Faisal Bari: Perfect Storm?
Faisal Bari: Perfect Storm?
Faisal Bari: Perfect Storm?
SOME economists and other commentators have been arguing that the economic/financial crisis that
we are facing, though serious, is relatively easy to fix. All we have to do is to a) implement and raise
the right taxes and reduce the wrong ones, and b) reduce overall expenditure while raising
expenditure targeted at the poor and development and cutting other expenditure by a lot.
The right taxes mentioned in this context are property tax and taxes on real estate, agricultural income
tax, and taxes on the income of traders and other groups who are currently not in the tax net.
At the same time, there should be a reduction in indirect taxes like flat taxes on services, sales tax and
taxes on imports. The idea, clearly, would be to increase direct taxes on those who are able to pay while
reducing them for those who cannot, and therefore should not be paying taxes.
On the expenditure side, the idea would be of overall reduction in expenses by moving to more targeted
subsides for the poor, the removal of subsidies, of which there are many for the rich, and the removal of
inefficiencies on the expenditure side.
The overall thought is that if by doing the above the government can remove the fiscal deficit, over time,
as we run surpluses, the problem of twin deficits (foreign currency and domestic fiscal deficit) will
become more manageable.
Sounds simple enough. But we have known all this for decades now. Economists and policymakers have
been talking about agricultural income tax, taxes on real estate and property, and taxes for traders for at
least 30-odd years.
And we have also been talking of making government efficient and re-prioritising expenditures for the
poor, and for development in general and human development in particular for a long time as well. But
all this has not happened. Clearly, it is not so easy to do it then.
The real question is why have we not been able to do what has been mentioned here? When we raise
taxes, and we do it all the time, why is the focus on indirect taxes and usually in presumptive or advance
mode? Why have we not been able to reduce subsidies for the rich?
Why do we have a large sugar industry when we have known for a long time that it is a waste of water
and other resources and the land under sugarcane cultivation can be utilised better for other purposes?
Why do we still end up protecting and subsidising the 50-odd richest families who have sugar mills? And
it is the same story in a number of other areas as well. For instance, why has it been so hard to tax real
estate?
We currently face a political crisis as well. Democracy is limping badly; the hybrid governance
arrangements, once a stable equilibrium for the elite, have been destabilised due to the entrance of new
players. It is not known what the new arrangement will be and when it will become clear, if at all.
I argue that the economic and political crises are not isolated events that have come at the same time by
mere coincidence. The two are connected. At the root of it are factors of political economy that have
been and are driving these dynamics. For long, our polity has been ‘rule of the few, by the few, for the
few’.
Those ‘few’ have been called the ‘elite’ by Ishrat Husain, and are now being called ‘one per cent’ by
Miftah Ismail. It is the rule of those who have had the resources and the power, supported and
bolstered by aspirants to those resources and power. It includes the top tier of politicians, bureaucrats,
the military and judiciary, business folk and the landed: resources and power.
The elites make sure that the rules are made to enrich them further and to confirm the entrenchment
and continuation of their interests. This may sometimes be done through illegal means, but most of the
time it is done using the law. Judges, bureaucrats and army officers get plots and land legally. The
Toshakhana usage was legal. Subsidies and/or protective measures for the sugar or automobile industry
have been legal.
At the same time, the structures have worked hard to control society and to undermine the
development of all institutions and movements that have or could threaten their control. The education
curriculum is controlled to ensure a certain narrative about religion and nationalism. Mass media and
social media are used for this purpose as well.
The development of political parties, grassroots mobilisation, democracy, media and civil society have all
been undermined again and again in our society. Student unions in most provinces are banned even
today. This has made mobilisation and/or organisation of the masses a lot more difficult. It has also
made the development of strong institutions that are needed to underwrite democratic development in
a country that much harder as well.
Is it any wonder then that governance has broken down? And we have not been able to implement
‘simple’ solutions that could solve the economic problems we currently face? It is naïve to think that
solutions and their implementation is ‘simple’.
The structures that have given rise to these problems cannot be the ones that provide us with the
solutions as well. For change to take place, something has to give. It might happen, as the crises deepen,
that the elites and the institutions that protect them start fighting amongst themselves for scarce
resources. Maybe that will break down the current equilibrium.
The current economic and political crisis might be an early sign of the coming battle. Maybe this will
bring about the change in structures that we need.
Many other countries have faced similar crises and some have resolved them successfully as well. But
this does not mean that all can. It just shows that it can be done, though the solutions for each country
tend to be context specific. We will have to forge our own path here. At the moment this looks like a
hard climb.
Wage theft
Zeenat Hisam Published March 18, 2023
THREE years have gone by since the WHO declared the Covid-19
outbreak a pandemic on March 11, 2020. Termed as the world’s
most serious humanitarian crisis since World War II, it is still
being debated whether the pandemic is over or not as new
infections and deaths occur in a number of countries. By February
2023, 6.8 million people had died. Besides, hundreds of millions of
people lost jobs globally, millions saw their salaries cut or work
hours reduced. Most countries have not yet returned to the levels
of employment and hours worked before the outbreak. According
to an ILO report, informality and working poverty have risen
further with the Covid-19 crisis.
While the majority of people suffered from the pandemic, a tiny minority —
corporate executives and wealthy shareholders — reaped profits. A 2022
report, Profits and the Pandemic, sheds light on how 22 leading corporations
(eg, Amazon, Disney, McDonald’s, FedEx) in retail, delivery, fast food, hotels
and entertainment, generated $1.5 trillion for shareholders in the first 22
months of the pandemic, nearly triple the wealth generated in the previous 22-
month period.
Similarly, in the apparel and textile sector, a new report Big Fashion & Wall
Street Cash in on Wage Theft reveals astounding amounts gained by the
owners of the 20 biggest brands in April and May 2020 as millions of garment
workers in supply chains were being laid off. In both cases, the windfalls
primarily came through stock buybacks (company buying shares of its own
stock with cash). The report, released on Feb 27, 2023, by Asia Floor Wage
Alliance, Global Labour Justice-International Rights Forum and 20 garment
worker unions from Bangladesh, Cambodia, India, Indonesia, Pakistan and Sri
Lanka, documents the great wage theft of Asian garment workers which led to
high corporate profits.
Earlier in 2021, the Alliance had brought out a report Money Heist that
surveyed 189 factories and 2,185 workers in the six countries. The report
documented wage theft amounting to $163m as garment producers violated
national laws. Pakistan’s survey revealed that 86 per cent workers were laid off
and 14pc terminated. Workers reported 29pc wage theft, though during this
period overall export declined only 2pc. The majority, 81pc, of workers were
pushed below the international poverty line. With the release of the 2023
report, Asian trade unions and support groups have launched the Fight the
Heist campaign, demanding an end to stock buybacks by the big brands.
Wage theft occurs when employers steal pay from their employees, that is
when they do not pay as mandated by law. Examples include paying less than
the minimum wage, not paying overtime, denying rest breaks, increments,
benefits or facilities committed to by the employer at the time of employment.
Wage theft is not new: it has been a central aspect of business models in
capitalism. What is new is the traction it is gaining among researchers and
labour rights activists, particularly its quantification. In recent years, surveys
and research have come out in several countries. In the US, a 2017 survey
indicated that the annual total wage theft in the US due to minimum wage
violations exceeds $15 billion. In 2019, wage theft in Britain amounted to
around £35bn. A report (December 2021) from Karnataka, India, revealed
that over 400,000 garment workers were being paid below the legal minimum
at more than 1,000 factories since April 2020. Labour groups estimated the
wage theft amounted to more than $50m.
Wage theft is a crime committed by factory owners against workers for which
they are not prosecuted. This theft may be considered morally wrong but is
not termed criminal in countries. However, a change is in the offing: Norway
is the first country to enact a law against wage theft in January 2022. Earlier,
in July 2021, the state of Victoria in Australia, made wage theft a crime.
Through Fight the Heist, the Asia Floor Wage Alliance has initiated a
campaign Wage Forward. The Alliance is demanding that the brands “should
pay an additional living wage contribution on every order they place. The
living wage contribution will be paid by the brand to the supplier, and then
will be distributed by the supplier, visible on the pay-slip, equally to all its
workers”. It will be enforced through a legally binding agreement monitored
by the signatories establishing independent third-party organisations for the
purpose.
Any campaign at the workplace requires the collective agency of the workers.
Only unions can take the struggle against wage theft forward. In this case,
local factory owners and suppliers should be on the side of the workers as the
living wage contribution will come from international brands and retailers and
not their own pockets.
Two approaches
Mohammad Ali Babakhel Published March 18, 2023
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A WoS approach faces multiple irritants. CSOs are often seen as suspicious,
unable to address security issues, and working to get grants. Conducting
research in extremism issues is considered out of bounds, and researchers
often avoid showing interest in this. Partnerships are often hampered by poor
awareness and skills in civil society, and CSOs may not know how to help
prevent extremism. In developing societies, lack of trust between the state and
CSOs creates hurdles.
Parental influence is very important too. Where parents have little influence
over their children’s decisions, they are less able to guard against their
radicalisation. ‘Parent-son’ ties can represent gaps. While fathers are away,
mothers in developing societies have to shoulder the responsibilities. They are
well placed to recognise the early signs of radicalisation; but unless they’re
empowered they can’t do much. Parents should be the first ones to detect
proclivities to violence. But they are not always equipped to address
psychological, sociological and ideological issues. In a recent attack in Karachi,
reportedly, for the last few months, the parents of one attacker were unaware
of their son’s whereabouts. Training parents to recognise and deconstruct VE
narratives will pay dividends.
For two decades, the US and its allies waged a war against terrorism, yet, the
virus of extremism infected many societies. Terrorists may be killed, but
extremism won’t be.
NAP I makes no reference to any policy to address VE. NAP II lists the
formulation, institutionalisation and implementation of the CVE policy. Last
year, Nacta drafted the national CVE policy, which awaits approval. Pakistan
needs separate CT and CVE policies, plans and laws to ensure clarity.
Quiet diplomacy
Aizaz Ahmad Chaudhry Published March 18, 2023
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The writer is a former foreign secretary and author of Diplomatic Footprints.
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Saudi Arabia of recent years has been changing at a rapid pace. Its young and
dynamic crown prince, Mohammed bin Salman, is spearheading the
‘transformation’. The country is diversifying its economy and reducing its
reliance on oil exports. The Saudi Vision 2030 envisages its role as a hub that
would “connect three continents: Africa, Asia and Europe”. Socially, Saudi
society is shedding much of the conservatism that had come to define Arabia
under the House of Saud.
To implement its ambitious agenda, Saudi Arabia is adapting its foreign policy
by rationalising its security relations with the US and reaching out to other
major powers, especially China.
For its part, Iran, too, has an interest in normalising ties with Saudi Arabia.
Iran is under deep economic stress due to the US sanctions, which are hurting
every segment of its national life.
Pakistan can benefit from the Saudi-Iran deal if it puts its economic house in
order.
The US, locked in a competition with China, has cautiously welcomed this
development but may regard it as an attempt by China to increase its influence
around the world. In that context, this development represents a setback to US
policy in the Middle East.
For decades, the US was Saudi Arabia’s key defence supplier and security
guarantor. Of late, some cracks had appeared in the relationship after
Washington failed to persuade Saudi Arabia to increase oil supplies, pushing
up the oil price, which the US felt would support Russia in its war against
Ukraine.
More notably, the US had increased its criticism of human rights in the
kingdom following the 2018 murder of Saudi journalist Jamal Khashoggi.
President Joe Biden even vowed to make Saudi Arabia a pariah state. The
kingdom’s pragmatic moves to normalise relations with Iran and enhance ties
with China are a reality check for Washington.
Even India, which the US had chosen as its partner of choice in South Asia,
prefers to pursue what it calls ‘strategic autonomy’ in its relations with China
and Russia. With the Middle East also drifting away from the US, the latter
might want to explore its options to improve relations with other countries in
the region, including Pakistan.
Israel may also not be happy with the development, but it has kept its options
open. While it remains determined to isolate Iran, it has taken steps towards
rapprochement with the Arab world and steadily increased its economic
linkage with China.
What does this development mean for Pakistan? Our government has rightly
welcomed the news as Pakistan has close ties with Saudi Arabia as well as
Iran. Our collective efforts in the Muslim world will also receive a fillip.
As the economic and commercial linkages between China and these two
countries grow, Pakistan, which lies right next door to these three states, can
benefit the most if its economic house is put in order and industrial zones and
agricultural fields are ready to absorb potential investments from these
countries.
Saudi Arabia has been willing to set up an oil refinery in Pakistan for which
ground work must be expedited. With Iran, we must expand border markets
and optimally use barter trade. Urgent steps are required to make Gwadar
port fully functional to enable it to serve as the regional hub of commerce and
trade.
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The writer is president of the Pakistan Institute of Legislative Development
And Transparency.
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IF one goes by the poll dates fixed by the president of Pakistan and
the Khyber Pakhtunkhwa governor for election to the provincial
assemblies of Punjab and KP, about 74 per cent of the country’s
registered voters will get a chance to elect their legislators within
the next two months.
Soon after that — in another five months — all 122 million voters in the
country will vote to elect their representatives in the National Assembly, along
with voters in Sindh and Balochistan who will choose their respective
province’s assembly.
How will these voters decide who to vote for? The Gallup exit polls for the last
three general elections provide useful insights. Contrary to popular belief, a
decreasing proportion of voters make their choice of representatives along
party lines.
In 2008, this proportion was 24pc which was the highest among the seven
choices provided to survey respondents. This percentage declined to 19pc in
2013 election and went down further to 11pc in the most recent general
election in 2018 when it ranked fifth among the seven indicated bases of
voting.
The exit poll in the 2018 election further showed that the largest single block
of voters — a whopping 30pc — opted for those candidates who had facilitated
or had the potential to facilitate local development such as roads, water
supply, schools, etc.
The second most popular reason for voting was the patronage received for
personal issues, such as help in dealing with the local administration and
police or helping in getting a job, etc.
Some way down the ladder, at number three, was performance within the
assembly that found favour with 14pc of voters. In the past three elections, this
trait had consistently ranked at either number three or four. Ideally,
performance within the assembly should have been the top consideration for
electing an assembly member, but one of the reasons why voters tend to give
less importance to parliamentary performance is that very little information is
publicly available about the elected representatives’ activities within the
assemblies. Whatever little information is available, a major part of it is either
in the English language or some less user-friendly mode, or both.
The attendance of legislators had been regarded as a secret until recently and a
protracted struggle had to be waged to get the principle accepted that it is the
right of the people to know how regularly their elected representatives attend
assembly sittings.
It was in 2012 that this writer had sought the attendance record of MNAs from
the National Assembly Secretariat but it was denied to him, as the information
was stated to be ‘private and personal’.
A final appeal, in accordance with the ordinance, was made to the president of
Pakistan who very emphatically not only reprimanded the secretariat for
denying this information but also directed it to make the members’ attendance
record public for future as well.
It took more than a year to obtain this verdict. This particular case is narrated
in detail to illustrate the reluctance of some of our democratic institutions to
part with very basic information, which is the right of every citizen.
Our legislatures’ system of voting is so deficient that except for some rare
occasions, there is no way of knowing who voted for or against a particular bill
or resolution, because most of the voting is executed through voice votes and
louder shouts translate into the majority.
This amendment, for the first time, authorised National Assembly committees
to receive a briefing on the Public Sector Development Programme from the
relevant ministries ahead of including development projects in the annual
budget.
These are just a few examples of the information needed about legislators to
form an informed opinion about their performance. Each honourable
legislature speaker should ensure that the members’ performance is displayed
for their voters’ information.
Honourable people
Hassan Kamal Wattoo Published March 19, 2023 Updated 2 days ago
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The writer is a lawyer.
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Every morning, they don colour-coded robes, walk into their workplace with
sherwani-clad chaperones, and look down from elevated seats at rooms full of
supplicants. Once court is over, they disappear behind the same closed doors
they entered from, not to be seen again till the next session. This vanishing
act, along with the other idiosyncrasies, isn’t accidental. Vast amounts are
spent each year on maintaining the spectacle that judges are not mere people
and courts are not mere buildings.
This is, of course, complete nonsense. Judges across the globe are regular
human beings with a job to do. Still, nobody challenges the illusion. Because
it’s a prerequisite of any functioning society to believe in things that exist only
in its peoples’ collective imagination, like culture and etiquettes. Judges are
not infallible beings divinely ordained with the power to bestow justice, but
society operates with the assumption that they are, because that’s the best
option we’ve got. Adhering to social constructs may seem silly, but the
alternative (lawless anarchy) isn’t much nicer.
What’s often forgotten is that the judge is meant to be in on the joke. But as
any practising lawyer will tell you, years of life as his lordship can take its toll.
In a 2017 essay titled ‘Judges as bullies’, Georgetown law professor Abbe
Smith proposes that a perpetual power imbalance and daily life that consists
of people bowing and scraping before them can convince some judges that
they’re above the law. And while everything said so far could be equally true
abroad, you can rest assured that this phenomenon’s Pakistani equivalent is
on steroids.
Consider last month, when some honourable lordships were caught using the
influence of their office to try and procure VVIP tickets to PSL. The reason you
didn’t see many lawyers commenting on this is that they’d be crazy to. Power
imbalances are too great and egos too fragile for a culture of honest, critical
discourse to even take root.
This pattern extends to criticism of judgements. Today, judges can rewrite the
Constitution, wrap the daylight robbery of democratic rights in complex
legalese, and most of those who understand what’s happening will struggle to
muster a statement stronger than ‘though his lordship is very brilliant, I
humbly disagree’.
The scope of this judgment is precise, the need for it long overdue, and the
message clear: Pakistan’s legal system needs to cut down on the fluff and
flattery. Respect for constitutional bodies and civility in discourse is
unquestionable. But you can’t clear a 50,000-case backlog if you’re imposing
the need to punctuate every breath with superfluous niceties. In the resultant
inefficiency, it is regular litigants who suffer most.
Focusing on words may seem needlessly pedantic; but small choices add up,
and over decades, they contribute to culture. Why, for example, should the
Supreme Court be referred to as ‘honourable’ if the National Assembly is not?
Is the Senate not honourable? Courts in the US, UK, and even the Hague are
not referred to with this title. Are we claiming to be more honourable than
them?
Well, in our case, it was an honourable court of very honourable people that
murdered Bhutto, betrayed the Constitution it swore an oath to uphold, went
through a brief dam-engineer phase, and found multiple occasions to sell its
soul to dictators.
If that is what the actualisation of this word looks like, maybe we’re far better
off without it.
Redefining goals
Muna Khan Published March 19, 2023 Updated 2 days ago
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It seems there’s still no definitive answer to the questions Prof Whitaker posed
as evidenced by the recent debacle at BBC following Gary Lineker’s tweet. In
case you missed it, the former footballer and highest paid sports broadcaster,
tweeted his dismay at a new UK immigration policy aimed at stopping
refugees from entering the country. He tweeted that it was beyond awful and
“an immeasurably cruel policy directed at the most vulnerable people in
language that is not dissimilar to that used by Germany in the ’30s”.
The reactions were swift. Prime Minister Rishi Sunak described his tweet as
disappointing from someone “whose salary is funded by hardworking British
[licence fee] payers” and suddenly Lineker’s impartiality — or lack thereof —
became the focal point of the debate. However, it felt like impartiality was
being weaponised. The BBC suspended Lineker two days later for breaching
social media guidelines, even though Lineker is a freelance contractor and not
bound by them like full-time employees. His co-panelists and other sports
personalities refused to appear on BBC in solidarity with Lineker and after
much debate on traditional and digital media, he was reinstated.
BBC says it places a great deal of value on its impartiality and its viewers
expect this but I think a lot of the licence fee-paying audiences expect to
watch Lineker’s commentary on sports and may not care for his opinions
outside the show. I wonder what the licence fee-paying audience made of
Lineker’s political views during the World Cup in Qatar where he criticised the
Gulf country on air for its ban on same-sex couples and treatment of migrant
workers. So Lineker should not mix politics on his TV show except when it suits
the bosses, ie the government of the day? The hypocrisy is sickening.
The BBC’s response to Lineker’s tweet has exposed its partiality and disservice
to the audience it claims to serve. It also shows the lengths politicians will go
to, to mount an attack on free speech which will have far-reaching
consequences. The BBC, which is the first public broadcaster, enjoys enormous
influence. It says it reached an average audience of 489 million adults every
week in 2022. But like so many media outlets around the world, it too faces
enormous challenges in catering to a diverse audience which consumes social
media, Netflix over TV and radio. But its most pressing issue is that it be seen
as independent. It can’t do that by cherry-picking which BBC presenter it
wants to censure and at whose behest.
At a time where audiences are drifting away from news, it may even be a good
time to review what impartiality/neutrality means and who it impacts. Quick
answer: it almost always hurts the marginalised. For example, is it objective
journalism if missing people have to share newspaper space with the powerful
agencies that abduct them? Perhaps we need to call for independent
journalism to do the necessary work to ensure audiences’ news needs are met
fairly. Public media, free of political and commercial pressures, play a valuable
role in creating an informed society, thus protecting democracy.
A test of leadership
Abbas Nasir Published March 19, 2023 Updated 2 days ago
The dogged resistance the police met from the former prime minister’s
supporters at and around his Zaman Park residence meant that several
unarmed policemen were injured and could only fire dozens of tear-gas shells
from afar. Some landed in the lane outside and others in the garden of the PTI
leader’s home.
The high courts in Lahore first and then Islamabad intervened to cancel the
lower court’s warrants of arrest that were issued after Mr Khan missed several
hearings. I don’t have legal training, so have lost track of how, why and what
the Islamabad High Court first left to the lower court, and then took up itself
and rescinded the latter’s order. I think the Lahore High Court may have done
something similar.
While the PTI supporters hailed the development as a big win and attributed it
to their resistance, the party’s opponents decried the authorities’ inability to
execute the warrants and described it as a mockery of the law and slammed
what they called a weak-kneed government.
These were the two largely dominant opinions being expressed on social as
well as mainstream media. What was missing from both was a rational
assessment of why unarmed policemen were sent in with the warrants and
what consequences an armed stand-off could have meant.
Four officers and five cult members were shot and killed when the compound
residents exchanged fire with them. The incident led to the law-enforcement
agents led by FBI laying a 50-day siege to the compound. Given the tense
stand-off lasting so long, it isn’t clear who started it but a fire engulfed the
whole complex in April 1993.
Some 75 cult members including 25 children and women, two of whom were
pregnant and David Koresh perished in the inferno. The FBI maintained that
listening devices told them that the Branch Davidian members themselves set
ablaze the buildings.
The critics blamed the incendiary tear-gas shells lobbed by the federal agents
for the fire. The incident is attributed as one of the reasons for the Oklahoma
bombing and the rise of the right-wing militias in the US.
Our own experience whether in Hyderabad’s Pucca Qilla in 1990 or the Model
Town incident in Lahore in 2014 is not too dissimilar. In both cases, the police
claimed they were fired at first and returned fire. But when civilians are killed,
the police are blamed by one and all. Their point of view receives scant
attention.
So, reverting to the events at Zaman Park this week, it was clear that if the
police had tried to execute the arrest warrants, an armed confrontation would
have ensued. Bloodshed is in nobody’s interest. While there can be no
justification for injuries to dozens of policemen, their leadership was prudent
in not sending them in armed.
The courts have come in for some criticism in what are being seen by some as
‘pro-Imran Khan’ decisions but allow me to express a contrary opinion.
Whether or not the decisions met the canons of justice and law is for legal
experts to say. I just feel the courts defused a fast-developing crisis.
I, for one, was grateful that better sense prevailed and the bickering of the
hardliners did not inform police policy. Sadly, hope of what appeared to be a
slight de-escalation, attributable to possible relief in the PTI, too, that nothing
untoward happened, faded soon.
For the first time in years, Imran Khan had stated he was prepared to talk to
‘anybody’ in the interest of the country and democracy. And his offer seemed
to be without words like ‘chors’ and ‘dakus’ (read: PML-N, PPP). Fawad
Chaudhry called on the government to come up with dates and venues.
But before the government could respond, events at the Judicial Complex in
Islamabad yesterday overtook whatever little optimism there was. It would not
be a cliché to say dialogue and consultation is at the heart of any democratic
process. Equally, for meaningful dialogue, both sides need to show flexibility
and accommodation and put on hold divisive rhetoric and narratives.
Misplaced optimism?
Muhammad Amir Rana Published March 19, 2023 Updated 2 days ago
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The writer is a security analyst.
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It is too early to predict whether the restoration of Saudi-Iranian ties will put
an end to their politico-ideological rivalry; it is also too simplistic to assume
that it will resolve sectarian tensions in Pakistan, which have largely been
abetted by the Saudis and Iranians in the past.
Many in Islamabad also describe the development as a game changer for
Pakistan based on the perception that normalcy between the two archrivals in
the Middle East will ease some economic difficulties. Pakistan needs to review
its relationship with both countries; it may discover that the restoration of
diplomatic ties between Iran and Saudi Arabia cannot change much for
Pakistan as the problem lies in its own (bilateral) relations with each of the
two countries.
Some optimistic analysts in the Middle East and China have portrayed the
development as a major shift in the global and regional political landscape and
have hinted at the formation of a new power bloc. Others see this as part of the
larger Saudi effort to diversify its strategic, economic and political options,
change its global image, and decrease dependency on traditional strategic
allies, including Pakistan, which maintain a position of neutrality when it
needs help. Saudi Crown Prince Mohammed bin Salman, who is the architect
of the ongoing transformation of the ideological state, may have learned this
‘lesson’ when Pakistan decided to stay neutral during the Yemen war.
The Saudi-Iran peace deal may not change things for Pakistan.
Pakistan needs to realise that Saudi Arabia broke off relations with Iran in
2016, while Pakistan already had a problematic relationship with it. It never
capitalised on the economic cooperation with its northwestern neighbour and
maintained a vague position on the Iran-Pakistan gas pipeline project.
The Yemen issue has greatly disappointed the Saudi crown prince as most
Saudi allies, who received oil and financial assistance from the kingdom, have
not extended the anticipated military support. During the process of
introducing changes in internal power structures and testing relations with
Saudi allies, he became adept at walking on a tightrope. Some analysts believe
he is testing the political and diplomatic strength of the kingdom and that the
restoration of diplomatic ties with Iran is part of that strategy.
Renewed relations between Iran and Saudi Arabia may have many
implications for the Middle East. However, as mentioned earlier, it may hardly
change things for Pakistan. For Saudis, defence cooperation has been an issue,
and for Iran, border security and acts of terrorism are among the major
irritants in its bilateral relations with Pakistan, which has similar and genuine
concerns about Iran as the Baloch insurgents now use its territory to launch
operations against Pakistani security forces.
Dystopian times
Huma Yusuf Published March 20, 2023 Updated a day ago
This family is not the first to succumb to raging inflationary pressures. The list
is a macabre one — a man seeking to escape poverty by jumping into a canal
with his four-year-old daughter in Muzaffargarh; a labourer from Narowal
also choosing to drown in a canal with his two children rather than continue to
battle penury.
These are among the few cases that are reported as suicides. Accurate
reporting on suicides is almost impossible to come by in a social context where
the desperate act is ridden with social and religious taboo. But anecdotal
evidence is mounting that there is a plague of depression and anxiety fuelled
by soaring food prices and the stalling economy. Sindh’s commerce minister
last month raised alarm bells about growing suicide rates among the poor.
But you may have missed these suicide stories and horrifying statistics. They
are unfortunately relegated to the back pages or late-night tickers while the
shenanigans of our mainstream political parties dominate news headlines. But
Pakistan is now at the tipping point where the shocking and callous disconnect
of our elite politics is in danger of making the democratic system completely
irrelevant.
While social media feeds and news cameras flit between Zaman Park and the
Judicial Complex, little attention is paid to the plight of millions of Pakistanis
who would rather submerge themselves in polluted canal waters or ingest
copper sulphate than endure another day in the land of the pure. Sadly, there
is no Toshakhana for the country’s masses to plunder when all other hope is
lost. And as academic Arsalan Khan pointed out in a pithy tweet, the real
horror is that it makes no difference which party comes out on top —
Pakistanis still suffer.
The clear shift in Pakistan to ‘each man (or elite institution) for himself’
approach could not be more clear than in the juxtaposition of the attempted
suicide/killing in Surjani and the theatrical, but ultimately navel-gazing chaos
at Zaman Park. But it is becoming apparent in all aspects of politicking,
policymaking and resource allocation.
Take, for example, last week’s news that the Punjab government is handing
over agricultural land to the army to manage and make more productive with
the help of the private sector. A trifecta of entitled elites will benefit from this
absurd arrangement, but there seems to be little thought for the welfare of
local communities or seasonal pastoralists that may rely on that land — or
indeed for the land itself, which may not benefit from commercially driven
overexploitation.
The growing number of suicides driven by hunger and poverty should dispel
several myths that have bred Pakistani complacency over recent decades.
First, that the ethnolinguistic, tribal and feudal nature of our politics means
that politicians inherently draw on grassroots support, and so will take care of
their constituents — in the name of retaining loyalty, if not as a public service.
The other is that Pakistan is among the most philanthropic countries in the
world, and that informal charitable giving can substitute for a functioning
social welfare state. The fact is, Pakistan is fast slipping out of global giving
indices as even middle and upper-middle classes feel the pinch and are less
forthcoming with donations. When the pie shrinks, it shrinks for everyone.
At some point, desperate Pakistanis will clue into the fact that the new rules of
the game are personal survival at the expense of others. In other countries, at
other times, such realisations have given rise to major — often left-wing —
political movements. Sadly, the only groups in Pakistan poised to exploit the
mounting desperation are violent extremist groups. If our mainstream parties
do not change tack and refocus on the public’s urgent needs, we must fear for
a future, fragmented Pakistan.
rincipled objection
Umair Javed Published March 20, 2023 Updated a day ago
In this country, like any other country, there are a range of occupations,
organisations, and individuals who have it as part of their stated mission to
uphold specific values and norms. These include media professionals, rights
activists, public interest lawyers, academics and public intellectuals and so on.
They draw their strength and credibility precisely from a defence of principles
rather than of particular actors. A failure to do so undermines the long-term
viability of both the organisations and of the cause in question.
In our specific case, there are three issues that deserve principled treatment
regardless of which party finds itself in what role. The first is upholding what
the Constitution says in plain letters. The Constitution says that an election
needs to be carried out within 90 days of a legislature’s dissolution.
There is no reason that can justify a delay, especially not one that is created
because a disliked party might win the said election. Doesn’t matter if you
think the dissolution was done on a whim. Or you think elections are not going
to solve one issue or another. Or even if you think the Constitution will be
undermined by the opposition in the long run.
Without upholding what the Constitution says, we’re in the familiar territory
of stick-wielding power.
The history, of course, is much longer with Ayub’s EBDO, Zia’s Martial Law
Regulations, and Musharraf’s NAB created precisely for these ends. Yesterday,
an unwithdrawn salary was proof of wilful concealment. Today, another set of
politicians are being declared as dishonest or corrupt or seditious or of
dubious moral character. The script is frustratingly familiar and it is being
written because someone wields a large enough stick over the rest of the
system.
Condemning the violation of the Constitution, the use of police violence, and
the subversion of judicial processes does not take much. What makes it
appreciably more difficult in Pakistan’s case is that often victims in the present
were enablers and instigators in the past.
Combined with the recent history of abuse and maltreatment of civil society, it
is easy to understand why partisan affiliations can take root. But it is precisely
in such circumstances that a greater commitment to democratic norms is
required. Personal distaste and purity tests directed at the victim need to be
set aside for conscientious objection.
Finally, there is a more fundamental reason why the current scenario requires
straightforward condemnation. The basic issue at play is the same one that has
been in play for seven decades. Some are waking up to this reality today,
others have been clamouring about it for decades. At its core, the issue is of
stick-wielding.
At its core, there is only one actor that wields a stick. It wants to retain
discretion on how it wields it. It will fight off any efforts to check that power,
no matter how half-hearted those efforts may be. And as we’ve seen many
times over, it will do whatever it takes to ensure that the power stays in place.
A game changer?
Maleeha Lodhi Published March 20, 2023 Updated a day ago
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The writer is a former ambassador to the US, UK & UN.
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In the joint trilateral statement, the two countries pledged to respect the
“sovereignty of states” and “non-interference in the internal affairs of states”.
They agreed to revive their 2001 security cooperation pact and renew their
general cooperation agreement of 1998, which ranges over trade, economy
and investment.
The breakthrough followed several days of talks in China, which were
preceded by two key high-level visits — by Iranian President Ebrahim Raisi to
Beijing in February 2023 and Chinese President Xi Jinping’s trip to Saudi
Arabia in December 2022. These summit-level meetings and Saudi-Iranian
exchanges in the region laid the necessary groundwork for the March 10
agreement.
The thaw in Saudi-Iran relations is a potential game changer for the region —
provided it gathers steam and lasts. It has far-reaching implications for the
Middle East and beyond, which could pave the way for a more stable and
peaceful region. Both countries had strong motivations to seek détente.
Iran’s interest was to break out of the diplomatic isolation imposed on it by the
US-led West. It was also deeply apprehensive about the likelihood of Saudi-
Israeli diplomatic relations being established at Washington’s prodding and
behest. That would have deepened Tehran’s isolation and gravely aggravated
its security challenges.
The Saudi motive emanated from its security anxieties over escalation in
tensions with Iran. In recent years, Saudi Arabia has faced several attacks
including on its oil facilities and infrastructure. Over half of the kingdom’s oil
production was affected by a missile and drone attack on its oil-processing
installations in 2019, for which Riyadh blamed Tehran.
For Riyadh, reduced tensions with Iran aims to address these security threats.
Other factors have also been at work. America’s diminished diplomatic and
military footprint in the Middle East as it switched focus to its strategic
priority of countering China as well as strained relations between the Biden
administration and the Saudi leadership seemed to convince Riyadh that
Washington was no longer a reliable or consistent ally, much less a guarantor
of its security.
The agreement is a tentative first step towards détente but it can pave the
way for a more stable region.
It has moved to mend ties with Qatar and Turkiye. And it has shown it can
distance itself from Washington, which has prompted many experts to note
that MBS is pursuing a foreign policy increasingly independent of the West.
The rapprochement has raised the question of how this will affect conflicts,
proxy wars and issues in the region on which the two countries have been at
loggerheads, especially Yemen but also Syria, Lebanon and Iraq. Will de-
escalation follow on these regional fronts?
Will they be able address each other’s security concerns? Will the West try to
undermine the deal? Can the two countries deal with underlying issues and
transcend the Shia-Sunni schism that has historically been a driver of their
enmity? Comments in the Saudi media have focused on whether Iranian
behaviour would change to make détente meaningful.
In fact, China has scored a major diplomatic victory by its mediation. It has
demonstrated its growing global influence and established itself as a major
player in the Middle East. China is the biggest trading partner of both
countries and, unlike the US, has good relations with both to play peacemaker.
The region accounts for 40 per cent of China’s oil imports which underlines its
stakes in the region.
On the other hand, the US has been diplomatically marginalised by the
development — for now. Its effort to isolate Iran has suffered a major setback
at a time of rising tensions between Washington and Tehran over Iran’s
nuclear programme.
The US plan to normalise Saudi-Israel relations has also been scuttled for the
immediate future. Israel faces a major reversal in seeking to build a regional
coalition against Iran. Israel’s former prime minister Naftali Bennett called
the agreement a “serious and dangerous” development and a “fatal blow to the
effort to create a regional alliance” against Iran.
Washington’s muted response indicates its unease and concern over the
rapprochement. Many Western commentators however saw the thaw for what
it is. Peter Baker wrote in The New York Times that the Chinese-brokered deal
had “upended US diplomacy in the Middle East”.
Many tests lie ahead for the rapprochement to gather momentum but for now
it holds the hope of regional powers seeking regional solutions to their
disputes.
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Dollar inflows (exports and remittances) have always lagged behind outflows
(imported goods and services). This gap narrowed in FY20 (the IMF
programme started) and in FY21 (Covid-19 was a positive boost for the
economy); excluding these one-offs, Pakistan needed $11bn per year to finance
its external deficit. Unfortunately, the country did not use this money to build
a dollar repayment capacity, and now we’re stuck.
After decades of hearing the mantra that exports will double in the next five
years, we have given up on textiles. Remittances have been a lifesaver, but
these inflows cannot be managed, so Pakistan must reduce imports — and
clamp down hard. There are two options: (1) emergency measures like
delaying and prioritising imports; and (2) using orthodox policy tools to
reduce import demand.
Pakistan has taken emergency measures since 2022 and is shifting to the
IMF’s solution (ie, let the rupee and interest rates do the heavy lifting). The
immediate goal is to sharply reduce import demand. We all know the IMF is
ideologically opposed to ad hoc measures to slow imports as it creates
distortions and is only a temporary fix.
The IMF is good at stabilisation but not so good at sustainable growth. Should
the rupee be allowed to weaken to reduce Pakistan’s imports to sustainable
levels? This policy option is regressive as it gives equal weight to importing
luxury cars and essential foods — if the rich are willing to pay, they should be
able to import a BMW i7. This policy is also highly inflationary, especially for a
country that imports fuel and essential foods. And finally, ongoing rupee
weakness will encourage dollarisation, undermining the banking system’s
ability to channel funds from savers to investors.
What about hiking interest rates to reduce import demand? This would create
a fiscal blowout, whereby the government would have to earmark its limited
funds for debt servicing and forego other expenses like running the
government and financing development. It would also undermine the health
of the banking system via a sharp increase in loan defaults, and starve the
private sector of credit.
The elite is praying for a return to the good old days (say, three years ago) to
avoid hard decisions that will hurt their interests. The policy challenge boils
down to addressing Pakistan’s addiction to superfluous imports — more
specifically, balancing the people’s needs against the short-term interests of
the elite. The goal should be to allow the fruits of a stable, growing economy to
lift all segments of society. However, looking at our policymakers in the past
seven years, can anyone hope for this outcome?
New teachers
Sajid Ali Published March 21, 2023 Updated about 4 hours ago
The writer is director research, Aga Khan University, Institute for Educational
Development.
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Many reputable school systems in Sindh are complaining about losing their
teachers to public schools. These teachers appear intelligent and enthusiastic,
indicating that the government has done a reasonable job in recruiting new
teachers. It may not be ideal but it is a reasonable outcome in light of our
situation. While we criticise the government for negative actions, we should
also appreciate it when it does some good. So well done, Sindh government!
But let us not stop here.
It is worrisome to note that the government has no extensive plans for the
effective utilisation and continuous development of this massive force of newly
recruited teachers after the induction training. Based on data from the Sindh
Education Management Information System, these 60,000 teachers will
roughly make up a quarter of the existing teaching workforce at public schools
in Sindh. This is a massive change in any organisation’s workforce in such a
short span of time. The government plans to reopen the closed schools
through these teachers. But beyond this, there are no plans for the further
growth of these teachers and for utilising them to improve the dismal
education system in the province.
Here are some suggestions for the education department to enhance the
potential of teachers:
1. Develop these teachers into a ‘community of practice’. The idea of a
community of practice, championed by Prof Étienne Wenger, suggests
that teachers should be given a sense of a professional community to
share good practices, inspire each other, withstand challenges together
and make efforts for continuous learning. Many of these teachers are
already members of online platforms such as WhatsApp, Facebook,
Instagram, etc. These platforms can be actively used for their
continuous professional growth. They should be encouraged to join
professional learning communities like the Pakistan Teachers
Association Network in order to grow.
2. The government should have regular professional development days for
the continuous growth of these teachers. In the United Kingdom, after
every term break, schools open two to three days earlier for teachers,
who attend professional development training and prepare for the next
term. The Sindh Teacher Education Development Authority has
developed a continuous professional development framework that
should be implemented with re-gular government financing.
3. The better performing teachers must be rewarded. A baseline
assessment of the classes assigned to the new teachers should be
conducted. If the students show improvement, the teachers should be
rewarded. An appreciation letter, a picture on the education ministry’s
website and monetary incentives will boost their morale. Those who
could not do better should be supported.
4. While many of the old teachers are not performing well, there are some
who are considered ‘gems’ of the system. It should be made possible for
such senior teachers to engage with the new teachers as mentors.
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The director, Rajkumar Santoshi wrote the screenplay with Wajahat and
called it Gandhi-Godse: Ek Yudh, which translates as a battle between Godse
and Gandhi. The battle was one of ideas, of course. The actors were all
unfamiliar faces though some were seasoned stage veterans. Chinmay
Mandlekar made a powerful Godse, which would make Pathan or Tiger
characters look like robots. Mandlekar went to the National School of Drama,
the institution where seasoned actors like Om Puri and Naseeruddin Shah
received their training. It shows. Mandlekar’s lines are sharp and rooted in
driven nationalism. Godse’s strong character is possibly what some of
Wajahat’s intellectual friends disapproved of. The movie has striven to move
away from the tradition of labelling villains and heroes in black and white,
something Hollywood war films would do with German soldiers. Then, Steven
Spielberg made a hero of a Soviet spy in Bridge of Spies, not ignoring the
reality that human beings can be flawed.
That apart, the dialogues given to Deepak Antani playing a superlative Gandhi
are winners, each one of them. His diminutive form makes a perfect foil for
the muscular Godse. For example, in the prison cell, Godse has drawn a map
of his idea of Akhand Bharat, Hindutva’s undivided India. The Hindu rashtra
stretches from Afghanistan to Myanmar via Tibet. While Sri Lanka, Nepal,
Bangladesh and Pakistan have become part of the great Indian nation, the
Hindu rashtra. Gandhi asks Godse a crisp question to which, for once, Godse
is seen groping for an answer. “Do you even know the people who live in these
countries?” Godse’s growing admiration for his rival takes a dramatic turn
when he protects Gandhi from another Hindutva gunman’s attempt on him.
In the terrifying real world today, Godse has grown in stature, as a cult
figure for Hindu nationalists.
Between surviving the assassin’s bullet and his imprisonment in free India,
Gandhi’s characterisation as a free-spirited do-gooder, on occasions
resembling Maoist guerrillas fighting for tribal rights, throws light on many
things that ail the impoverished masses in India today.
Wajahat is a former Hindi professor from Jamia Millia Islamia, and has been a
member of the Communist Party’s literary club for years. His progressive
views have seldom if ever abandoned his creative writing. One of his plays was
staged in Pakistan and was very popular with audiences in India. ‘Who hasn’t
seen Lahore has not lived’ would be a loose translation of the critically
acclaimed Urdu play with the partition as backdrop. In a sense, the Godse play
is also rooted in partition.
Godse’s transformation was only in the movie though. In the terrifying real
world today, he has grown in stature, as a cult figure for Hindu nationalists.
See the election of Godse-worshipping Sadhvi Pragya, for example, accused in
terror attacks targeting Muslims. Sadhvi was controversially given bail on
health grounds, while paralysed prisoners have struggled to get a sipping
straw from the warders. The bail enabled Pragya to win the Lok Sabha election
in 2019 from Bhopal. Another example of Godse’s victory: a key accused in the
Gandhi murder trial was V.D. Savarkar, charged as a plotter but freed for want
of clinching evidence. Demands are growing to posthumously confer on the
founder of the Hindutva worldview, the Bharat Ratna, India’s highest civilian
award.
The Godse-Gandhi movie has come under intense fire from some of Wajahat’s
friends who claim it gives the communal killer needless legitimacy. I didn’t get
that sense at all, and wondered why many of these friends saw no problem
with Attenborough’s Gandhi in which Dalit icon Ambedkar didn’t get a walk-
on role. There are graphic scenes of partition violence at the start of the movie,
which could be called terrifying. Tamas, another soul-searching movie on
partition, had more gory violence, which rightly didn’t invoke intellectual ire.
Wajahat is an old friend but that’s hardly a reason for my liking the movie. As
for Rajkumar Santoshi, one has admired him for making Lajja (Shame), an
unusual feminist protest. Lajja featured a female team of Rekha, Madhuri
Dixit and Manisha Koirala, each with powerful feminist roles. Santoshi has
been accused of holding reactionary views bordering on the communal. Lajja
questioned that.
Dixit, a theatre actor in the movie, plays Sita, and her fiancé plays Ram. When
the man doubts the child she was carrying was his, Dixit moves away from the
script in the test-by-fire scene. She exhorts Ram to take the chastity test with
her as both were away from each other. Did she not spurn Ravana and reduce
him to a dead man by her rejection? Ram valiantly fought a half-dead man. As
for Lakshman, he too inflicted his wrath on a woman. These are not regressive
dialogues. They are rare and badly needed lines today, not any less than the
Gandhi-Godse dialogue, creatively scripted by Asghar Wajahat to illustrate the
signs of the times for Indian democracy.
Hence, in the recesses of my mind, I can still see an article I read decades ago
on the election campaign of Boris Yeltsin. This piece was about how Yeltsin’s
election victory had been shaped by American men who had secured electoral
victories in the US for Bill Clinton, whose election was a landmark.
I didn’t remember many of the details but what did stick was how election
campaigns were about addressing the voter’s apprehensions and image-
building. For instance, the piece dealt with the campaign’s efforts to change or
shape the perception that Yeltsin may be seen as too old to run the
government.
Perhaps it was the first time I realised elections were not just an exercise of
people’s choice but also a part of the advertising industry where politicians
were a commodity to be packaged appropriately for consumers.
Two nights ago, I think I found the article again, thanks to Google. A long
investigative piece, it details how a group of Americans convinced Yeltsin and
those around him to run the election campaign, American-style in which
constant polling and focus groups determined what the candidate stood for or
should stand for.
Yeltsin was not popular for a number of reasons, including the poorly
performing economy, and the team convinced him that the best way to beat
the others was to shape himself as ‘anti-communist’, the man who would make
sure Russia didn’t return to communism.
The PML-N and PPP seem to think acquiring a social media team in itself is
the goal.
The piece came to mind because in recent times there has been considerable
talk about the PTI’s social media team. In the past year, many in government
have argued more than once that the party does well because it spends money,
which the others can’t necessarily afford.
For some, this money is being spent all over the world thanks to the support of
overseas Pakistanis. Some point fingers at the KP government and its hiring
while others speak of Imran Khan’s singular obsession with it and how he
coordinates with the PTI’s keyboard warriors himself — at the expense of
loftier issues such as governance. Whatever the reason, the rest are struggling
to play catch up.
This was obvious in the past few days during the clashes at Zaman Park and
then in Islamabad, where the PML-N’s version of events can be found
alongside the PTI account.
The PTI has built up this story of one man against the system and it tells it
through pictures, popular culture references and soundbites. For instance, a
commonly used image is of Imran Khan addressing a jalsa where the camera
shot from behind is far more than just a picture — it shows not just the size of
the crowd but also reinforces this symbol of one man with the people. This is
the story the PTI tells again and again.
After the showdown in Zaman Park, its supporters are sharing the climax of a
Marvel superhero film where those fighting have been given titles to depict the
Lahore clashes — the lone man (Imran Khan) is joined by the ‘Lahoriye’,
‘burger bachhay’, ‘wukla bhai’ as well as PTI stalwarts (Yasmin Rashid and
Murad Saeed) to take on Lahore ‘pulsiye’ (police), ‘Rangers’, ‘water cannon’ as
well as others.
Indeed, one can find many such videos and clips which, other than current
issues or events, simply tell the bigger story of Khan and the PTI again and
again and again. As does Khan in his speeches. That 1996 piece on Yeltsin
quotes one of the American experts telling the Russians, whatever it is that
we’re going to say and do, we have to repeat it between eight and 12 times.
This bigger story and its retelling is missing on the other side. The PML-N,
and for that matter, the PPP, seem to think acquiring a social media team in
itself is the goal. There is no story to tell — or if there is, it is too subtle for the
likes of me.
In the PTI’s story, the hero (Khan), the villains (the system) and the people
(for whom the PTI chief is fighting the battle) are all there, be it a jalsa or the
gathering at Zaman Park. Even the images of PTI supporters follow a checklist
— an aged person or buzurg, a young father with a child in his arms, young
men and women.
The government or the parties can bombard social media with images and
narratives but they also have to find a story to tell. A larger story of hope or
salvation. This is not to say elections are fought and won only on the basis of
image-building but it can’t be ignored either. You gotta have a sales pitch
about what the voters should buy and not just one about what they should
avoid.
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This is one big piece of evidence of the seriousness of the ongoing fiscal crisis.
But the crisis is not entirely of the current regime’s making. Fiscal imbalance
expanded phenomenally during the last year of the PTI government — and the
current government only contributed to its further expansion.
The fiscal deficit, or the gap between the government’s income and expenses,
has been at the heart of the ongoing external account crisis. As of March 10,
2023, SBP’s forex reserves totalled $4.319bn. In end-March 2022, less than
two weeks before the ouster of Imran Khan as prime minister, the central
bank’s reserves stood at $11.425bn.
On March 17, 2023, the rupee traded at 281.71 per US dollar in the interbank
market. On April 8, 2022 (the last working day before Imran Khan’s departure
from the prime minister’s office on April 10), it was at Rs184.68 to a US dollar.
This massive 52.5pc depreciation in the rupee value plus a sagging economy,
higher energy prices and food shortages after last year’s super floods pushed
headline inflation up from 12.7 per cent in March 2022 to 31.5pc in February
2023.
Whether the general elections are held on time or earlier will not make a big
difference because the twin deficits are big enough to give policymakers
constant headaches
During the current fiscal year ending in June, the fiscal deficit will surely rise
as the cost of external and internal debt servicing has increased due to the
rupee’s decline and tightening of interest rates. This means the government
will only continue to borrow more debts from commercial banks during the
April-June quarter.
Banks will keep investing funds in government debt papers instead of lending
to the private sector. The private sector’s credit appetite is already low thanks
to the withdrawal of subsidies, high energy prices and very high interest rates.
The political chaos that only deepens the economic mess may reduce in the
coming weeks. But the messy economy cannot be straightened only with it.
Whether the next general elections are held on time in October — or a bit
earlier. That, too, will not make a big difference. The fiscal deficit will remain
too large, and external sector financing gaps will remain big enough to give
policymakers constant headaches in the remaining three months of this
financial year.
However, a framework for addressing issues in the next year, starting in July,
can be made after achieving a broader consensus among all stakeholders of
the state. Whether you call it the Charter of Economy or the Framework for
Economic Reconstruction, a policy detailing how government expenses can be
reduced and its revenues can be increased is the need of the hour.
The same policy must also propose how exports and remittances can be
increased in short to medium term and how huge volumes of foreign debts can
be reprofiled or restricted.
Once this policy is made at the state level, its implementation needs to be
guaranteed under the supervision of the parliament. Pakistan has so far
resisted some of the International Monetary Fund’s (IMF) conditions that call
for what our establishment views as an unnecessary intervention in the
country’s strategic defence requirements.
But if we don’t set our house in order, such demands (like the alleged call for
giving up long-range missile programmes) may keep coming up in future. The
best way to avoid them is to show the IMF and the world that the country has
a national policy addressing its key economic issues, including a shortage of
foreign exchange.
But that strategy should rely least on offering any subsidy to goods’ exporters
for which no fiscal room is available and instead focus on diversification of
export destinations and more value-added export items. Some incentives may,
however, be offered to exporters of services, particularly to IT and IT-enabled
services exporters.
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When Maryam Nawaz was campaigning for her father’s release in 2018, I expressed that
to truly elicit support from the general public, she would have to tell the truth. That
telling the whole truth — as opposed to what just suited her narrative — would set her
family free.
She would have to accept that her family’s financial dealings may not have been
completely kosher, admit that the Calibri trust deed justifying the movement of her
family’s assets was a shoddily concocted fraud. She would then have to follow this up by
arguing that Nawaz was removed from power not for those reasons, but because of his
having fallen out again with the establishment — which, more or less, the father and
daughter have stated on various occasions since.
She would have had to put her trust in the electorate, that they would see the forest for
the trees. If she had told the whole truth, it would have allowed her to take on the
establishment without compromises that became the PML-N’s undoing soon thereafter.
Web of lies
I recently bought a bootleg copy of Waris to rewatch a drama I had seen snippets of on
YouTube. The entire intricate story is made possible due to deceit and treachery. Every
character has an internal conflict, leading them to weave webs of deceit around
themselves.
If any of the main characters had been fully expressive and truthful rather than weaving
webs within webs, none of the intricate plot lines would have been possible. And they
would not have been necessary. If anyone in Waris had taken stock of their lives and
told the full truth that was known to them at any point within its timeline, it would have
ripped the web holding them in place. It would have set them free.
The same is true for today’s politics. One of the greatest injustices perpetrated upon
lawyers who are asked to comment on television regarding Imran Khan and the recent
attempts to arrest him, is that they are asked questions of the law.
Path to freedom
Amid all the chaos, Imran said something on Twitter that puts him in the direction of the
truth, setting him free. After months of his party hinting at a London plan that involved
machinations between different politicians, Imran finally painted a bigger and more
coherent picture, filling in the blanks left out by his minions.
He tweeted what has hitherto been whispered about — that there was a senior partner
to the London plan. He tweeted about the quid pro quo agreement between the parties
that made the plan make sense. He reminded us that no London plan, past or present, is
really complete without a partner from Pindi.
By making this allegation, Imran has finally taken the fight directly to the public servant
whose appointment he made overtly controversial. He has finally dropped the garb of
friendliness and stopped resorting to whataboutery. In a post-truth media environment,
and perhaps as a last resort with elections still uncertain and legal battles rising, he is
propagating the version of events that will likely land him in prison, but can also
potentially set him absolutely free.
The biggest fear of our unelected power brokers has always been exposure. Like the
photographic film upon which they once stored the secrets of other people’s private
lives, exposure is lethal.
It is this exposure that Imran Khan is now threatening, which the PML-N so briefly hinted
at and capitulated immediately thereafter by way of the Bajwa extension.
What is lethal to the way they operate is not something they will take lightly. This is a
fight to the finish. A fight to the end of unelected hegemony.
In video games, you get to choose your champions; in real life, they are thrust upon you.
They are often flawed, selfish and hypocritical. But you take what you get, because on
the other end, you have a continuous cycle where your country gets poorer, more
dangerous and less liveable.
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The unlocking of the $1.1bn tranche seems arduous for the incumbents. The
policy level talks, which started in February, are yet to be concluded with the
signing of a staff-level agreement (SLA). The government abided by the Fund’s
conditions, imposing additional revenue measures worth Rs170bn,
introducing a market-based exchange rate, and hiking sales tax and federal
excise duty, but the Fund changed its goalpost.
The issue of draining forex reserves is just the tip of the iceberg; there is more
than meets the eye. Though IMF assistance will help avert default and pave
the way for foreign inflows from bilateral and multilateral sources,
nonetheless, strategic reforms are inevitable. The state needs to take on the
onerous task of countering the impediments inherent in our economic system,
or else the probability of breaking the logjam remains out of sight.
The energy sector, along with most other public institutions of the country, is
no less than a white elephant for the economy. The country’s circular debt
surpassed Rs4 trillion by December 2022. This menace of circular debt is
surging at a rate of about Rs129bn yearly, reflecting the inability and
ineffectiveness on the part of the authorities.
A hefty increase in gas prices for residential and other categories of consumers
will pour Rs310 billion in additional revenue from the pockets of residential
and other categories of consumers into the state’s treasury to comply with the
requirements of IMF.
The fiscal deficit is recorded at Rs1.683tr for the first half of FY23 (2pc of
GDP). This imbalance is inimical as it leads to increased government
borrowing and the consequent need to amplify revenue measures. The tax-to-
GDP ratio of 9.2pc in FY22 remains dismal, considering the narrow tax base.
This further burdens the active tax-payers and depicts the nonchalant attitude
of the government and the elite.
The country is also faced with challenges on the external front. The imports of
the country are twice its exports. Though the current account deficit
plummeted by 60pc in the first half of FY23 to $3.66bn, its sustainability after
lifting the import curb remains questionable.
The exchange rate of the country should be left to the market forces. The steep
plunge in the rupee amid the removal of the dollar cap depicts that the inter-
bank rate hovering around Rs230 for $1 until January 25 was illusory, which
confounded market participants. This led to a widening gap between inter-
bank and open market rates and created a huge black market, thus dampening
remittances and preventing exporters from realising their export receipts.
Pakistan is the 7th most vulnerable country to the effects of climate change.
The glimpse of natural disasters in the preceding year cost the country almost
$30 billion. There is a dire need to undertake measures to enhance climate
resiliency and shift focus towards renewable sources of energy, along with
expediting dam construction. The recent floods were a heads up; insouciance
on this front would prove acutely detrimental.
Economic stability is the key to national security and sovereignty. Thus petty
politics should be kept at bay, and long-term economic policies should be
formulated with all major stakeholders to impede uncertainty and
inconsistency. The current political impasse should be resolved at the earliest.
This game of chicken will further cost the nation.
The grant of $1.1bn from the IMF, followed by inflows from other sources,
would elate the authorities. However, this eventually has to be repaid. Loan
restructuring or rollover may provide a respite, but that, too, is to be paid by
the nation. It’s high time to realise the need for increasing domestic
productivity and setting the house in order, or else the current economic
condition will remain ominous.
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Mr Kumar said India wants “better relations with Pakistan because we cannot
change our geography”, and called for normalising trade ties. He added that
India was interested in tapping Central Asian markets, which Pakistan could
facilitate through transit trade.
This paper has frequently argued in these columns that better trade ties can
lead to a more congenial atmosphere in the subcontinent. Trading with India
and other states in our neighbourhood, indeed the wider Asian region, makes
geo-economic sense, and is in Pakistan’s interest.
Several past attempts have been made to establish robust trade ties with India,
but these have fallen victim to other factors, usually resulting in the military
establishment nixing plans to improve trade relations with our eastern
neighbour.
Yet even former army chief Gen Qamar Bajwa on numerous occasions talked
of the need to improve ties with India. It remains to be seen whether the
current army leadership agrees with this part of the Bajwa doctrine, or has
other ideas where India is concerned.
However, implementing a new trade policy will only be practical after a new
government takes charge in Pakistan and next year’s elections in India bring a
new administration to New Delhi. In the meantime, both states can start the
spadework by restoring their respective diplomatic missions to full strength,
and easing visa restrictions.
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Looking at the seven years from FY16 to FY22, Pakistan’s cumulative current
account deficit was $74.5 billion, while the State Bank’s forex reserves fell by
$3.6bn during this period. This means Pakistan needed financing of $70.9bn,
and borrowed $65bn. Foreign investment barely financed the external deficit,
so the government just kept borrowing. Since foreign creditors are reluctant to
continue lending, Pakistan’s external sector has become unsustainable.
Dollar inflows (exports and remittances) have always lagged behind outflows
(imported goods and services). This gap narrowed in FY20 (the IMF
programme started) and in FY21 (Covid-19 was a positive boost for the
economy); excluding these one-offs, Pakistan needed $11bn per year to finance
its external deficit. Unfortunately, the country did not use this money to build
a dollar repayment capacity, and now we’re stuck.
After decades of hearing the mantra that exports will double in the next five
years, we have given up on textiles. Remittances have been a lifesaver, but
these inflows cannot be managed, so Pakistan must reduce imports — and
clamp down hard. There are two options: (1) emergency measures like
delaying and prioritising imports; and (2) using orthodox policy tools to
reduce import demand.
Pakistan has taken emergency measures since 2022 and is shifting to the
IMF’s solution (ie, let the rupee and interest rates do the heavy lifting). The
immediate goal is to sharply reduce import demand. We all know the IMF is
ideologically opposed to ad hoc measures to slow imports as it creates
distortions and is only a temporary fix.
The IMF is good at stabilisation but not so good at sustainable growth. Should
the rupee be allowed to weaken to reduce Pakistan’s imports to sustainable
levels? This policy option is regressive as it gives equal weight to importing
luxury cars and essential foods — if the rich are willing to pay, they should be
able to import a BMW i7. This policy is also highly inflationary, especially for a
country that imports fuel and essential foods. And finally, ongoing rupee
weakness will encourage dollarisation, undermining the banking system’s
ability to channel funds from savers to investors.
What about hiking interest rates to reduce import demand? This would create
a fiscal blowout, whereby the government would have to earmark its limited
funds for debt servicing and forego other expenses like running the
government and financing development. It would also undermine the health
of the banking system via a sharp increase in loan defaults, and starve the
private sector of credit.
The elite is praying for a return to the good old days (say, three years ago) to
avoid hard decisions that will hurt their interests. The policy challenge boils
down to addressing Pakistan’s addiction to superfluous imports — more
specifically, balancing the people’s needs against the short-term interests of
the elite. The goal should be to allow the fruits of a stable, growing economy to
lift all segments of society. However, looking at our policymakers in the past
seven years, can anyone hope for this outcome?
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PTI chief Imran Khan addresses the nation on Sunday. — DawnNewsTV
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A visibly irate Imran made the remarks while addressing the nation a day
after hours-long clashes were reported between PTI workers and the capital
police after the former prime minister arrived at the Federal Judicial Complex
to attend a hearing in the Toshakhana case.
As Imran left his Zaman Park residence to appear before the judge, a heavy
contingent of police also launched a search operation at his house.
Talking about the police operation at Zaman Park, Imran said officials broke
down the gate and his walls while only his wife, Bushra Bibi, and a select few
servants were present.
“I want to ask everyone, police, army officers, the judges of this country and
the people [about] the respect of chaddor and char dewari in Islam.”
He said he wanted to address the matter last night but could not. “It was good
that I didn’t because I was angry. And a person should not talk when he is
angry.”
He said that officials knew that Bushra Bibi, a woman who was not involved in
politics, was home alone. “To do this at someone’s home, tell me what you
would have felt. I am asking my army officers. What would you have felt?” he
asked, posing the same question to police officials.
Imran alleged that officials carrying out the operation “looted” his home. “Is
the police supposed to loot homes? They looted whatever they found. Do you
not have any shame?” he asked as he targeted Punjab Inspector General (IG)
Usman Anwar and used choice words for him.
Imran accused the Punjab IG of violating the orders of the Lahore High Court
(LHC), saying that he had referred to an anti-terrorism court for obtaining a
search warrant even when a high court judge had already laid out the
procedure for conducting a search at Zaman Park.
“Even the ATC only allowed two officials to conduct the arrest. One was the SP
and another was a female police officer not below the rank of an inspector,” he
said.
He said that the PTI would initiate contempt proceedings in the LHC and also
take legal action against Punjab Chief Minister Mohsin Naqvi in connection
with the death of Ali Bilal, alias Zille Shah, a worker of the PTI.
Later in the day, PTI Senior Vice President Fawad Chaudhry tweeted that the
party had sent a letter to the Punjab chief secretary requesting a case be
registered against PML-N chief organiser Maryam Nawaz, Naqvi, Punjab
Inspector General of Police Dr Usman Anwar, Lahore Capital City Police
Officer Bilal Siddique Kamyana and 18 other police officers for the “attack and
robbery at Zaman Park”.
Chaudhry said the PTI had requested a judicial commission as well on the
Zaman Park operations and the death of party worker Ali Bilal.
Imran had earlier announced that the power show at Minar-i-Pakistan would
take place today (March 19) but the LHC had directed the PTI to reschedule its
rally and have a dialogue with the administration.
In his address, Imran said that the country was “headed towards disaster” and
the only way forward was conducting free and fair elections.
He said that the nation could not be controlled through force anymore as it
had gained “consciousness”.
“Whenever I leave the house, more cases are registered against me. Who is
doing this? The criminals responsible for doing this to the country are the
ones registering cases against me.”
He alleged that the coalition government was behind the attempt on his life in
Wazirabad, adding that they had the backing of “handlers”.
Giving a rundown of the past couple of weeks, Imran said that the elections in
Punjab were announced for April 30, following which the PTI decided to
initiate its election campaign by holding a rally in Lahore on March 8.
“On the night of March 7, it was decided with the police how the rally would
proceed and they approved it. We got permission. The next day, as we are
about to start, everyone starts saying that police contingents are here and
placing containers.”
He said that as police appeared clad in riot control gear, it was revealed that
Section 144 had been imposed in Lahore. “When elections have been
announced, how can Section 144 be imposed? Has this happened before in
Pakistan’s history?”
He said that when the rally started moving towards Zaman Park, police used
water cannons and tear gas against PTI workers. Subsequently, he decided to
cancel the rally by 5pm because “I knew that they are trying to cause the
situation deteriorate”.
Imran further said that he asked for his hearing to be shifted from an
Islamabad court due to security concerns. “F-8 kachery is a death trap,” he
said, adding that arrest warrants were issued for him for this reason.
He said that a huge “army” arrived at his Lahore residence over warrants
issued by a magistrate. “There were constant attacks here at my home. Has
this ever happened before in the history of Pakistan?”
Imran said that he was ready to hand himself over to the police but he was
stopped from doing so by his party workers who feared harm would befall the
party chief.
He said that when he reached the toll plaza, police had closed down the
motorway. “Only one lane was open. They had in mind that once my car
leaves, they will close it behind me so that rest of the cars cannot follow […]
the whole of Islamabad was closed down as if for a major criminal.”
He alleged that the police intended to either “murder” him or take him into
custody and then shift him to Balochistan.
The PTI chief said police tear gassed workers that were walking alongside his
car as they “wanted a reaction”. He said that once his car reached the judicial
complex, police again tear gassed workers. “I didn’t want to leave or else they
would have claimed I fled.”
He said that when he was at the gate, police also started beating the workers
surrounding the car. “They were waiting for me to step out of the car and then
kill me.”
“Don’t fool the people, tell them that two weeks before now when you took a
group of armed people and attacked the Judicial Complex — what conspiracy
was at play then?”
The interior minister questioned why Imran wanted to take the mob of 300-
400 people with him inside the Judicial Complex on Saturday and asked what
situation could have arisen if they had entered.
Sanaullah questioned Imran about how the PTI’s actions yesterday and the
party chairman’s alleged refusal to answer the accusations against him
matched up with his insistence on the rule of law.
“You will have to answer for the theft in the Toshakhana case.”
The interior minister also raised concern about the upcoming provincial
elections and said no one would accept their results since it would mean the
presence of elected provincial governments during the general elections.
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LAHORE: Just a day after the announcement of Rs50 subsidy on each litre of
petrol for the ‘less privileged’, State Minister for Petroleum Dr Musadik Malik
on Monday announced the government will provide petrol at Rs100 less than
the official rate for motorbikes and cars of up to 800cc.
“The initial working was to provide petrol at Rs50 less than the Ogra-notified
rate to the people having motorcycles and (up to 800cc) cars, but on Sunday
night, the prime minister conveyed to us give petrol to the people Rs100 less
than the notified rate,” Dr Malik told a press conference.
“However, the petrol for the rich people having cars/vehicles of over 800cc
would be costlier, as the objective of the government move is to help a
majority of poor people — 210 million of the total 220 million population of
the country,” the petroleum minister said.
“So we have separated the Pakistan of the poor and the Pakistan of the rich,”
he said, adding that giving petrol to the rich costlier “would help us in giving
fuel to the poor on cheaper rates”.
Talking about gas, he said the gas tariff for the poor and the rich had already
been separated with effect from January 1 this year.
“The gas bill of the poor will be much less than the rich,” the minister said.
The gas consumption (per unit) rate for the rich would be one-fourth higher
than that charged to the poor.
“The target subsidy on the electricity is already in place, as those using electri-
city up to 400 units are receiving cheaper bills,” he said, adding that the
planning for the next scheme for helping the poor people was also being
worked out.
Mechanism
The minister said it was earlier planned to give discounted fuel cards to the
people, but the proposed move appeared to be costly.
“And now it has been decided to use EasyPaisa, JazzCash etc services. Such
people having smart or ordinary phones would receive a text message through
which they could register and get the code that will be used by the people
while getting petrol at petrol stations. The monthly quota for those having
bikes would be 21 litres. The discounted petrol for those having cars would be
one-time full-tank filling,” he clarified.
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During Monday’s hearing, counsel for the petitioner, Hamid Ali Shah,
concluded his arguments in response to Mr Khan’s objections.
The matter was taken up by the bench comprising Chief Justice Aamer
Farooq, Justice Mohsin Akhtar Kayani and Justice Arbab Muhammad Tahir.
Justice Farooq inquired about the status of a returned candidate who would
not take oath as a parliamentarian and sought arguments on how a person
disqualified to hold public office can retain the position of a party’s chairman.
At this, the IHC chief justice cited the case of ex-senator Faisal Vawda who
was disqualified for the assembly’s term and not for a lifetime. The counsel
replied that the facts of both cases were not identical.
The court was told that the Supreme Court made it mandatory for contesting
candidates to file an affidavit about their dependents.
The apex court had declared that any concealment in the affidavit was
tantamount to submitting forged documents. Later, the hearing was
adjourned till Tuesday (today).
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The photo shows CJP Umar Ata Bandial speaking at a ceremony in Quetta on
Monday. — DawnNewsTV
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Justice Mohammad Ali Mazhar, Justice Yahya Khan Afridi and Justice Jamal
Khan Mandokhail of the Supreme Court, Balochistan High Court Chief Justice
Justice Naeem Akhtar Afghan, other BHC judges and a large number of senior
judges were also present.
CJP Bandial said that there should be rule of law and it was everyone’s
responsibility to respect the judiciary and the law. “The country would face
uncertainty if there is no respect for law and the judiciary,” he said, adding
that what is happening in the lower courts is deplorable.
The CJP said that the bar should play its role in restoring discipline. He said
that the state is like a mother, and it is the responsibility of the state to provide
protection to its citizens.
“As far as the Supreme Court is concerned, its responsibility is to protect all
institutions in accordance with law and the Constitution,” CJP Bandial said.
He added that the supremacy of law and the Constitution is imperative for
everyone. He said that providing protection to the state institutions was the
priority of the Supreme Court, and protecting human rights was also the
responsibility of the judiciary.
Referring to the situation in the province, the chief justice said Balochistan
was not as developed as it could be, for which not only the state was
responsible but the onus was on everyone living in the province. He said that
people should bring problems before the court, and we could determine the
legal path for the development.
He said the Supreme Court determins the priority for hearing cases based on
the merit and importance of the issues and the demands of the law, and it was
the right of the court to decide the importance of the cases. “The lawyers
should benefit from the video link in the courts,” the CJP said.
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Mr Niazi had obtained bail from the Anti-Terrorism Court (ATC) in cases
registered against him and other PTI supporters in connection with violence
that took place on Feb 28 and March 18 when Mr Khan appeared in the FJC.
The judge confirmed Mr Niazi’s bail in two cases registered on Feb 28 and
granted him pre-arrest interim bail in the FIR registered with the Counter
Terrorism Department (CTD) on March 18 when Mr Khan was supposed to be
indicted by a trial court in the Toshakhana case.
Due to rioting outside the main entrance to the FJC, trial court judge Zafar
Iqbal was left with no option but to defer the indictment and marked Mr
Khan’s attendance while the former prime minister sat in his vehicle parked
outside the complex.
Ironically, the court’s order sheet went missing during the signing process and
the judge had to retrieve a copy of the same from computer. He recorded
statements of Mr Khan’s counsel Khawaja Haris Ahmed, Barrister Gohar Ali
Khan and SP Sami Malik.
Hassaan Niazi among over 250 PTI supporters booked, detained for violence
near judicial complex; Bol News journalist picked up
The fourth FIR against Mr Niazi was submitted before IHC Chief Justice
Aamer Farooq during the hearing of a habeas corpus petition filed by
Advocate Faisal Hussain and Advocate Mohammad Ali Bukhari.
During arguments, Advocate Hussain informed the court that Mr Niazi was
picked up without due process of law.
Justice Farooq summoned the SHO of Ramna Police Station and a
representative of IG Islamabad. The SHO informed the court that Mr Niazi
was arrested after registration of an FIR.
Justice Farooq ordered the police to act in accordance with law. He also
directed for conducting medical examination of Niazi and asked them to
produce him before the judicial magistrate on Tuesday (today).
Mr Niazi was arrested after a case was registered against him under Section
324 and five other sections of PPC at Ramna Police Station.
Meanwhile, the capital police arrested over 250 local leaders, activists and
supporters of PTI in connection with two cases registered against them for
violence in and around the judicial complex on March 18, police said on
Monday.
They said 60 people were detained on Sunday and as the crackdown continued
the number of those arrested increased to 250 by Monday evening.
Safe City footage was used to spot those who caused a breakdown of law and
order, police said, adding that help of Nadra was also being sought to identify
the “miscreants”.
The capital police also picked up the bureau chief of Bol News channel,
Siddique Jan from his office and took him away in a private vehicle to an
undisclosed location.
In a video that was shared on social media, Mr Jan was purportedly asking
PTI supporters to fire tear gas shell on police at the FJC. Police PRO Jawad
Taqi was not available for comment.
Punjab govt wants to ‘sabotage’ Minar-i-Pakistan rally:
Imran
Mansoor Malik Published March 21, 2023 Updated 33 minutes ago
When contacted, Punjab chief secretary Zahid Akhtar Zaman and Deputy
Commissioner Lahore Rafia Haider stayed mum over the question regarding
the permission for the public gathering.
The former premier said the delay in permission for the public meeting was
aimed at eclipsing the PTI gathering as the party would not have enough time
for canvassing or setting up a stage at the venue. In light of these
circumstances, the public meeting might face another delay, sources said.
PTI chief urges CJP to order probe into ‘presence of assassins at Judicial
Complex’
While there were reports that the gathering may get postponed till Sunday,
party insiders said Ramazan would have begun by Sunday and it would not be
possible for the former ruling party to organise the meeting during the day
time.
In his televised address from the Zaman Park residence, Mr Khan said,
“Holding free and fair elections is the only way to steer the country out of
prevailing crises and bring political stability in the country, followed by
economic stability and strengthening of the society,” he asserted.
The PTI chief also chided caretaker Chief Minister Mohsin Naqvi for not doing
anything in a bid to ensure free and fair elections. Mr Khan also asserted that
the masses would come out in massive numbers at the Minar-i-Pakistan
public meeting to show their distrust against the incumbent rulers. “My sixth
public meeting at Minar-i-Pakistan venue in the past 12 years will serve as a
referendum against the incumbent rulers,” he asserted.
‘PTI vs army’
The former prime minister also said the PDM government was trying to pit the
Pakistan Army against the PTI. “The rulers are trying to mislead the army
against PTI,” he claimed. “The army and this country belong to us as we will
live here, but the incumbent corrupt rulers will run away as their wealth in
dollars is stashed abroad,” he claimed.
Reiterating yet again that the incumbent rulers wanted to kill him and a “trap”
was laid at the Islamabad Judicial Complex on the occasion of his hearing, the
PTI chairman urged the chief justice to investigate that who were
“plainclothesmen VIPs” that were allowed entry into the complex.
The PTI chief also ran video footage showing some “plainclothesmen” entering
the complex and added that one of his colleagues approached and beckoned
him to immediately move away. He said police also pelted stones and bricks at
his party workers and supporters to create a scene on the occasion and grab
him under the cover of the altercation.
According to Mr Khan, “they can succeed any time (in killing me) because
arresting and taking me to jail seems a Plan-B” of the government. He urged
the CJP to allow him the facility of joining courts’ proceedings through a
video-conference facility. He also lamented that the assailant, who fired to
assassinate him, was being given a video-conference facility in jail.
The former premier urged the CJP to take note of the “human rights violations
being committed by the PDM government and the caretaker government” in
Punjab. He alleged the police were raiding his party’s senior leadership
houses, harassing residents, picking up children, and ransacking belongings in
the same as they ransacked his house.
Mr Khan said the incumbent rulers were using every kind of tactic to eliminate
him as they were afraid of losing elections in his presence. Chiding the former
army chief Qamar Javed Bajwa for ruining the peace and well-being of the
country, the PTI chief said, “Even an enemy would not have been able to ruin
Pakistan as he did.”
The PTI chief also announced that his party was collecting all evidence of
human rights violations committed by the rulers and would be presented
before the international human rights organisations as well as the European
Union. He also asked his party chapters in all countries to take the case of
human rights violations at all forums in their respective countries.
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February showed a healthy sign as the CAD fell to just $74 million against
$519m last year, the lowest monthly deficit recorded since February 2021. The
deficit declined by 86 per cent on a year-on-year (YoY) basis.
The decline in the CAD was due to a fall in imports while no higher exports or
inflows were noted. Though the balance of payment reflected a healthy sign
for improvement in the external front of the country’s economy, the
government is unable to meet even this decreasing CAD due to extremely poor
foreign exchange reserves.
“On a YoY basis, the primary reason behind the decline in deficit was a 24pc
fall in total imports. However, total exports and remittances also decreased by
19pc and 9pc YoY, respectively,” said Tahir Abbas, head of research at Arif
Habib Limited.
The February deficit was even much lower than January’s $230m. The decline
made a trend for the CAD during FY23 and may end up with much lower
deficit compared to last year. The CAD stood at 17.4bn during the last fiscal
year (FY22).
Experts believe the CAD could be around $6bn in FY23. This figure is a real
problem for the country as the International Monetary Fund (IMF) has been
asking the government to arrange the amount needed to meet the CAD by the
end of FY23.
Pakistan got much-needed support from China which provided two tranches
of $700m and $500m to improve the country’s foreign exchange reserves that
stood at $4.3bn by March 10 this year.
Experts said that due to political uncertainties the friendly counties are
reluctant to extend loans as they fear Pakistan may default and their money
could get stuck up.
Former finance minister Miftah Ismail recently revealed that Pakistan had
met all IMF conditions. To meet the Fund’s conditions, the government has
increased the interest rate to 20 per cent. This high rate crippled the country’s
trade and industry, also resulting in higher inflation of 30pc.
In order to bring the fiscal deficit under control, the government has slashed
the development budget, thus slowing down the economic growth and creating
joblessness in the country.
Imports of goods during the first eight months of FY23 stood at $37.88bn,
while exports during the same period were $18.639bn. The import of services
during this period was $5.118lbn against the export of services at $4.778bn.
Despite a massive decline in the CAD, the government is unable to meet the
deficit due to large trade deficit.
Imports of goods during the first eight months of FY23 fell by almost $10bn
and exports by around $2bn. The poor exports with much higher imports did
not allow the country to find a balance on its external front. The balance of
trade in goods and services during the first eight months of FY23 was in deficit
with $19bn compared to $29.8bn last year.
Petroleum subsidy
Editorial Published March 21, 2023 Updated about 2 hours ago
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On the face of it, the move is likely to prove a non-starter; it will be difficult, if
not impossible, to pursue it under the IMF should Islamabad strike the long-
awaited deal with the Fund despite this new plan.
The scheme presupposes that the subsidy will reach every targeted individual,
will not be misused and that its cost — estimated at Rs120bn — can be cross-
subsidised by charging an additional tax of Rs100 per litre on petrol consumed
by ‘affluent’ sections. The designers of the programme have yet to explain their
definition of ‘affluent’.
After all, how many BISP beneficiaries own motorbikes, rickshaws or small
cars? Even if the proposal is implemented without hiccups, it will not help the
ruling set-up recoup its political capital.
At the most, the Robin Hood effect the move may create will retrieve only
narrow space for the PML-N and its allies — definitely not enough to improve
their electoral chances. The move is going to strengthen the impression that
the coalition partners are sinking deeper into the political quagmire.
The proposed plan underlines the fact that the present government is no
different from its predecessor. Like the previous PTI government, it seems
more interested in reviving its political capital through ad hoc, short-term
measures rather than implementing sound economic policies to fix the
collapsing economy, executing governance reforms, expanding the tax net and
cutting wasteful expenditure. It is common for politicians to pursue populist
policies closer to the elections.
The PML-N has a long history of offering such ‘relief’ — at a cost to the
economy. The massive tax cuts announced by the party’s then finance minister
Miftah Ismail in its last budget before the 2018 polls are just one example.
The decision did not help the party return to power. It also proved quite costly
to the economy just like the PTI decision to cut fuel and power prices and
freeze them to improve its government’s rating ahead of the vote of no-
confidence against Imran Khan a year ago.
Past experience underscores the fact that populist solutions to the problems
faced by the people always prove untenably expensive for the economy and
those who are supposed to benefit from them.
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They say politicians don’t care about the people, and the events of
the past couple of weeks have done little to dispel this impression.
The lengths they will go to in order to protect their narrow political interests,
pro-democracy and pro-people rhetoric notwithstanding, seem to have pushed
the country to a breaking point.
As the economy sinks deeper and deeper into quagmire, the ruling alliance —
led by the PML-N — and the opposition PTI have taken their fight to the
streets, at the expense of their inflation-stricken citizens, governance and, last
but not least, democracy.
No wonder then, that neither the IMF nor the so-called ‘friendly countries’
appear very interested in helping Pakistan back from the brink of an imminent
default.
In such a climate, hearing about growing ‘divisions’ within the military and the
judiciary along political lines does not come as much of a surprise – it is after
all merely a reflection of the polarisation that has already taken place in the
social fabric at large.
With Imran Khan demanding immediate elections and the ruling alliance hell
bent on delaying them, the political temperature is soaring to boiling point.
The most important question now seems to be: do those on either side of the
political fence — involved in this power struggle — have what it takes to save
the state of Pakistan?
“Both those in power and those in the opposition are to blame for what we are
seeing today. But those in government have a greater responsibility to cool
down political temperatures,” says a journalist and political analyst, speaking
on condition of anonymity.
“The polarisation has reached a level where even the caretaker setup in
Punjab, whose job is to make arrangements for fair polls in the province, has
lost its neutrality and is now looking like an extension of the PML-N or the
federal government,” he notes.
This does not augur well for the federal government or the upcoming
elections. “Who will agree to elections under the present caretakers in Punjab?
The interim government must distance itself from the coalition led by the
PML-N to restore its neutrality,” he argues.
But at the same time, he is also critical of Imran Khan and his party.
“It is unfortunate that Mr Khan has not even once denounced the violence (by
his party workers against the police). Why? He never tires of giving us
examples of the rule of law from the West. Do politicians behave like this in
the Western democracies he says he knows better than any fellow Pakistanis?
He also has a responsibility to tone down his rhetoric.”
The current chaos, in his view, can be traced back to the PTI chief’s decision to
quit parliament and bring his politics to the streets.
“When you bring politics out of parliament, you always run the risk of
encouraging agitation and violence. But the political, economic, governance
and institutional crises confronting this nation of 230 million people cannot
be tackled through agitation and street fights.
At the end of the day, Imran will also have to sit across the table from his
opponents and talk to them to find a way out of the current quagmire, the
analyst notes.
“He will have to give something in order to obtain something from his
opponents. There is no other way out of the turmoil we are in. Both sides will
have to take a step back and talk. Neither party can fix this country alone,” he
observes.
Fahad Rauf, who is head of research at Ismail Iqbal Securities in Karachi, says
the economy has fallen victim to political strife.
“The IMF programme was suspended owing to the political decisions of the
PTI government to slash and freeze power and fuel prices ahead of the vote of
no confidence against Imran Khan a year ago. It took months to restore the
funding package as the new government took its sweet time to reverse the
energy subsidies, only to deviate again from the programme (in October to
revive the PML-N’s political capital),” he says.
In his view, the reason why IMF or friendly nations are not coming forward to
help us in this dark hour is because of the growing political instability that is
tearing the country apart.
“We need a stable government for economic stability and revival. New
elections are no solution to our problems; but these at least will send a
message to the Fund and other creditors that they have a permanent setup in
Islamabad to talk to. With elections round the corner, it is useless to expect
the government to take rational economic decisions.”
Although he fears that that the party that wins the elections may have
undemocratic tendencies, he still suggests that the ruling alliance should
follow the Constitution.
“Deviation from the constitutional path will push us deeper into political and
economic turmoil. We have fought forces with fascist tendencies in the past
and we can fight them in the future as well. Nevertheless, there’ll be no
coming back from the abyss that we are leading this country into.”
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The huddles decided to take stern action against the protesting leaders and
workers of the PTI who, when Imran Khan was supposed to appear before a
court hearing the Toshakhana case, “brutally beat police personnel, set official
vehicles on fire, used petrol bombs against police and created unrest”.
According to an official statement issued after the meetings, the two sittings
agreed to take stern action against those involved in violent protests and the
ransacking of public and private property. The huddles also agreed that
elections to the national and provincial assemblies should be held
simultaneously.
The meeting also decided to take action against those involved in maligning
state institutions, including the armed forces and judiciary, through a “smear
campaign”.
“The meeting strongly condemned attacks on police and Rangers, who were
obeying court orders, and called it an enmity against the state,” the statement
said.
“All evidences and proofs are available, under which stern action will be taken
against those involved in the unrest,” it added.
The meeting condemned “a smear campaign against the army and army chief
on social media” and urged people not to become part of it. It observed that
the impression that Imran Khan and his followers were being given “special
treatment” was getting stronger. The statement noted that “two standards of
justice” will not be accepted.
The participants also expressed concern over a recent audio tape of ex-chief
justice Saqib Nisar and PTI lawyer Khawaja Tariq Rahim and condemned
“objectionable” remarks about PML-N Vice President Maryam Nawaz.
The official statement said that the PTI was not acting like a political party,
rather resembled “a gang of miscreants trained by outlawed groups” and
asserted that violence by its workers against security personnel would not be
tolerated.
Provinces’ concern
“In view of the concerns of Sindh and Balochistan, the meeting reached a
consensus that elections to the national and provincial assemblies should be
held at the same time, and not separately,” he added.
“If the elections in Punjab are held now, the new provincial government will
have influence on the polls to the National Assembly,” he said.
The minister said the elections in Punjab were scheduled to be held under the
last census, while the new census will be completed over the next four months
and the general elections in the country will be held as per the fresh census.
He said the final decision regarding holding of elections will be taken by the
Election Commission of Pakistan (ECP).
The Supreme Court had in a recent verdict directed the caretaker government
of Punjab to hold elections in the province on April 30.
Mr Iqbal said the apex court had taken the decision in “haste” as the present
circumstances did not allow holding of polls so early. “It was the responsibility
of the Supreme Court to take its decision keeping in view the ground realities,”
he added.
Separately, PPP leader Qamar Zaman Kaira said it was in the best interests of
the country that elections in all provinces and the Centre should be held
simultaneously. “It was a common opinion of all in the meeting. If elections in
Punjab and KP are held now, it will create more problems and conflict,” he
added.
Mr Kaira, however, said all the warring political forces should not give up the
option of dialogue and if Imran Khan had given any hint that he was serious
for talks, he should be welcomed. “There must be a middle way out of the
deadlock,” he added.