ISLAMABAD. Apr 3: The United Nations here urged cash strapped Pakistan not to cut funds to reduce poverty in a country where 30 per cent of the people live in need, says AFP.

"We really fear that expenditure under social action programmes may become victim of short term economic reforms." said UN Resident Coordinator Robert England.

England said Pakistan had allocated only two per cent of its gross domestic product for such programmes which was the barest minimum when compared to eight per cent being spent by East Asian countries.

'We have often seen the leadership in Pakistan Is preoccupied with short term issues at the expense of long term issues."

At a press briefing he also

criticised the lack of opportunities for women's development and called for a "coherent" national poverty reduction policy which must also address human rights.

Economic reforms and poverty alleviation programmes are vital for economic development, the UN coordinator said, adding that 30 per cent of the 130 million population lives below the "acceptable poverty level".

Pakistan's weak economy plunged into deeper crisis after its nuclear tests fast May, in response to Indian detonations, caused a halt in assistance from several major donors.

"The economic crisis which emerged as a result of nuclear tests and the subsequent economic sanctions was in reality

the outcome of years of poor management. England said, presenting an annual UN report on Pakistan.

The fallout from the East Asian financial crisis also had an effect in terms of loss of export earnings and constrained access to international capital markets, he said.

The country, burdened by some 32 billion dollars in foreign debts was on the verge of defaulting when in November the United States decided to ease sanctions, this led to an agreement with the International Monetary Fund to finalise a 5.5 billion dollars bailout package.

The US also refunded 325 million dollars of the payment made by Pakistan for the purchase of F-16 aircraft, this

helped boost foreign exchange reserves to around 1.8 billion dollars now.

The Paris and London clubs of international creditors have also approved the rescheduling of 3.3 billion dollars in debts.

"It is a rescue package. It is not a solution to the problem, the UN official said.

England said the assistance provided a breathing period for longer term structural reforms which "are considered essential if the country is to climb out of its accumulated impasse."

"Pakistan needs to come out of the debt trap." he remarked.

He urged the removal of institutional weaknesses to ensure that the real burden of national indebtedness was not borne mainly by the uneducated and those lacking health care.