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DAWN WIRE SERVICE

------------------------------------------------------------------- Week Ending : 08 November 1997 Issue : 03/45 -------------------------------------------------------------------

Contents | National News | Business & Economy | Editorials & Features | Sports

The DAWN Wire Service (DWS) is a free weekly news-service from Pakistan's largest English language newspaper, the daily DAWN. DWS offers news, analysis and features of particular interest to the Pakistani Community on the Internet. Extracts, not exceeding 50 lines, can be used provided that this entire header is included at the beginning of each extract. We encourage comments & suggestions. We can be reached at: e-mail dws-owner@dawn.com WWW http://dawn.com/ fax +92(21) 568-3188 & 568-3801 mail Pakistan Herald Publications (Pvt.) Limited DAWN Group of Newspapers Haroon House, Karachi 74200, Pakistan Please send all Editorials and Letters to the Editor at letters@dawn.com Make sure you include your full name, complete address and, if in Pakistan, your daytime telephone number. TO START RECEIVING DWS FREE EVERY WEEK, JUST SEND US YOUR E-MAIL ADDRESS! (c) Pakistan Herald Publications (Pvt.) Ltd., Pakistan - 1996 DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS ******************************************************************** *****DAWN - the Internet Edition ** DAWN - the Internet Edition***** ******************************************************************** Read DAWN - the Internet Edition on the WWW ! http://dawn.com DAWN - the Internet Edition is published daily and is available on the Web by noon GMT. Check us out !

CONTENTS

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NATIONAL NEWS

Two religious scholars killed in bomb attack Strike paralyses Karachi SC to take up case against PM on 12th Leghari to visit US next month Senate passes Environmental Protection Bill, 1997 Matriculate appointed adviser at monthly salary of Rs60,000 Saudi Arabia frees Pakistani children Aero Asia starts operations today ---------------------------------

BUSINESS & ECONOMY

State Bank rings alarm bells after worst year Devaluation unlikely to boost exports Structural reforms creating grave social unrest Is debt cause for jubilation? EPZs being planned for Quetta, Gwadar Foreign investment decline by 27.3pc Pakistanis in US present proposals to PM Real estate being opened up to foreign investment Forex reserves fall by $125m Equities post modest gains in brief session ---------------------------------------

EDITORIALS & FEATURES

Back to sanity Ardeshir Cowasjee The zone of good governance Irfan Husain Limits of a popular mandate M.H. Askari By losing he has won Eqbal Ahmad What is milk? Omar Kureishi -----------

SPORTS

Faisalabad fiasco and quadrangular Akram delighted with Anwar, Sohail's knocks Pakistan's exit debases cricket carnival Exciting final awaits cricket fans First phase of Pakistan's ascendancy in Squash-I World squash championship wide open Amjad loses to Power in world squash ===================================================================

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NATIONAL NEWS

971103 -------------------------------------------------------------------- Two religious scholars killed in bomb attack -------------------------------------------------------------------- Mohammed Riaz KARACHI, Nov 2: The principal of Jamia Islamia, Binori Town, Maulana Dr Habibullah Mukhtar, and one of his colleagues were burnt to death when two motorcyclists hurled an explosive device at their van on the Business Recorder Road. The driver also died on the spot as the assailants fired at the van. Maulana Mukhtar (60) was a son-in-law of the late Maulana Mohammad Yousuf Binori. A companion of the Maulana was injured and another escaped unhurt in the shooting, which took place near the Guru Mandir intersection at 12.50pm. Late in the night a student of Jamia Nomania was shot dead near Islamia College while he was going to Binori Town for attending the funeral of Maulana Mukhtar. The others who died were identified as Mufti Abdus Sami (40), driver Mohammad Tahir (26), and student Ibrarul Haq (23). Maulana Bashir Ahmed Naqshbandi (45), received multiple bullet injuries. Maulana Abdul Qayyum Chitrali (46) escaped unhurt as he jumped off the van. Protests spread to other areas of the city by evening and people started stoning vehicles. They also burned tyres to impede traffic. Residents of localities on Khalid Bin Waleed, Shaheed-i-Millat and Jamshed Roads told Dawn about the forced closure of markets and shops in the neighbourhood. Police were not present, one resident complained. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS* 971108 -------------------------------------------------------------------- Strike paralyses Karachi -------------------------------------------------------------------- Staff Reporter KARACHI, Nov 7: A complete strike was observed in the city on Friday on a call given by the Wafaqul Madaris Arabia, a chain of seminaries, and endorsed by politico-religious organisations, against the killings of two Ulema of Jamia Islamia, Binori Town, on Nov 2. Maulana Dr Habibullah Mukhtar, principal of the Jamia Islamia, Binori Town; Mufti Abdul Sami and van driver Mohammad Tahir were killed by unknown motorcyclists near Guru Mandir on Sunday. The city was virtually taken over on Friday by the students of religious schools run by the Wafaqul Madaris, Jamia Binoria, and workers of both factions of the Jamiat Ulema-i-Islam; Swad-i-Azam Ahl-i-Sunnat, Sipah-i- Sahaba Pakistan and Harkatul Ansar. The protesters set a wine shop (JBS Traders) on fire in Gulshan-i- Iqbal and blocked the streets and roads by burning tyres and placing big stones there. Students of Jamia Islamia, Clifton, pelted shops and offices in the Clifton Centre with stones and forced the shopkeepers to pull down shutters. "The rangers have asked us to immediately leave the area", a shopkeeper told Dawn by telephone. The miscreants set ablaze a classroom of a school, a roadside hotel and some hawker stalls. The furniture of a classroom of a government primary school was reduced to ashes in the neighbourhoods of Korangi. The police said the fire broke out due to short-circuit, but fire-brigade sources held a different view, saying the fire was apparently not caused by the short-circuit. In Bilal Colony a locality in the limits of the Korangi Industrial Area police some miscreants burnt a roadside hotel when they found it open. They also set ablaze some stalls of hawkers near the hotel. All business establishments, shopping centres and markets in the five districts remained closed. Transporters, who had observed a partial strike in the city on Wednesday, did not bring out buses, water tankers, trucks, coaches, vans, taxis and rickshaws on the roads. The police and rangers remained off the roads and this gave the students an opportunity to freely vent their anger. An Edhi volunteer said miscreants had damaged an ambulance (EA-0941) near Hadi Mills in Old Golimar. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS* 971108 -------------------------------------------------------------------- SC to take up case against PM on 12th -------------------------------------------------------------------- Rafaqat Ali ISLAMABAD, Nov 7: A three-member bench of the Supreme Court headed by Chief Justice Sajjad Ali Shah will take up the contempt of court petitions against the prime minister and seven legislators on Nov 12, the Supreme Court office confirmed on Friday. According to the cause list issued by the Supreme Court office on Friday, four cases: Mismanagement of public funds case; petitions against Anti-terrorism Act; two contempt of court petitions against prime minister and ten others; and appeal of two Ahmedis against the Lahore high Court verdict, would be taken up for hearing on Nov 10, 11, 12, and 13 respectively. The bench will comprise Chief Justice Sajjad Ali Shah, Justice Mohammad Bashir Jehangiri and Justice Chauhdry Mohammad Arif. On Nov 12, the court would take up two petitions seeking contempt of court proceedings against the prime minister and seven other members of the parliament for their alleged attempts to bring the institution of judiciary into ridicule. The petitioners in the case are Chaudhry Mohammad Ikram, additional secretary of the Supreme Court Bar Association and Syed Iqbal Haider, chairman of Muslim Welfare Movement. On the petition, the court had issued notice to 12 respondents including the PM to explain why contempt of court proceedings should not be initiated against them as demanded in the petition. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS* 971108 -------------------------------------------------------------------- Leghari to visit US next month -------------------------------------------------------------------- Staff Correspondent WASHINGTON, Nov 7: President Farooq Leghari will pay a visit to the United States in December, an official source said on Friday. The visit would be unofficial but the President would inaugurate a conference of computer software manufacturers in San Francisco. The conference is being organised by the Pakistan Embassy to attract US companies into developing their softwares in Pakistan, as many of them currently are doing in Bangalore in India. The programme of the President is being finalised and no date has yet been fixed. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS* 971108 -------------------------------------------------------------------- Senate passes Environmental Protection Bill, 1997 -------------------------------------------------------------------- Mohammad Yasin ISLAMABAD, Nov 7: The Senate on Friday passed the Pakistan Environmental Protection Bill 1997 amidst unanimous cries of "Ayes, Ayes" from the treasury and the opposition benches. As the Upper House took up legislative business, Deputy Opposition Leader Senator Raza Rabbani told the Chairman of Senate that his party was not opposing the Bill as it was originally his party which had introduced the Bill. Consequently the Bill was passed with unanimity by the House in a couple of minutes when the Chairman, Mr Wasim Sajjad, moved the motion for taking the Bill into consideration and then for its adoption. The Bill had a smooth sailing all the way. The Bill provides for the establishment of federal and provincial agencies, a framework for implementation of national conservation strategy, establishment of provincial sustainable development funds, the protection and conservation of species, habitats, and biodiversity, conservation of renewable resources, establishment of environmental tribunals and appointment of environmental magistrates, environmental impact assessment and promotion of public education and awareness of environmental issues through the mass media. Under the Bill, in addition to official environment agencies, any person or organization can request for inquiries and investigation into environmental issues and/or award of compensation for losses/damages sustained in this regard. The Bill empowers the federal government to make rules for implementing important international environmental agreements to which Pakistan is a party. The Bill provides that in case of offences by government, local authorities or local councils, head or other officer shall also be deemed guilty of such contravention along with the government agency, local authority or local council and shall be liable to be proceeded against. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS* 971105 -------------------------------------------------------------------- Matriculate appointed adviser at monthly salary of Rs60,000 -------------------------------------------------------------------- Our Correspondent ISLAMABAD, Nov 4: Among the 12 advisers/ consultants appointed by the Nawaz government since Feb 20, 1997, is a lucky matriculate, M. Afzalullah Siddiqui, who has been appointed adviser/consultant at a monthly salary of Rs60,000 in the National Investment Trust (NIT) under the finance ministry. This was disclosed in reply to a question asked by Senator Iqbal Haider during the question hour in the Senate on Tuesday. The minister in charge Yasin Wattoo told the House that the consultant had passed Part 1 examination of the Institute of Bankers from London. The gentleman is 43 with experience of working in various banks. He has been allowed a car with 250 litre of petrol per month. The list contains name of another consultant Shahid M. Sattar who has been appointed adviser to the finance minister. His qualification has been given as- 9 'O' and 3 'A' Levels. Besides he has diploma in accounting with final examination of the Chartered Institute of Management Accounts UK. The adviser draws a token salary of Re1 per month plus actual out of pocket expenses. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS* 971107 -------------------------------------------------------------------- Saudi Arabia frees Pakistani children -------------------------------------------------------------------- Our Correspondent ISLAMABAD, Nov 6: The government of Saudi Arabia has released the Pakistani children and a teenage girl who were arrested on charges of smuggling narcotics in the Kingdom. The Saudi interior minister has communicated to his Pakistan counterpart the decision to release the children in his letter. The letter was delivered here on Thursday to Interior Minister Chaudhry Shujaat Hussain by the Saudi ambassador, Assad bin Abdul Aziz Al- Zuhair. Their release came as a result of the personal efforts made by the interior minister who had contacted his Saudi counterpart and requested him to pardon the Pakistani children and release them on humanitarian grounds. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS* 971106 -------------------------------------------------------------------- Aero Asia starts operations today -------------------------------------------------------------------- Shafaat Yar Khan SHARJAH, Nov 5: Pakistan's largest private airline Aero Asia formally launches its operation on the Sharjah-Lahore sector with its first Boing 747 with more than 100 passengers arriving tomorrow (Thursday). The introduction of the new private airline, is expected to break the monopoly of national flag carrier, Pakistan International Airlines in this sector. Presently, PIA operates six weekly flight between Lahore and Dubai, which serves for passengers from Sharjah and other northern emirates also. Airline authorities hoped that extra baggage allowance, competitive fares, convenient arrival and departure timings and will play a key role to attract more passengers from northern Emirates, particularly those looking for direct connection between Sharjah and Lahore. 'With 50 kgs of baggage allowance (the highest for any airline flying to Lahore) and competitive fares (15% cheaper than PIA), Aero Asia is targeting higher traffic on this sector,' says Rafique Nasir who finalized arrangements for the airline's new operation. The airline has waived the fuel surcharge making the fare more competitive. For domestic flights which started on May 6, 1993, the airline operates BAC-111s, but will use a Boeing 707 on the Sharjah-Lahore sector, with 16 business class and 142 economy class seats. The airline plans to lease an Airbus A-300 in January 1998 for its new international routes.

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BUSINESS & ECONOMY

971103 -------------------------------------------------------------------- State Bank rings alarm bells after worst year -------------------------------------------------------------------- Sultan Ahmed A COMBINATION of enhanced autonomy of the Central Bank, the fact that the government it impugns is no longer in office and the adverse consequences of the cumulative follies of successive governments in recent times, has made the State Bank of Pakistan come up with a forthright report on the performance of the economy in 1996-97. Almost all the negative indices listed in the annual report confirm what have been known to the people through earlier official disclosures, but the report goes beyond last year and points out to the beginning of the sad chapter in our recent economic history, before declaring last year as one of the most difficult and disappointing year in the economic history of the country. The report cautions that even if the targets for the current year are less ambitious or more realistic than last year. They may not be achieved without adequate exertion and true vigilance on the part of the government along with the right mix of fiscal and monetary policies. But the Bank with its almost total autonomy has a new responsibility for monitoring the performance of the government and progress of the economy and bring them to the notice of the National Assembly and through it to the country. It did well by coming up with the first quarterly report to the National Assembly, as enjoined by the new law on the enhanced role of the Central Bank, for the first quarter of this calender year on May 31 last, but did not follow that up with a second quarterly report for the second quarter. Instead the present annual report for 1996-97 is to be treated as its second report which is not proper as it covers the whole year which encompasses three governments within the period and does not specifically evaluate the performance of the Nawaz Sharif government in its first full quarter ending June 30. And now that the first quarter of the Nawaz government in the current financial year is over (on September 30) it should come up with its quarterly report soon. The National Assembly with the overwhelming majority support for the government may not be particularly interested in the next quarterly report, but the newspapers and the non-official economic community are. The large gap between target and performance for the last five year shows that it is easy to fix attraction targets and difficult to achieve them in the normal bureaucratic manner. And when economic growth goes down as low as 3.1 per cent against the target of 6.3 per cent in a country with a population growth of 3 per cent per annum, almost everything goes out of gear and the country is left with a series of 14 negative indices and an increase in domestic and foreign debt which together has risen to Rs 2,240 billion. In fact, with external debt at Rs 1,198 billion, it is exceeding the domestic debt of Rs 1,042 billion by Rs 156 billion. And following the soaring short-term borrowing abroad the cost of that has risen to a high 11 per cent. On short-term loans of $2,486 million, the interest payments due are $263 million. And that makes the IMF's loan of $935 million at half a per cent interest and even the External Fund Facility of $623 million at around 4.5 per cent interest very valuable. What the government has to realise is the heavy inter- dependence of the economic sectors. Economic growth fell to 3.1 per cent last year as agriculture growth inched up only 0.7 per cent against the targeted 5 per cent. That happened as the major crops, particularly wheat and cotton, recorded a negative growth 4.5 per cent. Minor cops increased by only 3.4 per cent against the target of 8.8 per cent. All that resulted in the manufacturing sector growing by only 1.8 per cent against the target of 7.2 per cent, while the crucial large scale manufacturing registered a negative growth of 1.4 per cent against the modest target of 6.5 per cent. In the case of the large scale sector, the paralysis has been enduring as during the previous three years, the growth had been only 4.1, 1.7 and 2.6 per cent respectively and ultimately climaxed in the negative growth of last year. However all official figures show a constant growth of 8.4 per cent for the small scale sector and that is incredible. As the industrial and agricultural sectors grossly under- performed, the service sector grew last year by 4.1 per cent against the target of 6.1 per cent and the 4.8 per cent of the previous two years. As a result of less of the exportable surplus being available from both, the commodity producing sectors, exports fell by 2.7 per cent against the target of a 14.4 per cent rise. To boost exports, the rupee was devalued last year by over 13 per cent, including 3.65 per cent in September and 7.85 per cent in October last by the Benazir government and the rupee came down to Rs 40.46 to a dollar by the end of the year from Rs 35.10 on June 30 last year. But that instead of helping the exports cut down the imports by five per cent as the imports became more costly, particularly after the duties went up to the extent of the devaluation. How much of such imports then came in through smuggling remain a matter for speculation. But when the imports fell by 5 per cent instead of rising by 5.1 per cent as targeted the government's revenues fell and aggravated the budgetary deficit which rose of 6.2 per cent of the GDP instead of the targeted four per cent, which was the demand of the IMF. As agricultural and industrial production fell and imports came to cost far more, inflation rose to 11.8 per cent officially, and far more actually, against the target of 8.5 per cent, and the previous year's 10.8 per cent. Fall in incomes following the negative indices all round resulted in lowering the domestic liquidity to 12.2 per cent against the target of 13.1 per cent based on higher growth expectations, but the rise in domestic credit was a high 15.3 per cent against the targeted 14.2 per cent because of excessive government borrowing to cover the budget deficit. Low economic growth along with the shrinking of the industrial sector, as a consequence of which, about 4,000 industrial units falling sick, resulted in the tax revenue increasing by 13 per cent against the target of 14.9 per cent and the previous year's 14.1 per cent. And while the growth of total tax revenues dwindled to 15.5 per cent against the targeted 18.5 per cent a large gap of 3 per cent and the budgetary deficit rose to 6.2 per cent against the targeted 4 per cent. The fall in per capita incomes by $20 to $470 lowered the growth of savings to a 11.8 per cent against the target of 14.7 per cent which is pretty low by Asian standards, including that of India. Hence interest at current prices rose by 18.2 per cent against the targeted 20.5 per cent which is again low by Asian standards. The SBP report says: "Slowing down the industrial activity is also linked to a low rate of investment in the last several years. Gross fixed investment which recorded an average growth rate of 1.9 per cent (in real terms) in the last five years, actually declined by 3.6 per cent last year and in particular significant negative growth was recorded in manufacturing and agriculture." In the crucial balance of payments sector while the balance of trade recorded a deficit of $3,328 million, the balance of payments recorded a deficit of $4.2 billion and left the country with a poor foreign exchange reserve of $1,219 million against the target of $1,787 million and the previous year's $2,065 million, necessitating hectic short term borrowing at a high cost. Having done so badly last year, the government has fixed a growth target of 6 per cent for the current year, something which has not been achieved for the last five years. It is yet hopeful of achieving a 5.1 per cent growth in agriculture which it expects will boost industrial production for which the target is the same as last year's 7.2 per cent. But the government has to go all out to enlist and sustain the cooperation and energetic efforts of agriculturists and trade and industry to achieve such results in a year in which it cannot fail again. The SBP has to remain a vigilant monitor and timely bell- ringer. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS* 971103 -------------------------------------------------------------------- Devaluation unlikely to boost exports -------------------------------------------------------------------- S.M.A. Rizvi THE DEVALUATION of the rupee by 8.7 per cent against the US dollar is controversial not only among economists but the business community too. According to the Finance Minister, the step was taken by the State Bank, an autonomous body but not so autonomous as to recover loans from the defaulters. Instead of the Governor of the State Bank, the decision is being defended by the finance minister, the commerce minister, the chairman of the Planning Commission and others. The main argument in its favour is that it will boost exports and help achieve the target of $9.2 billion set for fiscal year 1997-98. Let us see how far this measure will help us enhance exports. Major export items are yarn, fabrics, and textile made-ups, rice, carpets, leather, sports goods, surgical goods, fruits nd vegetable, etc. Let us study their export potential (All figures are based on government statistics released for the year June 1996 to July 1997). Cotton: Textile industry is the backbone of Pakistan's exports having about 65.71 per cent share in the total volume. Since the last several years, the cotton crop is continuously suffering from pests, adulterated pesticides, due to bad manure, and shrinkage in acreage. The export of raw cotton will, no doubt, benefit from the devaluation but there is hardly any surplus. For about three decades the spinning mills exploited the growers by purchasing Phutti at a very low price. But for the last three or four years the situation has reversed. Now farmers demand a price of raw cotton which is at par with the intentional price or more. Though they are not benefited from it to the export of full increase. Major portion is shered by feudals lords, grinners and speculators who also have entered into this field. They hoard cotton with loans obtained through banks and demand high prices. It is a long story but to cut short, the country may not benefit from raw cotton export on account of nonavailability of surplus. Cotton yarn at one time had fetched $1.6 billion but declined to $1 or 1.2 billion. Last year it had picked up again to $1.3966 billion. The problem with yarn is, that it is an essential semi- manufactured raw material which is indispensable for all value- adding industries, which, although unorganized, fetch the highest amount of foreign exchange. Inspite of numerous exercises and studies, the government and the private sector have not been able to determine correctly what the domestic requirements are and what export surplus is. No doubt, devaluation will help boost to export of cotton yarn but at the cost of domestic value-added export industries. The value addition in cotton yarn itself is negligible. Moreover it is a known fact that our fabrics, garments, knitwear, towels, bedsheets and similar products are ousted from the international market by textile goods manufactured abroad by our own cotton yarn, which is sold to them at prices which are cheaper than those in the local market. Even the APTMA which was vocal for devaluation has disagreed with the present drastic downward adjustment. They wanted it to be done gradually and not in one go. Shortage of yarn in the domestic market will result in the closure of small factories, causing not only unprecedented unemployment but also substantial losses in foreign exchange. Value-added textiles: These will sufferer from devaluation more than others. The cost of production is already too high. The prices of raw materials, including yarn, have already gone up. The cost of machinery, spare parts, dyes, chemicals, packing materials etc. which are imported had already risen substantially and now there will be another hike on account of this devaluation. Even the local inputs i.e. cotton yarn, locally made chemicals and utility charges will further rise. Wages of labour will also increase following a new dose of price hike. The duty drawback rates have been slashed without any justification, knowing fully that the reduction in Customs tariff has been neutralised by the high prices of foreign imports consumed by the industry. While fixing duty drawback rates, no consideration is given to the refund of income tax paid by the importers at source, excise duty and other charges levied on electricity, telephone and gas. Wholesalers are not in the sales tax net. The exporter, therefore, cannot claim refund of sales tax on purchases made by them. Pakistan has, since the last six years, become a "buyers market". Majority of export is made on deferred payment basis mostly on DA. Buyers dictate their own prices and terms. Apart from other factors, export prices are low on account of internal and external competition. If any devaluation or any other concession is given to the exporter, foreign buyers immediately react and start demanding reduction in prices by the same percentage. Sellers' resistance is almost nil. Why? Simply because of the inconsistency in the government policies and forbidding cost of finance, high prices of raw cotton and cotton yarn. If the government expects devaluation will earn more from the export of value-added goods, it may not materialise. This sector needs real incentives, and not just lip service. Rice: Export of rice is not linked with any competition in international market. The Rice Export Corporation of Pakistan (RECP) and the private rice exporters are responsible for the low exports. Pakistan's Basmati rice is certainly superior to Indian variety. Inspite of every effort, no proper gradation and standard packing has ever been made. There are instances of many Indian businessmen abroad, having imported Pakistani Basmati, graded it, packed it attractively sold it at a very high price in the international market posing it as Indian rice. Rice did not require devaluation for its export, proper quality control, non- adulteration and acceptable packing could fetch us a billion dollars without devaluation. Rice export last year's fetched $460,300 million. Carpets: The export of carpets is suffering from the unjustified conditions in respect of child labour, environment and ISO 9000, which have been imposed by the developed countries. Instead of devaluation, if these problems were attended to, as our neighbouring country has done, our carpets would never have suffered a setback in the exports. Another problem which the carpet exporters are facing is the non- payment for their consignments by buyers on one plea or another. The government should have asked commercial counsellors to help the carpet exporters to realise their stuck up money. Sports goods: Sports goods are also facing problems of child labour and environment to which the government should have paid maximum attention so that they could increase their exports. Our footballs, cricket balls and bats are used in internationals matches but for the last two years a vile propaganda has been going on against these goods. The government has failed to counter it. If it had been done, export of these items would have gone up without any adjustment of currency. Leather and leather goods: The export of leather and leather goods has fallen on account of inconsistencies in the government policies. The problem of hides and skins, vet blue leather and finished leather remains unresolved. They are also a victim of drastic cut in their duty drawbacks. Although the PTA is making strenuous efforts to improve surrounding environment and it has been successful to a certain extent but propaganda against Pakistan in the international market is still continuing. Export of finished leather has shown an increase inspite of all odds. The tanners need better environment, correct duty drawbacks and solution of their problems instead of devaluation. Surgical instruments face almost the situation as other items. Fruits and vegetable: These can have a big market but in their case storage, gradation and packing are the adverse factor, not the prices. Apples of Balochistan, dates of Sindh and Balochistan, and mangoes of Multan and Bahawalpur can fetch higher prices without lowering the value of the currency. After 50 years, gradation and packing is as primitive as it ever was. No efforts have been made to improve thee. One has to visit the airport to see the shabby wooden crates of fruits and vegetables. Inspite of substantial freight concession, exports are not increasing as they should. Who in the international market would purchase these shabbily packed ungraded fruits? Best of fruit in such packing will never bring good price even if the currency is devalued heavily. This practically disposes off all the major items of exports from Pakistan. It will appear that except for cotton and cotton yarn and devaluation would not serve the purpose for which it has been done. Following is the summary of exports, value in thousand dollars. Mr Sartaj Aziz said that the decision was taken by State Bank, and it would help the export of agricultural products. But firstly there is little surplus of these commodities and secondly growers are not the beneficiaries because practically major portion of agricultural products go in the hands of big feudal lords on account of their major share due to "batai system" where the land belongs to absentee landlords and the Haris, Kissans and Muzarahs, toil and cultivate it by conceding lion's share of the yield to the owner of the land. The speculators, brokers and "arhthies" also hoard the agricultural products. We have seen this in the last Atta crisis. Another argument advanced by Mr. Aziz is that it would reduce inflation and gave the examples of USA, Japan and Korea, completely out of context as far as Pakistan was concerned. He argued that the export to European Union and other countries would increase on account of better rupee returns on exports to these countries. He added that with devaluation, the Customs revenue would increase but he said nothing about the duty drawbacks which have not been increased accordingly. Mr Muhammad Ishaq Dar, the Commerce Minister, and Dr Hafiz Pasha all were very confident about the increase in exports and their major thrust in favour of devaluation was export promotion, unmindful of the high cost of production, raw materials and other inputs. In heavily import-oriented economies like Pakistan, the fact is that the import bill neutralises the good effects of devaluation. Official import figures may be slightly low, but smuggling will increase. The problems with Pakistan is that many-a-right decision have been taken at wrong time. About five years back India took the bold step of ending the system of 100 per cent managed value of dollar by the Reserve Bank. They first allowed their exporters to sell 40 per cent of their foreign earnings in the open market and afterwards lifted further controls. At that time many Pakistani economists and businessmen requested the government to take immediate corrective measures. We kept with the old regulated currency system, as is being done even now, and are facing the consequences. On the contrary the Indian rupee at that time dipped down to Rs 44 against the dollar but gradually recovered and is stable at around Rs 35 which is its real value. All indications are that the revamp devaluations will increase inflation. Certainly it would not help the value added textile industry in getting the desired boost-up. It is a fact that all the previous governments in the last ten years, including the present one, paid only lip service but did not take any practical steps to bail out this industry. The government incentives are generally limited to cotton and the spinning industry. This narrow approach has stifled the growth of industry and employment as well. The government is concentrating on non-traditional items when it is easier for them to increase the export of traditional ones. No doubt non-traditional export should be encouraged, but not at the cost of our regular exports. India which, in 1984 was far behind in export of textile, has increased it to over $12 billion and has set a target of $26 billion by the year 2000. I suggest that the State Bank should start loosening its strong grip on the rupee in stages and a certain portion of export earnings be allowed to be sold in open market by the exporters. The State Bank should also direct all banks to allow, at the request of sellers, to hedge their sales made in other currencies with dollar without charging commission and pay the exporter their export proceeds in Pak rupees at dollar parity. Bank charges should be absorbed by the State Bank. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS* 971103 -------------------------------------------------------------------- Structural reforms creating grave social unrest -------------------------------------------------------------------- Mohiuddin Aazim THE STATE Bank of Pakistan has again cut its repo rate by a half per cent to 18 per cent. On July 27 it had reduced its repo rate by a half per cent to 18.5 per cent. The one per cent reduction in the repo rate within 3 months coupled with many similar steps including initiation of two-way open market operations indicates a major shift in monetary management that appears to be more market-oriented than before. The move has come at a time when there is a huge surplus in the inter-bank money market that has caused a steep fall in the call and term rates. Besides the 1997-98 credit allocation of Rs 82 billion for the private sector remains almost intact as the first quarter ended with no drawdown on the same. Instead there was a Rs 14 billion inflow in that head on account of the private debt retirement. The State Bank has become much more autonomous and is asserting itself and is taking control of the instruments of monetary management. But the question that haunts bankers and businessmen alike is whether an appropriate monetary policy can deliver in the absence of an equally appropriate fiscal policy as well as political stability? The answer, a big NO. The participants of the recently-held meeting of the National Credit Consultative Committee the supreme advisory body on the national credit plan rather subscribed to the appropriateness of this answer when it came to the fore that on the one hand the private sector laments non-availibility of funds despite the credit allocation having been unused and on the other it also complains of a grave lull in industrial activity. Analysed in its right perspective the situation is as follows: Industrial activity is not picking up because the transitory phase of the structural reforms have reduced the purchasing power of the people but at the same time the industrialists are desparately looking for additional funds to run their day-to-day business or else to diversify their production line in the hope of creating new clientele. On the other hand, banks are wallowing in excess liquidity that has rolled in as a result of monetary reforms and slowing down of economic activity and not due to an increased volume of business, but they are reluctant to advance loans fearing any expansion in their already huge infected loan portfolios that they have failed to contain even through the much-trumpeted June 5 special scheme of recovery of loans and revival of sick units. While the country's economic managers boast of a successful completion of a crucial phase of structural reforms, the fact is it has reduced the purchasing power so drastically that trading and industrial activity seems to be at a halt. Executives including those running multinationals here say their sale volumes have gone down; they are finding it difficult to create artificial demand any more, even after employing expensive and innovative advertising techniques. Traders say there is no buying to be seen anywhere, not even at grand concessional fairs and at the popular weekly bazars. So what is going wrong and where? The State Bank Governor, Dr Muhammad Yaqub says the State Bank is now autonomous and is relatively free in making monetary policies. Finance Minister Sartaj Aziz says the economy is ready to take an upturn as a result of the structural reforms undertaken. But the common man continues to suffer from back-breaking inflation and one is at his wits end to calculate the havoc a fast-approaching high rate of joblessness would play. The menace of joblessness continues to grow with the large scale lay-offs in banks and government organisations in the name of downsizing and restructuring. Those sitting at the helm of banks and state-run organisations play with statistics to show that a laid-off employee would earn this much or that much amount by investing whatever he is being offered in the name of golden handshake, but they forget that the depression-cum-inflation, the economy is passing through would badly expose their claim. Coming to specifics: Let us see what is happening in the banking sector and how it is adding to the miseries of the common man. Currently, thousands of employees of state-run banks and development financial institutions are being thrown out of jobs in the name of downsizing through golden handshake or direct retrenchment, as is the case with the UBL. Those carrying out this exercise believe it will help them save billions of rupees every year and make banking institutions more efficient. But they have hardly taken a realistic view of the impact of this exercise on the economy as a whole and the banking sector in particular. Since the economy is faced with a depression, it presently offers little opportunities of mixing enterprise with money and since the sacked employees cannot get an entrepreneur's skill overnight, most of them would be forced to commit the folly of placing their retirement benefits in bank accounts, only to earn a negative rate of return. There is no denying the fact that the return on savings in Pakistan has been less than the real rate of inflation. Besides a large number of the sacked employees would not have much to save after adjustment of their loans and overdrafts taken from the banks they used to serve and after meeting urgent financial requirements like running the household for a few initial months of joblessness and other pressing obligations. Accepting the facts as they are, the retrenched employees would continue to be jobless, inflation may not come down and the current spell of depression in economic activity may go on. So what needs to be done? The sooner the economic managers of the country find a realistic and practical answer to this question, the better it is for the government as well as for the country. While finding an answer, the government will have to accept that it has miserably failed to foster political stability and discharge its socio-political obligations which impedes the realisation of desired results through monetary reforms. The first and foremost object of all the structural and monetary reforms that the country underwent recently was to ensure revival of economic activity and making cheap goods and services available at an affordable price to the people. But every day experience says that economic activity is not picking up and the inflationary impact of the structural and monetary reforms has eroded the buying power of the poeple to an extent where it would be sheer optimism to hope that economic activity would pick up in the near future. This conclusion may apparently seem to have been drawn out of pessimism but is based on a review of as things stand. The major setbacks our economy received in 1996-97 is no secret, not at least after the release of the State Bank annual report that calls it one of the most difficult and disappointing years in the history of Pakistan. It is true that this goverment came into power in the second half of the last fiscal and as such did not contribute much to the deterioration of economic conditions, but it should be borne in mind that the structural and monetary reforms that had been initiated towards the end of the PPP government and continued during the caretakers period, took the country by storm during the present political set-up. That the present set-up may be upset due to the negative impacts of the structural reforms is quite obvious. The period the country is passing through can best be described as transitory, more so because the reforms so far undertaken may take a long time to show positive effects and that too if supported by political stability and coherent economic policies. If the leadership had the vision, it would have been living in an altogether changed political atmosphere, less polluted with polarisation. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS* 971103 -------------------------------------------------------------------- Is debt cause for jubilation? -------------------------------------------------------------------- Dr Farrukh Saleem WE HAVE BECOME a people that celebrate new loans as if it were a matter of true national euphoria. We have a government that is trying awfully hard to cure the cancer of debt with more debt. By the time we are successful there may not be very many Pakistanis left to celebrate, but we as a leading example shall surely go into the Guinness Book of World Records. The World Bank would then have its first genuine accomplishment in its 50 years of attempting to alleviate poverty from the face of this planet. The entire Ministry of Finance was euphoric when we raised a loan of some $200 million by pledging the future earnings of Pakistan Telecommunication Company Limited (PTCL). Every time we are able to raise a few hundred million dollars by issuing sovereign-guaranteed bonds, the ministry makes it a point to let everybody in the country know as to how smart it really is. When we get tired of holding our 'begging bowls' in Europe we move over to Japan and feel even more elated at the possibility of raising yen-denominated debt. 'Samurai bonds', as we lovingly call them haven't yet been floated but we are going ecstatic at the opportunity of being able to raise even more debt by selling the future earnings of Pakistanis working abroad. How about selling the future dollar-denominated ticket sales of Pakistan International Airlines (PIA)? Our government must take on more debt. Our leading political lights must also learn that true success is merely overcoming the fear of being unsuccessful. The financial whiz kids working for high-powered foreign banks are enriching their institutions by dumping their wizardry on our docile finance bureaucracy. The ministry, however, is exhilarated and Sartaj Aziz is thrilled while the rest of the nation is euphoric. No one should now have the right to blow out anybody's candle. We must also continue celebrating more debt coming our way, if nothing more than a means of being successful at befouling the international lending community. Look at the Karachi Stock market, for instance. They have never been known to be a logical herd but celebrating a new $1.56 billion IMF loan, that would take us even closer to the frightening $60 billion national debt-mark, is for the psychiatrists to unravel. The Pakistan Psychiatric Society (PPS) has always considered Karachi to be a good place for business. The Karachi Stock Exchange (KSE), the cotton exchange and the foreign banking hub has always been very kind to PPS supplying the society with a well-heeled clientele. In the recent past, however, the PPS seems to be reviewing its strategy as they feel that Islamabad may actually become a more lucrative market. Washington-based World Bank Chief Mr James Wolfensohn (a lawyer-turned banker) has said that he is "satisfied with Pakistan's fiscal position." Washington is a city known for nurturing the highest per-capita population of lawyers. Its time for PPS to be pointing their guns at Washington as well. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS* 971104 -------------------------------------------------------------------- EPZs being planned for Quetta, Gwadar -------------------------------------------------------------------- S. Azam Ali QUETTA, Nov 3: Two export processing zones, one each at Gwadar and Quetta will be set up to boost Pakistan's exports to the Gulf states on one side, and Afghanistan and Central Asian states through Balochistan sea and overland routes, on the other, reliable sources disclosed here on Monday. According to these sources, the aim is to accelerate the pace of industrial investment in Balochistan and increase exports to potential export markets in the region with emphasis on ECO countries and the Gulf states. Another objective is to ensure transfer of technology and creation of job opportunities. The projects in export processing zones will be allowed if at least sixty per cent of annual production is exported. The hi-tech electronics and engineering industries have been exempted from this condition provided there are arrangements for transfer of technology. These sources maintain that maximum foreign equity for these units would be 40 per cent. This may include investment by non-resident Pakistanis. If the foreign equity in a unit is 51 per cent its export requirement will be reduced to fifty per cent of the annual production. Main incentives and facilities for investors and industrialists to be available in these export processing zones will include income tax holiday for five years, from the date of commencement of commercial production, complete exemption from customs duty, sales tax, import and Iqra charges on import of plant and machinery not manufactured in Pakistan. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS* 971105 -------------------------------------------------------------------- Foreign investment decline by 27.3pc -------------------------------------------------------------------- Our Correspondent ISLAMABAD, Nov 4: Foreign investment in Pakistan during 1996-97 totalled $949.5 m, indicating a sharp 27.3% drop from $1306.7m during the preceding year, according to the latest official statistics available on Tuesday. Thus the last financial year witnessed the lowest level since 1994- 95 when foreign investment had stood at $1532.3m including $442.4m on account of foreign direct investment (FDI) and $1089.9m as portfolio investment, probably attributable to the flotation of PTC shares in overseas capital markets. By 1996-97, FDI had dropped to $682.1m (down from $1101.7m in 1995- 96) and portfolio investment to $267.7m tons. The statistics show a sizable $62m increase last year in portfolio investment as compared to 1995-96. Apart from these fluctuations in the last three years, the 1990s, nevertheless, show a positive trend so far as foreign investment is concerned. In 1990-91, it had totalled $237m after subtracting negative flow of portfolio investment to the tune of $9.0m. In the subsequent year, however, foreign investment more than doubled to $553.6m which included $218.5m received in the form of portfolio investment. The golden year of the decade was 1994-95 when F.I. reached $1532m mark. Country-wise analysis shows that United States topped all the other countries in 1996-97 with a total investment of $357.5m constituting 37.6% of total foreign investment in Pakistan. United Kingdom has vied with US for the top slot. Its share in foreign investment witnessed a sharp jump from only $82.0m in 1993- 94 to $282.6m in 1994-95 and to $399.8m in 1995-96. The year 1996- 97, however, saw a substantial drop of about $82m in UK's investment. Its portfolio investment, after peaking at $243.9m in 1994-95 dwindled to $77.9m last year. The increase by these two advanced countries in their FDI in Pakistan was accounted for mostly by private power projects. Thus their FDI constituted 59.1% of total FDI in 1995-96 and 71.2% during 1996-97. Only 12 countries account for as much as 85% of total foreign investment in Pakistan. These are USA, UK, UAE, Germany, France, Hong Kong, Italy, Japan, Saudi Arabia, Canada, Netherlands and South Korea. A worrying aspect of the statistics is negative flow of foreign investment from Hong Kong and Saudi Arabia. The total foreign investment by Hong Kong stood at $29.6m in 1995- 96, as against minus $13.1m in 1996-97. This sudden drop is explained by negative flow of portfolio investment to the tune of $20.6m. In the case of Saudi Arabia, last year saw a negative flow of $17.0m on account of FDI as against 1995-96 when its total investment had amounted to $25.8 all as FDI. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS* 971106 -------------------------------------------------------------------- Pakistanis in US present proposals to PM -------------------------------------------------------------------- By Our Correspondent NEW YORK, Nov 5: Pakistani financial experts and bank executives have requested Prime Minister Nawaz Sharif to speed up implementation of the economic policy framework laid down by his government, to revive the idle industrial sector, and to speed up the privatization process. A group of eight US-based Pakistani bank executives and investors, led by the executive vice-president of Citibank, Shaukat Aziz, who had met the prime minister and his economic team in Islamabad on Sunday, submitted a 75-page report suggesting ways and means to spur on the still-staggering economy. The prime minister, according to financial experts attending the talks, assured them that their suggestions would be assimilated into the government's economic policies. According to an investor who had participated in the talks, the meeting took an overview of the global economic events, specially the downturn in the South Asian economies and its implications on Pakistan. While noting that Mr Sharif's government was pro-business, the Pakistani financial experts stressed the need to improve the investors perceptions about Pakistan. They underscored the importance of clarifying the vision of the future economic activity as perceived by the policy makers in Pakistan. The experts told the prime minister that the decisions and policies should be clearly defined and notified to the foreign investors directly by the key players in Pakistan. "We end up reading about the changes in the newspapers which are often murky and unclear," they told the prime minister. Emphasizing the need to speed up the privatization process, the financial experts asked the prime minister to add 50 to 100 professionals in various economic sectors as they could prove to be catalysts in reviving the economy. They asked the prime minister to institute a massive training project in order to re-orient and train the civil servants in order to equip them with skills to manage the deregulated economy which they felt was essential to the speedy growth. The prime minister was informed that while the changes in the economic policies were good, their implementation was lagging far behind and close follow-ups were needed to realize the full benefits of the new initiatives taken by his government. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS* 971107 -------------------------------------------------------------------- Real estate being opened up to foreign investment -------------------------------------------------------------------- Our Correspondent ISLAMABAD, Nov 6: Federal Minister for Commerce, Ishaq Dar said on Thursday that Pakistan is in the process of opening up new sectors like the infrastructure, housing and real estate, wholesaling and retailing, health and education to foreign investment. He added that the government would announce a new investment policy towards the end of this month to provide a very enabling environment to the foreign investors. Enumerating the incentives being given to the local and foreign investors under the new regime he said, foreign exchange controls have been relaxed and 100 per cent equity participation has been allowed to the foreign investors. *Ceiling on payment of royalty and technical fees has also been abolished. *No prior approval for investment in any sector is required except arms and ammunition, high explosives, radio active substances, and security printing, currency and mint. *Export processing zones with infrastructure, one-window facility and tax holidays, have been established. *Tariff rates have been brought down to maximum of 45 per cent on a cascading basis. *Special industrial zones have been planned along the motorway. *Income tax has been reduced by almost half, and the tax base widened, investment in debt instruments has been exempted from tax, and incentives provided for value-added exports. He said all these steps have been approved and appreciated by the IMF and the World Bank and Pakistan's long-standing friends. The IMF has, a fortnight earlier, cleared Pakistan's request for a short term ESAF/EEF facility of $1.558 billion. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS* 971107 -------------------------------------------------------------------- Forex reserves fall by $125m -------------------------------------------------------------------- Staff Reporter KARACHI, Nov 6: Pakistan's foreign exchange reserves slipped by $125 million to $1.514 billion on November 1 from $1.639 billion on October 25. A State Bank report released on Thursday showed the approved foreign exchange reserves at $1.145 billion on November 1 up slightly from $1.143 billion on October 25. It put the balances held outside Pakistan at $368.8 million against $415.3 million reported on October 25. The fall in reserves is expected to be compensated during the week ending November 7 since a sum of $157 million was debited to the State Bank account by the IMF on November 4 as part of the first transche of $208 million of a $1.56 billion medium term loan. The IMF had already debited $51 million to the State Bank account on October 23. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS* 971108 -------------------------------------------------------------------- Equities post modest gains in brief session -------------------------------------------------------------------- Staff Reporter KARACHI, Nov 7: Stock prices on Friday rose modestly in a brief sessions as foreign investors covered positions at the lower levels amid light trading. The trading has to be suspended just an hour after the opening bell as most of the staff members could not reach the office owing to strike called by the religious parties to protest the killing of top Ulema in a terrorist attack on Sunday last. The market opened at the official time of 9.15 a.m but was closed at 10.30 a.m. as the attendance in the rings was thin in the absence of leading brokers and their agents. The KSE 100-share index managed to finish with a gain of 1.98 points at 1,847.15 as compared to 1,845.17 a day earlier as some of the leading base shares managed to finish modestly higher. The market capitalization also showed a modest rise of Rs 607.422m at Rs 558.680 billion as compared to Rs 558.073 billion a day earlier as highly capitalized shares managed to finish higher or unchanged. The increase was largely attributed to good performance turned in by the leading shares, notably PSO, Hub-Power, PTCL, and some others including Adamjee Insurance and MCB. Floor brokers said the opening was fairly promising as some of the foreign funds were in the rings and made active covering purchases on the selected counters. Although the city was tense amid conflicting rumours about violence in the wake of strike, those who were present in the rings made extensive buying, sending signals that the market has shrugged off some of its current inhibitions,they added. "That could well mean investors will be back in the rings by the next week and cover positions, putting the market back on the rails", said a leading floor broker. Bulk of the buying interest was again centred around the energy shares at the lower levels as leading foreign funds covered positions at the lower levels. Dealers said the energy sector should have put the market back on the rails if the trading was not suspended . Although, Shell Pakistan consolidated its overnight sharp gain, both PSO and Pakistan Refinery maintained their upward drive and were quoted further sharply higher. Kohinoor Energy remained in the limelight and ended with a fresh good gain on active support on rumours that a foreign party is taking an equity stake in it. Volume was light at 2.288m shares, while out of the 29 actives, 17 ended higher, six fell and as many stayed unchanged. But most of the gains were fractional barring Kohinoor Energy, PSO and Pakistan Refinery, which posted gains ranging from Rs 1.05 to Rs 5. Adamjee Insurance also came in for active support and was marked up by Rs 5 as some foreign made active buying apparently on some positive news. Barring Exided Pakistan, which fell by Rs 4.50 after being ex- dividend, other losses were modest ranging from 15 paisa to 75 paisa. The most active list was topped by Hub-Power, unchanged on 0.805m shares followed by Kohinoor Energy,up Rs 1.05 on 0.503m shares; PTCL, unchanged on 0.350m shares; ICI Pakistan, unchanged on 0.400m shares. The other actively traded shares were led by Southern Electric, up 20 paisa on 64,000 shares; Sui Northern Gas, higher 25 paisa on 54,500 shares; and Sui Southern Gas, firm 15 paisa on 42,000 shares. There were some other deals also. ------------------------------------------------------------------- SUBSCRIBE TO HERALD TODAY ! ------------------------------------------------------------------- Every month the Herald captures the issues, the pace and the action, shaping events across Pakistan's lively, fast-moving current affairs spectrum. Subscribe to Herald and get the whole story. Annual Subscription Rates : Latin America & Caribbean US$ 93 Rs. 2,700 North America & Australasia US$ 93 Rs. 2,700 Africa, East Asia Europe & UK US$ 63 Rs. 1,824 Middle East, Indian Sub-Continent & CAS US$ 63 Rs. 1,824 Please send the following information : Payments (payable to Herald) can be by crossed cheque (for Pakistani Rupees), or by demand draft drawn on a bank in New York, NY (for US Dollars). 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EDITORIALS & FEATURES

971102 -------------------------------------------------------------------- Back to sanity -------------------------------------------------------------------- Ardeshir Cowasjee "THE rulers of the country, good, bad or indifferent will continue to get away with both evil and nonsense for as long as they continue to keep illiterate the 120-odd million over whom they rule. "Some comfort, however,comes to us from the signals sent by certain members of our judiciary, men of conscience who feel that all does not augur well for the future of law and justice in Pakistan." (Dawn, November 25, 1994). Since this was written, the 120 million have risen to 140 million and the comfort signals sent to us by certain members of our judiciary have somewhat evaporated. In the past week, many pretences have been washed away and it has now become clear to most of us exactly where each player in the game now being played between the parliament and the judiciary stands, and what each wants at the cost of the country and its people. There is little left for the skirts now to cover. The President, Sardar Farooq Ahmed Khan, Tumandar of all the Legharis, aspires for a second term, as did his predecessor in office, Ghulam Ishaq. He will take a 'principled stand', backing the principles which will help him achieve his aim. At the same time, he is vulnerable and fears Article 47 of the Constitution, ("Removal or impeachment of the President,") for he is aware, as are the others aware, of his acts of omission and commission. Only two-thirds of the total membership of both Houses at a joint sitting is necessary to decide his fate. He also fears the 'hereafter' on Mother Earth. Senate Chairman, Rhodes Scholar Waseem Sajjad, continues to be economical with the truth, as he was so long ago, when the then COAS Aslam Beg, the man who wears shades in the shade sent for him. He would like to be president rather than merely 'acting' on occasions. He is dolled up and waiting in the wings. The prime minister, Mian of Lahore Nawaz Sharif, head of the executive and of the legislature, has despotic tendencies which, to his credit and in his ignorance, he does not even pretend to hide. He depends on what he calls his overwhelming mandate. Democracy being what it is in this country, as reported in this newspaper on October 30: "Sources said the prime minister told the meeting that he enjoyed a massive support and was ready to go to the people in case he was forced to accept the decision of the Supreme Court. They said the issue of resigning from the prime ministership was also discussed at the meeting. Nawaz Sharif said he would come back with a bigger majority in case fresh elections were held. However, he expressed fears that the country would plunge into chaos and that everything would become uncertain in case he stepped down or was thrown out through illegal and unlawful means." And on October 31, from other sources: "We are ready to hammer out an agreement with the CJ in the larger interest of the country. In spite of a massive mandate, the prime minister is ready to find a solution to the crisis. But nobody should think that he (Nawaz) is weak." Did he have to make public his weakness and how useless and light his heavy mandate really is? On the high that he was, he suspended rules, prohibited debate and rushed through the 13th Amendment, emasculating the president and theoretically strengthening his hold over the army. Not content, in exactly the same manner he rushed through parliament the 14th Amendment, prohibiting dissent, and under which an elected representative would be disqualified on the ground of defection defection being defined as: "a Member of the House shall be deemed to defect from a political party if he ...(a) commits a breach of party discipline, which means a violation of the party constitution, code of conduct, and declared policies, or (b) votes contrary to any direction issued by the parliamentary party to which he belongs, or (c) abstains from voting in the House against any party policy in relation to any Bill." Should any member be guilty of any of the above three, the head of a party (for all intents and purposes judge, prosecutor, defence counsel, and jury) can order that he be disqualified and lose his seat. What this 14th Amendment in effect did was to cut the number of members of the House to merely the leaders of the political parties therein represented, rendering party members dumb shadows. What is distressing is that this amendment was passed with a majority of over two-thirds of both Houses. Not one, repeat, not one, member stood up, spoke for democracy and recorded his vote of dissent. Fascism that day took firm root. All that then remained to be destroyed was the moral force of the judiciary and the physical force of the army. Even now, at this late stage, it would be worth telling Nawaz Sharif and his desk-thumpers how democracy really works. Last week in the land of the Mother of Parliaments, a senior Tory MP, Peter Temple- Morris, seriously considered defecting from his party over party leader William Hague's decision to fight the next election on a campaign opposing the European single currency, despite the assurance by the party whips that he would be able to both vote against his own party's line in the Commons and campaign against it at the next election. However, rather than be treated as a sort of 'licensed leper' during the election, he chose resignation. He wrote to his local association in his constituency telling them that the Tory leader's new stance was contrary to his personal statement at the last election, and that he would be resigning his seat. Being sympathetic to Labour Prime Minister Blair's reform agenda and policies in general, his intention was to cross over to the Labour party. If accepted, he would be given a chance in a suitable byelection. That is how defection works. However, as things turned out, with a change of policy stances on the single currency issue by both the Labour party and Tories, Temple-Morris has since changed his mind and will not defect. Coming back to droll reality, Chief Justice of Pakistan Sajjad Ali Shah this August recommended the elevation of five High Court judges to the bench of the Supreme Court, three of them from the Lahore High Court. Nawaz Sharif needed LHC Chief Justice Shaikh Riaz and wanted him to remain in Lahore, and he felt that the other two, Munir and Arif, would prove hostile to him in the Supreme court. We all know too well how he fought to keep these three where they are. The Chief Justice, on October 29, struck. After admitting a petition filed against the 14th Amendment, after hearing the petitioner's lawyer, he gave an interim order suspending the amendment. He did so without hearing the government counsel, Sharifuddin Pirzada, who had been flown from Karachi to Islamabad in a special plane. Since then, the government has been trying to rush through the 15th Amendment to the Constitution amending Article 191, the first draft of which reads: "191, Rules of procedure: (1) Subject to clauses (2) and (3), the Supreme Court may make rules regulating the practice and procedure of the Court. "(2) Notwithstanding anything contained in clause (1), serious cases involving critical constitutional issues shall be heard by all the judges of the Court or so many judges thereof as may be available and willing to sit on the bench. "(3) Notwithstanding anything contained in clause (1) but subject to clause (2), the benches, roster and fixation of cases before the Supreme Court shall be regulated by a panel consisting of the Chief Justice and the two senior-most judges." (Article 191, now reads: "Subject to the Constitution and law, the Supreme Court may make rules regulating the practice and procedure of the Court.") The amendment would clip the wings of the Chief Justice. But how to get it through both Houses? Palms have already been extended for alms. What else remains to go into the cauldron? A petition challenging the validity of the 13th Amendment has been filed. The CJ can also suspend this one. The president can come to the aid of the Supreme Court and notify the five judges, or he can do nothing and please the government. The government can impeach the president. The prime minister can be disqualified. Each man in power has many weapons up his sleeve which he will wield in the name of anything held to be 'holy'. Daggers have been drawn, blood will be spilt, whose depending upon the army decree. We must be thankful that we have a decent individual, General Jehangir Karamat, as Chief of Army Staff. Unfortunately the same cannot be said for many of his officers. Noon, Friday October 31. Epilogue: Sense has prevailed. After wasting two months of valuable time, Nawaz Sharif has realized that time should not be wasted on non-issues. Let us hope that now, when he starts his third term as prime minister, he also realizes that the nation will not accept his brand of fascism. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS* 971108 -------------------------------------------------------------------- The zone of good governance -------------------------------------------------------------------- Irfan Husain FOR most travellers setting foot in Pakistan for the first time, the first experience consists of fighting their way through a mob of smelly, pushy taxi drivers and their touts blocking the exit of the airport and harassing them mercilessly as they emerge with their luggage. Miraculously, this state of affairs has undergone a sudden and dramatic change at Karachi's Quaid-i-Azam International airport. The pick-up-and-drop lane, usually clogged with so-called VIP cars, is now used only for the purpose for which it was intended. Taxis now queue up, and passengers get into the one at the head of the line, and the next one moves up. The lane previously used by cabs is now reserved for Civil Aviation Authority vehicles, and the car park has been divided into clearly marked zones. In short, for the first time that I can remember, there is sanity and order at the airport. So how did this transformation take place? The answer says more about governance in Pakistan or the lack of it than a hundred seminars in 5-star hotels could. In order to fully appreciate what has been achieved at the Karachi airport, try and imagine a single place in Pakistan today where a car with government or defence forces number plates can be towed away. VIP culture has been so deeply ingrained into every level of our administration that it is normally inconceivable for a cop to even think about taking action against the high and mighty. Foreigners who fly into Karachi for the first time now will probably not even notice that there is no chaos at the airport, but those of us who had despaired of any possibility of improvement can now rejoice in the possibility of positive change, given the will and commitment. While a number of individuals and agencies should be given credit for this transformation, the idea and impetus came from a small core group of concerned citizens. I know Sami Mustafa will not be happy at being singled out, but I am mentioning his role as many readers are already familiar with his name. Apart from being an occasional contributor to this newspaper, his Book Group has done marvellous work in making attractive, high-quality books available to underprivileged schoolchildren at reasonable prices. Among other initiatives, he, in conjunction with the Citizens- Police Liaison Committee, has sorted out the traffic nightmare in a Karachi locality that has a large number of private schools. Basically, the idea behind bringing sanity to the traffic at the Karachi airport was to demonstrate that despite all the pessimism and cynicism, good governance is possible. This particular area was selected because it is the most visible demonstration of our VIP culture as well as the chaos that has become symbolic of Pakistan. How Sami Mustafa and his friends managed to put their ideas into practice is an object lesson in persistence as well as the possibilities in the cooperation between concerned citizens and dedicated government officials. Fortunately for us, the latter are not yet an extinct species. Sami's group first held a series of meetings with senior Sindh government officials, including police officers, and convinced them of the pressing need to sort out the mess at the airport. The informal working group knew they would be treading on sensitive toes if they were to uniformly enforce the rule of law. However, they all agreed that the experiment would fail if they started making exceptions. The next step was to convince the army corps commander, as well as the senior air force and navy officers based in Karachi, that their vehicles should not block the pick-up-and-drop lane. Actually, getting the cooperation of the civil and military bureaucracy at the highest level was easier than convincing taxi drivers that they had to abide by the rules and stop jumping the queue. The yellow cab association invoked Mr Nawaz Sharif's name as their patron saint, and threatened dire action if their members were made to toe the line. But the group pressed ahead regardless, and the new arrangements are now in place, proving that with the right mix of circumstances and individuals, change is possible. And herein lies the rub: How many people do we have who will invest their own time and money for civic action? As the level of governance has fallen progressively, the number of individuals and NGOs attempting to fill the vacuum has multiplied, but obviously, they cannot play the government's role as they have neither the manpower nor the money. Ultimately, there is no substitute for the state. And this is the point Sami and his group are making: unless government officials and agencies are involved, there can be no long-term solution to the crisis of governance that has taken the country to the brink. For them, sorting out the traffic at Karachi airport was merely a demonstration, not an end in itself. When they took turns at monitoring the situation around the clock and then hired people to report violations, they did so in the hope that their work would have repercussions beyond the airport. Just as a pebble thrown into a pool causes ripples far beyond the point of impact, so too they would like to see the area of good governance expand to other parts and institutions of Pakistan. One objection Sami and his friends have to the model created by the partial success of NGOs is that they start with the assumption that the state, its organs and its servants are a hindrance rather than a help. Thus, while they may achieve a certain measure of success, their work usually cannot be replicated, and hence have limited impact on the overall crisis of governance. The airport project has demonstrated that in order to make a difference, there is no option but to co-opt government agencies and officials. This brings us to the next problem, and that is how to ensure that other groups of citizens have the same zeal and powers of persuasion that Sami Mustafa and his friends have displayed? And how many civil servants like Mirza Qamar Beg, and police officers like Asad Jehangir and Saleem Wahidi, are willing to push through a project which may make them unpopular, and will certainly not advance their careers? And yet it is clear that unless we try, we will never know how many motivated citizens and government officials will emerge from their drawing rooms and offices and expand the zone of good governance until it covers the whole country. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS* 971105 -------------------------------------------------------------------- Limits of a popular mandate -------------------------------------------------------------------- M.H. Askari THE impatience of the leaders even of those who come to power with a solid popular mandate with state institutions which by their very nature limit the exercise of unbridled political power in any democratic system has been a disconcerting factor in Pakistani politics and this, perhaps more than anything else can explain the situation which confronted Pakistan recently. It is not always remembered that the line separating democracy from the authoritarianism of an ostensible democratic government which derives its power from the massive support that it may command in the legislature is very thin. There can be no question of the immense mandate which has brought Mr Nawaz Sharif to power and when he was sworn in as prime minister in March there could have been no question of his not being able to complete his full tenure of five years. However the past few weeks have seen doubts being expressed over and over again whether he would be able to remain in office for the full tenure. Even now when the immediate question of the appointment of judges to the Supreme Court seems to have been settled to the satisfaction of all parties concerned, the veteran politician Nawabzada Nasrullah Khan has declared that the all-parties conference which was held in Islamabad recently would mobilise public opinion for a change of government "as the existing leadership had failed to deliver the goods." Even more alarmingly, there has been a demand, mercifully from a small section of the people, for the restoration of the President's powers to dissolve the national assembly and dismiss the government under an article of the constitution which has since been expunged. The powers to do so had been arrogated to the office of President by the late Gen Zia-ul-Haq under the authority of his martial law. Unfortunately it is not always remembered that there are lessons to be learnt from Pakistan's recent history. While at the outset, Zulfikar Ali Bhutto's power base was as solid as it can be, towards the latter part of his tenure he began to lean more and more on what have been called the coercive elements of state authority. In 1973, Bhutto abolished the elitist CSP cadre of the bureaucracy, in keeping with egalitarian reforms of the system which he had promised in his party manifesto in 1970. But not much later whatever remained of the civil services began to be heavily politicised. Finally, as many observers have pointed out, Bhutto's need to secure the tacit support of the civil and military bureaucracy, and even of the police, an elite section of which he converted into the Federal Security Force (FSF), increased his dependence on state authority and eroded his popular base. In the end, as it is only too well known, the FSF was given a free rein to suppress all opposition. In dealing with the non-PPP governments in Balochistan and the NWFP also, Bhutto exploited his massive popular support to strengthen his highly centralised style of government. This led to his seeking more and more support from the military which he had, at the beginning of his regime, attempted to trim and prune. Ironically, it was his misplaced confidence in being able to mobilise support from the army, as evident from his imposition of martial law on a selective basis to deal with the post-1977 election agitation, that proved Bhutto's undoing. His own hand-picked army chief, who had started scheming against him as soon as the agitation started, deposed him through a coup at a time when he least expected and finally had him executed. It is clear that in his ambition to wield absolute political power, Bhutto had squandered the moral support of the massive political base that he had been able to build during his years in political wilderness. It was practically the same that happened to Benazir Bhutto who first came to power on the crest of popular support. Mesmerised with the adulatory slogans by the crowds in the major cities which turned out to greet her on her return from self-exile in 1986, Benazir Bhutto failed to realise that the elections in 1988 had given her only a nominal majority in the national assembly. It is known that she as well as her close aides were totally unaware of the moves made by the then President, Ghulam Ishaq khan, which culminated with her government being summarily dismissed through a presidential order. It was perhaps her popular support which remained intact despite the presidential action which brought her back to power in 1993. But then, as the Asian Wall Street Journal was to say in its editorial after Murtaza Bhutto's murder (as quoted by Mr Roedad Khan in his recently published account of the vicissitudes of Pakistan) that "arrogance of pharaonic proportions was to lead her toward political doom." The editorial also said that she remained woefully unaware of the opposition which was building up against her and "instead of trying to mend her ways (she) continued to blame everyone but herself for Pakistan's woes." There are innumerable factors which have hampered the growth of the democratic process in Pakistan. The South Asia scholar Lawrence Ziring in his "Pakistan: The Enigma of Political Development" has even argued that "Pakistan's leaders never intended to rest the national foundation (of the country) on a constitutional rock." However, it is easy to see that it is the leaders, though being the product of democratic process, who have most undermined the foundations of Pakistan's democracy. The standoff between Mr Nawaz Sharif's government and the higher judiciary was perhaps the most unnecessary and bizarre and yet the most avoidable development, something that had the potential to rock the very foundations of the political process which has only recently started to stabilise. Ironically, the crisis began in what to the layman appears to have been essentially a routine matter: the chief justice recommending the appointment of five judges to the Supreme Court and the federal government calling upon him to "review" his demand. The deadlock which ensued was subjected to prolonged "negotiations" between the Chief Justice and, somewhat unexpectedly, the chief minister of Punjab, but these did not lead to any positive outcome. The Chief Justice subsequently decided not to negotiate any more with the government and the government at this stage even contemplated a move to curtail the strength of the Supreme Court through legislative action, but, however, decided not to do so at the last minute. However, the stand-off remained stalemated, with the Chief Justice insisting upon his recommendation of elevation of five judges to the apex court while the government remained unresponsive. There were reports that the matter had been under review among others by the President and the Chief of Army Staff. The National Assembly by adopting a resolution on October 29 reiterating the supremacy of the parliament over all other organs of state appeared to reaffirm its authority to amend the constitution and fix the number of judges comprising the Supreme Court. There was then disturbing speculation that the President may be impeached or that the country may be placed under martial law which fortunately turned out to be baseless. In a statesman-like statement, free of any contentiousness, the prime minister told the National Assembly on October 31 that the government had decided to implement the Chief Justice's recommendation. The National Assembly then unanimously adopted a resolution raising to 17 the Supreme Court's strength. The development has generally been received with a sense of relief and a spokesman of the Supreme Court has even said that the Chief Justice was "happy" and "satisfied" with it. In another development which cannot but be seen in the context of the government-judiciary standoff, the chief of army Staff, Gen Jahangir Karamat has reportedly been unhappy at the fact that the print media had been quoting him out of context. An ISPR statement said that "the army is clear about its role, position and responsibility" and that it has been functioning and will continue to function within the parameters of its responsibility. Nevertheless, it must be recognised that if the ultimate positive outcome of the prolonged crisis has in any way been influenced by the position adopted by the military establishment or the chief of staff, their role in having strengthened the foundation of democracy can only be appreciated. The lesson to be drawn is that elected governments, too, should understand that there are clear parameters of their authority as enshrined in the Constitution and good governance demands that they should function within these parameters. Democracy lies in taking even those with you who are not necessarily supportive of your manifesto but with whom a consensus can always be established. Regardless of the temptation to cash in on a massive popular mandate, the business of the state should be conducted in a spirit of give and take. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS* 971102 -------------------------------------------------------------------- By losing he has won -------------------------------------------------------------------- Eqbal Ahmad IT IS Pakistan's moment of glory. Wisdom has prevailed over folly. Prime Minister Nawaz Sharif has won by losing. Mr Justice Sajjad Ali Shah has earned his title as the Chief Justice of Pakistan. The common good and the cause of democracy has been served. Very well indeed! What should have been a routine matter developed into a grave constitutional crisis. All of last week I was reminded of a well known fable: The river was full, and flowing vigorously. The scorpion had to get urgently across as his family were stranded on the land beyond, needing food and care. The scorpion entreated with the frog to take him across the river. The frog being scared of the scorpion's poisonous fangs, hesitated. But the creature had the gift of persuasion, and reason on his side. "How can I hurt you?" he asked the frog "If I bite you, you will die and I shall drown too." "You speak wisely scorpion," said the frog. "Fear, fowl and irrational, overwhelms me. But I must overcome it." Thereupon, the frog embarked on the journey carrying the lucky scorpion on his back. As they reached mid-stream, the scorpion plunged his pincers into the back and underside of the frog. "Ouch!", he yelled "stop biting me as you will drown if I die." "I know", said the scorpion. "But I can't help it. It is my nature." At the expense of stating the obvious, one may offer the moral of the story: Instinct may compel behaviour that is counter to reason. When it does, instinct should be suppressed. It took weeks, but the Prime Minister's reason prevailed over instinct, and just in time. In this land of political suicides this is a record. We have reason to celebrate. Mr Nawaz Sharif's government was swimming quite nicely through the stormy economic and social conditions it had inherited from its predecessor. Then in mid-stream, it began to commit harakiri as though driven by tragic nature. A host of political opportunists, particularly of the opposition parties, abandoned caution and considerations of the national interest, to eke out their paltry profits from this constitutional crisis. History shall record these bit players as vultures of a very low order. The Prime Minister should take note that all his recent bows to obscurantism did not yield even a fraction of gratitude from the obscurantists he has sought to placate. But it has reinforced the sectarianism he has vowed to eradicate. There is a premium in our political culture on confrontation rather than compromise. Mr Nawaz Sharif has shown courage in pulling back from the brink. He could have dug in his fangs, down and be drowned. He did not. He and his cabinet colleagues shall hopefully view this as a victory of reason, not a tactical retreat to be undone at a more opportune time. Democracy in Pakistan has been strengthened by it, and the government has not been weakened by any means. For Mr Sharif to perceive this as a defeat will be self-defeating. The developments of the last four weeks hold, nevertheless, lessons that all should ponder for this country's sake and for democracy's. The first is that people in high office ought to distinguish between authority and power. Authority the worthiness to be recognized as legitimate is the civilizing factor behind power, the element that makes the difference between coercing a multitude and governing a society. Power the ability to get what one wants, or to produce desired changes progressively degenerates when it is de-linked from authority. The divorce between the two yields dictatorship, tyranny, rebellion, or anarchy. Political instability and military rule in Pakistan have been premised on the absence of linkages between power and authority. The future of democracy in this country rests on our will and capacity to associate power with authority. Since Plato's time, political theorists have observed that concentration of power undermines authority. The converse is equally true: institutionalized devolution and separation of powers enhances the authority of the state, the government and those who preside over it. This is the golden rule of good organization generally. "How do you keep your vast organization running so smoothly?", I had once asked the head of General Motors Corporation. Came the prompt reply: "By allowing maximum autonomy to the managers of our various sectors." Added the corporate leader ironically: "The communists coined democratic centralism. We practise it." The Soviet Union fell apart not because power was decentralized there but because it was not. Strong men produce weak nations. Concentration of power produces augmentation of institutionalized no less than individual anxieties. An observer of the fish bowl that is Islamabad saw what the Prime Minister and his advisors must finally have seen: Whatever his failings and there were some the sympathies, spoken and unspoken, of the press, the legal profession, the bureaucracy, and the army's officers' corps lay with the Chief Justice. Of course, Pakistan's soldier-in-chief became a visible and central player in the high game of politics. More importantly, the constituency he represented was restive, very restive indeed. At work was anxiety, not ambition. The political class will do the country, and itself, a favour by comprehending the sources of this anxiety. Today, there is no noticeable ambition to political power in the high command of the armed forces. To the contrary, their attention is focused on maintaining the army's autonomy, its ethos, professional integrity, and fighting capabilities in a world of lost friendships and shrinking supplies. Armies are rarely very articulate institutions; this one has inherited a colonial tradition of in-articulation. Hence, its frustrations have to be understood by civilian leaders. It is an army that has ruled this country long and badly which is not a pleasant reminder. It has fought three wars without winning, and was badly defeated in one. It had a pyrrhic victory in a proxy war Afghanistan's as its military objective there the attainment of something its theoreticians called 'strategic depth' remains a remote dream. Its agenda in Kashmir is unfulfilled. To make matters worse, it is economically squeezed. Inflation is emaciating it as an institution, and its personnel individually. Jawans rarely get to eat meat; and officers are served meat just about twice a week. In this bleak environment, its leaders cherish the army's autonomy and their unity of command and purpose. They get anxious when these are threatened. Like the bureaucracy, the judiciary, the press and professional organizations the army officers of today regard with apprehension the concentration of power in the executive branch of the government. Like others, they too regard devolution of power and a system of checks and balances as essential features of stable and democratic governance. To make matters worse, Prime Minister Sharif was perceived by many as prone to concentrating power in his office. Rumours reinforced this perception. Rumours play a large role in our society. Official misuse of the media, which renders radio and television extremely unreliable sources of information, enhances the role of rumour and gossip as vehicles for comprehending the workings and intent of those in power. Since the passage of the 13th and 14th amendments rumours had filled the air of how the Prime Minister proposes to tame the judiciary, how he plans to take control of the army, and how eventually he would circumscribe the press. None of it may have been true but the rumours were all there, causing anxieties and shaping attitudes. To many people in many places, the Chief Justice appeared to be standing up to an ominous trend. That explains the spontaneous and broad based support he elicited. But rumours were not the only stimulants to anxiety over a trend toward concentration of power, Prime Minister Nawaz Sharif's overwhelming parliamentary majority permits him a nearly free hand to legislate, make rules and change the rules of government. Then came the anxiety-inducing legislation. Some objected to the 14th amendment on purist ground: any constriction put on legislators is a violation of their rights. Most people thought the purist position inappropriate in a country where so many elected representatives used their freedom of choice to go on the auction block. The majority welcomes the prohibition on lotabazi as a necessary deterrent. But then the government added to it a blanket prohibition on dissent itself. The Court had no choice but to throw the baby out with the bath water. Similarly, the anti-terrorist law was legislated despite an informed consensus against it. The Prime Minister appears convinced that it has effectively ended sectarian violence in Pakistan. That is not true and his advisors ought to tell him so. Moreover, it is a bad policeman's law. Its provisions too are unlikely to win judicial approval. The Prime Minister should realize this lest an unfavourable ruling cause another rift with the judiciary. True, the parliament is the supreme legislative body. But true also, that the judiciary has the ultimate authority to rule on the constitutionality of laws. If the right lessons are drawn from this event, great good will have come out of a bad situation. The weeks past revealed a polity stronger and more lively than most observers had imagined. The President avoided partisanship and played a quiet, moderating role. The Court stood its ground and has reinforced the principle of separation of powers. In doing so it had the active support of the institutions of civil society the bar associations, the press, and the intelligentsia as a whole. Above all, the Prime Minister finally acted wisely. To him goes the ultimate credit of defusing a crisis that could have caused great damage to the country. Those who describe the conclusion of this crisis as Nawaz Sharif's defeat are medieval 'pahalwans'. They do not know what democracy is about, nor what modernity entails. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS* 971103 -------------------------------------------------------------------- What is milk? -------------------------------------------------------------------- Omar Kureishi MS. AMINA JILANI writing in her Jaywalker column (Dawn magazine October 26) was in top form. Responding to a letter published in this newspaper about a traffic accident that led to the death of two young girls by a car driven at high speed by a driver allegedly inebriated, she laments the fact that this particular incident went unreported by the newspapers and wonders why. She writes: "The crash allegedly took place in the early hours of a Sunday morning. Now, our newspapers, including this one, publish regular reports on car accidents in the city particularly when anybody involved have been killed. In that Sunday's two Karachi papers, it was reported that a motorcyclist was knocked down and killed by a water tanker and pedestrian killed by a hit and run vehicle. No mention of the two dead girls. On Monday it was reported that two men were killed in an accident between a taxi and a minibus and another man killed when a coach turned turtle. No mention again of the two girls." This omission baffles her but only momentarily for she goes on to raise some serious questions. Those in the car that killed the two young girls were obviously well-connected. She asks what sort of children are being raised, what sort of education are they being given at home and at school. Writes Ms Jilani: "The two boys in question, "A" level students in one of Karachi's elite moneyed breed, to the best of our knowledge have received no punishment, no censure, they have merely picked up from where they left off." I share Ms Jilani's concern though it is not easy to provide her with the answers. It is all a matter of perception. When a poor boy steals oranges from an orchard, he is a thief. When a rich boy does the same, it is a bit of a lark. I can do no better than bring in the Hungarian born British writer George Mikes, best known for his book How to be an Alien. In another book, he recalls an old story which is about explaining something very difficult to understand. A blind man asks a young girl what milk is. The girl is astonished that someone can be so foolish that he doesn't know what milk is." Milk is white," she tells him. The old man tells her that he is blind and he doesn't know what white means. The girl tells him that it is easy to explain, and tells him that a swan is white. The old man tells her that a swan may be white but he has never seen a swan. "It has a curved neck," she tells him. The blind man says that he has no idea what "curved" is. The girl lifts her arm, bends her wrists forward like a swan's neck." "Feel it," she says. "That's curved." The old man feels the girl's arm, touches the curved wrist and exclaims joyfully: "Thank God. Now at last I know what milk is." We all have our own ways of defining terms. When we say, as we are inclined to say ad nauseum, that the law must apply to all equally, we do not have ourselves in mind. It is a fact of life that the poor and the wretched of this world, the meek (who are destined to inherit the world which has always seemed to me a post-dated cheque on a crashing bank) are twice penalised. Once for the simple fact of being poor and then again for being victimised because they are poor. The yard-stick we apply in dispensing justice differs. Take just the fact that even in our jails, a class system operates. We have A, B, and C class prisoners and these are awarded not by the nature of the crime but by social classification. Thus we will find that a lowly pickpocket will be lodged in C class while a rich and powerfully connected serial killer will be in A class. This is an elementary example but it goes to the core of the problem of law enforcement. So long as there are exceptions, the system of law-enforcement as such will be flawed. I have always maintained that the law should be perceived as the protector of the people and by that token the law- enforcer should be seen as a friend. The reverse is true. The common man, if I may refer to the majority of the population in so rustic a fashion, has no confidence in the judicial system and the relationship with the law-enforcer is an adversarial one. My idea of a just society would be when any man, woman or child can walk into a police thana without fear, without feeling intimidated. He or she should walk in seeking help and support and made to feel that they will get it, without a price tag. As to what sort of education the moneyed breed are getting in elite homes and schools, I cannot really say. But what I can say with certainty is that the majority of the children in this country are getting no education at all. We would need someone like George Mikes to tell these children what schools look like. I hope the above addresses some of the concerns of Ms Amina Jilani and others like her who tilt at windmills. It's the best that I can do. I entirely agree with the American visitor who said that the future is "Scary, man real scary."

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SPORTS

971103 -------------------------------------------------------------------- Faisalabad fiasco and quadrangular -------------------------------------------------------------------- Qamar Ahmed Stunning defeat in the decisive third and final Test against South Africa at Faisalabad where Pakistan were decimated and were bowled out for 92 while chasing a marginal target of 146 to win with all the time in the world may not have come as a rude shock as much for the players as it was for hundreds and thousands of people at home and abroad who were glued to their television sets anticipating a series win for Pakistan after they had dominated the Test for almost three days out of three and a half. The manner of self-inflicted distruction was such that it once again makes the mind wander triggering signals of suspicion which are associated with the modern day game. A defeat at Christchurch two years ago in the final Test after Pakistan had won two Tests on the trot and emphatically too, a massive 324 runs beating at Johannesburg against South Africa in the one-off Test and then an innings defeat at Harare against Zimbabwe only a few days later which sparked the fixing and bribery controversy found an echo after the defeat at Faisalabad. Without casting aspersions on the team which somehow failed to come to the expectations of the cricket loving public and in no way denying the merits of the respected visitors excellence, it is common knowledge that outside elements have their own axe to grind. Even in normal circumstances Pakistan is known to have flunked. They floundered at Headingley in the early seventies in Australia a couple of times and in the West Indies too but then we only had stars and no team, individuals with diverse interest and angles with an eye on self projection. That is why Pakistan could manage to win only one Test series overseas and that too against New Zealand in the late seventies. Therefore it is nothing new really that Pakistan has once again let a golden moment slip. There may not have been something fishy in that but the way our players threw away their wickets and failed to rise to the occasion was quite embarrassing, to say the least. For this debacle the people who trained boys were also to blame. Surely the humiliating defeat in the third Test has now come to them as a rude awakening. Chopping and changing the team every now and then has brought little and no result. It has unsettled a team which has started to emerge alongside the best. Now that they will be faced with the best like Sri Lanka, South Africa and West Indies in the one-day quadrangular they will be once again with a new captain and a changed side. That will not do them any good unless they really play to their full potential which they seldom do. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS* 971105 -------------------------------------------------------------------- Akram delighted with Anwar, Sohail's knocks -------------------------------------------------------------------- Sports Reporter KARACHI, Nov 3: Pakistan captain Wasim Akram was delighted not only because Pakistan beat the West Indies by eight wickets but two of his frontline batsmen were back in form. "Winning is always great and it's needed more frequently. But what is more important is the fact that Saeed Anwar and Aamir Sohail were back in form," Akram said from Lahore. "I always had confidence in both the players, specially Saeed Anwar. He (Saeed Anwar) was through a rough period but I am glad that with sheer determination, he is back to his old ways," Akram, who has taken over the charge from Anwar, said. Akram maintained that as a leader it was his moral duty to support his key player. "Saeed Anwar has done for the team in the last three years or so more than anyone else has done. But this was the period when he wanted someone to boost his morale." Saeed Anwar's 108 not out was his first century in 11 matches. He now becomes the second leading century-maker after Desmond Haynes of West Indies who has 17. Indian skipper Sachin Tendulkar has 12 centuries. "Aamir Sohail had been struggling with the bat as well as off-the- field. But now he has sorted out all his problems and it is great that he should now be looking forward to perform even better," Akram said. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS* 971108 -------------------------------------------------------------------- Pakistan's exit debases cricket carnival -------------------------------------------------------------------- Zafar Samdani LAHORE, Nov 7: Soaring carnival spirits were somewhat deflated as Pakistan crashed out of the Golden Jubilee Quadrangular Tournament on Wednesday, but Lahore is still a city living by cricket. The question uppermost in everyone's mind till the national team's exit from the eight day cricket-vaganza this is how the Pakistan Cricket Board billed the event was: what are Pakistan's chances of winning? Inevitably, the team was rated high, with sentiment prevailing over ground facts. The track performance of participants suggested Sri Lanka leading the quartet and South Africa about one-fourth of a length behind but expected to produce a burst of speed in the home stretch. Clandestine gambling operations offered a miserly rate for the islanders and no lucrative bargain for backing the springboks. The West Indians, trailing the field by a distance, could be backed at long odds. Pakistan's position kept fluctuating with the bookies but never was the team installed as favourites. Mobiles have been incessantly bleeping in five-star lobbies. An ear to the small instrument and a hand on the driving wheel is no unusual sight in Lahore, but it has been more on show in the last few days than ever before, presumably because of heavy betting on the quadrangular matches. Not just on results. Information on the grapevine suggests that millions would be staked on the toss tomorrow (Saturday) when the coin is flung in the air. Batting first, everyone agrees, places a team in the driving seat. Sri Lankans were the hot favourites from the start, but the South African win on Thursday has made the final more of an open contest even though the islanders batted without Jayasuriya and two of their key bowlers. But then South Africa also rested paceman Donald. The finalists appear well equipped for overcoming odds which makes the match anybody's game, the Sri Lankans remain ahead in most people's contention. A full house is expected. If it has been a week of hectic calculations for punters, genuine followers of the sport were also served a stroke-full feast of cricket. Spectators shouted, roared, banged plastic bottles and beat drums with every delivery. They were only disappointed by dot balls. They came to the matches with the fullest preparation for a picnic, not that there is a dearth of eatables in the stands which leave the stadium in a sorry, garbage-filled state much before the end of play. Sandwich baskets, coffee flasks and fruit are brought by most families in the more expensive enclosures while in the general and women's enclosures, traditional homemade food is mostly the menu. The city is flooded with cricket-related banners which inundate the scene around the venue. Inside the Qadhafi Stadium, young men with their faces painted, drooled up girls, older people getting into the mood, wave flags. With strict security arrangement setting up a formidable buffer between players and cricket enthusiasts and the teams hotel not easily accessible to all, cricketers have reliable protection from excessive attention of cricket-mad crowds. Determined admirers nevertheless find a way of reaching them. Or other personalities converging on the provincial capital for professional or cricket interests. At the final, practically every past and present Pakistani cricketer of note is expected to be present. Always hospitable, most citizens are in an unprecedentedly generous mood. Sunil Gavaskar should be able to drive away a Pajero of his preference and no bills presented. Henry Blofeld could ask for royalty from shops selling artificial jewellry. His Sharjah originated focus on earrings has reportedly upped their sales. Among those who may not recognise Geoffrey Boycott, he has just to pronounce an 'o' to find out how much more following his insight into the sport may have won him in our part of the world than his prowess with the willow had earns when he toured the country as a cricketer. This is not to say that foreigners and locals, commentators, experts and cricketers not mentioned here haven't made an impact. None more than Jonty Rhodes. The tournament's participants included many a famous cricketer. But it is his athletic feats in the field, plus an ever smiling and clapping presence that have made him the most popular cricketer of the tournament. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS* 971108 -------------------------------------------------------------------- Exciting final awaits cricket fans -------------------------------------------------------------------- Ilyas Beg LAHORE, Nov 7: An exciting competition will be witnessed in final of the Golden Jubilee Quadrangular Floodlit Cricket Tournament between two evenly-balanced sides of South Africa and Sri Lanka at the Qadhafi Stadium on Saturday. It has been reliably learnt that Sri Lanka management would play the same team which beat the West Indies and Pakistan sides during league matches in this tournament. In a strange move, the Sri Lanka team has planned to open the bowling attack with a spinner. More interesting is the strategy to open the bowling with off-spinner Aravinda de Silva. It will be something amusing to see whether the plan of an off-spinner operating with the new ball succeeds or not. No doubt, the strong South African side is considered to be rather weak while playing the quality spin-bowling, but during the Test series against Pakistan and in this tournament, South African batsmen have been competently handling the spin bowling. That is why the South African side has unbeaten record in this competition. No one should be surprised if the South African team maintains its unblemished record and wins the tournament. But the Sri Lanka side is no "push-over"! Winning of toss has played very important role in this tournament. Team winning the toss likes to put the other side in to bat as it wants to avoid to bowl and field in the evening when dew makes gripping of ball by bowlers and catching or stopping the ball by fielders very difficult. However, South Africa is the only side which won two matches of the competition bowling in the evening. It had registered wins against Pakistan and Sri Lanka. The pitch looks full of runs. Most of the fans lost interest in the tournament after the ouster of Pakistan. The hard-fought last league match between South Africa and Sri Lanka was a very poorly-attended show despite the fact that game of the highest order was on display. But the final is expected to draw reasonable number of cricket- lovers. Many concessions have been announced by Pakistan Cricket Board (PCB) in tickets. That should also have a good effect on attendance in the final. South Africa 'on-the-tour' management committee had a meeting late on Friday evening and finalised the team for the all-important match of the tournament. Paceman Alan Donald has been brought into the side in place of the diminutive, unorthodox left-arm spinner Paul Adams. All the other players of the team which beat Sri Lanka on Thursday have been retained. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS* 971103 -------------------------------------------------------------------- First phase of Pakistan's ascendancy in Squash-I -------------------------------------------------------------------- A. Majid Khan Squash and Pakistan have virtually become synonymous. No other nation in the world has in its fifty years history earned so much international glory and honour by dint of its unique record and unparalleled achievements in the realm of sports. Whether in the British Open or World Open or at the Asian level, the country has maintained its grip not only on the courts but in the councils too. The foundation of the Asian Squash Federation as well as the Professional Squash Players Association (ISPA) later re- named as the Professional Squash Association (PSA) owed a great deal to Pakistan. While celebrating its golden jubilees the country remembers with pride the world renowned sportsmen particularly in squash, who kept its flag flying high in several continents and all corners of the globe. Living legend Hashim Khan, born 81 years ago in 1916 in Nawakille, a village near Peshawar (NWFP) in the British ruled India, is rightly called the Baba-i-Squash (Father of modern squash) for its was he who put Pakistan for the first time on the map of world squash. Serving in the Pakistan Air Force, before serving as a ball boy in the Peshawar Club's uncovered cemented courts where the British officers used to play squash, Hashim Khan learnt his game the hard way. With the passage of time he improved his technique and mastery. He demonstrated his power in the Western India championship winning the title three years in a row (1944, 1945, 1946) at the age of 28 beating Abdul Bari before returning to his native city Peshawar after the partition of India in 1947. For almost six years there was no squash organisation in the country at the national level. Jalil Qureshi, a former national amateur champion, took the initiative in forming the Pakistan Squash Rackets Federation in Karachi in 1954. It was milestone in Pakistan's squash history. The Federation has alternately been patronised and promoted by the Pakistan Navy and the Pakistan Air Force. Hashim Khan, now living in the United States brought the first international glory to Pakistan in 1951 by ending the Egyptian ascendancy when he outplayed Mahmood al-Karim in straight games in the prestigious British Open, then regarded as the unofficial world championship. It was a professional event but the amateurs also did compete in the tournament. Winning the British Open at the age of 36 was a great feat indeed. He subsequently went on to establish a new record of seven victories in the British Open (1951 - 56 and 1958.) besides six successive wins (1978-83) after the event was instituted in 1976. Hashim, Roshan, Azam and Mohibullah Senior all the great Khans hailing from NWFP together ruled the international squash for an unprecedented 13 years, winning 13 British Open titles in a row, besides winning many other tournaments in Australia, Canada, USA, Egypt, Scotland and other places. The Pakistan Air Force not only helped Hashim Khan to earn honours and glories for Pakistan, but also built a modern squash complex Hashim Khan Squash Complex at Peshawar in recognition of the legendary champion's services to national squash. Hashim's younger brother Azam Khan and Mohibullah Khan all were in PAF who later took foreign coaching assignments. Hashim and Mohibullah settled in USA and Azam in London after Pakistan's domination in professional squash went through an eclipse in 1963. Roshan Khan, one of the finest stroke players the world has seen, performed a remarkable feat by beating the then uncrowned squash king Hashim Khan in the 1957 British Open Final. Roshan Khan had, however, to struggle hard to prove hat he was equally good but lacked required support and incentive which later came from Pakistan Navy which helped him prove his capabilities and calibre. Before the British Open victory Roshan Khan had beaten Hashim in the Pakistan Professionals Squash Championship Final held in 1956 at the Karachi Parsi Institute Squash Court. The Karachi victory further highlighted Roshan Khan's position as one of the world's leading squash stars. He won the 1956 Dunlop Professional Championship final one though losing his teeth in the bargain. Like a wounded tiger he fought back to claim the title and then proceeded to win a number of international tournaments. Azam Khan also demonstrated his squash power by wining the Britain Open four times in a row (1959-62) and several other international tournaments. The last member of the great Khan clan was Mohibullah Sr who won the 1963 British Open but thereafter Pakistan's first golden squash era ended. Aftab Javed, Gogi Alauddin, Mohammed Yasin and Mohibullah Khan Junior, Qamar Zaman all did their best to recapture Pakistan's supremacy in the British Open but could not fully succeed. Aftab Javed thrice reached the British Open finals losing to Egypt's Abu Talib, Australia's G. Hunt and Ireland's Jonah Barrington respectively in 1966,67,71. Gogi Alauddin, called the master of the lob; twice entered the British Open finals but lost to Barrington in 1973 and was beaten by Qamar Zaman in the 1975 final. Mohammad Yasin, too, entered the 1974 British Open final but gave a walkover to Hunt of Australia because of the injury he sustained though he surprised defending champion Barrington in the semi-final. Mohibullah Junior reached the 1979 British Open final but was beaten by Hunt. Qamar was the only player of the post Khans era, to reach the British Open finals three times (1978-80) more but each time he lost to Hunt who surpassed Khan's record of seven wins in 1981. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS* 971104 -------------------------------------------------------------------- World squash championship wide open -------------------------------------------------------------------- Dicky Rutnagur KUALA LUMPUR, Nov 3: the non-participation of Pakistan's Jansher Khan, eight times the winner and holder, creates the inevitable situation of a new champion of the World Open Squash Championship being crowned here on Saturday. The tournament begins tomorrow. In order of seeding, the main contenders for the vacant title are Rodney Eyles, the 30-year-old Australian, who was the losing finalist in Karachi last year, Peter Nicol, of Scotland, semi- finalist in 1994 and 1996, and Canadian Jonathon Power, the most improved player over the last two years. On the basis of results this season, Eyles is not a likely champion. Only once in six tournaments since June has he progressed beyond the quarter-finals stage. In view of Nicol's performances against Jansher, the Scot must be fancied. He stretched him to the full distance in the British Open, in April, and beat him twice afterwards, in the Al-Ahram Tournament, in Cairo in June, and in the final of the Kuwait Open, a fortnight ago. On the other hand, Nicol has twice lost to Power. indeed he is fortunate that Power is drawn in the opposite half. Seedings indicate that England's Simon is Nicol's main rival for a semi- finals place. However, Nicol has more to fear from Ahmed Barada, of Egypt. Indeed, he beat him in the Al ahram Tournament, but only after a long and fractious match in which Barada's tactics were so wickedly physical and unfair that he was reprimanded and fined by the Professional Squash Association. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS* 971107 -------------------------------------------------------------------- Amjad loses to Power in world squash -------------------------------------------------------------------- Dicky Rutnagur KUALA LUMPUR, Nov 6: For the first time since the World Squash Championship was instituted in 1976, Pakistan are unrepresented at the quarter-finals stage. her last survivor, qualifier Amjad Khan, found himself too inexperienced to cope with the speed and brilliant racket work of Canada's Jonathon Power, one of the three contenders most likely to succeed Amjad's illustrious uncle, Jansher Khan, as World champion. Power beat Amjad in only 35 minutes, 15-9, 15-6, 15-4. The Pakistani youngster had come through to the second round by upsetting the 16th seeded Irishman, Dcrek Ryan, yesterday. Back to the top.

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