As the helicopter weaved between the craggy peaks of Pakistani Kashmir the sunlight glinted off countless steel roofs where a year ago there was little but rubble.

Landing in a remote mountain village near the disputed border with India, General Ahmed Nadeem stepped from the cockpit with obvious pride. Two years ago on Monday this area was devastated by a huge earthquake, measuring 7.6 on the Richter scale, which killed 74,500 people and left 3 million homeless.

On the first anniversary 2 million were still in temporary shelters, including 40,000 in tents, as the harsh Himalayan winter approached.

Today, however, the story is refreshingly upbeat. More than 150,000 houses have been rebuilt, 200,000 more are under construction and all of the planned 600,000 will be finished by the middle of next year, according to officials from Pakistan and the UN. They describe this as one of the world’s most successful reconstruction operations — outstripping the efforts after the 2004 tsunami — and a model for the response to future disasters.

They say that the success lies in a radical approach: giving money to victims directly and encouraging them, instead of non governmental organisations (NGOs) and aid agencies, to rebuild their homes.

“We started with a lot of hiccups,” General Nadeem, the deputy head of Pakistan’s Earthquake Reconstruction and Rehabilitation Authority, told The Times. “But when you look at the almost finished product now, it’s something very unique that’s been done on such a large scale.”

There is a consensus among international aid organisations that Pakistan has made a surprising and exemplary recovery from its worst natural disaster. “When you fly over Kashmir you can hardly believe there was an earthquake two years ago,” Jean-Christophe Adrian, of UN-Habitat, the United Nations housing agency, said. “It’s really impressive — better than anything we have seen before.”

Two years after the 2004 tsunami only 50,000 houses had been rebuilt in Sri Lanka, which is far smaller, more developed and less mountainous than Pakistan. Two years after Hurricane Katrina, 250,000 people are still waiting to return to their homes in New Orleans. “In Sri Lanka, if you were a lucky victim with a good NGO you were fine, but if you were unlucky you got a shack,” Mr Adrian said. In the confusion caused by reconstruction being delegated to dozens of international agencies and NGOs, millions of pounds of aid were wasted as corrupt officials siphoned off funds and local contractors overcharged foreign organisations.

With £3 billion of foreign aid pledged — including £196 million from Britain — Pakistan’s problem was not how to raise funds, but how best to spend them. So it decided that, for the first time, all housing reconstruction funds would be given directly to the victims. Each was allocated 150,000 rupees (£1,200), paid in three instalments with regular checks to ensure that it was spent on building houses strong enough to resist another earthquake.

The results were not always a success. Muzaffar, whose wife died with her mother and sister during the earthquake, still has not started to rebuild, saying that the money is insufficient and that the construction standards are too high. He says that the cost of labour and building materials has tripled in the last year. “People are still unhappy,” he said. “There’s been progress, but not up to expectations.”

Aid workers admit that six months were wasted because the World Bank, one of the main donors, set construction standards too high, insisting that all houses were built of concrete and steel. Since January standards have been lowered to permit traditional building methods, using stone and wood. Reconstruction of schools is painfully slow — 800,000 children are still studying in tents — and public services have yet to be restored in many areas. On housing, however, the new approach appears to have paid off.

“If the Government or NGOs had been doing it, there would have been a lot more problems,” Iftikhar Khalid, the deputy head of Oxfam in Pakistan, said. “This way, the people have ownership.”

Earthquake Aftermath

7.6 on the Richter scale

74,500 people dead

70,000 people severely injured or disabled

3m homeless

585,000 rural homes severely damaged or destroyed

40,000 urban houses severely damaged or destroyed

Sources: Times archives; Asian Development Bank; DFID; DEC; USAID

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