privatisation of PTCL part deux

moizza said...
I’ll pitch in for privatization if you can convince me the following issues will somehow be countered:1. Telecommunication, gas, electricity etc. are public goods that have become significant enough to count as indicators of a high standard of living in any area of the country. A private company that operates on the principle of profit (and efficiency is defined in terms of the cost effective ways to achieve profit) is hardly likely to have the incentive to invest in infrastructure in far flung, poverty stricken and terrain-wise inhospitable areas such as Balochistan. Under state control or in the garb of an even public-private enterprise, profit concerns are traded off with concerns of good governance. Admittedly, Pakistan is missing covering barely half of the are with a telephone network but that just makes a case for a further decline in the scope of service in private hands.2. Siphoning money abroad is actually a minor issue compared to the larger implications of the PTCL Act Of 1996; specifically with regards to Jarrar’s statement “in this case theres not much to worry about cos the company that had the highest bid only controls 26% of PTCL.10% is on the stock market while the other 64% belongs to the government.hence they cant take the profits and run.”“Section 90 of the Companies Ordinance, 1984 requires that the rights as to profits, votes and other benefits between various classes of ordinary shares are to be proportionate to the paid up value of such shares. Through the Pakistan Telecommunication (Reorganization) Act, 1996 the company has been exempted from the provisions of Section 90. Except for voting rights the "A" and "B" class ordinary shares rank pari passu in all respects. "A"[insert: 74%] ordinary shares carry one vote and "B"[insert: 26%] ordinary shares carry four votes.”Implication? The 26% shares sold are all B class shares i.e. will give the holder 26*4 = 104 votes while the government will have 62 only. As a minority shareholder it is unlikely to be able to swing any sort of clout which goes back to issues of money draining out; security control; and subsidized provision to poor villages in remote areas etc. You’d think there would be a way out of it? The above quoted article continues“The "B" ordinary shares are intended for sale to the strategic investor on the privatization of the company. "A" ordinary shares cannot be converted into "B" ordinary shares. However, "B" ordinary shares may be converted into "A" ordinary shares at the option exercisable in writing submitted to the company by the holders of three fourths of the "B" ordinary shares. In the event of termination of the license issued to the company under the provisions of Pakistan Telecommunication (Reorganization) Act, 1996 or any change of control of the strategic investor within seven years of transfer of "B" ordinary shares, the "B" ordinary shares shall be automatically converted into "A" ordinary shares.”What is the likelihood of conversion? It’s a private company not the Pope.3. Protests against privatization have been registered at the party level, the military (who call it a strategic asset and hence see privatization as exposing sensitive state communication to external control), trade union level (and to that end “yes people lose their jobs.but overall consumers benefit from better service” is harsh. I really don’t want a better service than the one I have, ESPECIALLY at the cost of a high unemployment level. Its Mobilink I have a problem with, not PTCL/Ufone.) and various civil associations. The government in its characteristic ways has responded through diplomatic press releases, buying off workers, and crackdowns on union leaders. If the state role in the economy has to be limited, coercive interference is not way to do it.4. Yes WAPDA should be privatized. It’s a blood sucking leech. But not PTCL. We have got to be the first country that privatizes a profit making company. Service providers at the national level always tend to be monopolies (the bar is too high for an average investor). To that end at a personal level, I have my doubts about the notion of improved customer service etc. There is no other company rivaling PTCL in the range of provision because of the prohibitive costs to, so there will be no competition so to speak.
9:22 AM
Jarrar Shah said...
excellent points.firstly i think ure right about the minority/majority share holder thingy.on a personel level i dont have a problem with foreign entities taking out profits as long they are paying taxes to the GOP,expanding businessess and jobs in Pskistan.like you said theyre not the pope but at the same time they are a profit seeking enterprise.and Pakistan with a teledensity level of 3% is a huge potential market.as for not wanting better consumer service at the expense of jobs.well i dont agree with the fact that PTCL is giving good services.one of the hardest things to do is to get a phone connection.if u develop a fault or wind knocks down ure wires, it takes them a good five-six days if youre lucky to fix the proble.it takes a good month or two again if youre lucky and well connected to get a land line connection.so frankly PTCL service wasnt really that good.jobs is a harsh thing and i know.but why should any organisation be overstaffed.the point of a telecom company is to provide services and employment but not over employment.ure right in saying that PTCL was profitable so why the need for privatisation.the point was that PTCL's profitability wouldve lasted two years at the max.reason being that the govt. deregulated the telecom industry 2-3 yrs ago.hence the arrival of worldcall,GO CDMA,teletips etc.because of that deregulation,150,000(should be more) poor people became entrepreneurs.their business being PCO's all over Pakistan.i have a huge problem with mobilink believe me.they should be fined.im just too lazy too change my provider.but these providers are a huge competitor to PTCL as well.for the first time in history the number of mobile users surpassed PTCL consumers.people like us who have access to both are using mobiles more and more.all this means and meant lower revenues and consequently lower profits for PTCL.once the profits died up PTCL like before and like WAPDA right now would have become a subsidised govt. utility provider.PTCL is no longer a monopoly in the telecom sector.hence to expect them to be profitable for long is hard to imagine.now PTCL being in private hands does a few things.firstly it stops being the govt. headache and us tax payers headache in the future.secondly the govt. gets a record amount of money that will be used to lower our debt and 10% of the money will go to poverty alleviation.thirdly being in private hands, PTCL will become efficient. i dont know of many foreign firms that are not more efficient than govt. entities, hence it gives PTCL a better chance to survive in a competitive telecom market.finally and most importantly it sends a signal to the rest of the world in general and flushed with oil wealth gulf investors in particualr that Pakistan is an exciting and growing economy where money can be poured in and opportunities availed.this is how Maoist China lifted 300 million and counting poeple out of poverty.will jobs be lost.perhaps.but according to my understanding not for the next two years.after that meritocracy will take place in PTCL.there are two sides to the job issue.if someone who was placed in PTCL by a political bigwig to establish patronage does not deserve to be in PTCL and is fired after a two year period so be it. what we have to understand is that govt. employees are usually political appointees.merit needs to be introduced in our society.govt. cant do that.private sector can.as for services going to far flung areas.thats a concern.but with the introduction of wireless loop by PTCL and others i think it wont be very expensive to provide coverage to far flung areas.i hope i dont sound like a blood thirsty capitalist know it all.its just that we need to move fast.the people of this country have suffered more than enough.its time prosperity started reaching our society cos the world will leave us far behind.the govt. if it was capable would have done what needed to be done.unfortunatly govt,bureacracies cant run enterprises.its not in their make up.its not in their training.its not in their culture.plus history's not on their side.there can and will be exceptions but they'll be exceptions to the rule.

as someone aptly described democracy;democracy is simply the least worst of bad political systems.one could say the same about privatisation and market economy.

good news

supreme court has ordered the arrest of all those accused of raping mukhtaran mai.even though theres definetely a bitter taste in the mouth about the whole issue but better late than never.just goes to show how small the world has become.the state can no longer carry out draconian measures and not let the world find out about it.anyway hope the bastards are hung.examples need to be set!!

privatisation of PTCL

in my opinion the privatisation of PTCL was fantastic.to get 2.6 billion dollars for 26% of the shares says a lot.and frankly i have a feeling this will open the floodgates to Foreign investment.one persistent criticism of this priviatisation or FDI in general (and there was reference to this by Moizza in one the earlier posts ) is that these multinationals will take the money abroad.in this case theres not much to worry about cos the company that had the highest bid only controls 26% of PTCL.10% is on the stock market while the other 64% belongs to the government.hence they cant take the profits and run.
government can not run companies.PTCL was a monopoly and that was why it was profitable.by deregulating the telecom industry there was no way in hell PTCL would have sustained profitability in a few years.wapda received a 90 billion rupees subsidy this year.why because it loses money.its inefficient,corrupt and totally useless.find me one fan of wapda in this country and ill show you santa claus galivanting around with his rein deers.its our tax payers money that is keeping wapda afloat.its not enough that we pay too much for electricity as it is.we also have to subsidise it through the taxes we pay.think if WAPDA was private right now that 90 billion could have been spent on poverty alleviation,hospitals,schools,teacher training etc.
i dunno whether people believe in privatisation or not.yes people lose their jobs.but overall consumers benefit from better service and in most cases lower prices.for me the governments role should should be limited to health, education and infratructure.other than that they should just be regulators not managers.

hey people.its too hot.too hot!!!!since talking bt the heat and lahore's electricity's woes isnt fun i wont say much.hopefully ill post something insightful soon.right now my brains fried.need to start watching TV again.something intriguing might come up.ah just have one observation.VIP culture which we all avail from time to time is getting extremely annoying.every Tom,dick and harry has a frigging police escort or dangerous looking body guards with klashinkovs escorts these days.when will they learn.its silly to see ppl getting plates made for their cars if theyre an MNA,MPA,senator,councillor etc.i mean why would you want to get a plate made?and why would you want to get a plate made if ure a friggin councillor??seriously the politicicians/bureacracy/establishment here will never learn.the other day i got really ticked off at some patwari.they create so much nuisance.i needed to get some documents.normally this should take 5 minutes but it took me 5 weeks,numerous phone calls to higher ups to get this guy to do what he's supposed to do.its too hot.AC is not working.im going to the canal....

lahore is burning!! 

Happy birthday BB.

i read this birthday/political rhetoric speech today in the newspaper.thought i'd post it.


Tuesday, June 21, 2005

Waiting for Benazir

By Zia Khokhar

Pakistan People’s Party workers will celebrate the birthday of their leader Benazir Bhutto today. They will be joined by all pro-democracy politicians and those who wish to see a progressive Pakistan adhering to liberal values, championing human rights and promoting a society based on equality.

But who will fill the front rows of these functions? The common folks crushed by poverty and high prices. They are the ones who will shout ‘Jeeay Bhutto, Jeeay Benazir’, for it is they who have suffered the miseries of injustice and unemployment.

And they dream. They dream that one day their leader will free the country from the claws of a puppet regime which took power by violating the Constitution. They dream that Benazir Bhutto will bring democracy, peace, justice, freedom, tolerance and progress to all Pakistanis.

Why are Pakistanis waiting for Benazir Bhutto? Because she speaks for them. She is the vanguard of democracy, a symbol of freedom and the torch-bearer of revolution.

Zulfikar Ali Bhutto took the reins of a demoralised country in December 1971. He turned the country around and the shattered people forgot their collective pain. This great revolutionary and philosopher wanted to change the fate of a debilitated Pakistan as well as reach out to other downtrodden nations. But the Yazeed of that time had other plans. The leader of the Muslim world and pride of the poor was martyred, extinguishing a light of which there is no parallel.

And thus began the darkest nights of repression and dictatorship. A popular struggle was launched to end the martial law of Gen Zia ul Haq and bring to power the daughter of Bhutto Shaheed. The opponent was ruthless, but by the grace of God Benazir Bhutto became the first elected woman prime minister in the Muslim world. She served the nation and worked hard for the people. But just 18 months into her first tenure, the opponents of democracy dashed the hopes of the people. But the people resisted the nefarious plans of the sectarian, fundamentalist and anti-human rights forces and voted her to power a second time.

Her time in power was fruitful. For instance, students, political workers and leaders jailed in false cases were released and rehabilitated. Some 35,000 poor farmers received 12.5 acres each. More farmers would have benefited from this programme had the big landowners not stopped this revolutionary policy by challenging the government in the Supreme Court.

Hundreds of thousands of unemployed youth were given jobs and those dismissed for speaking against martial law were reinstated. Thousands of young people were given loans to set up businesses. The ban on trade unions was removed. Over 40,000 workers in the private sector were reinstated to their jobs. The minimum wage was increased.

The government set up a separate ministry for women’s development. Women’s banks and computer training centres were introduced. Women were appointed judges of superior courts. Some 33,000 women were given jobs as health workers. Admission fees to hospitals introduced by the martial law regime were abolished.

The budget allocation for education was markedly increased. Schooling up to class eight was made compulsory and more attention was paid to technical and scientific education. Some 50,000 fresh teachers were recruited.

Load shedding was brought to an end with major power projects like Ghazi Barotha and HUBCO. Some 18,000 villages were electrified.

The media was freed from black laws, such as the requirement for journalists to get a No Objection Certificate before travelling abroad. Journalists fired from radio and television for speaking against martial law were reinstated. The Sixth Wage Board Award was announced.

In defence, 60 F-16 jet fighters, two frigates and an Agosta submarine were purchased. The army was given a battalion of modern tanks. Pakistan acquired missile technology and modern radar systems.

FM radio and dish antennas were allowed and Pakistan’s first independent TV station, STN, was set up. Mobiles phones and pager services were introduced. Hundreds of thousands of new telephone connections were provided.

Today, as we celebrate Benazir Bhutto’s birthday, the nation is once again reeling under the devastation of terrorism, sectarianism and fundamentalism, and people are fighting for the restoration of democracy and rule of law. The people pray for the end of dictatorship so that democracy, freedom, equality, progress and prosperity can flourish under a people’s government."

Wow.this guy sure will get a ministry if benazir comes to power again.

open letter to the general

Saturday, June 18, 2005

I stopped Mai from going abroad: president
AUCKLAND: President General Pervez Musharraf said on Friday that he ordered a travel ban on Mukhtar Mai to protect Pakistan’s image abroad.Gen Musharraf said Mukhtar Mai, the victim of a punchayat-ordered gang rape, was being taken to the United States by foreign non-government organisations “to bad-mouth Pakistan” over the “terrible state” of the nation’s women. He said NGOs are “Westernised fringe elements” which “are as bad as the Islamic extremists”.He acknowledged that he placed the 36-year-old on the list of people banned from leaving Pakistan while responding to media questions during a three-day visit to New Zealand.“She was told not to go” to the United States to appear on media there to tell her story, Gen Musharraf told the Auckland Foreign Correspondents’ Club. The government lifted the travel ban on Wednesday after Mai appealed to Prime Minister Shaukat Aziz. Musharraf said atrocities are perpetrated daily against women in developing nations round the world - “in Kashmir and many other places”.“I don’t want to project the bad image of Pakistan,” he told the journalists’ club.“I am a realist. Public relations is the most important thing in the world,” he said, adding that media misperceptions would discourage tourists from travelling to Pakistan.“Pakistan is the victim of poor perceptions. The reality is very different,” he said. He defended his regime’s treatment of women, saying it was working for their emancipation. Rape was not “a rampant malaise Pakistan suffers from every day,” he said. He said he was on the side of women and was trying to bring rapists to “justice in the strongest form”. His government was encouraging the emancipation of women through education and by reducing high death rates for women and children. Women’s right were also discussed during earlier talks with New Zealand Prime Minister Helen Clark. “This is a country with many women in powerful positions so we do take an interest. So I certainly have been satisfied today that President Musharraf shares that concern and would like to see his country move,” she said. As well as Clark, New Zealand’s top judge, parliamentary speaker and top business leader are all women.


Very dissapointing,Mr. President.either u have some really bad advisors or you just got your judgement horribly wrong this time round.anyway ure realism ended up doing what u intended to prevent and that is bad PR.infact we r getting hammered in the press.

ure right when u say that Pakistan gets picked on more than other countries and that its negatives are highlighted more vigorously but that doesnt mean we ourselves stick our heads in the sand and pretend as if nothing happened or is happening.we have a brutal tribal/feudal cultural system where a woman is considered to be less than an animal and its sickening.and instead of trying to protect this country's image by preventing the victim from highlighting her case you should be trying ure best to smash this jirga/panchayat nonsense once and for all.better start walking the walk with the talk.and please dont let ure dislike for NGO's cloud your judgement.they do good work on the whole.their attitudes like the mullahs on the other side of the political spectrum can be uncompromising but at least their ideals are way more admirable.there can be no enlightened moderation if the rights of women cant be protected and promoted and frankly we still have miles to go in this regard and such incidents dont help one bit!!

some excellent and further thought provoking comments.
Shahan Zafar said...
As you rightly pointed out, it all circles back to education and economic development. A perfect example of that is the United States (North vs. South) or Europe (European Union). Make the economy so very integrated that regional isolationism has financial repercussions. We can celebrate different ethnicities populating Pakistan while still embracing “Pakistaniat.”Furthermore, I couldn’t agree with you more on how disturbing this problem is for Pakistan. In an unfortunate way, this internal problem plaguing Pakistan somewhat necessitates a common enemy (“Hindu”) for us to be loosely united. What happens when we have made peace with India? Will we ever make peace? I admit these are rambling thoughts and questions but worth pondering


Muneeba Omar said...
Haan I am in complete agreement with you about our identity issues. The only think that unites us a nation besides cricket is being pro-kashmir and anti-India. Us ke elawa, each province's population has issues with the other. Here is some an excerpt from my thesis which details the ethnic challenge in Pakistan. "Although Islam provided a unifying element in Pakistan, the ethnic diversity of Pkaistan proved to be a source of dissension and conflicts. The multi-ethnic and multilingual nature of Pakistan constitutes a formidable challenge to its governability and stability. Each of the four provinces (Baluchistan, North West Frontier Province (NWFP), Punjab and Sindh) has its own language and is distinct in its cultures and traditions, even though they share the same religion. There is a wide income disparity between the four provinces, with Punjab occupying the lion’s share and earning the resentment of the other poorer provinces. Each province is also plagued by identity issues with the Pathans of the (N.W.F.P.) “having more in common with their Afghan neighbours than with the [Muhajir] Sindhis on the other side of the Indus River, whose culture reflects that of Mughal India. The Punjabis of Lahore inhabit a different civilization from the tribesmen of Baluchistan. Pakistan's Kashmiris are something else entirely.” In fact, the only common trait in the political identity of the provinces is that are pro-Kashmir and anti-India. Rarely seeing eye-to-eye on political issues, disputes have often broken out between the four provinces, with Baluchistan and Sindh threatening to separate. In fact, the conflict between the Baluchis and Pathans in Baluchistan, and between the Sindhis and Muhajirs in Sindh has spiralled out of control with the occurrence of collective ethnic riots in which militant groups for each side have caused extensive damage to life and property (See Figure 13 on page 57 for details on the conflicts). Echoing John Stuart Mill, David Laitin argues that it is impossible to found a democracy in a multi-ethnic and multilingual country, and that authoritarianism would be a more feasible and preferable alternative in such a scenario simply to prevent inter-ethnic violence and conflict. Laitin persuasively argues that democracy can only be established in multi-ethnic states provided that there is strong central control, and that the centre is able to make credible threats to regional/ethnic politicians and movements. In Pakistan, central institutions are extremely weak and dominated by feudal landlords who instead of seeking unity have a history of exploiting internal divisions for short-term advantage. Thus one cannot help but be sceptical about the ability of a democratic centre (controlled by Pakistani elites) to control regional and ethnic divisions. In fact, it was under the democratic governments of Bhutto and Shariff that nationalist groups in Sindh and Baluchiston emerged, complete with violent militant factions. Hence, it is reasonable to argue that the democratic rule would lead to the rise of more ethnic groups, increase political gridlock, and aggravate the conflicts since it facilitates political liberalization and ethnic mobilization. In addition, Pakistani democratic governments were never able to make credible threats to regional/ethnic politicians and movements and always had to rely on the army to control and contain the conflicts and movements in Sindh and Baluchistan. In fact, successive federal governments sought to manipulate ethnic differences to promote their own narrow interests. Thus, it becomes all too evident that the Pakistan’s ethnic reality is not yet conducive to a liberal democracy. In order to prevent and control inter-ethnic violence and conflict, a liberal authoritarian regime headed by a benevolent leader like Musharraf (who also has control over the Army being the Chief of Army Staff) is arguably Pakistan’s best option for inter-ethnic harmony as well as eventual democracy.

moizza said...
I think shahan answered his own question. India’s representation as an enemy will fluctuate in Pakistan’s affections but is unlikely to disappear given the legitimacy it gives to the establishment in terms of uniting the country and defence budget allocations. I have a couple of questions regarding Muneeba’s post somewhere down the line your excerpt seems to suggest that nationalist outbursts were a direct outcome of democratic government (well quasi at least) which implies that nationalist conflict is something that is inherent to Pakistan and so efforts should be focused towards quelling it. However ethnic groups are another form of identity politics and authors like Brueilly mark out ethnicity as just another political resource with which you vie with the center for resources (e.g. language as a tool for the Sindhi movement). Instead of focusing on repressive measures shouldn’t any sort of government in power try to at least address the original concerns of such movements? The rhetoric of ethnicity comes much after very basic deprivations such as unemployment, skewed budget allocations etc. As Jarrar pointed out in his initial post on religious politics, the fundos came up because of income disparity and lack of education and what not. Could be the same for ethnic movements.

economic growth,secularism etc is fine but...

what is our identity?how do we define it?how do we make people buy into it?this touches secularism/fundamentalism/feudal everything.this is the key.i said a long time ago in this blog that cricket or sports in general is perhaps the only thing that unites us in this country.otherwise its shia/sunni, in sunnis its depbandis/barelvis etc.ethnically its sindhi/balochi/punjabi/pakhtun/muhajir etc.or its seraiki belt vs rest of punjab or even more pitiful biradiri system or tribal system.arains/jats/bugtis/afridis etc etc.our whole society is characterised by groupings/subgroupings and so on.islam was the unifying force but how do we go about promoting Pakistan first.cos when it comes to Islam, the fundamentalists have taken hold of that and for them its about the ummah first and then pakistan.i have no problems in helping out the ummah but the best way to do that is by strentghening Pakistan and anyway we've pretty much established that the mullah knows nothing.Pakistaniat.how to create?what to do?how do we make a baloch tribal a proud pakistani etc etc.when can we see the day where there is no more talk of provincial nationalism.when its ok for people to move across provinces to work and marry.is it simply education and economic development thats needed.oh and btw what is our culture?

i'd just like to reiterate some of what ive already said before while also adding something insightful to the discussion.
im a great believer in contextualising history. for instance the context of the 99 musharraf coup in my opinion is as follows.1994-96:the second bhutto government is sworn in amid great hopes for the future.expectations are high that this bhutto government would have learnt from all the mistakes it made during its first term.two things stand out.one the PPP government opens up the energy market to foreign investors(a good thing) but allows them to charge extremely high prices for thje electicity they produce.a major reason why we have such high electricity bills compared to neighboring countries(bad thing).also whereas mr zardari was popularly referred to as Mr.10% the first time round does even better this time earning himself the title of Mr.30%.whther true or false that was certainly the popular perception amongst many.1997-99:Bhutto government is sworn in the 2nd time around.again its hoped that this govt mustve learnt from not only its own mistakes but from bhutto govt's mistakes as well.well this govt turned out to be the most repressive govt a democracy could possibly see.ehtisab bureau formed where opposition politicians are persecuted to kingdome come.the supreme court is stormed so as to stop tht court from inititating corruption cases against nawaz sharif.a sitting president is impeached.a sitting army chief is made to resign.the daily newspaper The News is forced to print a single page newspaper on recycled toilet paper(ok i dunno how to define that yellow looking sheet of paper) because it dared to criticise the government.najam sethi the TFT editor is picked up from his home in the wee hrrs of the morning and held incommunicado for several months because of what he wrote in his editorials.finally nawaz sharif introduces the 15th ammendment.this ammendment proposed sweeping changes to the constitution whereby nawaz sharif would have become ruler for life and be known as amir-ul-momineen.basically the 15th ammendment was sharia law.why didnt it get passed.well it was supposed to pass in january 2000 when the new senate with a nawaz sharif majority would have met.unfortunatly for nawaz and fortunatly for us he tried to sack the 2nd army chief in less than a year.we all know what happened next.apart from political victimisation,corruption and finally trying to establish a personel dictatorship by the two parties and their respective leadership, the politicians of the 90's brought our nation to the brink of bankruptcy.

So what democracy are we really talikng about here.why is musharraf's violating the constitution so bad?is it ok to give the constituion a total makeover when u have a 2/3rd majority in parliament?our political parties are run like jagirs.why is it tht benazir is chairperson for life for her party.Why could she not allow amin fahim to become the PM instead in 2002.maybe today she could have been back here being the sonia gandhi of Pakistan.no.our politiicans are in love with power and its perks.hence the opposition for the sake of opposition.i can hardly remember the opposition in anytime giving the government credit for anything.so for me the 73 constitution is no sacred document.yes i would ideally have democracy take root in this country but not at the expense of our dignity and well being as a nation.

trickle down theory seems to have people in a bind these days.i see people coming on TV declaring trickle down theories as being failed policies.for one school of thought it certainly is.for the other its the statist model that has failed.what does the last 50 yrs of economic development tell us.

like ive said many times before.equitable distribution cannot take place all of a sudden.what can take place is increased emphasis/spending on education,health and other essential public services such as infrastructure which includes electrification of villages,roads,sanitation water etc.but when it comes to economic development and creating employment its the private sector that needs to be encouraged.
when people talk about budget for the rich and i ask for alternatives the answer i usually get is that since we are an agrarian economy the agriculture should be helped more.and it should but theres a caveat.statistically agriculture employs 42% of our workforce yet only contributes 23% to our GDP.our whole focus of economic development should be on transforming our agrarian/rural economy intoan industrialised/services-oriented/urban economy.thats when the standard of living will really improve.the problem is basic.we have limited resources.i wont get into the debate about defence spending.taking that out of the equation we are left with a limited amount of resources.so balances and sacrifices need to be made.this year the greatest incentives were given to exporters.thats very sound policy.because if we take a look at and ive said this so many times at china,korea etc its export led growth thats led these countries to development.another sector that been focused on is the small and medium sector.this the sector that will become the backbone of our economy.more needs to be done and if the economy continues to grow at rates of 7% or higher each year the state will have more resources to spend then the previous year.then will we start seeing the trickle down effect.
one last point.this government has also decided to employ the one village one product concept.if implemented this would be something that would be done at the grass roots.but realistically villagers cant become entrepreneurs/traders overnight.but encouraging cottage industry is a good first step as well.

finally education and y'all have put alot of stress on it and rightly so,is the key.and its trickle down effects will become visible in 10-15yrs time as well.hopefully the economy will grow at such a place to be able to provide employment to many educated youth coming out of schools and colleges.and its then that democracy will truly take hold.it will sooner but it will become enshrined for a long long time when the populace is literate in all senses of the word.

thank you all for your comments.i had started developing cobwebs in my head but thanks to you guys ive started thinking again.hopefully the discussion will continue,broaden and expand.this is our country and i dont intend on immigrating anywhere.so on this highly emotional note i shall take leave and go attend my cousins birthday

moizza said...
just to add some grain to the chaff on fundamentalist politics in pakistan --> to legitimize absence of any sort of equitable economic growth, the state had to resort to a religious discourse but it has not been able to hijack it. consequently, right now, the only legitimate and legal voice of political opposition to Musharraf comes from the religious lobby what with their demands that he doff his uniform etc.i don't know (need to study this more) but i think most case studies and literature suggests that allowing democratic participation of religious politics generally tends to undermine the fundo part of the agenda because the non-secular parties in the end have to garner votes and have to deliver.

on jarrar's suggestion that economic development needs to be the vanguard: pakistan's problematic status quo seems to stem from the fact that its political and economic development occurred separately (as opposed to the european experience etc. where colonisation didn't hand over a custom made political set up) so the curative value of just economic development is questionable specially when you take into account that equitable distribution can't really come about without some sort of political plan/government ideology.

to an extent i agree with moizza that the state used religion to mobilise and distract people form its repeated shortcomings.however i dont agree with the notion that fundamentalists when given the chance to take part in mainstream politics tend to lose their fundamentalist edge. in pakistan i strongly believe that if the fundos were to win an election, they would change the constitution immeadiatly so as to make their rule perpetual.the reason why people will support them is two fold.the continued brainwashing or propogation of a particular interpretation of islam to the public for the last thirty odd years coupled with successive 'secular' parties inability to deliever economically as well as politically for the massess.and given the current international environment post 9/11 the fundos with their fundo message could and are becoming more appealing to the public at large.since the state has allowed the MMA people to become the 'thaikadars' of Islam its very difficult to refute their propoganda.For eg.ignoring the fact that the establishment allowed the MMa to win elections in NWFP in 2002, the MMA would have won anyway.the reason being that the MMA chose as their election symbol the Quran.and their campaign was not vote for MR XYZ.it was Vote for the Quran.NWFP heavily affected by tradition and talibanisation in neighboring afghanistan chose the Quran.Turkey is the only muslim country where religious parties have discarded their extremist baggage so as to garner votes.they were forced to do this cos Turkey has been brainwashed secular since attaturk in the 1920's.

finally i still believe that economic growth and development is the better way forward.for a third country living in a competitive globalised shrinking world theres no other way.distribution of income cant happen from day one.and i dont believe that the past 50 years anything of note really happened because there was no coherency in planning or policies.for me 1999 is the base year to rely on.if certain policies (that unfortunatly&with all respect for some) happen to be market driven are employed in a stable environment for 10-15 years this country will experience tremendous positive change.again like i said we dont have to look to examples dating back many years nor do we need to look at countries far from us.it has happened and is happening in South east asia and eastern europe.not everyone can be an industrialist or trader.in a free market there will be some who make it bigger than others.the main point is providing an even playing field to all.that means quality education and health services.if the previous two budgets is anything to go by we can already see a quantum leap in spending on these sectors.its not enough but its going in the right direction.thats something that one didnt see in the decade of the 90's
finally given the cold war.infact given recorded history ive stopped believing in ideologies.they end up being destructive and non-productive.politically the only ideology i see fit is that of good governance.where the leaders dont see themselves as rulers but as servants for the massess.pretty pie in the sky stuff cos once u taste power power corrupts.but when i see musharraf or even shaukat aziz i see people who are genuinely sincere for the well being of this country and its massess.again something that i didnt feel or see in the 90's.finally musharaf has an ideolgy.its not so bad and encompasses just about everything;enlightened moderation.its another story that most of the ruling party doesnt believe in it but at least he himself has a vision.

secularism part II

shahan a friend from aitchison days emailed me his take on the previous post.thought i'd share his thoughts. oh and i have no arguments with what he's written.
Jerry – getting bored I ventured into your blogs and am impressed with the intellectual masturbation you are engaged in. I agree that fundamentalism is one of the key issues Pakistan has to address if it is to move forward in any sustainable fashion. The way I think about this issue – and let me know if you disagree – fundamentalism is a consequence of illiteracy and economic disparity amongst the classes.
In a country where 70-65% of the population has no access to any formal education, the social psychology has to be driven by conditioned sentiments rather than rationale. I strongly believe that our nation has been subjected to a lot of social conditioning in its formidable phase. I am alluding to the orchestrated history our text books convey, the historic “heroes” we are told about through our curriculum and the subtle attempts by state controlled media (at least for the majority of Pakistan’s history) to link patriotism with religion. All these tools employed by the state may have been necessary given the military needs of the nation, but it has left Pakistan with a problem of mass fundamentalism that worries all of us.
Another reason for this fundamentalism is the huge economic disparity between the masses and the social elite. It is only a natural human reaction to try and find reasons to dismiss a thing you desire but can’t have. Religious fundamentalism is an outcome of the frustration and jealousy the masses harbor towards the more privileged class. I am even tempted to qualify this fanaticism as a distraction masses have embraced to forget their more immediate needs and problems that they feel helpless about.
I understand that in your blog you alluded to economic growth as a tool to curb this menace plaguing our country. But I further qualify that we must ensure a better distribution of this economic prosperity amongst the masses.
\r\nA more robust middle class and improving poverty statistics coupled with a more liberal education (text books / madrassas / media) will be a good start to sustain the economic growth our country needs and deserves.------------------------------------------------------------
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secularism in spirit

i was having this really interesting conversation last night with a friend which prompted me to post something about the topic.we were talking about religion in general and islam in today's world.now for people who know me they know im not really a practicing muslim.but im also not anti-islam either.i believe very strongly in the essence of islam etc.in the post 9/11 world islam has become defined as the islam that is espoused by fundamentalist islam.fundamenatlist muslims are the taliban or the MMA in this country.they also include the wahabi clergy in Saudi Arabia as well as the ruling Shia clerics in Iran.all these factions practice a very strict form of Islam.by strict i mean alot of emphasis is placed on literal interpretations and Symbolisms.these were reactionary forces whose roots can be found as back as the 17th century when the Wahabi guy converted(for lack of a better word) to his interpretation of Islam which was based on the strict literal interpreation of the Quran and Sunah.however they really came into their own when western imperialism swept across muslim lands and colonised muslim peoples.these people came up with the notion that since muslims had strayed from the correct path this was Allah's punishment upon them.hence to reverse the punishment Muslims had to revert back to 'Sharia' or the literal letter of Islam.to cut a long story short they continued to grow from strength to strength in post independence era when leaders like gamal abdul nasser,bhutto etc failed to deliever prosperity to the masses.now coming to today's scenario.we have one military ruler trying to reverse the previous military ruler's disastrous legacy.the short cut way is the turkey/attaturk way.crackdown hard and declare yourself secular.the second way is to undermine the credibility of the mullah at the one hand and to provide a credible alternative instead.that credible alternative would be in the form of economic development and greater political freedom.something akin to what mahathir managed to do in Malaysia.there are fundamenatlists in Malaysia but they are on the fringe.by and large Malaysia is a highly tolerant and progressive nation.in todays' Pakistan which has been brainwashed for two decades by a strong dose of Mullah Islam,Attaturk wont work unless Pakistan was to suffer a catastrophe similar to turkey after WWI.unfortunatly if a similar situation/disaster was to occur it would make Pakistanis more favorable to the mullahs as they are not in power.we also should guard against the Shah of iran model.the shah created a society which was totally alien to 90% of the massess.we must first focus on economic development.secondly the state's writ must be extended to such an extent that not only do mosques,madrassa come under its sway,the writ also encompasses tribal areas in NWFP and Balochistan.Secular has come to assume a bad name in Pakistan.its come to symbolise anti-religion which its not.a secular society is merely a society where everyone has their own freedom of choice regarding religion and that the state doesnt impose a religion or discriminate on the basis of religion.in many ways being the Islamic republic of Pakistan doesnt matter cos its a symbol.there is no sharia here.yes there is the horrendous hudood and blasphemy laws but no taliban sharia here yet.Pakistan ideologically was created for muslims not islam.thats the key difference.finally i favor the slightly cautious mush approach cos as i said the vast majority of the nation has been brainwashed and many ppl feel a strong affinity for not only islam but fellow muslims as well.i dont know bt others but even though as a believer in human rights i feel for people being killed maimed anywhere in the world when it involves muslims say in palestine,bosnia,kosovo,chechnya and kashmir i feel stronger pain and interest.i dunno whther its the zia-ul-haq islamiat tht causes that or what.but its true.ill continue but first some feedback.

budget and economy and life in general

fact:there is widespread poverty in our nation;
fact:development is not evenly distributed amongst different regions.
fact:things are on the move in an economic sense in this country

now poverty that has been increasing and accumulating over the past 57 years can not be eradicated by one budget,two budgets or even five budgets.it will take at least 20 years of sustained and focused policies for poverty to be reduced drastically.if growth is sustained, peoples lives will improve in a generation.

secondly what is this nonsense about the budget being pro-rich,anti-poor bullshit??how does a government improve the lot of the poor.it could either hand out cheques to each and every citizen of this country every year.if everyone was to receive an equal amount then that would come out to roughly 6700 rupees.6700 rupees per person per year.or roughly 500 rupees per month.so i guess this option goes out of the window.or the government could do is say to hell with all u smug rich bastards out there.all of you will give half of what you earn to the government and the government will in turn redistribute the money to the 70% people who are poor.not a bad idea.only problem is most of those rich people wont stick around and those who do will soon join the ranks of the 70% poor cos theyre companies would stagnate and die.
but wait what if the government was to slash taxes on all income brackets?what if it was to slash duties on all raw material imports?
would such moves God-forbid lead the tiny winey rich elite to start investing more in their businesses cos cost of doing business just went down to an extent.God-forbid would they start importing duty free raw materials in greater number so that they could use those raw materials not for eating purposes or hoarding purposes but for producing greater quantity of goods for exports.oops this cant be good.cos greater exports means expansion.expansion means more profits for the rich.oh as an afterthought expansion would mean more jobs.permanent jobs.but hey who's counting that.we have to worry about the rich getting richer.fuck the fact that for that to happen the rich need to provide employment.

so giving incentives to businesses such as those involved in exports is BAD.no country in the world went down this path.there are other paths.

south Korea did a different thing.they cut taxes,duties,invested in Human resources etc and produced giants like LG,SAMSUNG,Hyundai.look at them now.they are the world's 11th largest economy.their people who were poor are now enjoying a standard of level enjoyed by those in the developed world.im sure this is confusing.wait it gets more confusing.Japan,Germany post WW2,malaysia,Thailand and now to an extent india.whats going on here.do i sense a familiar pattern.did all these countries give incentives to businessess?well unfortunatly they did and look where it landed them.

big corporations,industries etc theyve been provided incentives so that makes the budget pro-rich.thats bad.

but wait this budget gets worse.theyve slashed income taxes for the very poor from 7.5% to 3.5%.for small and medium enterprises theyve slashed it down to 20%.for salaried classess the following is the breakdownAmount of tax payable on incomes
as provided by THE NEWS
By our correspondent

ISLAMABAD: Tax payable on incomes, according to the budget:

-Where taxable income does not exceed Rs 100,000, — nil.

-Where taxable income exceeds Rs 100,000 but does not exceed Rs 200,000 — 3.5pc of the amount exceeding Rs 100,000.

-Where taxable income exceeds Rs 200,000 but does not exceed Rs 400,000 — Rs.3,500 plus 12pc of the amount exceeding Rs.200,000.

-Where taxable income exceeds Rs 400,000 but does not exceed Rs 700,000 - Rs 27,500 plus 25pc of the amount exceeding Rs 400,000.

-Where taxable income exceeds Rs 700,000 — Rs.102,500 plus 30 per cent of the amount exceeding Rs 700,000.

obviously this shows how the budget has been designed to provide benefit to the rich.

enough said.there are times when the cynicism in this country drives me nuts.there is no mercy,no fairness, the least bit of objectivity.im not saying im objective all the time.but we need to get a bit mature.if not we wont get anywhere.this country belongs to everyone and everyone has a stake and interest in seeing this country move forward.poverty alleviation will only take place if economic growth takes place.pure and simple.economic growth leads to jobs.jobs means incomes.its not rocket science.we live in a globalised,market driven economy.that is a misfortune perhaps.gone are the days when one could isolate yourself from the rest and give subsides and protect industries.we either grow or get left behind and live on handouts given to us by the west now, and india 20 years from now.whether one likes commercialisation of society or materialism and classes divide is a separate issue and frankly due to current circumstances a highly irrelevant issue.its human nature to demand.its human nature to strive.its human nature to grow.if the atmosphere is conducive to business,businesses will grow.and businessess can not grow without adding labor.foreign investment will not come if atmosphere is not conducive.FDI will come if there are incentives and opportunities.so to think that there is a magic wand that will magically eradicate the poverty and everyone knows how extreme poverty is prevalent amongst wide swathes of our society.but due to the fact that there were no consistent policies in the past we will have to endure another 15 years of sufferring.but if we remain consistent in 15 years inshallah the face of this nation would have transformed.
development cant take place in all sectors at once.it probably cant take place in all regions at once.but eventually it will reach people.

as a poor nation we cant become a welfare state just yet.in 15 years inshallah we could.so tolerate expansion of businessess and rich getting richer.cos it will invariably lead to people getting out of poverty.apologies for the length.just worked up on all the negativity on TV.the budget is not perfect.it could have done more.but the budget itself is not bad.could have been better i dont know how that translates into a bad budget.but anyway feedback is welcome.

budget

budget was fairly good considering the circumstances.but then im biased.hehe.exporters given huge boost.and nice slashing of taxes for everyone.people like me instead of having 35% tax now have 20% which is cool.less incentive for me to fudge the books or evade outrightly.hopefully more people will get registered and contribute to broadening the tax base.as far as statements that this is a anti poor budget well huge incentives given to farmers and textiles.two sectors that employ the bulk of the poor.fertilisers made duty free.tractors duties slashed etc etc.minimum salaries raised.anyway all in all a positive budget.inshallah growth will be sustained.I for one had a nice budget celebration in punjab club till 3 in the morning.laterz!!

final day

well i said that i had decided to attend the final day of my course which i did.but boy was i hammered or what.i swear i could hardly see or listen to the presenters.but at least i went.the course is over.ive learnt alot.now its time to implement.wish me luck folks.budget coming out today.this is the craziest part of the political season with all kinds of propoganda being thrown here and there.even though i should know whats coming in the budget, i have no concrete idea.hopefully it'll be a good one.less taxes more incentives.fingers crossed!

2nd day

well the 2nd day of my course just ended.im fairly satisfied.actually im feeling quite good about attending this.as a result ive decided i will wake up tommorrow and finish what ive started.tonight ill try to be gentle.hey cant miss out on a saturday night now can i.there are only 52 in a year.i wrote in some previous post how i felt i was waiting for something to happen.well part of that something has happened in the form of this course.its inspired me.more than anything its given me focus which i badly needed.but we'll see months from now whether i manage to actually walk the walk.

my first executive course.

today was the first day of the first course im taking as a "businessman".hehe.eversince I saw the add about a course being held at LUMS on retailing i knew i had to attend.honestly its been fun.its kind off shaken my thinking in a very positive way.presentations were given by retailers as well as lums faculty.two more days to go.though im skipping the one and a half hour concluding,meaningless session on sunday.who would have the final course session on sunday at 9 in the morning?i mean cant u have it in the evening so that ive recovered from the saturday night beating im going to receive.so i will have a good time saturday night knowing that i have learnt 90% of what needed to be learnt.the other 10%i have the notes.so thats that.work hard play hard!!

political opportunism or principled politics?

the following came in the newspaper.thought i'd post this alongwith some commentary.


WASHINGTON: Syeda Abida Hussain and Fakhar Imam told a meeting here on Tuesday that Pakistan’s salvation lies in the return of a genuinely elected government and a sovereign parliament, not in a system where all power resides in a single individual.

The two visiting politicians had been invited by the Middle East Institute to speak about the political situation in Pakistan. The small invited audience consisted of some of the leading South Asia experts in the US capital. Ms Hussain was ambassador to Washington during the first Nawaz Sharif government.

The couple was introduced by Marvin Weinbaum who praised the political acumen of the two and listed the highlights of their long and eventful political careers. Syed Fakhar Imam was invited to speak first. He began by saying that Pakistan had been unable to stabilise its institutions and unless it did so, its future would not be as bright as it could be. “That’s the essence of where Pakistan stands today,” he added. He said President Pervez Musharraf and his group lack legitimacy and as is the wont of such governments, they are constantly groping for mechanisms that will give them what they lack. He said Musharraf like Ayub and Zia might have found external acceptance but he has failed to match that domestically. The parliament has played no role in the selection of the three prime ministers that have been imposed on the country. All important functions continue to be performed by Gen Musharraf, who has gained enormous powers, thanks to the 17th amendment. A National Security Council had been formed which is presided over by the President, with four uniformed men among its sitting members. It is they who call the shots. The prime minister does not have the moral courage to object to anything, while the cabinet is inconsequential in terms of political authority. Even Zia in the end was persuaded not to set up a National Security Council, he added.

The former speaker of the National Assembly rejected the Musharraf claim that there was no alternative to him. What, he asked, would happen were he to leave the scene for some reason? He also rejected the regime’s claim that the economy is doing well. What space has been created economically is because of the turnaround taken by Islamabad after 9/11, he added. Inflation is running at 10 percent and poverty is up by 34 percent, which means that 45 million to 50 million Pakistanis now live on less than a dollar a day. There is no law and order in the country and sectarian killings are going ahead unabated. The smaller provinces are unhappy and feel alienated. “We have a techno prime minister but in the five and a half years he has been around, he has failed to announce the National Finance Award, which should have been announced three years ago,” he pointed out. He said if Pakistan is to gain stability, free, fair and impartial elections under an independent commission must be held. The sooner the elections are held the better, even this year. A truth and reconciliation commission must also be constituted, he added. “Pakistan, he reminded the audience, was brought into existence through a popular vote. The country’s roots are embedded in democracy, he added. Syeda Abida Hussain began by declaring that Gen Musharraf had given the people “precious little” since assuming power, but there had been a lot of talk of what was going to be done. “He talks and he travels, having beaten Benazir Bhutto’s record in the latter department,” she quipped. He travelled all the way to Argentina, she said, to sign trade treaties with a country with which Pakistan can have little if any trade. She said the 14 years during which civilians had been in power after Zia, it was really the GHQ that was calling the shots and pulling the strings. At the PMA, cadets were trained to govern rather than fight. She regretted that the people of Pakistan had never had the opportunity of voting out a government. It was galling for Pakistanis to be told that they were not fit for democracy. If India had done it, why couldn’t we, people asked, she said. The military, she stressed, was best protected when it was not governing. Today, the military was running everything. The local government system was a disaster. The devolution plan had led to internecine fighting for power and pelf at local levels. She said the people of Pakistan longed for the day when someone holding power would walk away from it. He would be a true hero, she added. She confessed that for a time she thought Gen. Musharraf might be one such man, but he had turned out to be no different from earlier military rulers.

Ms Hussain said it was the right of the people of Pakistan to be empowered to vote in and vote out governments. The governments that come to office should enrich the people, not themselves. She hoped that the United States would use its influence to have true democracy come to Pakistan. Pakistan and the people of Pakistan have tremendous potential but it cannot flower under military rule, she declared.

A lively question-answer session followed the two presentations. Asked if the army would be able to relinquish power, Ms Hussain replied that it had done so on four occasions in the past, so why could it not do so today? It should find it easy to disengage, once the top brass goes back to the barracks, she added. Imam joined the argument to stress that all political parties should agree on a minimum political programme. Asked about the current Indo-Pakistan peace process, Ms Hussain said after the two countries became declared nuclear states, there remained no reason for them to fight. However, peace must be made by taking the people’s elected representatives into confidence. It should not lie in the power of one individual to make peace or war, she emphasised. Imam criticised the President for making off the cuff comments at dinner parties about Kashmir. He called for parliament to be consulted and taken into confidence. It should not be a “one-man show.” Decisions must not be taken behind closed doors but in full public view.

Another attendee wanted to know if the war on terrorism could be effectively conducted were Musharraf not on the scene, to which Ms Hussain said that it certainly could. She charged that the jihadi groups were a creation of the army. Imam held these groups responsible for the sectarian war that had been raging in Pakistan for the last 15 years. He said a political government would be better equipped to deal with the forces of extremism. Answering another question, he said that little had been done to bring about curriculum or madrassa reform though much had been claimed. He said it was the public sector schools where the majority of children go that need reform of the curriculum. He called “enlightened moderation” a couple of “buzz words that nobody quite knows what to make of.” When reminded by a questioner that big business was quite happy with the present government, Imam answered that big business and the army had always gone together. However, there was no economic boom as claimed by the government, except that the wealthy were getting wealthier and the middle class was going under barring those in its upper reaches. He said if Pakistan is really doing as well as is being claimed, why is foreign investment not coming to the country?

arrgh.firstly these two were amongst the first to break away from nawaz sharif to support the general.secondly when their group got sidelined by the chaudries of gujrat in the battle for PML(Q) they alongwith the erstwhile Imran khan (loved him as a cricketer and love him for his hospital(s)) became the strongest proponents of democracy.sounds like sour grapes to me.their comments on the economy well i dunno if the upper classes are the ones buying all those motor cylcles,tractors etc.maybe its the upper classes buying all the mobile connections they can get their hands on.or maybe just maybe its the upper classes who are going to fill in the 50000 jobs created in one week in rural chakwal district due to the creation of three mega cement plants.i wont deny the rich havent gotten richer.but theyve become richer not by looting tax payers or anything (though they may be guilty of tax evasion some if not most of them) but theyve become richer by investing more money in the economy.by expanding capacities.by building new projects.and so far Pakistan does not have an automated workforce.hence theyve created jobs.the reason why inflation has happened in the first place apart from rise in oil prices i.e is because of the surge in demand and the resulting shortage in supply.to be fair there are people who have missed out and continue to live in poverty.in fact many millions belong to that boat.some millions have been lifted up though.so to expect miracles in 5 years is a bit of a stretch considering how thingts were messed up in the past.we are on the right path.its not perfect but things are progressing in the right path.

got tourists?

by changing one simple policy,pakistan can create a tourism industry overnight.legalise alcohol.two things happen.one that obviously the government gets its hands on huge amounts of revenue cos it'll be taxing booze.that revenue can be used to build whatever.secondly goraswill flock.he whole makran coast will become like the thai coast.resort upon resot.our pious arab brethren will flock there as well as europeans looking for sun and fun.karachi people can drive down there over the weekends.us lahoris can fly there.but the point is that without legalising alcohol and foreign brands tourism is not going to pick up.there are only so many mountaineers you can attract to the himalayas and even less historical/archeological junkies to moenjedaro.follow the dubai model.khair this suggestion of mine is pretty much pie in the sky cos general zia-ul-haq's legacy is alive and kicking.in a few years though who knows.