Resilient Pakistan's Year 2011 in Review
“You tend to hear the worst 5% of the Pakistan story 95% of the time.” Pakistani Entrepreneur Monis Rahman
Most of the reviews of Pakistan's Year 2011 fit the above description of how Pakistan's story is told by foreign and domestic media engaged in the 24X7 news cycle.
So let me get the worst 5% of the story out of the way before telling you the rest of the 95% of it.
The Worst 5% of Pakistan's Story in 2011:
Pakistan added to the list of multiple serious crises of energy, economy, education, security and the worst ever governance by adding one more--a civilian-military conflict created by the hubris, incompetence and corruption of the ruling Peoples' Party leadership. This ongoing crisis now threatens to discredit and derail democracy yet again with the rapidly declining popularity of the Zardari-Gilani government and growing favorability ratings of the Pakistani military and its leadership.
Now the Rest of the Pakistan Story in 2011:
1. The current PPP-led coalition reached a key milestone of becoming the longest-serving elected civilian government in Pakistan's history.
2. Deep dissatisfaction with PPP-PML(N) duopoly gave rise to a credible third option with the emergence of Pakistan Tehrik-e-Insaf (PTI) party, led by the popular cricketer-turned politician Imran Khan. PTI particularly gained considerable momentum with successful political rallies in Lahore and Karachi.
1. Early childhood education received a significant boost with the launch of Sim Sim Hamara, Pakistani adaptation of the popular Sesame Street TV show for pre-school children.
2. Pakistan continued to be ahead of India in graduation rates at all levels, according to 2011 update published by Harvard researchers Robert Barro and Jong-Wha Lee.
3. Pakistan achieved the distinction of having the world's largest Fulbright Foundation program in 2011, with about 200 scholarships for advanced degrees during the year.
4. Punjab government launched elite Danish School system for high-achieving but poor college-bound students in Southern Punjab region. Public-sector Danish schools are intended as an alternative to the best available private schools which are beyond the reach of the poor rural students. There are currently two schools each in Chistian, Hasilpur and Rahim Yar Khan, and ambitious plans for over 600 such schools in the future.
5. The Citizens Foundation (TCF), a private foundation, continued to expand its network of schools, reaching a total of 730 well-equipped schools as of April, 2011, serving over 100,000 mostly underprivileged students. 71 of these TCF schools have been built are being operated with funds from Pakistani-American donors.
6. The British government announced $1 billion in aid for improving primary education in Pakistan over a four year period. The money will fund education for up to 4 million students, train 9,000 teachers, purchase 6 million new text books and build 8,000 schools by 2015.
1. Pakistan's lady health workers were described as "the best in the world" by a Boston University researcher and author of a community-based health care delivery study in Pakistan.
Women at Work:
1. The year 2011 saw a silent social revolution in Pakistan with rising number of women joining the workforce and moving up the corporate ladder. "More of them(women) than ever are finding employment, doing everything from pumping gasoline and serving burgers at McDonald’s to running major corporations", said a 2011 report in Businessweek magazine.
2. Women now make up 4.6% of board members of Pakistani companies, a tad lower than the 4.7% average in emerging Asia, but higher than 1% in South Korea, 4.1% in India and Indonesia, and 4.2% in Malaysia, according to a February 2011 report on women in the boardrooms.
3. In rural Sindh, the government started granting over 212,864 acres of government-owned agriculture land to landless peasants in the province. Over half of the farm land being given is prime nehri (land irrigated by canals) farm land, and the rest being barani or rain-dependent. About 70 percent of the 5,800 beneficiaries of this gift are women. Other provincial governments, especially the Punjab government have also announced land allotment for women, for which initial surveys are underway, according to ActionAid Pakistan.
1. Middle class consumers started spending again in 2011. over 10,000 more units of locally assembled cars were sold in July-November 2011 with sales hitting 62,353 units compared with 52,200 units in the same period of 2010. Auto sales in Pakistan hit a two year high, jumping 61% in July, 2011 to 17,563 units from 10,942 units in the same month of last year. Pak Suzuki Motor Company led the auto sales up with 116 percent rise to 11,997 units from 4,503 seen in the same period last year.
2. Away from the violence and the troubles of the big cities, the economy of rural Pakistan experienced a boom. Flush with cash from bumper crops at record commodity prices, the farmers spent on tractors, cars, motorcycles, mobile phones, personal grooming items, packaged foods and beverages and other consumer products like never before. Higher crop prices increased farmers’ incomes in Pakistan by Rs. 342 billion in the 12 months through June, according to a government economic survey. That was higher than the gain of Rs. 329 billion in the preceding eight years, according to a report by Bloomberg News. Companies like Millat tractors, Honda Atlas Motorcycles, Pak Suzuki Motors, Engro Foods, Telnor, Nestle, Colgate-Palmolive, and Unilever have been big beneficiaries of the rural consumption boom.
3. Pakistan's key share index KSE-100 dropped about 5% in 2011, significantly less than most the emerging markets around the world. Mumbai's Sensex, by contrast, lost about 25% of its value, putting it among the worst performing markets in the world.
1. Significant new investments were announced in the renewable energy sector, particular hydroelectric power plants and wind farms. WAPDA announced 28% completion of the 969 MW Neelum-Jhelum hydroelectric project, and ADB took the lead financier role in the 4500 MW Diamer-Bhasha dam project. Pakistan has about 1000 MW of wind power plants at various stages of planning and construction, and another 498.5 megawatts of wind programs announced, mostly in Jhimpir, Gharo, Keti Bandar and Port Qasim wind corridors along the Arabian Sea coast in Sindh.
2. In addition to billions of tons of coal deposits in Sindh, exploration confirmed the presence of upwards of 60 trillion cubic feet of shale gas in Pakistan, enough for 20 years or more.
1. As US-Pakistan relations sank to new lows, there were tentative signs that Pakistan's fight against Tehrik-e-Taliban Pakistan (TTP) is beginning to succeed. There have been no major terrorist attacks in Pakistan since the the Mehran Naval Base siege in Karachi in May, 2011.
2. Death toll from terrorism declined for the third year in row, according to South Asia Terrorism Portal. After hitting a peak of 11,704 in 2009, number of deaths fell to 7,435 in 2010 and 6,048 in 2011.
3. Huge political rallies in 2011 passed off without violence, helping boost confidence in the security situation in major Pakistani cities.
While deep concerns remain about Pakistanis' ability to overcome the myriad crises they face today, the year 2011 showed that the people continue to be undaunted and resilient. A significant number of them, like Edhi Foundation, The Citizens Foundation, Pakistan Lady Health Workers and others are showing the way by lighting candles rather than cursing darkness.
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Light a Candle, Don't Curse Darkness
Apne Ulloo Lyrics
Quaid-e-Azam aya angrezo ko bhagaya
Pakistan banaya teera maah chalaya
Ziarat ke dourey par aya maut ne isko bulaya
Dunya aakhir fani chor dya usko
Jani sacha tha Pakistani
Karachi mein dafnaya poora dunya aya
phoolon ka chadar chadaya
phir noton par photo aya
goro ko tune bhagya
Quaid-e-Azam ke baad baba jo bhi aata hai
apna ulloo seedha karta hai
Apne Ulloo kitne taire ap tak na hue yeh seedhe
Apne Ulloo korey korey woh yehi pe hai korey korey
Apne Ulloo kitne taire ap tak na hue yeh seedhe
Apne Ulloo korey korey woh yehi pe hai korey korey
Liaquat Ali Khan aya usko aamro ne marwaya
Iskandar Mirza aya usne nahin chalaya
General Ayub Khan aya marital law lagaya
Mirza ko bahadur banaya
1965 ka jang laraya Shastri ko maar bhagaya
Aisa sabak seekha moo tod jawab dilaya
[Nehr] bhi banwaya isne bhi nahin chalaya
Sir baad mein aya Yahya Khan adha Pakistan ganwaya
Fauj ko qaid karwaya Bangladesh chinaya
Isne bhi nahin chalaya
Taale, waadey, signal, dil sabkuch toda kuch nahin choda
kuch nahin choda
Do number kaamon mein bhi hum number two
hum number two
Kar Allah hoo
Apne Ulloo kitne taire ap tak na hue yeh seedhe
Apne Ulloo korey korey woh yehi pe hai korey korey
Bhutoo sahab jab aya aisa nizam chalaya
Pehle qaidy chudaya zameen takseem karwaya
Haari aur mazdooro ko dilwaya
Miloo ko taala lagwaya one unit toodwaya
Sarkari khatam karaya roti kapre ka nara lagaya
Sarmayadaro ne socha isse kabhi na hoga
mansooba banaya Zia-ul-Haq mangwaya bhutto ko qaid karwaya
Kasuri ka case chalaya suli par latqaya
Sir Marshal Law lagaya Junejo ko mangwaya Wazeer-e-Azam banaya
Usko mazool karwaya referendum karaya Khud ko bhi chunwaya
Bhutto ko bhi bhagaya court mein tune lagaya jailon mein bandh karwaya
11 saal chalaya
koi rule nahin hai rule yehi yeh baat sahi taariq ne ki
taariq ne ki
Apne Ulloo kitne taire ap tak na hue yeh seedhe
Apne Ulloo korey korey woh yehi pe hai korey korey
Rangeene ne Rang dikhaya Jaahaz uska giraya Islamabad dafnaya
Ghulam Ishaq Khan aya mehangayi ko bharhaya 500rs bori aate ka bharhaya
Ghareebo ko bhookh maraya aik saal PPP ko diya usko mazool kya
Nawaz Sharif ko mangaya wazeer-e-azam banwaya uksko mazool karwaya
Moin Qureshi aya emandari nibhaya vote jald karwaya
Fauj ko bulwaya dhandhali se bachaya jeet gya hai PPP
Benazir jab aya bijli aur gas dilwaya thoda tankha barhaya
Farooq ko sadar banaya siyasi chakar aya farooq ko gussa aya
Assemblies khatam karwaya nigrah wazeer bhitaya
Nishan tha jiska cheetah Nawaz Sharif ne jeeta
Aaane mein aaya 300 tankha barhaya
Bhai logo ko danda chadhaya aathwi tarmeem khatam karaya
Aate ki kilat karwaya Aik peice PAKISTAN ka America se atta karwaya
Soobha Baluchistan ke zilah Chagi mein aitamy dhamaka karwaya
Pervez Musharaff aya Nawwz sharif ko hataya aghwah ka kais chalwaya
100 takhwa barhaya karzey wapis karwaya Nawaz Sharif ko qaid sunwaya
mulk badar bhi karwaya aisa kaam karwaya ke tarar ko tune bhagaya
khud ko tune sadar banaya referendum karwaya khud ko jeetaya
intekhabad karwaya Jamali sahab ko wazeer-e-azam banwaya
Jamali ne jurat aur bahaduri yehi dikhaya ke apna mohallah azad karwaya
Sab hazm kiya sab khatam kya hum phir denge woh kaahe ge
Hum peeche hai hat jaye to backing to gayi voting bhi gayi
voting bhi gayi
Apne Ulloo kitne taire ap tak na hue yeh seedhe
Apne Ulloo korey korey woh yehi pe hai korey korey
Apne Ulloo kitne taire ap tak na hue yeh seedhe
Apne Ulloo korey korey woh yehi pe hai korey korey
Shehzad Roy ne gaana banaya kisi ko samaj na aya
Angelina Jolie aya baba sab ko samaj aya
Pakistan’s inflation slowed in December to the lowest level in 25 months, giving the central bank scope to cut interest rates.
Consumer prices rose 9.75 percent from a year earlier, the Bureau of Statistics said in Islamabad today. That compares with a 10.19 percent gain in November.
Emerging markets from Indonesia to Thailand have eased monetary policy to support consumer demand as Europe’s debt crisis threatens a global economic slump. Pakistan’s central bank last month left rates unchanged, pausing to gauge the impact of a 2 percentage-point cut since the end of July as foreign investment declines.
“The easing inflation trend will give room for another rate cut,” said Raza Jafri, an economist at AKD Securities Ltd. in Karachi. “The central bank will still closely monitor inflation pressures emanating from the rupee’s weakness.”
The Pakistan rupee weakened 5 percent to 89.95 against the U.S. dollar in 2011, risking higher import costs. The Karachi Stock Exchange 100 Index declined 5.6 percent last year.
Policy makers in Pakistan plan to boost economic growth from 2.4 percent in the year ended June 30, one of the lowest expansions in the past decade, as the country struggled to cope with floods and militant attacks.
The growth rate may be 0.5 percentage point lower than the government target of 4.2 percent for the current fiscal year, a finance ministry official said Oct. 19, citing the impact of floods in the country.
Floods in August forced more than one million people from their homes and damaged crops in parts of southern Pakistan still recovering from the worst ever monsoon inundations in 2010. Terror attacks in the South Asian nation have killed at least 35,000 people since 2006, according to government estimates.
Qari Kamran, a senior Movement of the Taliban in Pakistan commander in the northwestern district of Nowshera, was killed along with 11 fighters yesterday during a military operation in the tribal agency of Khyber. The Taliban have been fighting the Pakistani military as well as the rival Islamist terror group Lashkar-e-Islam in Khyber.
Kamran was involved in some of the most deadly suicide attacks and ambushes in northwestern Pakistan over the past several years. The most devastating attack took place on May 13, 2011, when a suicide bomber detonated among a crowd of newly trained troops of Pakistan's paramilitary Frontier Corps at a training center in Shabqadar in the neighboring district of Charsadda. The suicide attack was followed by a car bomb. More than 80 Pakistani troops and civilians were killed in the twin blasts.
The Taliban claimed credit for the horrific attack and said it was carried out to avenge the death of al Qaeda emir Osama bin Laden, who was killed by US special operations forces in Abbottabad, Pakistan, on May 2, 2011.
The Shabqadar attack was followed by the June 5, 2011 suicide attack at the Nowshera Cantonment that killed 18 Pakistani soldiers.
Read more: http://www.longwarjournal.org/archives/2012/01/pakistani_troops_kil.php#ixzz1iLDHw6La
Now there are signs that the tide is turning against the TTP.
The TTP has been battered by Pakistani military operations and U.S. drone strikes. It is splintered into more than 100 smaller factions, significantly weakened and running short of cash, according to security officials, analysts and tribesmen from the insurgent who spoke to the reporters of the Associated Press (AP).
There have been no major terrorist attacks in Pakistan since the the Mehran Naval Base siege in Karachi in May, 2011.
Death toll from terrorism declined for the third year in row, according to South Asia Terrorism Portal. After hitting a peak of 11,704 in 2009, number of deaths fell to 7,435 in 2010 and 6,048 in 2011.
As to why the year 2012 is challenging, he said, the global activity has weakened and become more uneven, confidence has fallen and fears of global economic recession are growing and likes of 2008 recession are being debated. A number of shocks have hit the international economy last year, including the devastating Japanese earthquake and tsunami, unrest in some oil-producing countries, and the major financial turbulence in the Eurozone
“The economy is susceptible to international economic developments,” he said. The oil prices have recently risen to around $110 barrel while the economic projections by the IMF remain pessimistic. In this instance, Pakistan’s current account deficit may reach close to $3 billion.
Trade balance is likely to remain between $14 and $14.5 billion. Exports are likely to increase to $26 billion while imports are likely to be below $40 billion. Remittances are expected to remain robust with close to $12.5 billion inflow. However, Pakistan’s economic position suggests that the external account position is unlikely to deteriorate and high probability is that foreign reserves on June 30th, 2012 will remain between $17- $18 billion.
For this year, the growth rate is forecast to improve to 3.6 as compared to 2.4 per cent achieved last year. Dr Shaikh said there are also pressures on the rupee. Indian rupee has devalued by more than 18 per cent since January 1, 2011 giving it competitive advantage over Pakistani rupee in international textile exports.
The budget deficit is likely to be below five per cent of GDP while the FBR tax revenue is likely to reach Rs1,952 billion, 25 per cent higher than 2010-11. Inflation is likely to reduce due to improvements in supply, government’s resolve to limit borrowings from the State Bank of Pakistan and stagnation of international commodity prices.
However, international recessionary fears, further rise in oil prices due to tensions in Iran and Gulf states, persistence of energy crisis in Pakistan due to low hydrogeneration and low gas reserves, and delays in reforming public sector entities add to risks in the economy.
..“Although conflict-related violence decreased in Pakistan in 2011, the complex security landscape in the country made it one of the most volatile states in the region and necessitated effective measures to curb militancy and terrorism,” Islamabad-based Pak Institute for Peace Studies (PIPS) said in a press release, ahead of release of its ‘Security Report 2011’ today (Wednesday).
The report noted that the trend of an overall decrease in the number of violent incidents and casualties in Pakistan that was witnessed in 2010 continued in 2011. The report attributed a fall in conflict-related casualties largely to military operations in the Tribal Areas and in Khyber Pakhtunkhwa, and to fewer suicide bombings and drone strikes in the country in 2011.
According to the report, a total of 2,985 violent incidents—including terrorist attacks, security forces operations, ethno-political violence, inter-tribal clashes, drone attacks, and cross-border attacks—were reported in Pakistan in 2011. This is compared to 3,393 incidents in 2010 and 3,816 in 2009, a decrease of 12 percent and 22 percent, respectively. Casualties in violent incidents also went down, from 10,003 fatalities in 2010 to 7,107 in 2011, a decrease of 29 percent. The number of people injured in these attacks declined from 10,283 in 2010 to 6,736 in 2011, representing a 34 percent decrease.
The Federally Administered Tribal Areas (FATA) suffered 675 terrorist attacks in 2011, the highest for any region of the country during the year. In Balochistan and Khyber Pakhtunkhwa (KP), 640 and 512 terrorist attacks were recorded, respectively. The highest number of casualties in terrorist attacks in 2011 was reported from Khyber Pakhtunkhwa where 820 people were killed and 1,684 wounded, followed by Balochistan (710 dead and 853 injured), and FATA (612 dead and 1,190 injured).
Forty-five suicide attacks were reported across Pakistan in 2011, compared to 68 in 2010 and 87 in 2009. In these attacks in 2011, as many as 676 people were killed and 1,462 injured. Most of the casualties were civilians. More than half of these attacks (27) occurred in KP, claiming the lives of 449 people.
The overall incidence of sectarian violence in the country decreased by nine percent—from 152 incidents in 2010 to 139 in 2011. However, unlike the year 2010, sectarian violence was not concentrated in just a few cities. As many as 79 people were killed in Karachi, 80 in Quetta, 50 each in Kurram Agency and Dera Ghazi Khan and 26 in Mastung in such attacks.
It said 261 people were killed and 206 injured in 84 clashes and other incidents along the country’s borders in 2011.
“As many as 75 US drone attacks took place in Pakistan in 2011, killing 557 people and injuring 153,” the PIPS security report revealed.
It added that the security forces launched 144 attacks against militants in various parts of FATA and Khyber Pakhtunkhwa, killing at least 1,016 militants, while 279 Taliban militants surrendered to the authorities in FATA and Khyber Pakhtunkhwa. A total of 4,219 militants and members of radical organisations were arrested across the country. However, few of them were put on trial.
On the political and administrative front, the FATA reforms package was noted as a “positive development”, although implementation remained lacking. The compensation mechanism for civilian victims of terrorist attacks remained a critical issue, as did hundreds of schools in FATA, which had remained closed since 2009.
Absence of effective political means to address the situation in Balochistan was also highlighted, and the report noting that the tribal guerilla warfare of earlier years had morphed into a robust urban insurgency in the province...
Following the private curriers services, the ministry for Postal Services is also considering the delivery of mail within 24 hours across the country, sources in the ministry told Daily Times here on Tuesday.
In this regard, sources said the entire mail arrangement has already been reviewed thoroughly and in the first phase measures have been introduced for overnight delivery in capitals like Islamabad, Karachi, Lahore and Peshawar.
After successful implementation of this service in capitals, gradually the new system would be introduced in other big cities across the country. About exact implementation of this proposal, the sources said it is a continuous process, and Pakistan Post has to cover far flung areas, where courier services are not functioning, time frame cannot be given, the sources maintained. Improvement in administrative affairs with regards to delivery of mail is a continuous process and necessary steps are taken as whenever changes in the mail arrangements are required.
When asked the sources any proposals to make the Pakistan Post a corporation, the sources said at present, no proposal to make it as corporation is under consideration.
However, a proposal for establishment of Post Bank with merger of finance services of Pakistan Post and SME Bank was received from Privatisation Commission. The proposal was not found feasible by Pakistan Post and a reply was accordingly given.
About total number of Post offices across the country, the sources claimed that there are 12035 functional currently. The government has taken a number of measures to improve the performance of post offices across the country.
The government has also plan full computerization of post offices. In this regard the sources said that a PC-I was prepared and submitted to Planning Commission for computerisation of 617 departmental post offices spread over three years in phased manner. The PC-I was placed before the Central Development Working Party (CDWP). The project was deferred due to non-preparation of working papers. Based on the go-ahead signal of Planning and Development Division, Pakistan Post has completed preparatory work on the project. The PC-I is still in submission phase.
The sources further said that Pakistan Post has computerised the 83 GPOs in the country to improve the service for the Military Pensioners and further planning to computerise all post offices but it will take a lot of time. Officials in the ministry of Postal Services told Daily Times that the Secretariat Allowance has not been given to the employees of the Pakistan post. The Finance Division had allowed Federal Secretariat Allowance at 20 percent of basic pay to the employees of federal government but it was confined to the employees of Federal Secretariat.
Therefore, it was also not given to the employees of the Pakistan Post Office Department. Currently the Federal Secretariat Allowance is not permissible. Certain employees of Federal Government (AGPR) preferred an appeal before the Peshawar High Court, who ordered for payment of arrear of Federal Secretariat Allowance for the period from 01-07-1988 to 28-2-1994 and the Finance Division, Government of Pakistan directed to pay the same.
On the basis of decision of Peshawar High Court, the officials said that the case was taken up with the Finance Division, which has agreed to the payment of arrear of Federal Secretariat Allowance for the period from July 1, 1988 to Feb 28,1994 to the employees of Administrative Offices under the Pakistan Post Office Department who perform Secretariat duties, which is under consideration and will be made on availability of necessary funds from Finance Division....
Pakistan starts 2012 on a slightly brighter note after a year of recovering from the worst floods in the country’s history in 2010 (while continuing to endure high levels of terrorism-related violence). As part of the effort to rebuild, sunny days and solar panels and multipurpose lights are providing reliable and much needed electricity for schools and rural areas of Pakistan that have been without electricity since the floods.
Plan International Pakistan and the Punjab education department have rehabilitated nearly 400 schools destroyed by floods, and implemented solar power in 250 schools that did not have electricity. Funded by the United Kingdom’s Department for International Development (DFID), the project piloted the first use of solar technology in the UK’s disaster response. In addition to the solar panel installation, the project also provided water and sanitation, school furniture, school paper, schoolbags and uniforms, sports equipment and health education for 54,000 primary school children.
In addition to powering up the schools, aid from the U.K.’s DFID also provided multipurpose solar light units to people across rural southern Pakistan who have been without power since the floods and were relying on candles, kerosene oil and rechargeable flashlights for light. The solar unites provide free and sustainable light for up to 10 hours after charged and last up to five years. But beyond providing light, the units can also be used to recharge mobile phones, which play a critical role in helping displaced families and communities stay connected in areas where landline phones are rare.
Marvi, a woman living in southern Pakistan with her seven children, explained to aid officials how the solar units were benefiting her family: “I use the solar light for cooking at night,” she explains. “We save money because we had to buy candles and kerosene before. We also use it to charge our mobile phones.”
Pakistan may face international isolation on the economic front if drastic steps are taken during the reviewing of bilateral terms with the United States, the country’s finance minister cautioned on Thursday.
The warning from Finance Minister Abdul Hafeez Sheikh came at a meeting of the Parliamentary Committee on National Security, which on Thursday finalised its draft recommendations for its review of ties with the US.
“There are some shocks Pakistan can absorb but there are others it can’t,” Sheikh was quoted as saying at the parliamentary committee meeting.
The review was ordered by the government following the November 26 Nato airstrikes that killed 24 Pakistani soldiers in Mohmand Agency and led to a new low in relations between the allies.
“A single incident must not determine our relations with the US,” Sheikh said in an apparent reference to the steps taken by the government following the Nato airstrikes.
“Any decision should be taken while keeping in mind the multidimensional paradigm of security, prosperity of the country and economic diplomacy,” he added.
The minister, while spelling out alternatives, argued that the country should adopt a ‘balanced’ approach towards its relations with the US.
Briefing the 17-member all-party bicameral parliamentary panel, Sheikh was quoted as saying that Washington might use its influence over international financial institutions to hurt the country’s economic interests.
The minister went on to give a detailed briefing about the likely implications the country may face in the event of a move to pull out of the US alliance.
A committee member, who asked to remain anonymous, said that, according to the finance minister, the country’s fragile economy would face a daunting task if the relationship between Pakistan and the US deteriorated further.
“It is not about American aid but its clout over the IMF, World Bank and other financial institutions that can pose a real challenge for us,” said the committee member referring to the elaborate briefing given by the finance minister.
However, some of the members present questioned the finance minister’s wisdom, arguing that in the past Pakistan’s economy had survived ‘crippling sanctions’ imposed by the US – referring to sanctions placed on Pakistan after it tested nuclear devices in 1998 in a tit-for-tat response to tests carried out in India.
“Pakistan survived then and can survive now,” said an opposition lawmaker, who drafted his own proposals for the review of ties with the US.
The committee headed by Senator Mian Raza Rabbani has finalised the draft recommendations and forwarded them to the defence and foreign ministries for their input.
Rabbani told reporters that the committee will meet next Tuesday to fine-tune the final recommendations before they are handed over to Prime Minister Yousaf Raza Gilani.
The government will then present the committee’s proposals before a joint session of Parliament to seek its approval. The joint sitting is expected to be convened in mid-January.
The review is being eagerly awaited and closely watched by local and international observers since it is meant to reshape and herald a new era in Pakistan’s relations with the US and more significantly have a major impact on the Afghan endgame.
The United Nations (UN) on Wednesday announced that its Children's Fund (UNICEF) opened 35 newly constructed schools in the Pakistani province of Punjab, which was severely damaged by the 2010 floods.
With donor funding in the southern area of Punjab province, the new schools were handed over to the Punjab Education Department and opened with 4,500 pupils attending classes. The 35 schools are located in the districts of Muzaffargah, Rajanpur and Rahimyar Khan.
Most of the Government school buildings were either damaged or completely destroyed in the 2010 floods, prompting UNICEF to initiate a schools reconstruction program in the worst affected districts of southern Punjab and other parts of the country.
Temporary learning centers were also established to ensure that children did not miss their academic year, but prefabricated school structures with all amenities have already replaced the temporary learning centers, UNICEF said in an update.
"The Child Friendly Schooling approach is interactive and makes learning fun for children," said Karen Allen, UNICEF’s deputy representative in Pakistan.
"It has elements of health and hygiene through provision of safe drinking water and improved sanitation, early childhood and development for preparing young children for school, playground and equipment for healthy physical activities, psychosocial support for rehabilitation of trauma-affected children, involvement of parents and community, and many other unique features that makes education attractive," she added.
The Embassy of the Netherlands in Pakistan contributed $1.2 million for the construction of 24 schools, while the Organization of Petroleum Exporting Countries (OPEC) donated an additional $250,000, which was used to build seven schools. Funding for the construction of four schools was provided by Italy, Hungary and Sweden.
Foreign Direct Investment (FDI) in fy-2011 was $ 1.6 billion down from $ 2.2 billion in fiscal year-2010, State Bank of Pakistan (SBP), the central bank, reported this week. The downtrend is attributed to three international factors including the slowdown in the global economy including low business in Western-US region, EU currency crisis and the trouble in Middle
East North Africa (Mena) region. The domestic problems that afflicted investment were bad governance, the energy crunch, reduction in the public sector development spending due to large defence and administrative expenses, expensive credit, high rate of inflation, poor Law and order and the effects of the war on terror. The decline in investment has been fairly of a broad range, encompassing a number of sectors. The country’s biggest industrial producer job provider, and exporter — textile industry — recorded a steep decline in manufacturing, spinning, ready-to-wear garments and other finished products, primarily owing to acute electricity and natural gas short -age.
Oil and gas sector was hit by limited profits and weak motivation to expand capacity and production at a time when the demand for all of its products is huge. Import of finished and refined products also hit it hard. Investment in construction declined by Rs2 billion n in fiscal year-2011— a reduction for the fourth year running. A continued decline in the real estate market , along with rising bank default by construction sector borrowers has over shadowed the positive impact of post-flood construction activities” of fiscal year-2011, SBP points out.
Except for the financial services and power sectors, a number of other sectors saw a drop in investment. In energy sector oil and natural gas received the largest amount of FDI amounting to $512 million in 2011. Financial services got $ 247 million. Telecoms saw the biggest decline. Its profit repatriation abroad was higher than investment by Rs34 million, down from positive investment of Rs 291 million in 2010.
SBP notes that US was the biggest investor with $239 million. United Arab Emirates was the runner up with $284.2 million, and Britain was the third with $208 million.But, at the same time, a just-conducted survey by Overseas Investors Chamber of Commerce & Industry (OICC&I) cites inflation as “the biggest single reason for decline in business confidence in the last six months, eclipsing all other negative factors including law and order.”
There is a genuine feel good and confidence-plus sentiment according to BCI. “As many as 69 per cent of all the respondents plan to make capital investment, 64 per cent expect sales to increase, 54 per cent expect profits to rise and 47 per cent are of the opinion that return on investment will go up,” it confirms. The hope is pinned on a growth in the output of the Large Scale Manufacturing (LSM), farming, and oil and gas which are looking up, coupled with a likely reduction in the severity of the energy outages, will help push GDP growth to 3.9 per cent in fiscal year-2012, from 2.4 per cent in fiscal year-2011.
What are the bourses indicating? Karachi Stock Market, the country’s biggest bourse, will move up “once things become clear on the political front. Market is trading at a price to earning ratio of six much attractive than the regional average of 11. It is yielding around 8.5 per cent which stands as one of the highest in the region,” says Ashraf Bava, CFA and CEO of Noel Capital. ...
Despite the regular eruptions of bad news from Pakistan, Shaukat Aziz, a former finance and prime minister there, remains cautiously bullish about his country's prospects, including the peace dividend that could come with the orderly exit of U.S. troops from Afghanistan. But that depends, he says, on a Marshall Plan-like reconstruction of Afghanistan -- and the U.S. delivering on tribal economic development plans.
That might seem overly ambitious for distracted Western capitals with tapped out coffers. But the 'mostly-sunny' technocratic vision is not unusual for Aziz, a former Citibank (C) executive who presided over strong growth as finance minister after General Pervez Musharraf staged a coup in 1999. (Musharraf just announced he would shortly be returning to Pakistan -- and risking arrest -- from Dubai where he has been since leaving office.)
Aziz, 64, was elected prime minister in 2004 (surviving an assassination attempt while campaigning) and was the first of 23 predecessors to serve out a full term, until 2007. He took up residence in London soon after and now serves on the board of the British hotel chain Millennium and Copthorne Hotels, and as an advisor to the Blackstone Group (BX).
Aziz recently spoke with Fortune about the state of Pakistan's economy, how to rebuild Afghanistan, and why Pakistan deserves a free trade agreement with the U.S. Below is an edited transcript of that discussion.
It's been more than six years since Goldman Sachs (GS) recognized Pakistan among the Next Eleven newly industrialized countries -- inflation is up, investment is at a 40-year low, and infrastructure is deteriorating, particularly in the power sector. By just about any measure things are not particularly good, so what is the source of your optimism about the Pakistani economy?
The problems of the world economy have obviously leaked to Pakistan. Yes, investment is down, trade also, but in Pakistan's case a lot of this is due to the security situation, the war on terror. We have to pay a huge price in terms of damaging our investor confidence -- both domestic and foreign.
On the other hand, we should bear in mind that more than two-thirds of the population lives in rural areas and agriculture has done well, especially in cotton -- prices and exports are up and the farmer is relatively more comfortable.
The country's human capital is a strong suit, the Pakistani people are very talented, their skills levels are impressive and they are hard-working. There's a huge number of Pakistanis working overseas and we can export a few more million and there won't be an iota of difference because there is a whole pipeline of trained – and untrained - people coming.
You mentioned the need for good management. How would you assess the current management of the economy? I ask that in light of the lapsing of the stabilization plan with the IMF.
Being out of the IMF -- obviously this reflects the desire of the government to have more flexibility to pursue its reforms. The IMF program does bring with it certain macroeconomic discipline and that's beneficial, but I also believe in economic sovereignty. You need good governance and good management, but abdicating the economy to the IMF is not the way to succeed. What we need is growth and job creation, like every other country in the world.
The disagreement with the IMF is at least in part related to tax collection, which has been notoriously weak in Pakistan. There is a lot of concern whether Pakistan can muster the political will to make tough reforms, partly because of self-serving elites among the political class that have brought the country to the point of being nearly a failed state.
No, I think that's not true. The country is large -- roughly 180 million people -- and it's functioning. It has many challenges -- governance issues, transparency and management issues -- on top of the security issues that have cost us dearly. But the country is functioning. Obviously it could function better, but it's not come to a grinding halt. Life is going on.
Don't expect an Iranian oil crisis
Clearly, the country is facing a challenging situation financially, and tax reform has been an issue. It's true there is low tax compliance, but you have to look at the political impact -- not just the economic impact -- of taxes. The tax system has been around for a long time. Trade-offs have to be made; indirect taxes -- sales tax and customs duties -- have grown because of that, quite handsomely. Income tax is also up, but that is mostly out of big corporations' profits.
The key question is: How do we get growth? The pie has to get bigger for you to collect more taxes. You can't squeeze the lemon if there's no juice in it.
Moving on to Afghanistan, the U.S. is being more realistic about its transformative agenda and the Obama administration seems to be determined to wind things down. How do you see this playing out?
I think this is the right way to go. The presence of foreign troops generates ill effects and the sooner they are gone, the better. But the exit strategy has to be very carefully choreographed.
We need a Marshall Plan-like approach, a massive program for reconstruction. The World Bank, the Asian Development Bank, the sovereign banks, and many individual countries, have to be involved. There was a very successful meeting recently of Turkey, Pakistan, Afghanistan and others in Istanbul. People need to see a future, that tomorrow will be better than yesterday. The people of Afghanistan will have to work hard themselves to leverage this opportunity. It's a good thing that the U.S. and the Taliban are talking -- all stakeholders have to be included. I'm cautiously optimistic that adversity can be changed into an opportunity if it is funded well.
U.S.-Pakistan relations are generally refracted through the prism of Afghanistan but also through the fact that Pakistan is a nuclear power.
I think certainly the relationship is opportunistic on both sides. But I think the U.S. is pursuing a policy of both engagement and containment of Pakistan at the same time. We are both a friend and an adversary. Therein lies the conflict in the relationship. There is a trust deficit and when it comes to the nuclear issue there is a fundamental problem.....
Investing after the Arab Spring: Unfinished business
When India was drawn into the Nuclear Suppliers Group (a multilateral anti-proliferation organization) Pakistan should have been included too. The United States has to decide: are we in the tent or outside? That was a major missed opportunity. Inclusion in the NSG comes with a lot of responsibility and obligations. Engagement becomes more formalized, providing a forum for all key players to be around the table to discuss and solve issues. We are a nuclear power – there is no such thing as a halfway house here - and to deny it doesn't help anybody. It's not too late to rectify this. It would help the whole atmosphere in South Asia. If you keep people out of the tent, things can suddenly move the other way.
You've said that Pakistan would be better off with a free trade agreement with the U.S., instead of aid, but given the state of US-Pakistan relations that seems very unlikely.
I'm not optimistic about a free trade agreement because even when Congress was very friendly, they couldn't get things through, even things which were promised like the Reconstruction Opportunity Zones in the border area of Afghanistan and Pakistan, which was important for all three countries. The idea was to give duty-free access to the U.S. market for any goods produced in the tribal areas. Obviously when you put up a factory there the cost of production will be high, initially at least, because there is no infrastructure. This was a well-conceived and well-designed way of creating jobs. Otherwise they will have no incentive to put down their guns. Congress has approved other special market access programs like this for Haiti and Jordan, and maybe others. It was promised by the U.S. five or six years ago but nothing happened.
We really need to re-focus on these things so that when peace returns in the area, especially in the border areas, people will have alternatives for making a living. Security is not a big issue. It can be done by local people. You don't need expatriates; there are already plenty of entrepreneurs in that area. You're talking about very small numbers for the textile market, but symbolically it's very important because it will give people hope. This would be a good way for the U.S. government and Congress to send a message to people in the border areas: we want you to have a better, peaceful future.....
Pakistan Agribusiness service provides proprietary medium term price forecasts for key commodities, including corn, wheat, rice, sugar, cocoa, coffee, soy and milk; in addition to newly-researched competitive intelligence on leading agribusiness producers, traders and suppliers; in-depth analysis of latest industry developments; and essential industry context on Pakistan's agribusiness service.
Pakistan's agricultural output has steadily declined in its contribution to GDP in the past decade, down from 24.0% in 2000/01 to 20.9% in 2010/11. That said, the sector still employs the largest number of workers in the population and we expect the industry to remain a government priority as the country deals with issues of food security and the vulnerability to natural disasters. Over the long term, we foresee the dairy, poultry and wheat industries as benefiting the most from increased investment.
However, despite the existing network of irrigation systems across the country, we believe that significant improvements in infrastructure and better supply chains will have to be implemented in order for the country to reap the full benefits of its fertile soil.
- Rice production out to 2015/16: 7.5% to 7.3mn tonnes. We expect the country to increase its share in the basmati rice trade as production expands over our forecast period.
- Wheat consumption out to 2016: 14.2% to 25.3mn tonnes. Consumption growth will be driven by rising incomes and population growth, as well as increased access to good-quality milk.
- Sugar production out to 2015/16: 35.1% to 4.8mn tonnes. Large-scale consumers such as confectioners, candy makers and soft drink manufacturers account for about 60% of the total sugar demand and will be the main drivers of growth.
- 2012 Real GDP Growth: 3.8% (up from 2.4% y-o-y in 2011; forecast to average 3.7% from 2011 to 2016).
- Consumer Price Inflation: 11.2% average in 2012 (down from 13.7% in 2011).
- Central Bank Policy Rate: 12.0% (lower than 14.0% in 2011)
South Asia rice exporters should benefit the most from the recent rice trade disruptions out of Thailand. So far, traders report that more than 100,000 tonnes of rice for export have been stalled as a result of the country's worst flooding in decades. Some sources estimate that this could rise to more than 300,000 tonnes. Given these developments, the spotlight has now turned to South Asia to meet demand for the grain in the near term.
Despite the recent floods, which destroyed approximately 20-30% of the sugarcane crop in the Sindh region, we forecast 2011/12 sugar output from Pakistan at 4.1mn tonnes, 2.5% up from our previous estimates. This is largely due to an overall 5-8% increase in sugarcane yields, area harvested and favourable monsoon rains during the growing season. Sugar crushing is estimated at 82% and sugar recovery at 8.8%. According to provincial reports, higher sugar prices farmers received last year, coupled with strong demand from the industrial sector, have boosted planting in the provinces of Punjab, Sindh and Khyber Pakhtunkhawah.
Federal Minister for Finance and Economic Affairs Dr Abdul Hafeez Shaikh while briefing the parliamentarians about the national economy informed that the government would receive $2.5 billion in foreign exchange in the coming months from Etisalat’s pending dues, CSF from US, and Auction of 3-G Spectrum Licence.
He highlighted the achievements so far made by this present government, hurdles and subsequent solutions in the way of Pakistan’s economy. He apprised of the three factors, which are for causing the burden on our national economy. First, great flood in 2010, which caused damage of $10 billion as estimated by the World Bank, increase in oil prices at the international level and security situation.
While highlighting the tax revenue position he said that 17 percent increase has been achieved during the last six months, export touched historical way by up to 28 percent with respect to previous year, and remittances showed a star performance. In addition to that, foreign exchange reserves touched the highest figure in the history of Pakistan, he said.
He also said that we are facing certain issues in power and gas sector, Pakistan International Airlines, Pakistan Railways (PR), and Pakistan Steel Mills (PSM) but he said that the Cabinet Committee on Restructuring of the Public Sector Enterprises has been relentlessly working on revamping these enterprises and we have made certain very good advances in this regard, and hopefully these corporations shall start functioning under the economic vision of the present government. He said these issues are overshadowing our tremendous performance in the economy and said that like PSM are always source of criticism on our government and this must be seen in the political context only. While pondering on the PR, he said that the government has managed to create a consortium of banks to provide the requested Rs 6 billion to PR and said that government of Pakistan is paying the salaries and pension of PR’s service and retired workers. Although the PR is a public sector corporation, which should by itself arrange their salaries and pensions, moreover the government is going to pay to the electricity bill of PR also.
The meeting was told that the government has reached single digit inflation and in addition to that, export witnessed an increase by 4 percent in last six months, import increased by 18 percent, which is also an indicator of increasing activity in our economic and commercial field.
The minister hoped that the government would receive $2.5 billion in foreign exchange in the coming months, from Etisalat’s pending dues, CSF form US, and Auction of 3-G Spectrum Licence. The minister has also said that the government must be credited for some of the outstanding measures taken for the improvement of the country’s poor, that is the provision of Balochistan package, funding to the Gilgit Baltistan province and AJK, plus the alleviation of poor through the Benazir Income Support Programme through which almost 6 million poor families are getting financial help. As the gas is not been provided to the fertilizer plants, the government has decided to import 1.2 million tonnes of fertilizers so that the poor farmers may not be affected. And in this regard, the government is providing subsidy of Rs 40-50 billion on the prices of fertilizer to the farmers, the minister said.
The economy is in the doldrums, but that is not news any more. What is more interesting, and more difficult to investigate, is what is happening in the world beyond the survey operator and tax collector's ambit. Papers published by the Social Policy Development Center (SPDC) in Karachi and the State Bank place the informal economy in a range of 20 to 30 percent of GDP. But most of this undocumented economy does not include strictly illegal, or shall we say criminal, practice.
that militant groups are running their own businesses (during the TNSM's movement in Swat, emerald mines were reputed to be in the hands of Maulana Fazlullah's men); that militants and terrorists are even coming up with new ways to generate funds (kidnapping for ransom being a case in point).
According to data from the UN, Afghanistan produced about 90% of the global output of opium in 2007. This fell to just over 62% by 2010 (with Myanmar accounting for most of the rest). Three quarters of the poppy production was in the provinces of Helmand and Kandahar, which border Pakistan. Domestic consumption of opium in Afghanistan is next to nil. Also, the country does not legally import the chemicals needed to process opium into heroin, although these are imported in Pakistan for legitimate uses. Almost 7,000 metric tons of opium, both raw and processed, in the form of morphine and heroin, leaves Afghanistan and finds its way to the lucrative markets of Western Europe.
Given that the global trade in opiates is estimated to have a value of some $70 billion, even a small proportion of the proceeds can make life comfortable for a lot of people in Pakistan.
With close to 80 suicide attacks in 2010, about 400 rocket attacks, and about 350 bomb blasts in addition to target killings, use of improvised explosive devices etc, its not hard to deduce that there is a significant trade in arms and ammunition in Pakistan. The ISAF container scam case led to some interesting findings. There were the obvious conclusions - including that the abuse of the Afghan Transit Trade facility is massive. More tellingly, the Supreme Court's suo moto case found that 7,922 ISAF containers simply went missing. In addition to the packed meals, the alcohol and the camp supplies stamped with ISAF logos that appear in border markets, the possibility of pilferage of more dangerous items cannot be ruled out.
The smuggling masked by the Afghan Transit Trade is another story altogether, and according to some stakeholders extends to the illegal trade in timber, antiquities and gemstones stemming from that unfortunate nation. Being a neighbor to a land-locked, war-ravaged country with no semblance of law and order was never going to be easy. But Pakistan's governance failures have made a bad situation worse.
There's much more to Pakistan's economy than meets the eye, and many of the more interesting activities are practically impossible to investigate unless someone is prepared to take considerable personal risks. The few pieces of the jigsaw puzzle that are available from public data and information paint a tantalizing picture. If the downslide of the formal economy continues, things could get even more interesting.
There has been a quiet revolution in the last two years, particularly in improved quality, access and relevance, which are the cornerstones of the Higher Education Commission (HEC).
Quality is a ‘process’ and cannot be improved overnight by dialling ‘Q’. Quality enhancement cells have been established in 81 universities which will monitor and ‘own’ quality and report to the HEC’s QA (Quality Assurance) division. Six accreditation councils, including in business and computing, have been established, and these will accredit professional programmes. An institutional performance evaluation (IPE) process has begun, and by next year, the universities will be given a scorecard on good governance. For the first time ever, universities and programmes are being ranked as per international standards, and the results will be published by the end of the year. A two-day orientation of newly-appointed vice-chancellors (VCs), facilitated by two British VCs and one American university president, was organised — also for the first time — to inculcate leadership and to improve quality in governing higher educational institutes.
Accessibility to university education among the population is now 7.8 per cent, and not 5.1 per cent as implied by Dr Tahir, and we are well on our way to reaching 10 per cent by 2015 as per the education policy, despite a 10 per cent cut in higher education funding. Pakistan spends 1.7 per cent of its GDP on education, and only six other countries in the world spend less. Of this, 0.22 per cent is spent on higher education and not 0.3 per cent as the article incorrectly states. Under these circumstances, the HEC has done wonders!
What the writer fails to mention is the new emphasis on ‘knowledge exchange’. Ten offices of research, innovation and commercialisation (ORIC) have been established this year, and 20 more are in the pipeline to bridge the gap between university research and industry. With a 30 per cent increase in research publications and PhD dissertations in the last two years, a focus on relevant research and a new programme to establish incubators and technology parks, the Pakistani higher education sector is on its way to become an economic powerhouse in the next two years.
This is the soft and quiet revolution taking place at our universities which is already becoming visible and changing the lives of millions of youth who are the beneficiaries of higher education in Pakistan.
Pakistan appears on the brink of chaos again, with the judiciary and army bearing down on its elected leaders. But already the crisis has underlined how Pakistan has changed in recent years: The military can no longer simply march in and seize power as it has done three times over the last six decades.
As a result, opportunities remain for both sides to back down. The civilian government may be able to ride it out until elections now seen likely in late summer.
"If this were the '90s, there would have been a coup a year ago," said Moeed Yusuf of the Washington-based United States Institute of Peace.
A watchful media poised to hound the generals — and a populace under few illusions that the top brass can be saviors after failing so many times before — seem to have acted as a brake on any designs by the army. The judiciary itself, although regarded by some as out to get President Asif Ali Zardari, would not sanction a coup.
It's also unclear how much of an appetite the judges have for dismissing a government that heads a coalition with a solid majority in parliament and with just one year left before it has to call elections.
Opposition parties are happy to see the government weakened. But the country's largest party, that of former Prime Minister Nawaz Sharif, is no fan of the army and might not want to come to power on the shoulders of a military intervention.
"The status quo remains, despite all the institutions coming to a head. Every scenario you paint, there will be chaos and no one benefits," Yusuf said.
To be sure, tensions are higher now than they have ever been since Zardari took office in 2008, and the crisis could yet turn in unpredictable and dangerous directions. The political turmoil has all but paralyzed governance in the nuclear-armed country, hampering American hopes of rebuilding strained ties with Islamabad and securing its help with negotiating peace in neighboring Afghanistan.
Last week, coup jitters spread after the army issued an unusual warning of "grievous consequences" for the country over a scandal involving an unsigned memo sent last year to Washington asking for U.S. help in preventing a coup in the aftermath of the American raid that killed Osama bin Laden.
But pundits and government critics alike have been predicting the imminent fall of either Zardari, Prime Minister Yousuf Raza Gilani or the government they head for much of the past four years. Each time, they have been proven wrong.
Many observers suspect Zardari's party is happy to play up conflict with the army and the judges because it diverts attention from its paltry list of achievements in office. The party may even embrace the prospect of being kicked out because it would fire up its base ahead of elections.
The Pakistan People's Party has a long history of battles with the army. Benazir Bhutto's father, Former Prime Minister Zulfikar Ali Bhutto, was executed by a military dictator in 1979. Zardari himself was elected on a massive sympathy vote after Benazir Bhutto's Dec. 27, 2007 assassination, which the party was happy to hint could have been orchestrated by elements of the army establishment.
The World Bank has observed that Pakistan’s weak economic growth is due to worsening security condition accompanied by greater political uncertainty and a breakdown in policy implementation. It predicted country’s economic growth at 3.9 per cent during the year 2012.
According to the report, GDP growth rate in Pakistan would be 3.9 per cent during the year 2012 that was 2.4 per cent in 2011. Pakistan’s weak growth outturns are also tied to the worsening security situation, accompanied by greater political uncertainty and a breakdown in policy implementation. Infrastructure bottlenecks, including disruptions in power delivery, remain widespread. However, a notable bright spot has been the increased exports, evident particularly in the first half of 2011, led by textiles that surged 39 per cent in the first half of the year.
Industrial production surged to grow at a robust 32.1 per cent annualised pace during the three months ending in October (3m/3m, at seasonally adjusted annualised rates), after falling at 9.1 and 10.1 per cent rates during the first and second quarters, respectively. Part of the strengthening in growth reflects base effects due to the widespread flooding that had hampered activity in the second half of 2010. Indeed, because the floods occurred in July and August 2010, GDP growth on a fiscal year basis (ending June-2011) slowed to 2.4 per cent from 4.1 per cent of the fiscal year 2009-2010.
Worker remittances remain a critical source of foreign exchange in South Asia. Remittance inflows to Pakistan rose by an estimated 25 per cent in 2011, partly in response to the widespread flooding in the second half of 2010. When measured in local currency terms, given the appreciation of the dollar, remittances inflows to the region grew by a more vibrant 13 per cent in 2011 (median rate). Adjusting for inflation, worker remittances inflows to the region grew by a less robust 5.8 per cent (median rate) in local currency terms.
...Pakistan is South Asia’s second largest economy, representing about 15 per cent of regional GDP.
The portion on Pakistan points out that the country’s economy firmed in the second half of 2011. Industrial production surged to grow at a robust 32.1pc annualised pace during the three months ending in October, after falling at 9.1 and 10.1pc rates during the first and second quarters, respectively.
Part of the strengthening in growth reflects base effects due to the widespread flooding that had hampered activity in the second half of 2010. Since the floods occurred in July and August 2010, GDP growth on a fiscal year basis (ending June-2011) slowed to 2.4pc.
The report notes that Pakistan’s weak growth outturns are also tied to “worsening security conditions, accompanied by greater political uncertainty and a breakdown in policy implementation”.
The report also notes that “infrastructure bottlenecks, including disruptions in power delivery,” remain widespread.
A notable bright spot has been a strengthening of exports, evident particularly in the first half of 2011, led by textiles that surged 39pc in the first half of the year.However, like India, Pakistan’s export volume growth saw a sharp fall-off in October.
Indeed, Pakistan’s export volumes fell to a minus 46pc rate in the three-months ending October.
Along with an upswing in worker remittances inflows, robust exports have supported Pakistan’s external positions and contributed to an improvement in the current account from a deficit of 0.9pc of GDP in 2010 to a surplus of close to 0.5pc of GDP in the 2011 calendar year.
The World Bank notes that monetary tightening in Pakistan brought about positive real lending rates in early 2011 as well, the first time since late 2009.
The bank points out that for South Asian nations, including India and Pakistan, domestic crop conditions and price controls are more important determinants of domestic food price inflation.
Regional monetary policy authorities face several challenges in reducing inflation.
More recently, currency devaluation has contributed to inflation as well. In Pakistan, monetary authorities have also been monetising the deficit, complicating the efficacy of other monetary policy efforts to reduce inflation.
A key factor working against monetary policy efforts is the overall stance of fiscal policy, which despite some consolidation, remains very loose.
Monetary authorities in Pakistan have responded to persistent price pressures by raising policy interest rates and/or introducing higher reserve requirements.
Lower revenue growth has contributed to larger fiscal deficits in Pakistan. Terms of trade losses are estimated at about 1.9pc of GDP for the region in aggregate. India and Pakistan saw negative impacts of close to 1.8pc of GDP – estimated January through September 2011 terms of trade impacts relative to 2010.
Remittance inflow to Pakistan rose by an estimated 25pc in 2011, partly in response to the widespread flooding in the second half of 2010.
International reserve positions in South Asia have generally improved since mid-2008. Latest readings of foreign currency holdings were equivalent to at least three-months of merchandise imports in Pakistan.
A good crop year (2011-12) in much of South Asia and sustained high regional stocks are providing a buffer for grain prices and import demand in 2012....
...Gilani’s argument (about president's immunity) is likely to be contested when the judges convene again, on Feb. 1. “On the next date, let’s hear you convince us the issue is of the president’s immunity,” one of the judges told the prime minister. “Let’s grab the bull by the horns.” In fact, however, there seems to be some doubt as to whether the prime minister will be required to appear in person for the hearing. Meanwhile the prime minister’s lawyer, Aitzan Ahsan, hastened to assure the court that his client intends to comply with the order—eventually. “The letter shall be written when Asif Ali Zardari is no longer president,” Ahsan told the judges.
Not that Zardari is in such good shape politically. His approval rating at best is just above 20 percent. Ordinary Pakistanis are struggling to hold themselves together, buffeted by inflation, energy shortages, and worry. Steel mills, railways, the national airline and other state-run enterprises are in pitiful shape as they drain the country’s already depleted treasury. Corruption and cronyism rage unchecked.
To make matters worse, Zardari still has not lived down his reputation for corruption. Back in the late 1980s, when his wife, Benazir Bhutto, was serving her first term as prime minister, Pakistanis contemptuously nicknamed him “Mr. 10 Percent,” and in 2003 a Swiss court convicted the couple in absentia of skimming and laundering tens of millions of dollars from a Swiss contract. In 2008, after Zardari was elected president in the wake of his wife’s assassination, the Swiss closed the case at his government’s request.
As if Zardari didn’t have enough problems, his generals hate him. “The military sees him as a man with no principles, who is prepared to be pro-American and pro-Indian without any ideology of his own,” says retired Lt. Gen. Talat Masood. “They consider him to be a parasite. They really look down on him.” The dislike has only worsened as the military’s relations with Washington have deteriorated. “The Army is unhappy with the Americans, and they are taking it out on Zardari,” says opposition parliamentarian and political columnist Ayaz Amir. “It’s the Army, the judiciary, it’s everyone who wants his scalp.”
“The military sees him as a man with no principles,” says retired Lt. Gen. Talat Masood. “They consider him to be a parasite. They really look down on him.”
At present, though, time appears to be on his side. His term of office (and those of the Parliament his party controls) won’t expire until 2013. His party and its allies are expected to prevail in the upcoming Senate elections this March, and Zardari could even call for early elections this year to ensure his hold on power. Despite the government’s incompetence, his Pakistan People’s Party remains strong and well-organized and the only party with roots in all four provinces...
...After devastating summer floods caused economic growth to slow to 2.4 per cent in the 2010/11 fiscal year, ADB country director for Pakistan Werner Liepach forecast growth to pick up to just 3.6 per cent in 2011/12. The government targets an expansion of 4.2 per cent.
“Short-term there are huge challenges… (the) next few months will continue to be protracted as there are repayments and not enough inflows, reserves will go down,” Liepach said.
“But I don’t see a crash coming, and I don’t see the economy taking off either and that’s not good enough.”
There is grave concern amongst analysts about a possible balance of payments crisis as Pakistan’s current account deficit has widened to $2.154 billion in the first six months of the 2011/12 fiscal year.
Pakistan had a surplus of $8 million in the same period last year.
The deficit is likely to widen further in the coming months because of debt repayments and a lack of external aid.
The country’s foreign exchange reserves stood at $16.90 billion in week ending Jan. 13, compared with its record of $18.31 billion in July last year.
The pressure on reserves is likely to continue especially as IMF repayments start from next month.
Pakistan has to repay IMF about $1.1 billion by the end of 2011/12 fiscal year.
“Pakistan has huge potential and not all is negative or gloom and doom,” said Liepach. “I am positive in the long term if right decisions are taken today.”
Pakistan has been criticised over its slow implementation of fiscal reforms which include elimination of energy subsidies and restructuring of the state owned utilities.
The government also received criticism for not being committed towards implementing the necessary reforms to bring the economy back on track.
“The people who we are talking to in the government, technocrats, they are committed and want to see the benefits and improvements in Pakistan, they are very sincere in bringing a change in Pakistan,” said Liepach.
“But when you move away from the technocrat level, that’s when it becomes more complicated. It is a complex decision making system.”
Focus on projects and delivery of results
ADB’s focus and therefore assistance largely now revolves around projects with four core areas, energy, urban services, water infrastructure and irrigation, and transport.
“We want to fight poverty through growth and right now our business is focused on implementation of projects and to get results on ground,” said Liepach.
ADB does not require a letter of comfort from the IMF for approval or disbursement of project-based assistance.
ADB has an envelope of $2.9 billion for energy for Pakistan until 2016, out of which $1.4 billion has been utilised and $1.5 billion remains to be drawn down by the government.
Pakistan’s power sector faces a shortfall that often peaks at 5,000 megawatts per day.
For urban services, the board has approved $300 million, out of which $260 million remains, water infrastructure and irrigation $900 million has been approved with about $400 million left to be drawn down and $1.1 billion has been approved for transport, and $700 million is left.
Government can draw down the assistance when a project is approved and made effective.
“It’s a success when power reaches families and industries or when water becomes available to the families etc,” said Liepach.
The Karachi stock market was dominated by bullish sentiment during the week as news regarding the proposals sent by Securities and Exchange Commission of Pakistan (SECP) to the Ministry of Finance pertaining to capital gains tax (CGT), withholding tax (WHT) and disclosure of the source of income created positive investor sentiment.
Furthermore, the announcement in the KSE regarding the visit of Finance Minister Hafeez Shaikh on the last trading day also provided impetus to the market as he is expected to announce some major changes to the CGT regime.
The Karachi Stock Exchange (KSE) 100-share index gained 760.22 points or 6.9 percent to close at 11, 774.68 points as compared to 11,014.46 points of the previous week.
“The 100-share index rallied 6.9 percent during the week, highest since April 03, 2009 (146 week high),” said JS Sec analyst Naveed Tehsin. “However, foreigners remained net sellers, offloading shares worth $3.7 million.”
Positive expectations related to the CGT issue ruled the market sentiment, while continuing global economic crisis and uncertain domestic political environment failed to dampen investor confidence, he said and added that moreover, the circular debt adjustment worth Rs 150 billion through issuance of Term Finance Certificates (TFCs) and the raid by Competition Commission of Pakistan (CCP) at All Pakistan Cement Manufacturers Association (APCMA) office were the major highlights of the week.
News regarding the proposals sent by SECP to the Ministry of Finance pertaining to CGT, WHT and disclosure of the source of income created positive investor sentiment.
The government of Pakistan has decided to adjust circular debt worth Rs 150 billion through issuance of TFCs. Reportedly the banks have agreed to subscribe to these issues that is likely to provide relief to the energy and banking sectors by converting loans of the energy companies into TFCs. Despite this news, banks and electricity sectors underperformed the market by 2.8 percent and 3.6 percent, respectively.
The daily turnover increased 456.69 percent to close at 178.42 million shares as against 32.05 million shares of the previous week.
“Stocks closed bullish during the week with record high trades on the last trading day of the week,” said Arif Habib Investments Ltd Director Ahsan Mehanti. “Hopes of good news regarding CGT issues supported the market while positive revision in Pakistan economic growth estimate to 4 percent, recovery in global stocks, foreign interest in blue chips and statement issued by White House on US, Pakistan to work together to reset ties played a catalyst role in the bullish sentiment at KSE.
Sharmeen Obaid-Chinoy became the first Pakistani filmmaker to earn an Oscar nomination with her film Saving face, which was nominated in the “Documentary, short film” category as the Oscar nominations were released on Tuesday.
Obaid, who has directed several documentary films, won an Emmy award in 2010 for her documentary Pakistan: Children of the Taliban.
Saving face, which the Karachi-based filmmaker has co-directed with Daniel Junge, depicts the life of a British Pakistani plastic surgeon who donates his time to heal acid victims in Pakistan.
The film is set to be released in March this year, while the Oscars will be held on February 26.
Car sales in the first half of current fiscal year went up by 20.5 per cent amid negative developments including the government’s decision to impose a ban on CNG kits and cylinders, suspension in production of Honda Civic and City and increase in prices of all vehicles.
According to figures shared by the Pakistan Automotive Manufacturers (PAMA), consumers purchased 12,240 more cars in July-December 2011 to 71,886 units as compared to 59,646 units in the same period of 2010.
Increase in production of Suzuki Mehran and Suzuki Bolan for onward supply to Punjab government’s Yellow Cab Scheme was the main reason that averted the negative impact of ban on CNG kits and cylinders and production halt of Honda cars on the overall production figures.
However, local assemblers are still perturbed over the government’s decision of imposing ban on CNG kits and cylinders. In this regard, Pak Suzuki Motor Company Limited (PSMCL), which holds over 50 per cent market share, may suffer more as it used to roll out 80 per cent CNG fitted vehicles out of its total production. Assemblers added that six months sales had risen due to previous orders and the impact of government’s decision would be visible in coming months. It must be noted that Toyota Corolla, which also launched CNG fitted vehicles few months ago, might also be affected by this decision.
Sarfaraz Abbasi, an analyst at Summit Capital, linked the growth in auto sales to removal of 2.5 per cent special excise duty and cut in the rate of General Sales Tax (GST) from 17 to 16 per cent.
Car sales in December 2011 plunged due to 92 per cent decline in sales of Honda Cars and flat sales of Indus Motor Company.
Honda Atlas Cars has suspended Civic and City production for December 2011 to January 2012 owing to non supply of parts from Thailand. Civic and City sales in December 2011 were recorded only 49 and 22 units as compared to 369 and 528 units in November 2011 respectively.
Nauman Khan of Top Line Securities said December 2011 sales declined as buyers preferred to defer orders due to year end phenomenon.
“Despite launch of new variants by the company in 1600cc segment and CNG vehicles (Eco), Toyota Corolla sales showed a decline on account of reduced farm income amid falling cotton prices,” he added.
Mehran leads: According to PAMA figures, production and sales of Mehran stood at 15,343 and 17,014 units as compared to 11,995 and 11,591 units in July-December 2010. Production and sales of Bolan rose to 8,052 and 8,848 units as compared to 6,978 and 6,483 units.
While other manufacturers suffered production and sales in December 2011 as compared to November 2011, production and sales of Mehran in December 2011 surged to 2,697 and 2,880 units as compared to 2,262 and 2,720 units in November 2011.
The production and sale of Bolan in December 2011 recorded at 1,603 and 1,968 units as compared to 1,380 and 1,369 units in November 2011.
Daihatsu Cuore continued to suffer as its production and sales plunged to 2,060 and 1,884 units in July-December 2011 as compared to 3,051 and 2,959 units in the corresponding period of 2010 due to reports of closure of its production in Pakistan from March this year.
Sale of Suzuki Cultus and Alto rose to 7,034 units in the last six months as compared to 5,599 while sale of Alto increased to 6,779 as compared to 5,762 units.
In 1,300cc and above, a total of 2,664 units of Honda Civic and 4,197 units of Honda City were sold in the last six months as compared to 2,918 and 3,957 units in the same period of 2010.
Suzuki Liana sales slightly stood at 199 units as compared to 188 units while Swift sales improved to 3,247 from 1,472 units.
Toyota Corolla sales grew to 20,020 units from 18,717 units.
Pakistan's Prime Minister, Yousuf Raza Gilani, has told business leaders attending the World Economic Forum in Davos that his government is stable and Pakistan is open for business.
Mr Gilani tried to convince corporate bosses that despite all the worrying news coming out of Pakistan, his country remains one of the best destinations for foreign investment.
It's a tough sell on his part, not least because of the recent political tensions and a fragile security situation at home. But also because of the country's faltering economy, with its public finances in disarray and growth hampered by the steady erosion of investor confidence.
According to the International Monetary Fund (IMF), Pakistan's economy grew by only 2.4% last year, one of the lowest in the region and way behind India, Sri Lanka and Bangladesh.
At the heart of Pakistan's fiscal problem are some chronic structural imbalances. In a country of 180 million, less than 1% of people pay income tax. Billions of rupees of government revenue never make it into the treasury because of leakages, waste and corruption.
The country's public sector enterprises - such as, Pakistan International Airlines and Pakistan Railways - are ailing due to mismanagement and blatant inefficiencies. Industrial production and exports are hampered by crippling energy shortages, often leading to violent protests.
Absence of private sector investment means fewer jobs and a growing number of unemployed youths. Particularly unbearable for the majority of low-income Pakistani families was the unprecedented continuous double-digit inflation during most of Mr Gilani's four years in office.
Critics of Mr Gilani say that in the face of his government's dismal economic performance, his upbeat statements show the government is either in denial or ignorant of realities.
"During the last four years, we have seen four governors change hands at the State Bank of Pakistan, four finance ministers, four finance secretaries, and five heads of the Central Board of Revenue," points out Dr Ashfaq Hasan Khan, a former adviser to Pakistan's Ministry of Finance.
Economist S Akbar Zaidi believes there is a silver lining and rejects predictions of Pakistan's imminent economic collapse.
"Yes, Pakistan's economy is struggling, but it is not in a freefall or even on the verge of it," he says.
"In fact, in my view, the economy is doing surprisingly better than expected under the circumstances. The economy has shown itself to be much more resilient than many people would like to admit. With necessary structural reforms, Pakistan has all the potential to rise above its current low growth trap."
To be fair, Mr Gilani got off to a bumpy start when he came into office in 2008. It proved to be a disastrous year for Pakistan's economy, mainly due to external shocks it suffered from the sudden rise in world oil prices and the global financial turmoil. .....
In Pakistan’s diversity lies a measure of its resilience. This was argued by distinguished journalist and author Anatol Lieven during his talk at the Oxford University Head Office on Saturday.
Mr Lieven’s talk basically gave a sketch of his book ‘Pakistan: A Hard Country.’ He began by asserting that Pakistan was not a failed state and said the people who had gathered to listen to him were proof of it. Pakistan was not Afghanistan, Chechnya or Somalia. He maintained that his book was about the sources of resilience in Pakistan, which could be sources of stagnation as well (in terms of development). To explain his point, he said he had used the expression ‘Janus-faced’ many a time in the book, and that the editors had made 18 deletions of the phrase, leaving just half a dozen. The book was an attempt at discussing power in the country, how it is exercised and what are its roots – religious, cultural etc. This central theme was set against the background of the war in Afghanistan and the rise of militancy in Pakistan. He told the gathering that when an American publisher read it he was taken aback because he had thought that it would be about the Taliban and an impending Islamic revolution in Pakistan. He added that it also discussed the role of the military and the four provinces and the difference within those provinces.
Mr Lieven said he had spent a lot of time talking about the diversity in Pakistan. For example, how Karachi was different from the rest of Sindh and how Punjab was an immensely varied region. Also, the important role that kinship played in the country’s politics and power struggles. In his view, a measure of its resilience lay in the country’s diversity, because of which, however, it was sometimes difficult to get things done. He argued that Pakistan couldn’t have an Iran-style revolution because it didn’t have a monolithic culture.
Mr Lieven said that as he was a journalist he got quotes from the Pakistani people in their own words. The problem with the West was that it didn’t listen to people directly and therefore had a flawed understanding of things. If you were to know about the tribal justice system in Balochistan, you had to talk to a Baloch sardar, he pointed out.
With respect to militancy in Pakistan Mr Lieven said that although the fear of terrorism was pervasive, and that it had claimed numerous victims, the insurgency was limited, particularly after the 2009 Swat operation in which militants were driven back. However, he added that insurgency was common in the region and, except for Bangladesh, every country had faced it.
Mr Lieven said sympathy for the Afghan Taliban in areas like Peshawar was similar to the support for the mujahideen in the ‘80s. It did not necessarily mean an Islamic revolution. He argued that up to a certain point the situation did appear perilous but the post-Musharraf scenario proved that if the state and the army made a concerted attempt things could be done. He said his book also took issue with the US foreign policy. The US should realise that Pakistan is a much more important country than Afghanistan and that it needs to tread lightly here. He said however that the Osama bin Laden operation had impacted public opinion in the US, and if there was a terrorist attack in the US or India in future, US retaliation could be severe. It was important for Pakistan to continue visible cooperation against international terrorism, he remarked.
Replying to a question, Mr Lieven said one of the reasons he used the word ‘hard’ in the title of the book was that he would often hear the phrase ‘Pakistan is a hard country’ from the locals. He gave the example of a Chaudhry in Punjab who, explaining the killing of his detractors, commented that Pakistan was a hard country....
“Drama sells beautifully,” said Anatol Lieven, “You see a headline, ‘Pakistan on the edge of destruction’ it does wonders for selling the news. Lieven, a British journalist, was speaking with The Express Tribune at a talk organised by the Oxford University Press regarding his latest book, Pakistan: A Hard Country. Lieven admitted that the ‘West’ is not that well informed about Pakistan and those journalists who were relied on for information also liked their drama.
“No matter how angry the Pakistani government is with the US,” he said, “it is imperative for both to continue real and public cooperation.” Lieven does believe that the government had no clue about Osama Bin Laden’s presence in the country but said he was not sure about the military or intelligence. Conspiracy theories, he said, were rife in Pakistan and could be infuriating. “No one knows who killed General Ziaul Haq. But we all do know that he was killed.”
Calling the US’s decision to send troops during the May 2 raid in Abbottabad last year a ‘bad idea’, Lieven said there was some awareness in the UK and in ‘sensible’ quarters of the Washington establishment about the intrusive nature of that raid. However, he said after the Bin Laden discovery, it was difficult to maintain much of a stance against raids.
Lieven is more concerned about how the US would respond in case a terrorist act carried out in the US is traced back to Pakistan. “The reaction by the US government would be disastrous.” With the mood in the US Congress and on the street turning highly sceptical over the years, Lieven said post 9/11 even the most moderate quarters had lost their reasonableness. “The US congress is not a very sophisticated force. They are very easily provoked,” he said.
Explaining title of his book, Lieven said Pakistan was a resilient country that had over the years faced hard challenges. Lieven believes that though Pakistan was facing its toughest crisis yet, it had always survived. He said the country had bounced back from the ‘increasingly dangerous’ situation in Swat as well as from the aftermath of the recent floods.
Lieven also warned against blaming the West alone. “We cannot deny that there are certain elements in Pakistan that hold a sympathetic view of the Afghan Taliban,” he said, “and resist US policies.”
The author, who has worked for The Financial Times and is currently a professor of international relations and war studies at King’s College in London, has written six books. Lieven said an Islamic revolution in Pakistan could disintegration of the country. “People talk of the Arab Spring in Pakistan,” he said, “Though with its democratic character – no matter how flawed- Pakistan is very different from the Middle East.”
“I have received criticism for being too soft on the military,” he said during the talk later, “but it is unfair to say that the military or the government are doing absolutely nothing,” he said.
Lieven said that in his opinion the military was the only institution in Pakistan that ‘works’, but that did not imply that the military could take over the state. “I hope one thing is clear from my book,” Lieven said, “as far as civil rights, education and boosting the economy is concerned, I am with the liberals – how one gets there is another thing.”
A rally in Pakistani banking shares helped lift the bourse to end on a six-and-a-half month high on Tuesday as foreign investors snapped up local stocks on the back of expected strong corporate results, dealers said.
The Karachi Stock Exchange (KSE) benchmark 100-share index gained more than one percent for a second straight day, closing up 1.22 percent or 147.70 points, at 12,284.62 points, its highest close since July 26, 2011.
Volume fell to 162.11 million shares, compared with 196.3 million traded on Monday.
"The bullish trend continued on renewed foreign investment led by banking stocks in the earnings announcement session at KSE," said Ahsan Mehanti, director at Arif Habib Corp Ltd.
Foreign investors bought shares worth a net $3.47 million on Monday. Data for Tuesday will be released later in the day.
Winners on the KSE included Bank Alfalah, which closed 2 percent higher at 12.75 rupees, and National Bank of Pakistan, which rose 2.85 percent to 46.58 rupees.
In the currency market, the rupee ended weaker at 90.62/67 to the dollar, compared with Monday's close of 90.50/56 due to increased import payments, particularly oil.
Dealers said they were also cautious after the International Monetary Fund advised Pakistan to take immediate steps to tackle growing budget pressures and raise interest rates to contain inflation.
The IMF projected a widening of Pakistan's fiscal deficit in the 2011/12 fiscal year to 7 percent of gross domestic product, compared with the government's revised budget target of 4.7 percent.
The rupee touched a record low of 91.28 to the dollar on Jan. 9, pressured by worries about higher payments for oil imports and the country's overall economic health, especially a weakening current account.
The current account recorded a provisional deficit of $2.154 billion in the first six months of the 2011/12 fiscal year, compared with a surplus of $8 million in the same period last year, according to data from the State Bank of Pakistan.
The deficit is likely to widen further in coming months because of debt repayments and a lack of external aid.
In the money market, overnight rates ended lower at between 11.25 percent and 11.75 percent, compared with Monday's close of 11.90 percent after the central bank bought back government paper worth 37 billion rupees ($408.70 million).
The internal disagreement over whether to assuage the Pakistanis with a face-saving expression of apology or contrition is part of a larger debate within the administration as it puzzles its way through the Afghan endgame. With the United States pushing for talks with the Taliban ahead of a planned withdrawal that is to be phased in starting in 2013, Washington knows that without some help from Islamabad, America could end up bequeathing a huge safe haven to the Taliban in Pakistan, which has sought to support the Islamist group as a strategic asset.
Making matters even stickier, the debate comes in an election season when President Obama is being regularly accused of appeasement and, as Mitt Romney regularly puts it, "apologizing for America." Until now the farthest the U.S. government has gone is to "express our deepest regret" for "the loss of life, and for the lack of proper coordination between U.S. and Pakistani forces that contributed to those losses," according to a Defense Department statement issued after the report.
New rifts have also emerged in the administration over the details of the planned U.S. withdrawal from Afghanistan. Some White House officials working on the Afghanistan problem were taken aback when, on Feb. 1, Defense Secretary Leon Panetta told reporters about U.S. plans for a partial withdrawal from lead combat roles by mid-2013, before even consulting with other NATO officials. While the plan was generally agreed upon within the administration, the details had still not been clarified.
On Wednesday State Department spokeswoman Victoria Nuland, responding to harsh comments about the U.S.-Pakistan relationship from Pakistani Ambassador Sherry Rehman earlier in the day, said that "divorce is not an option with Pakistan. We have strategic interests in common, we have a lot of work to do together." Nuland added: "We're looking forward to the completion of Pakistan's internal review of our military-to-military relationship so we can get back to all the important work we have together."
The forces that compete to shape contemporary Pakistan were in plain sight in Karachi last Sunday. While at a posh creek-side hotel, literary glitterati from Pakistan and India and the South Asian diaspora in Britain and beyond gathered for the third annual Karachi Literature Festival, at the mausoleum of Pakistan’s founder, the symbolic center of the city, the Difa-e-Pakistan Council (D.P.C.), a coalition of more than 40 religious political parties and extremist groups, drew thousands to its first rally in Karachi.
In short, for all their ideological diversity, the liberal left and the extremist right now agree that Pakistan needs to better protect its interests and negotiate a more equitable partnership with the United States. This consensus could be the basis for a new national discourse that engages the viewpoints of all stakeholders. After all, a shared vision for the country could help bridge its ethnic and sectarian fractures.
But as NATO supply lines reopen this week and a national security committee dithers about how to reframe the U.S.-Pakistani relationship, coherent policymaking still seems far off. Pakistan’s leaders simply have too little interest in representing the views of their constituents, no matter how similar those are.
The Karachi Stock Exchange’s (KSE) benchmark index improved by 37 points on select buying in cement, banking, fertiliser and energy stocks, as investors continued to take position in those stocks, which announced healthy earnings in the ongoing results season, dealers said on Monday.
“Earnings excitement kept investors’ moral amid the market on higher side,” said Samar Iqbal, an equity dealer at the Topline Securities, adding that the developments related to the capital gains tax regime did not allow the market sustain intraday high gains. The benchmark KSE-100 Index increased by 37.14 points, or 0.29 percent, to 12,743.66 points. This was a new record high level of 45-month. The index moved either side of the fence by 136.52 points between intraday high of 12,790.52 points and a low of 12,654 points.
The KSE-30 Index surged by 35.56 points, or 0.30 percent, to 11,880.70 points.
The UBL was the star performer as it closed with one-day maximum increase of five percent, or Rs3.32, at Rs69.73. The stock ranked at the third position among the top volume leaders with 6.58 million shares. Moreover, UBL alone drove the index higher by 17 points.
Other stocks, which strengthened the index included MCB Bank, Allied Bank Limited, NIB Bank, Meezan Bank Limited, DG Khan Cement, Engro Corporation, Fauji Fertilizer Company, Pakistan Oilfields Limited, Pakistan Petroleum and PTCL.
The Oil and Gas Development Company drove the index down by 15 points. It closed at Rs165 with a loss of 52 paisas on a turnover of 397,491 shares.
“DG Khan Cement continued to remain in the limelight and closed four percent up along with Lafarge Pakistan that also gained four percent as investors believed that the cement companies’ profits will further improve.” Moreover, investors focused on the FBR-related development on the CGT reform package, she added. Hasnain Asghar Ali, a market analyst, added that the news reports regarding an increase in holding period for CGT computations led to a sluggish start.
“The FBR may increase stock holdings period to 120 days from previously 90 days so that the investors will not be asked to disclose their source of income.”
Hefty trading in mid-tier and low-priced stocks, however, disallowed the initial negativity to stay for a long period, he added.
Volumes increased to 205.79 million shares from 192.34 million shares traded in the previous session on Friday. The market capitalisation improved by Rs9 billion to Rs3,319 billion.
Out of the total 365 companies’ traded stocks, 151 declined, 145 advanced and 69 remained unchanged.
Jahangir Siddiqui was the volume leader with a turnover of 22.36 million shares as it closed at Rs10.49 with a loss of one paisa followed by DG Khan Cement with a turnover of 20.89 million shares as it closed at Rs28.23 with an increase of Rs1.07.
PESHAWAR, Mar 4 2012 (IPS) - With no money to see a doctor, Gul Lakhta,50, had resigned himself to blindness when a ‘mobile hospital’ drove into his village in the Bajaur Agency of the Federally Administered Tribal Areas (FATA), on Pakistan’s rugged border with Afghanistan.
“They operated on me the same day. Now, my eyesight is excellent,” says Lakhta, a beneficiary of the Mobile Hospital Programme (MHP) started by the government in 2003 to provide healthcare to people in the war-torn areas of northern Pakistan.
After the United States-led coalition forces toppled the Taliban government in Afghanistan in 2001 its leaders fled across the border to the FATA and adjacent areas, bringing with them their fundamentalist ideology and culture of violence.
Before long, the Taliban had unleashed a campaign of bombings against their hosts, targeting schools, health facilities, markets, government buildings and forces, bringing life to a virtual standstill in the seven agencies that make up the FATA.
“In the process, Taliban militants also destroyed 60 health facilities, forcing patients to travel to Peshawar and beyond to seek treatment for even minor ailments,” said Dr Niaz Afridi, head of the MHP in the FATA.
The government allocates Pakistani rupees 60 million (660,000 dollars) per year for the programme and there are plans to expand it, Afridi said.
These clinics-on-wheels have proved a blessing for the patients because they are well-equipped and manned by dedicated teams. Currently they provide treatment to 90,000 patients annually.
“We also organise medical camps in areas which are inaccessible by the regular medical workers and our medical teams visit the remotest areas to reach the patients and provide diagnosis and treatment free,” Afridi said.
Dr Nauman Mujahid, development officer for health services in the FATA, said the MHP is manned by a staff of 150, including physicians, surgeons, gynaecologists and other specialists like ophthalmologists and dentists.
Each vehicle is equipped with a generator that powers a mobile operation theatre, a dental unit, x-ray and ultrasound machines and laboratories that allow for quick diagnostics.
“Critically-ill patients who require hospitalisation are referred to tertiary care centres in Peshawar,” said Mujahid.
The programme started with the South Korean government donating 14 mobile clinic units in 2003 to help the people in the insurgency-hit areas of the FATA.
Although the process of the rebuilding damaged health outlets is in progress, the MHP will, because of its popularity, continue to operate in the FATA with a fleet that was augmented in 2010 by the government.
Mobile hospitals are particularly effective in ensuring that patients who need to be on drug regimens lasting several months get their doses. This is especially so in the case of tuberculosis (TB) patients who, if improperly treated, can develop drug resistant strains that can endanger a community.
Waqar Ali, 46, who was diagnosed with TB at a free medical camp in North Waziristan three months ago, is now on medication he must take for eight months. “I am feeling better and do my farming like normal people,” he told IPS.
Authorities take care to notify people in areas where the camps are going to be held about a week in advance. Often announcements are made from the mosques.
Talking to IPS, Dr Bilqees Qayyum, a gynaecologist on the rolls of the MHP, says that people often come to the medical camps in droves with a variety of complaints.....
When I ask entrepreneurs in most countries what drives them to innovate and succeed, they give similar answers: Inspiration. Passion. Vision.
During a recent trip to Pakistan, I heard those same responses. But after spending a week talking to Pakistani entrepreneurs, I realized that for them these qualities are mere afterthoughts. What really drives them is their country. Above all they are propelled by the desire to pull Pakistan out of its political and economic abyss and back to some semblance of normalcy. Their patriotism, combined with their entrepreneurial drive, makes me bullish on Pakistan.
Pakistan is in crisis. Serious and sobering crisis, not the rhetorical and idealistic “there is opportunity in crisis.” Security is a real threat. Corruption is a crippling problem. There is no confidence in the country’s laws, courts, or leadership. The Council on Foreign Relations recently issued a report on Pakistan that lists state collapse and authoritarianism as two possible future scenarios for the country. That is why I was surprised to hear from every entrepreneur I met with that not only did he or she believe in the country, but that his or her business was “about Pakistan.”
That was the response Shamoon Sultan gave when I asked him to describe the company he founded in 1998, Khaadi. The country’s leading design textile retailer, Khaadi produces high-quality fabrics and ready-to-wear his and hers loose shirts known as kurtas. They are products made out of locally sourced material and woven by local artisans. Most interestingly, they are products for locals who are not deterred, as I witnessed in one of 14 nationwide shops, by Khaadi’s high prices.
“For a country, it is important to create brands,” the soft-spoken and immaculately groomed Sultan said over breakfast at the garishly lit Marriott Karachi.
For him, a graduate of the prestigious Indus design school, Khaadi is a brand that reflects Pakistan’s rich tradition of handloom crafts and textiles. (Textiles account for 11 percent of Pakistan’s GDP.)
He isn’t necessarily selling something. “It’s not about the profits,” he said. He is the son of a successful businessman with options to leave the country, so that much was clear.
Much like Ralph Lauren tying his brand to America, Khaadi is the trim, bearded Sultan’s effort at providing an experience for his fellow countrymen to display pride. More importantly, he has created an enterprise where outsiders see another side of his country.
“Pakistan has a huge perception challenge,” said Monis Rahman, CEO of the Lahore-based Naseeb Networks. “That is interfering with investment that is badly needed to fuel growth.”
It has not interfered, however, with Rahman’s individual ability to raise capital for his several startups—capital raised not in Pakistan, but in Silicon Valley.
Naseeb launched that September with 10,000 users. Six months in, the number rose to 80,000. That Pakistan has, according to Morgan Stanley, the third-fastest-growing number of Internet users made Naseeb.com’s prospects even brighter. And it firmly proved Rahman to be a worthy entrepreneur.
True to that identity, a few years later, in 2005, he launched another Web platform, this time through his own funding. It was a job-search site, Rozee.pk, which today is Pakistan’s No. 1 online employment site. Over 30,000 employers, including U.S.-based firms such as McDonald’s and Coca-Cola, advertise on Rozee.pk.
Read more: http://www.portfolio.com/companies-executives/2010/10/26/pakistani-entrepreneurs-are-in-it-for-country-and-profit/
The adage that you can't judge a book by its cover is apparently not true in the case of Pakistan. Consider the following top ten recently published books on Pakistan: (1) Pakistan: Beyond the crisis state ; (2) Playing with fire: Pakistan at war with itself . (3) The unraveling: Pakistan in the age of jihad ; (4) Pakistan on the brink ; (5) Pakistan: Eye of the storm ; (6) Deadly Embrace: Pakistan, America and the future of global jihad ; (7) Fatal Fault Lines: Pakistan, Islam and the West ; ( 8) Pakistan: the most dangerous place in the world ; (9) Pakistan Cauldron: conspiracy, assassination and instability ; (9) Pakistan: The scorpion's tail ; (10) Pakistan: terrorism ground zero.
To top it all, The Future of Pakistan, which is a collection of essays by noted Pakistan-hands, makes bold to provoke the debate of "Whither" Vs "Whether" Pakistan.
Pakistan is wracked by ten major crises. (1) Crisis of Economy - this is characterised by stagflation, dependency, resource scarcity and mass impoverishment. (2) Crisis of Education - this is characterised by the Madrassah challenge, jihad indoctrination, English- Urdu apartheid. (3) Crisis of Urbanisation - this is characterised by slum development, criminalisation, ethnic warfare. (4) Crisis of Demography - this is characterised by a youth bulge, religious conservatism and class volatility. (5) Crisis of Foreign Policy - this is characterised by conflict, isolation and estrangement. (6) Crisis of terrorism and radicalisation - this is characterised by Islamic extremism, violent sectarianism and ethnic separatism. (7) Crisis of Civil-Military Relations - this is characterised by military domination and civilian incapacity. (8) Crisis of Political System and Governance - this is characterised by corruption, incompetence and autocracy. (9) Crisis of Law and Order - this is characterised by stateorgan failure and constitutional gridlock. (10) Crisis of Identity - this is characterised by tension between notions of Nation- State vs Pan- Islamism, being primarily Pakistani Vs Muslim, and having South Asian Vs Middle-Eastern roots.
Read more at: http://indiatoday.intoday.in/story/the-pakistani-state-is-staring-at-a-dark-abyss/1/185216.html
Pakistanis continue to defy economic and security odds with unprecedented democratic reforms, economic recovery and vitality of civil society and march forward in key areas of development.
This was stated by top Pakistani officials at a World Bank forum, where international experts acknowledged that this wide-ranging resilience - which is ignored in the global media - is a major cause of hope and optimism for future of key South Asian nations, according to a message received here on Tuesday.
Finance Minister Dr Abdul Hafeez Shaikh and Ambassador to the United States Sherry Rehman, speaking at the panel discussion on ‘Pakistan: The Untold Story’ highlighted the fact that the Pakistanis are determinedly grappling with challenges as the people and their elected representatives strengthen democratic institutions, vital to development of the country. Ambassador Robin Rahpeh, US Coordinator for Non-Military Assistance to Pakistan, Nancy Birdsall, President of Washington think tank Center for Global Development, Mohsin Khan, a leading Pakistani economist at the International Monetary Fund and Professor Anatol Leieven, writer of Pakistan: A Hard Country, also spoke about Pakistan’s inspiring performance in various fields of endeavour and reforms that the country needs to step up its development. World Bank Vice President Isabell Guerrero moderated the discussion. The finance minister, who led a team of economic managers to the International Monetary Fund (IMF)-World Bank meetings, said he draws inspiration from the strong character of the founder Quaid-i-Azam Muhammad Ali Jinnah and ordinary Pakistanis who face off daily pressures of life and continue to contribute to the development of their country. He said it would take Pakistan a combination of measures - including focus on human development, steps towards sustained high levels of exports and an appropriate mix between the roles of government and the private sector - would help Pakistan tide over difficulties and move forward as a stable economy.
“Underlying all this will be the role of institutions and most remarkable feature in Pakistan right now is the strengthening of the democratic and civil society institutions including the parliament, court, media, the State Bank of Pakistan, Securities Exchange Commission are free and working autonomously.”
He pointed out that overseas Pakistanis have great confidence in their country and are remitting unprecedented amounts back home.
Ms Rehman, spotlighting some of the Pakistani achievements that are not reported in the global media, told the gathering of experts that Pakistan offers a great deal of resilience and hope.
“A historic shift is taking place, institutions are being built in Pakistan, there is movement towards a democratic accountable structure of the government, among the untold stories in the last four-and-a-half-year is that for the first time Pakistan’s democracy is witnessing a peaceful transfer of power, we finished Senate elections recently and the parliament has been empowered.” Pakistan, she said, wishes to live not just as a responsible country but wants to see its people live as global citizens. Pakistan is renegotiating its social contract with its own people. She also cited enactment of a series of laws and constitutional amendments that empower the provinces, ensure protection of women’s rights. She said martyred prime minister Benazir Bhutto remains an inspiration for women’s rights.
This is a story affecting millions of Pakistanis — and it does not involve suicide bombings, honor killings, extremism or President Zardari's mustache.
"What would you like to be when you grow up?" I asked Sakafat, a boisterous 12-year-old girl, while visiting a remote Pakistani village in the Sindh province.
"A scientist!" she immediately replied. "Why can't we be scientists? Why not us?"
The confident Sakafat lives in Abdul Qadir Lashari village, which is home to 500 people in Mirpur Sakro. It is in one of the most impoverished regions of Pakistan.
There was a characteristic resilience and optimism in this particular village. This should come as no surprise to anyone who knows anything about Pakistan's often dysfunctional, surreal yet endearing daily existence.
The 500 villagers live in 48 small huts, except for the one "wealthy" family who recently built a home made of concrete. The village chief, Abdul Qadir Lashari, proudly showed off his village's brand-new community toilets, paved roads, and water pump that brings fresh water to the village.
These simple, critical amenities, taken for granted by most of us in the West, resulted from the direct assistance of the Rural Support Programmes Network, Pakistan's largest nongovernmental organization. RSPN has worked with thousands of similar Pakistani villages to help them achieve economic self-sufficiency.
I visited the Sindh village with RSPN to witness the results of using community organizing to alleviate poverty. The staff told me its goal was to teach villagers to "fish for themselves."
Every household in the Abdul Qadir Lashari village was able to reach a profit by the end of 2011 as a result of professional skills training, financial management, community leadership workshops and microloans.
Specifically, a middle-aged, illiterate woman proudly told me how she learned sewing and financial management and was thus able to increase her household revenue, manage her bills, and use a small profit to purchase an extra cow for the family. She was excited to introduce me to her cow, but sadly due to lack of time I was unable to make the bovine acquaintance.
Asked what single thing she felt was most important most for her village, she replied education. Upon asking another elderly lady what she wishes for Pakistan, she repeated one word three times: "sukoon," which means peace.
When it was time to depart, the people of the village presented me with a beautiful handmade Sindhi shawl, an example of the craftwork the villagers are now able to sell for profit.
As I left the village with the dark red, traditional Sindhi shawl adorned around my neck, my thoughts returned to the 12-year-old girl, Sakafat, who passionately asked why she couldn't become a scientist.
I looked in her eyes and could only respond with the following: "You're right. You can be anything you want to be. And I have every confidence you will, inshallah ("God willing"), reach your manzil ("desired destination").
By focusing on education and local empowerment to lift the next generation out of poverty, Sakafat's dream could indeed one day become a reality for all of Pakistan.
Engro Foods Ltd. (EFOODS), Pakistan’s biggest maker of packaged milk, may record an 80 percent increase in net income this year as demand for dairy products rises, the chief executive officer said.
Profit may cross 1.6 billion rupees ($17 million) in the year ending Dec. 31 compared with 891 million rupees a year earlier, Muhammad Afnan Ahsan said in telephone interview from Karachi yesterday. Net income rose to 531.8 million rupees in the three months ended June 30, from 99.2 million rupees a year ago, the Karachi-based company said in a filing to the stock exchange yesterday.
Engro Foods, which has a 45 percent share of the milk market and a quarter of the ice cream trade, may introduce as many as 13 new products and lines, Muhammad Aliuddin Ansari Chief Executive Officer of Engro Corp., the parent company, said in an interview this month. The food business may become the largest segment by profit and sales and will be the dominant area in the next five years, he said.
Engro Foods, which has climbed threefold this year, compared with a 20 percent gain in the benchmark KSE100 index, increased as much as 1 percent to 67.83 rupees at 9:33 a.m. local time
Historically, purveyors of books and magazines predicting doom and gloom have mostly been wrong but sold lots of copies.
Matt Ridley, the author of "The Rational Optimist", says that the prophets of doom and gloom from Robert Malthus to Paul Ehrlich(both predicted catastrophe of mass starvation) have always found great acceptance as "sages" in their time but proved to be completely wrong because they discount human resilience and ingenuity.
The reasons for wide acceptance of pessimists have to do with how the human brain has evolved through the millennia.
It's been established that once the amygdala starts hunting for bad news, it'll mostly find bad news.
Peter Diamandis explains this phenomenon well in his book "Abundance-Why Future is Better Than You Think".
Here's a excerpt from Diamandis's book:
"These are turbulent times. A quick glance at the headlines is enough to set anybody on edge-with endless media stream that has lately become our lives-it's hard to get away from those headlines. Worse, evolution shaped human brain to be acutely aware of all potential dangers...this dire combination has a profound impact on human perception: It literally shuts off our ability to take in good news."
In Pakistan's case, the good news continues to be the emergence of a large and growing middle class population and a vibrant mass media and civil society which underpin the country's extraordinary resilience.
Pakistan needs such resilience to complete its difficult ongoing transition to democracy which, the history tells us, has never been easy for any nation.
I believe Pakistan is making good progress toward becoming a prosperous urban middle class democracy.
The U.S. Agency for International Development (USAID) seeks bids to perform a technical engineering review and upgrade of plans for Pakistan's proposed 4,500-MW Diamer Bhasha hydroelectric project on the Indus River. Bids are due November 17.
USAID also has called for bids by October 27 to provide financial advisory services to the government of Pakistan for Diamer Bhasha. It awarded a contract in September to MWH Global to perform an environmental and social impact assessment of the project.
USAID has pledged US$200 million toward development of Diamer Basha, with funds to be used for assessment of environmental and social effects of the proposed project as well as preparation of a financial package. The project is to include a 272-meter-tall roller-compacted-concrete dam, two diversion tunnels, two underground powerhouses of 2,250 MW each, a permanent access bridge, and hydro-mechanical and steel structural equipment.
USAID/Pakistan now seeks bids for technical assessment, review and upgrade of the engineering design, cost estimates and documentation for Diamer Bhasha. The work is expected to require one year at a cost of US$5.59 million to US$6.59 million.
A solicitation notice may be obtained from the U.S. Federal Business Opportunities Internet site, www.fbo.gov, by entering Solicitation No. AID39114000059 in the "Keyword/Solicitation #" box.
Bidders are to submit separate technical and cost proposals by 4 p.m., U.S. Eastern time, November 17. For information, contact Maria Hassan, Acquisition and Assistance Specialist, Department of State, USAID Unit 62206, APO 09812-2206, Islamabad, Pakistan; (92) 51-2081285; E-mail: email@example.com.
Most photographs in Pakistan depict something awful or its immediate aftermath: suicide bombings, a horrible earthquake, even more horrible floods, unimaginable grief. The Spanish photographer Diego Ibarra Sánchez, who made Pakistan his home for five years, saw something different amid all the tragedy: hope.
His latest project, called “Resilience, Pakistan,” is the culmination of small moments from his time there, until he left in 2014 after visa problems and intimidation by the country’s main spy agency. Mr. Ibarra divided this work into two categories: “Nightmare,” for the kind of images one expects from Pakistan, and “Hope,” for less frequently seen images of daily life, like a taxi driver in his car at night, young men playing pool, even a model at a fashion show.
“I started realizing that whatever happened, Pakistanis keep moving forward,” Mr. Ibarra said. “They don’t lose their hope, they don’t stop moving to the future. I thought it was my duty to show more, to show more than the terrorism, the nightmare, that there is hope for the future.”
Mr. Ibarra, 33, left Barcelona for Pakistan in 2009 almost on a whim. He won a photo contest for taking pictures at a mall, bought a secondhand lens with his winnings, went on a brief trip to Pakistan and then packed up his belongings to move there six months later.
He started working on “Resilience” almost immediately, but didn’t realize how his photographs knit together until 2010. Everywhere, he looked for hope. He started a workshop to teach survivors of acid attacks to take pictures, and he constantly reminded himself of how Pakistanis would rush to give him anything — biscuits, curry, tea — even when they had little of their own. Many of his photographs are moody, even dark, with shafts of light that highlight a man walking, or sitting in a jail cell
“I’m always searching for this ray of light,” Mr. Ibarra said. “You know, after the storm, this ray of light that illuminates everything. This is what I’m trying to use, to explain, that no matter the nightmare there is hope.”
He walked the streets without security to take photographs, and after five years on the project, he said that the story remained unfinished and that he couldn’t pick a favorite image. “Each picture has its own moment, its own soul,” Mr. Ibarra said. “For me, each picture is some kind of gift.”
Some have a dramatic story behind them. In one, young men are silhouetted at night by fires raging after a Taliban attack on NATO supply trucks heading for Afghanistan. No one was killed in the blaze near the tribal agencies, but Mr. Ibarra, who didn’t have a permit to be there, had to flee when agents from the country’s main intelligence agency, Inter-Services Intelligence, or ISI, showed up in the early-morning hours.
There are also photographs of small acts of protest: a man nervously watching a movie in the Swat Valley, even though the Taliban loathe cinema.
Pakistan can be a maddening place to be a foreign journalist, as much of one’s effort goes toward figuring out how to work despite efforts by the government and the ISI to control stories and news events. It is a country where journalists are constantly followed, where they can be kicked out for seemingly innocuous reasons, where the daily grind of shaking someone from ISI can range between humorous and scary.
NETSOL’s Education Support Program (NESP) has proved to be a huge success after the company reported that it has hired 3 ambitious women who were the daughters of security guards working at NETSOL.
NETSOL has been actively involved in contributing to the education sector. The company has been recognized for its NESTOL Education Support Program (NESP) by PASHA Awards in 2019. The NESP Program is specifically designed to provide support to the children of underprivileged employees. The program covers almost 500 children who are working in NETSOL’s “Admin Support Function”. Moreover, the company makes sure that the children attend english-medium schools only. The students enrolled in the program can gain access to quality education from schools located all over Pakistan.
NETSOL’s effort to contribute to society has indeed bore fruit with the exciting news that three young females who are daughters of security guards have been hired in NETSOL’s IT department. The company stands true to its vision:
Note: Mani Shankar spent some time in Pakistan posted as a diplomat, serving as India's first consul-general in Karachi from 1978 to 1982. He's a former federal cabinet minister and current member of Rajya Sabha
"unlike numerous other emerging nations, particularly in Africa, the Idea of Pakistan has repeatedly trumped fissiparous tendencies, especially since Pakistan assumed its present form in 1971. And its institutions have withstood repeated buffeting that almost anywhere elsewhere would have resulted in the State crumbling. Despite numerous dire forecasts of imminently proving to be a "failed state", Pakistan has survived, bouncing back every now and then as a recognizable democracy with a popularly elected civilian government, the military in the wings but politics very much centre-stage, linguistic and regional groups pulling and pushing, sectarian factions murdering each other, but the Government of Pakistan remaining in charge, and the military stepping in to rescue the nation from chaos every time Pakistan appeared on the knife's edge. The disintegration of Pakistan has been predicted often enough, most passionately now that internally-generated terrorism and externally sponsored religious extremism are consistently taking on the state to the point that the army is so engaged in full-time and full-scale operations in the north-west of the country bordering Afghanistan that some 40,000 lives have been lost in the battle against fanaticism and insurgency.
"And yet," as was said on a more famous occasion, "it works!" Pakistan and her people keep coming back, resolutely defeating sustained political, armed and terrorist attempts to break down the country and undermine its ideological foundations. That is what Jaffrelot calls its "resilience". That resilience is not recognized in Modi's India. That is what leads the Rathores and the Parrikars to make statements that find a certain resonance in anti-Pakistan circles in India but dangerously leverage the impact on Pakistani public opinion of anti-India circles in Pakistan. The Parrikars and the Saeeds feed on each other. It is essential that both be overcome.
But even as there are saner voices in India than Rathore's, so also are there saner - much saner - voices in Pakistan than Hafiz Saeed's. Many Indians would prefer a Pakistan overflowing with Saeeds to keep their bile flowing. So would many Pakistanis prefer an India with the Rathores overflowing to keep the bile flowing. At eight times Pakistan's size, we can flex our muscles like the bully on the school play field. But Pakistan's resilience ensures that all that emerges from Parrikar and Rathore are empty words. India is no more able than Pakistan is to destroy the other country"
Retired Indian diplomat Sharat Sabharwal in his recently published book "India's Pakistan Conundrum" disabuses his fellow Indians of the notion that Pakistan is about to collapse. He faithfully parrots the familiar Indian tropes about Pakistani Army and accuses it of sponsoring "cross-border terrorism". He also writes that "Pakistan has shown remarkable resilience in the face of adversity". "Pakistan is neither a failed state nor one about to fail", he adds. He sees "limitations on India’s ability to inflict a decisive blow on Pakistan through military means". The best option for New Delhi, he argues, is to engage with Pakistan diplomatically. In an obvious message to India's hawkish Hindu Nationalist Prime Minister Narendra Modi, he warns: "Absence of dialogue and diplomacy between the two countries carries the risk of an unintended flare-up". Ambassador Sabharwal served as Indian High Commissioner to Pakistan from 2009 to 2013. Prior to that, he was Deputy High Commissioner in Islamabad in the 1990s.