be used. Evidence shows that using carrots as well as sticks,
particularly in countries with a history of regulatory noncompliance, can ease the transition
to greater pollution prevention and abatement (particularly if the subsides are strictly time-
bound and are not open-ended)."
(f) Energy pricing to encourage greater efficiency, including the cost of electricity for
irrigation.
(g) Creation of incentive structures to protect natural forests from degradation --
involving greater local management and ownership.
(h) Greater use of subsidy-removal and pollution-related taxes as part of ongoing deficit
reduction efforts. Reduced spending on subsidized agricultural inputs and on electricity,
cotnbined with greater reliance on pollution taxes and user charges, would benefit both the
environment and the deficit. These reforms should be pursued simultaneously with any more
targeted regulatory/enforcement measures and investment initiatives.
64. It would be premature to recommend more detailed strategies for addressing Pakistan's
highest priority environmental problems, since this paper completes only half of the desired cost-benefit
framework. However, it does invite that a similar 'back-of-the-envelope'approach to estimating mitigation
costs be undertaken. As for the priority areas requiring more careful analysis, the findings from this study
are fairly clear At stake are measurable savings in economic well-being of several percentage points of
GDP per year.
2sSee "Towardan EnvironmentalStrategyfor Asia," 193,pg. 77.

31. 22
Referenes
Agricultural Development Bank of Pakistan (1991), Agridigest, Vol Xl, October/December 1991,
Economic Research Department.
Agricultural Prices Commission (1993), Determination of Support Prices, Government of Pakistan.
Islamabad.
Bojo, J. (1994). The Costs of Land Degradation from a National Perspective: An Assessment of African
Evidence, Environmental Sustainable Development Division, Africa Technical Department, The
World Bank.
Brandon, C. and R. Ramankutty (1993), Toward an Environmental Strategy for Asia, World Bank
Discussion Paper 224, Washington, D.C.
Crosson, P.R. and A.T. Stout (1983), Productivity Effects of Cropland Erosion in the U.S., Resources for
the Future, Washington. D.C.
Esrey, S.A . J B. Potash. L Roberts, and C. Shiff (1991), Effects of Improved Water Supply and
Sanitation on Ascariasis, Diarrhea, Dracunculiasis, Hookworm Infection, Schistosomiasis, and
Trachoma," WHO Bulletin OMS, Vol. 69.
Faruqee, R. (1995). Pakistan's Agricultural Sector: Is 3 to 4 Percent Annual Growth Sustainable?. South
Asia Policy Research Working Paper 1407, World Bank, Washington, D.C.
Ghauri, B. et al (1988), A Report on Assessment of Air Pollution in the Metropolitan Karachi, Pakistan
Space and Upper Atmosphere Research Commission (SUPARCO).
Government of Punjab (1994), Air Quality Monitoring in Punjab, Environmental Protection Agency.
Lahore, Punjab.
Government of' Pakistan (1992), National Conservation Strategy, Environment and Urban Affairs
Division
---- (1993). Pakistan Farm Income, Gross Farm Income Generated by Commodity, 1983/84 through
1990/91. Economic Wing Monograph No. 2, Ministry of Food, Agriculture and Co-operatives.
---- (1993), Statistical Supplement 1993-94, Economic Survey, Economic Adviser's Wing.
Hettige, H.. P. Martin, M. Singh. and D. Wheeler (1994), IPPS: The Industrial Pollution Projection
System. PRDEI. World Bank, Washington, D.C.
IMF (1992). International Financial Statisi.
Margulis. S. ( 1992). Back-of-the-Envelope Estimates of Environmental Damage Costs in Mexico, LAC
Policy Working Paper 824, World Bank, Washington. D.C.

32. 23
Mian, A. and Y.J. Mirza (1993), Pakistan's Soil Resources, A Pakistan National Conservation Strategy
Sector Paper, IUCN.
Mohammad. N., Rangeland Management in Pakistan, Intemational Centre for Integrated Mountain
Development, Islamabad.
Ostro, Bart (1994), Estimating the Health Effects of Air Pollutants, A Method with an Application to
Jakarta, Policy Research Working Paper No. 1301, The World Bank, Policy Research Department,
Public Economics Division.
Sadoff, C. (1992). User Cost and Depreciation: A Practical Comparison of Natural Resource Accounting
Methodologies, Environment Department, World Bank, Washington, DC.
Saleemi, A.R. (1994). Pakistan Agriculture Sector Study: Agronomy Crop Production, and Sources of
Productivity, Enterprise & Development Consulting, Islamabad.
United Nations (1993). World Urbanization Prospects: The 1992 Revision, Department of Economic and
Social Information and Policy Analysis.
World Bank (1992), Pakistan: Environmental Protection and Resource Conservation Project. SAR,
Agricultural Operations Division, South Asia Region.
---- (1992). Development and the Environment. World Development Report, Washington, D.C.
---- (1993). Investing in Health. World Development Report, Washington, D.C.
---- (1994), Infrastructure for Development World Development Repor, Washington, D.C.
---- (1994), Pakistan: A Strategy for Sustainable Agricultural Growth, Agricultural Operations Division,
South Asia Region
---- (1995), Middle East and North Africa Environmental Strategy: Toward Sustainable Development,
Middle East and North Africa Dept., Washington, D.C.
Wolman, M.G. (1985), Soil Erosion and Crop Productivity: A Worldwide Perspective, in Soil Erosion
and Crop Productivity, R.F. Follett and B.A. Stewart, eds., American Society of Agronomy,
Madison, WI.
World Resource Institute (1994), World Resources 1994-95, New York: Oxford University Press.

33. Table 1: AnnioalHlealthfncidences andlHcalthCostsdueto Ambient
Air PolluoionLevelsescetlin? WIIO Guidelines
Ctle. K-esctd Lal-oen Tol oIler clilies aboveI mlulOoo Totl1 Il-id-e-ces nd Cost
INCIDENCES
Pner--lu-e &.cllo 1.338 358 351 2.047
I capital d-ipI I,ns ondtickn-ttes
equinn-medical Ucobnetil 4.866,880 1.225.720 317,293 6,409,093
Incidencenofmineeticknesoet
including RADsand RSDs5 269.699,907 73.359.945 74.932 316 417.992.168
cosr LSTrINIATES IN UJSS
(Uppm and Loe, Bounds)
I1c-u-1ire deaths S11.618.195 to S72.526.727 S3.109.895 to S19,413,560 S3.052.599 i S19.055,884 S17.780,689 in S110,996.171
IloIspilaladmso and-icko-ess
eqoingmedinal I talmeol S13.888.833 to 122.887.006 S2.222.935 In 53,302.550 12,280,582 In S3.388.183 S18.392.350 i SS29,577,739
Incidence orminon sicknesoct
ncludindgRADs andRSD) S123.723.838 to S143,646.529 S35.987.373 to S41.348,744 $36,885.3773 i S42,355,691 S196.596.584 to S227,350.963
rolul Cost S149.230,866 to S239,060,262 041.320.204 In S64.064.853 S42.218.553 tn S64.799.758 1232.769.623 lo 0367,924.87
No -nibienl ii po1llctiondt- s a,aialbilefon lo'itsl.ild, Guj--alwa, ,-olia,lIcacn anulpitid CAl-tlution, .ric
bonedonthe -oen boundofaueb-entsir pollution ob-cevd in Indiancitiesafa ompaatblestun

34. to cm-I0 I
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37. Table 4h: ADproach usedfur Estimating the Cost of Air Pollution
Dote-h etemsFincriono(Otto,-, 994) P.etlO
P- -matnMontlily chango i mona/ito = 0 096 * hagoe i P10t (1 100) *oids mortlity ate *e-posed populaon
Rapo-atorn tospitalAdotatot thanp rinepoaoryhospla distoos pe 100.000 II 20*h0ge toRN)10
Ema
5
envy Room Visit. hSge em-geny Mooc-taiLspa 100.000 = 2354 * uooaalehoge to PMI0
Roi-oed Attloty Day oht.oS t roseno--d atiaty day pa p-non pa en = 0 0575 * 1,og. o PM/10
Lown Resposr"oryIl/ossatoChildrenohungetobrooclotios=0000169 c/xseesi=PM10
Asthmsa ohi chihage to thma attcks 00720 ehaoneto RN/I
RosporatorySyopioms eha -- ptoscp -omdsapayenpapo-n =0 183 ch tSootza.lPNtI0
Cho-cB-ronohis okns10sicrh-omo honctoi0s= 0/D 10 theoa= atuN/ID
S0t
Peomtoe M.-sIs,) pe-ooap chne to m-ot-n -00408 c,tno SO'
Resp-ntoeySptom h-atgoa probab.iityfotngh pa l.OOOktdsp ten = 00/St1 th,ge to50D
Chat DiscoPos hngo tohe peohbtbiiyof,hosi d,scmfoo pa 0e0010 ohno in 002
03
Respitory Hospitl kdoossoe thnge in -apiratoy hosp.toadm--oo p pnon - 0 0077 * ohas mi-dilly I-ho. mae0000 (ppm)
Moo. ResootltdAcOn(yDay =oa r- cio-d a-tiaty dapsp peron pa yen - 340 ehnge t I-hon m-aotm o-one(ppm)
RespiratorySymptomsihago = symptomdas pa pson pa ye = 5475 1hn5
e in 1-ho- mimm noose(ppm)
Eye Lntato- ehngoet eyeo--tior pa aditt pa yen = -heost I -ho.. ma --nm 000n (ppm)
Ad-hts E-cabstion chJg to athma attcks pa yen- * 68 JJ chgc toOo=e (ppm)
Pb
Non-Fatl Hean Atucl ehasgetie e-ta het atatlk pa I oo//,onof aa/n agod40-59= 340* mItogtm ehoogein lead
Hypennion. aeo o(thypeneson pa I million oPmaraaed 20 70 = 72.600 t mitnogtm ehnnge e loed
P -emroDsih chDnen =deadpn Id- M ioe ofmalea aed 059= 350 * I hrostm
t
ihao =oI.ead
IQLos lo. of IQ pompn ehhld - 0 0975 * I -- eg-mg ch'ng to lad
.NO2
Resp-ntory Symptom ehngo = topostory symptomspa yn = 10.22 ch-nge = I honrm.--am NO2 (ppm)
CO
Q -uiauteeffeo.. scra
CD2
Q- -utatneeff.ct nooiut

38. Table 5: Companrisonsof Annual Health Costs Averted if Ambient Levelsof SPM, S02. NOx and Lcad are Reduced to WHO Standards: Different Asian Cities
Total Annual Costs Population Per Capita Arnual Costs Per Capita GNP(in ntillion USS) (in nrillion) (in USSper capita) (in 1992 USS)
Pakistan Karachi 194.2 7.9 24.6 420Lahore 52.7 4.2 12.5India Bombay 165.4 12.6 13.2 310Calcutta 205.1 10.9 18.8Delbi 269 9 84 32.2Hyderabad 27.9 5.4 5.2Madras 31.1 5.4 5.8Bangalore' 9.2 4.1 2.2Abmedabad 98.9 3.3 30.0Pune' 36.6 2.5 147Kanpur 64.1 2.1 30.4Nagpur 18.7 1.7 11.2Indonesia Jakarta' 566.4 9.2 61.5 670Philipines Manila' 155.5 8 9 17.5 770Thailand Bangkok"'
5
1.942.0 7 1 274.0 1.840
Annotations Sources:
I excluding Lead India: Brandon, C (1995), Valuing Environmental Costsin India, draf2 oniy SPM and Lead Indonesia Larssen,S.et al (1994), UJRBAIR:JaixartaCity Specific Report,crafl3 onliySPM Philipines: Larssen, S et al (1994), URBAIR: Manila City Specific Report.draft4 excluding NOx Thailand: The World Bank (1994), Thailand: NMiigatingPolluuon and Congestion
Impacts in a I-ligh-gTos%thEconomy5 ambient air reduciuon: estimatesare of costsavertedby reducing ambientpollution levelsby 20%(asopposedto meeting WHO standards).

39. Table 6a: Burden of Water-Related Diseases in Pakistan, 1990 (hundreds of thousandsof DALYs)-
Disease Female Male Total
Diarrhea] Diseases 13 42 13 63 27 05
IntestinalHelnunths 2 43 2 55 4 98
Trachoma 019 0 07 0 26
Hepaitus 0 20 0 18 0 38
Total, Water-related Diseases 16 23 16 43 32 66
Note (-) Estimated data -- see tex- DALYs = disabilirt adjusted ILfe years
Data source: WDR 1993 pp 216-219
Table 6b: Access to Drinking Water and Sanitation in Pakistan, 1980 and 1990 (%)
Urban Rural Total
Waler Supply
1980 72% 20% 35%
1990 82% 42% 55%
Sarutation
1980 42% 2% 13%
1990 53% 12% 25%
Source: WDR 1994 pg 146

40. _ n< rn -. CO --
c Ccc88
_ _n
1°8Ww8-. o O0 O r,,
a= o 0 s> i,
-t 0 - H><~8=Oao°~°wv s
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0 ,° ° Co Oa0_w>
| c w ° °cico
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~°~< a e _<a 2,ov883 >>

41. Table R Extent of Soil Degradation
Problem Punjab Sundh NWFP - Balach. N A Pakistan
FATA
------ - - '000 hectares ----------
Total Area Sureyed 20,625 9,222 9.139 19,141 3,685 61,812
Water Erosion 1,904 59 4.292 2,635 2,282 11,172
Wind Erosion 3,804 639 36 280 4,760
Salinity & Sodicity 2,667 2,110 48 502 5,328
Waterlogging 696 625 92 142 1,554
Flooding 915 763 276 598 5 2,557
Ponding 691 245 936
Nutrient Degradation 1,580 246 296 96 2,218
Total Area Degraded
Across All Categones 12,257 4,442 5,285 4,253 2,287 28,226
Percent of Total Area
Degraded 59% 48% 58% 22% 62% 46%
Source: Mian and Mirza (1993)

42. Table 9: Annual Cost of Soil Degradation by
T pe of Deeradation. in Thousand USS
0TowICoI of N'.18FP Pnj.b Sidh B.106hri.0n All P.l0u_ C-,ront Prrd-rtion
SodlEro-on 10,821.35 26.12656 i.861.24 5,177.70 43.98690 0.9 %Solinir,
2,246.38 141.01091 58,41805 11,77523 213,450.58 4.2 lVosnrlocgiog
5.52897 52,84655 14.383.29 6.50319 79.262.01 16 %Nul,i-ot D,plktion 1.13565 6.946.72 660.07 208.22 8.970.67 0.2 l
S.blnt1.. 5 .in Crop. 19.75235 226,930.74 75,322.66 23,66439 345.670.15 68
Al0Oh-r Crop,
7.04644 6.8
All Crops - To1. 1o--ml Lo-t
352.716.59 6.8%

43. Table 10: Annual Cost of Production Lost due to Soil
DEcradation for Pakistan's Five Main Crops. in '000 USS
NWFP Puoj.b Sbdh B.Joohitn Alt PaokIl AA Pkb: . of
P.ddy Sod Eroded 988 77 4,68023 862.26 3,26421 9,79548
Salt Affeod oo 19 11,95979 19.245 SS 3.605.57 34.91143
Wate.ogged 10969 2.489.32 3.030 74 1,20449 6,84224
N.tr,e-ro Depleed 66.97 716.85 240.79 69.21 1.093S2
Total 1.265.61 19,846.20 23,387.67 8,143.48 52,642.97 213 %
XVh,.t Sod Eroded 5.130.79 15.937.55 8744 1,098.92 23,S4173
Salt Affeaed 956 14 87.79948 32.82050 8,OS439 129.660 52
Waterlogped 1,96660 34.751 23 9.50574 5,258 12 51.561 70
N.looti. Depleted 568.09 4,62964 367 03 13795 S,702.71
To.t. 8.621.62 143,117.91 43.647.74 15379.38 210,766.66 12.7%
*tohe Sod Eroded 4,697.92 784.17 3 05 1409 5.499.23
Salt AfTeted 1,1S907 5,872 16 155.46 82 28 7,290.97
Watelogged 3,450.79 2.4S525 58 31 3881 6.033 17
Nate,rt Deple-ed 520 16 22779 1 28 I 02 75026
Toal 9.857.94 9.369.37 218.10 136.21 19.581.63 11.2%
Coton Sod Eroded 1 31 4,72083 12081 0 50 4,S4345
Salt AOeted 033 35.35120 6,16279 295 41,517.26
Watrlogged 0.66 13,11085 1.69143 1.73 14,804.67
Nwt-eru Depleted 0 15 1,371.34 50.70 0 04 1,422.22
Total 2.45 54.504.21 8,025.73 5.22 62,587.61 2.5%
S.uZ.tone Sol E-oded 2 56 7S 0.66 001 7 00
Salt Affrecd 0 65 28 2 3.42 0 05 6240
Wa.teeogged 1 24 9 90 9 07 0 03 20.23
Nut-eos Depleted 0.28 I 10 0 27 0.00 1 66
Total 4.73 43.05 43.42 0.09 91.29 0.0
FloeSlol Crop, . Total [nroo, 19,752,35 226,930.74 75,322.66 23,664.39 345,670.15 6.8%

44. Table II: Annual Production Lost due to Soil Depradation
for Pakistan's FiNe Main Crops, in Tonnes
N'WFP
~~~~~~~~~~~~~~A.lPakistn-
.NWFP Pat'jab Sbldh alotdstrani All Pkdistan d%
Current Pr-odur.-oP-ddy Curnt Prodution 111,90000 1,403.90000 1.272.800.00 327,50000 3,116,100.00
Soil Eroded 12,49482 59,142.88 10.896.17 41,249.01 123,782.89Salt Affeded 1,266.03 151,132.71 243,205.13 45,562.60 441.166.47Waterlogged 1.386.09 31,456.93 38.399 74 15,220.82 86.46.359Nuenieet Depleted 846.23 9,058.70 3,042.76 874.61 13.822.29Torta 15.993.t8 250,791.22 295.543.80 102.907.03 665235.24 213 %
tese.t Cu.re Prodution 1.183.000.00 i1.299,200.00 2.417.90000 813.50000 15,713,600.00
Soil Eroded 48,481.38 150,595.57 8,262.98 17,943.13 225,283.06Sell Affecd 9.03469 829.626.75 310.124.44 76,390.26 1,225,176.13Watrlogged 18,582.63 328,368.15 90,576.72 49,684.55 487,212.04Nutrients Depleted 5,367.94 43,746.00 3,468.08 1,303.52 53.885.55Total 81,466.63 3520336.47 412,432.22 145221.46 1,991,556.78 12.7%
Staie Curent Produc.ion 771.400.00 395,900.00 6,000.00 4,300.00 1,177,600.00
Soil Eroded 31.612.16 5.276.68 20.51 94.84 37,004.18Sa11Affeted 8.00124 39,513.61 1,046.08 553.63 49,114.56Waterlogged 23.22028 16.723.16 392.39 261.18 40,597.02Nutrietsu Depletd 3.500.15 1,532.81 8.61 6.89 5,048.45Total 66233.83 63,046.25 1,467.59 916.54 131,764.22 11.2%
Cotter Cuent Produtior 700.00 8,237,100.00 815,400.00 500.00 9,053,700.00
Soil Eeuded 4.78 17,194.92 440.02 1.84 17,641.57Salt Affected 1.21 128,761.53 22,447.05 10.73 151,220.52Watrlogged 2.39 47,754.34 6,160.78 6.32 53,933.82Nutrients Depleted 0.53 4.994.90 184.68 0 13 5,180.24Total 8.91 198,705.69 29,232.54 19.02 227,966.10 2.0
Su.arCr-o Cuen Produr.-oo 4,428,400.00 20,044,800.00 13.556.800.00 28,900.00 38.058,900.00
Soil Eroded 181.37 267.23 46.36 0.64 495.59Suit Affected 45.90 2,001.11 2.36497 3.72 4,413.71Watrlogged 87.40 700.26 641.82 2.04 1,431.52Nutrie.ns Drpleted 2008 77.63 19.46 0.05 117.21Tatal 334.75 3,046.23 3,072.61 6.49 6,460.04 0.0 1'.

45. Table 12: Area. Production and Yield by Crop
and bv State for the Year 1992/93
Crop .NWVF' Pojtab Sidh BaloWhi,t. All PoIzb,
P.ddy
.A.tn(OOOha) 62 1.222 589 121 1.993
h6bd..on (000 ) 112 1.404 i.273 328 3.116
Yeld (kgha.| I 602 1.149 2.162 2,711 1,956
-ta(000 ha) 950 3,749 1.104 386 8,1S9
Po-od.m-(OO0,) 1,13 11.299 2.418 814 15.714
Y,ld (kgAa) 1,246 1,963 2.191 2.108 1.877
Area(060ho) 52S 323 12 4 068
Prod.onon (000 1) 771 396 6 4 1,178
Yield (kgh) 1.462 1.224 496 1,024 1.051
Coton
40cc(000 ha) 0 2.439 397 0 2.S37
Producoon(000) I 8.237 815 1 9.054
Yjld (kglr) 292 529 324 417 390
Arcn(000 ha) 100 536 248 I SS5
Prodo-on (000t) 4,428 26,045 13,557 29 38.059
Yi.ld (kg/h) 44 37 55 48 46
Toltl A-oa -rdr Or
F. Crops(060 ha) 1.640 10,269 2,350 512 14,771

46. Table 13: Yield Reducin2 Factors b%Crop
and by Extent of Decradation
Crop Type of Degtod.ton Light Nfoder-te S-e-
P.ddy Soil Eosion 2.0% 50.0 % 100 'Svinity 20.0 % 45.5 % 60.00i
W.trrlogg.g 1.0% 25.9% 60.0Nrientt Lor. I.0 3.0% 52.00
ViVh-t Soil Ero-io- 20% 5.0 % 10.00S.lioiy 15.8° 29.0% 42.40Woznl.oggmn I 0 % 29.2 % 79 0 i
Nutritnt Lo. 1.0% 2.0% 3.00'
Nioke Soil Erosion 2.0 9. 50 % I0.00S.Iiity 20.0 % 40.0% 60.0 i'W.tenloggirg 47.4%. 77.7% 7711-. Nurirts Lo 1.0 9% 2.0 % 3.0
conto SoilErosion 2.0 % 50% 10.0*S4liory 20 0% 40.0% 60.00'
Waenloggig 5.0 % 38.0% 9800N.tenot L.o. 10 % 2.0 % 3.00'
Sog.-.rtte Soil E-os-on 2.0% 5.0 % 10.0S51it01y 200 °' 40.0% 60 0 %WatologrlogS 5.0 % 41.7 % 91.00'
NutriextsLort 1.0% 2.0% 30 9
Source see text