D A W N    W I R E    S E R V I C E
Week Ending : 31 May, 1997                            Issue : 03/22
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                          C O N T E N T S 

N A T I O N A L   N E W S
Gross irregularities in defence expenditure
Murtaza murder probe report to be published
Talks held with US lawyers on F-16 issue: Gohar
SC orders judge to settle dispute by Feb. next 
India-Russia arms, trade ties on the rocks
Benazir demands accountability from '81
Nawaz family acquitted in bank fraud case
7 references against Nawaz shelved by govt: PPP
US gallery asked to return Gandhara era relic
Consulate employees evacuated, says FO 
Benazir says Bill aimed at victimization
Benazir made opposition leader

B U S I N E S S  &  E C O N O M Y 
5 percent difference on identical imports allowed
Union Texas acquires stakes
Wyeth Lab dissolved
Appeals process in NWFP annuls Rs270m in tax dues
Recovering defaulted loans
Govt. to be restricted on bank borrowing
Selective support emerges strong on extensive buying

E D I T O R I A L S  &  F E A T U R E S
These so-called 'encounters'                       Editorial Column
Legislation in haste                               Editorial Column
Streamlining the banking system                    Editorial Column
Body parts for sale?                                         Mazdak

S P O R T S 
Arshad disallowed to play in finals
Sri Lanka whip Pakistan to win Independence Cup
Notts terminate Zahid's contract
Mushtaq quitting job, says he is not greedy

                     N A T I O N A L   N E W S 
Gross irregularities in defense expenditure
Bureau Report

ISLAMABAD, May 24: In a recent test audit to the total allocation of
Rs109.23 billion for defense services in 1994-95, financial irregularities
to the tune of Rs3.27 billion and $118.409 million have been detected, says
a report of the auditor general of Pakistan. The test audit included
payment of salaries.
The report pointed out that initially a grant of Rs101.75 billion was
earmarked in the budget 1994-95 for the defense services. Later, a
supplementary grant of Rs7.478 billion was authorized by finance division.
The grant was further reviewed towards the close of the financial year and
certain re-appropriations within the grant were made. However, the
expenditure amounted to Rs113.05 billion-about Rs3.83 billion in excess of
even the revised allocations.
The report gave details of over 400 cases reviewed during audit by the AGP
which reflected reckless spending of public money. In a case of diversion
of funds, certain military buildings were constructed out of the "Chief of
Naval Staff Fund". The rent and allied charges amounting to Rs6.847
million, recovered from the occupants of these buildings, were deposited in
to their non-public accounts.  "Lapsable Defense Fund" of Rs2.25 million
was irregularly invested into the National Defense Saving Certificates and
Rs44.403 million, inclusive of the profit earned, were not deposited into
the government treasury.
In military land management department, several cases of corruption were
unearthed. In one of such cases, the report said, a sum of Rs7.037 million
was paid in excess to the landlords towards compensation for acquisition of
land; the reason was incorrect evaluation of the average cost of land by
the land acquisition collector.
In another case involving spares, an amount of US$100 million were found
unaccounted for in a Naval depot. When, after the expiry of lease period, a
naval ship was returned to the US government, the stores on board the ship
were not deposited in the relevant depot.
The auditor found losses of Rs64.503 million in two different cases
classified as "miscellaneous irregularities". An amount of Rs35.540 million
was found recoverable from various countries on account of charges of
training provided to their cadets in various PAF institutions.
A sum of Rs28.601 million was found unadjusted since 1989-92 against
various Pakistani embassies on account of advances or special remittances
provided for payments of travel and disturbance allowances and purchase of
The report also enlisted 41 cases involving serious financial
irregularities in the accounts of Military Engineering Services (MES)
having a financial effect of Rs88.269 million. These cases pertained to
irregularities in conclusion and execution of contracts, stores accounts,
overpayment to contractors, non-recovery of hire charges of tools and
plants, non-recovery of risk and cost amounts and overpayment to work
contractors due to deviation orders.
Defense production division sustained a total loss of Rs70,623 million and
half a million US dollars in 12 different cases of stores procurement.
Despite ban on fresh procurement of staff cars, a procurement agency got 80
Toyota Corona cars despite the fact that 123 Datsun Sunny staff cars
purchased earlier had not completed their prescribed life cycle of 12 years
and their disposal was also not on record. It involved irregular
expenditure of Rs36.097 million, the report said.
Certain stores supplied by a firm were rejected being not conforming to the
standards specifications while some items were supplied short. Despite
lapse of over five years, rejected or short quantities were not supplied by
the firm, resulting in an overpayment of $0.501 million, it added.
The report noted: "Violating the government orders regarding purchase of
common users items of three services centrally two defense procurement
agencies procured such stores at different and higher rates during a
calendar year involving an extra expenditure of Rs1.985 million."
Murtaza murder probe report to be published
By Rafaqat Ali

ISLAMABAD, May 24: The Sindh Government has assured the head of inquiry
commission probing the tragic death of Mir Murtaza Bhutto and his
supporters that the "full" report of the commission would be made public.
Sources told Dawn that Justice Nasir Aslam Zahid, head of the inquiry
commission, started writing the report only after he was assured by the
Sindh's home department in writing that the report would be made public as
soon it was received. After this written assurance, the chairman of the
commission would be at liberty to make the report public if the government
backs out on its promise.
In the recent years the inquiry commissions were constituted to probe the
cooperative societies scandal, death of COAS Asif Nawaz and the Mehran Bank
scandal. None of these reports were published fully, and only some portions
of these reports were released in an attempt to exonerate the sitting
rulers. Mehran Bank Inquiry Commission report has also gone missing.
Sources further revealed that Justice Nasir Aslam Zahid, heading the
Murtaza Inquiry Commission was not happy with the high court direction to
police to register the second and third FIR. It is rare that the courts
have directed the police to register second FIR in one incident, but in
Murtaza Bhutto case this has been done by the Sindh High Court.
Talks held with US lawyers on F-16 issue: Gohar
Bureau Report

ISLAMABAD, May 25: Pakistan has only three to four months to take a final
decision on what to do about the undelivered F-16s, warned Foreign Minister
Gohar Ayub while answering questions on the issue.
"The statute of limitation on the matter expires in 1999, but if we wait
until 1999 or even until the next year, then things would undergo a
dramatic change as no one would listen to us because by then the new
election season would have commenced in the US. So we only have three to
four months to make up our mind," Gohar pointed out.
He appeared confident of winning the court case and said that he had
discussed the matter in great detail with American lawyers and was
convinced that Pakistan had a strong case. He said Pakistan had four
options: 1. Delivery of F-16s; 2. Reimbursement of the full payment; 3.
Sale of F-16s to a third country and; 4. Go to American courts for settlement.
Gohar said the US had tried to sell our F-16s to Indonesia but due to some
problems with the Congress the sale could not go through, "now they are
trying to sell them to one of the eastern European countries-most likely
Slovania." However, Gohar pointed out that there were 500 F-16s of A and B
series standing idle in the US hangars, costing perhaps 3-4 million dollars
"Anybody can buy them and turn them into advanced aircraft's by spending
4-5 million on each. So why would anybody want to buy our F-16s which are
costlier. So it is necessary to move fast on the issue," he explained. He
said the question of full payment by the Americans had also become too
doubtful presently because no such funds are available to spare with any
relevant departments because no prior appropriation had been made.
Answering a question with regard to the subpoena served on former prime
minister Benazir Bhutto in the US during her recent visit to America, the
foreign minister said that the US has agreed to allow her the facility of
recording her statement in front of an official of the US embassy in
When asked about the matter of official secrets act which the former prime
minister had said barred her from making any public statement on the issue,
Gohar said a copy of the act had been provided to the US administration,
"and if she wants to make a statement on the matter without being made
liable, she can do so by using the forum of the national assembly. No court
of law could hold her accountable for what she had uttered inside the house."
SC orders judge to settle dispute by Feb. next 
Bureau Report 

ISLAMABAD, May 26: The Supreme Court has directed the Additional District
Judge, Rawalpindi, to settle the ownership dispute of Attock Oil Company
(AOC) between the BCCI's liquidators and Ghaith Pharaon by Feb. 28 next year.
The court had earlier directed the trial court to decide the ownership
dispute in two cases, filed in 1992 and 1993, by May 19 this year.
Dr. Ghaith Pharaon, a Saudi national, claims that AOC was handed over to
him by BCCI chief, Agha Hasan Abidi. The BCCI liquidators, however, are of
the view that it is the property of BCCI and hence they should be allowed
to sell it.
When the suits could not be decided within the prescribed time, the
International Credit and Investment Company (ICIC), which is acting on
behalf of BCCI liquidators, again filed an application for extension of date.
The counsel for Ghaith Pharaon, Mr. Abdul Hafeez Pirzada, opposed the
request for extension of time. He stated that the delay in disposal of
pending suits had occurred due to the "tactics adopted by the petitioners"
(BCCI liquidators).
Raza Kazim, counsel for the petitioner, alleged that as the respondents
held sway over the present management of the AOC, they were more interested
in delaying the disposal of the suits. The court, however, observed that
difficulties had arisen on account of reluctance of a foreign government to
allow examination of a witness who was presently undergoing imprisonment in
that country.
Raza Kazim , counsel for the petitioner, agreed that the country in
question could not be compelled by the courts in Pakistan to allow
examination of witness in their custody.
The counsel for both parties agreed that the reluctance on the part of a
foreign country to allow examination of the witness should not stand in the
way of disposal of the suit. The court observed that the onus for producing
relevant evidence in any case was on the party concerned, and it could seek
assistance only from the court.
On a query, Raza Kazim informed the court that he wanted to examine Mr.
Kazmi, undergoing imprisonment in the UAE, and in case he was unable to get
his evidence recorded, he would then examine Mr. Saleh Naqvi, serving a
prison term in the United States. He said besides examining either Mr.
Kazmi or Saleh Naqvi, he would like to examine one more witness from M/S
Campbel Security, Mr. Michael Mackey, and one of the assistants of Mackey,
in addition to Registrar Joint Stock Companies, Rawalpindi.
Mr. Raza Kazim assured the court of completing the production of the entire
evidence in the two suits before Dec. 31.
Accepting the assurance of Raza Kazim, the court observed: "In the interest
of justice, subject to the condition that the defendants alone would be
responsible for arranging the examination of these witnesses either by way
of commission or by any other means permissible under the law, time is
The court made it clear that no further extension of time for production of
evidence would be allowed. It was further observed that if the petitioner
failed to produce the witnesses by Dec. 31, the evidence would stand closed
and the cases would go ahead. The Supreme Court allowed the Additional
District Judge to conclude the cases two months after the completion of
evidence by Dec. 31.
When the counsel for the petitioner pointed out that certain proceedings
arising out of these suits were pending in the Lahore High Court, the apex
court directed him to approach the LHC Chief Justice. Earlier on April 15,
Michael W. Mackey, senior liquidator of BCCI, had visited Pakistan and
announced that another dividend would be paid to BCCI creditors by the end
of this year.
He had visited Pakistan as a part of efforts to recover BCCI assets. During
his visit he held meetings with senior officials, including the United
States Ambassador, Thomas W. Simons.
Talking to a group of journalists, Mr. Mackey , a partner of Deloitte &
Touche, said he was pleased to have paid a dividend of 24.5 percent to all
creditors last year. Hundreds of millions of dollars from this payment went
to Pakistanis and foreigners living here. Mr. Mackey observed that the
liquidators were working hard to ensure payment of an additional dividend
as soon as possible. He, however, refused to give estimates of the second
dividend on the premise that it might raise false hopes.  
Estimated liabilities of the BCCI, he said, were 10 billion dollars. He
refused to give estimates of BCCI's assets.

India-Russia arms, trade ties on the rocks
Shaheen Sehbai 

WASHINGTON, May 26: Cracks have apparently developed in the weapons trade
relations between India and Russia and defense experts believe if Pakistan
were to play its card correctly, the long-time strategic ban by Moscow to
supply arms to Pakistan may be lifted.
The first indication of differences between Moscow and New Delhi over arms
deals came in an official Itar-Tass News Agency report from Moscow last
week which actually spoke of a resumption of weapons sale to Pakistan.
"Russia is considering reviewing its stand on arms sale to Pakistan in view
of the Indian plans to buy T-72 tanks from the Czech Republic," the
Itar-Tass news agency was quoted as reporting.
The news agency report was picked up by Indian newspapers and news agencies
and the UNI report began with the words: "Russia has threatened to lift its
arms embargo against Pakistan if India went ahead with a deal with
Czechoslovakia to purchase 500 T-72 MI tanks."
The UNI report, published by the Indian Express on May 22, said Russia was
irked by reports of "confidential" Indo-Czech negotiations on the possible
purchase of T-72 tanks and as a threat against the deal was considering to
sell weapons to Pakistan. The report also quoted an unnamed official of the
Sokhoi aircraft plant in Russia as saying that "the plant was ready to
execute Pakistani order for multi-role SU-27 or SU-35 aircraft, without any
delay, as soon as the related governments give their permission." Another
Indian newspaper Telegraph of Calcutta said in a report that the "Pakistani
military establishment had managed to open the doors at the Kremlin over
time which were shut earlier."
"It is for New Delhi's strategists to decide how to either close them or
learn to share patrons in the new realities of a post-Cold war world.
Russia, stripped of its superpower status, is a much different entity to
fathom as it is driven by internal disputes, rivalries and a near-perpetual
financial crisis," the Telegraph report said.
Defense observers said the tone of the Itar-Tass report from Moscow which
talked about resuming arms sales to Pakistan was basically a "blackmail
threat" to the Indians but it did show that the Russians no longer
considered it a sacred policy not to sell arms to Pakistan, "just because
the Indians would be angry." They said if in such a situation Pakistan
could approach Moscow with an attractive and viable offer of buying "big
stuff" on financial terms acceptable to them, the possibility of supply of
aircraft, tanks and other sensitive weaponry could become a reality.
The observers said even if Pakistan had to pay a relatively higher price to
the Russians for their defense goods, Islamabad should not shy away as the
strategic advantage that such a resumption of sale would bring would be
tremendous, invaluable so to say, they added.

Benazir demands accountability from '81
Staff Reporter

KARACHI, May 27: Pakistan People's Party Chairperson Benazir Bhutto, called
upon the government to initiate the process of accountability against
corrupt people from 1981, otherwise it would be an exercise in futility.

Ms Bhutto said: "The Prime Minister's intention on this issue is good, but
people around him are trying to provide a cover-up to big fish who got
loans written off between 1983 and 1985".The political non-entities and
corrupt people, she said, had looted the national exchequer by getting
their loans written off before 1985. She demanded that names of such people
who got their loans written off between 1981 and 1983 should be made public.
Ms Bhutto asked the government to take some concrete measures and to arrest
the growing trend of inflation, unemployment, debt and population growth
instead of indulging in political victimization of opponents.
She demanded of the government to immediately release Ahmed Sadik, her
former principal secretary, and Wajid Shamsul Hasan, former High
Commissioner of Pakistan to United Kingdom, as various investigating
agencies had failed to collect any evidence of malpractice against them.
Nawaz family acquitted in bank fraud case
Staff Reporter

LAHORE, May 27: Prime Minister Nawaz Sharif's father, brothers, son and
nephew were acquitted in a bank fraud case by a full bench of the Lahore
High Court.
Two FIRs were registered on July 10 and 22, 1994 against Mian Nawaz Sharif,
Mian Mohammad Sharif, Mian Shahbaz Sharif, Mian Abbas Sharif, Hamza
Shahbaz, Hussain Nawaz, Hassan Nawaz and Abdul Hameed Butt for drawing two
loans of Rs 60 million and Rs 45 million against allegedly fake bank accounts.
Mr. Nawaz Sharif's name was later deleted from the chalan submitted by the
FIA before the Special Court for Banking Offenses. The loans were said to
have been taken as directors of Hudaibia Engineering Limited and Hudaibia
Paper Mills from Citibank and the Bank of America.
The court acquitted the accused on a writ petition filed for quashment of
the cases. The full bench, comprising Chief Justice Ijaz Nisar, Justice
Raja Khursheed and Justice Saeedur Rehman Farrukh, in its short judgment
stated that "for reasons to be recorded later in the judgment we allow the
petition and acquit the accused considering that their trial would be an
abuse of the process of the court."
The court, however, kept pending another petition pertaining to the same
case in which the FIA's authority to look into foreign currency accounts
was challenged. It will determine the FIA's jurisdiction in this regard.
Deputy Attorney-General Khwaja Saeeduz Zafar stated that the immunity
provided under the Economic Reforms Act 1992 was only regarding the source
of the money deposited in a foreign currency account. The FIA has authority
to inquire into the such accounts if a criminal case is registered against
the account holder, he added.
Defence counsel Ashtar Ausaf Ali, arguing the quashment petition, stated
that no case was made out as no person had complained of having suffered a
loss by the act of the accused.

7 references against Nawaz shelved by govt: PPP
Staff Reporter

LAHORE, May 29: The Pakistan People's Party alleged that the government had
shelved seven references against Prime Minister Nawaz Sharif sent to the
Chief Ehtesab Commissioner by the caretaker government.

"The fact that no ruling party leader has been proceeded against by the
Ehtesab Commission and that only a witch-hunt of the PPP is going on in the
name of accountability shows the government's design of settling political
scores with the PPP in the name of accountability", PPP federal council
secretary, Khalid Ahmad Kharal, told reporters.

Mr Kharal said his party favored accountability, but it must be even-handed
and across the board and the process must be transparent. The PPP would not
object to bringing its leaders into the accountability net provided the
process was extended to all political parties and bureaucrats without

Mr. Kharal said it was the government and not the Chief Ehtesab
Commissioner who was responsible for deleting references against the prime
minister. This, he said, showed that the commission was not free in sending
references to the courts.

Mr. Kharal said the case of Mr. Asif Ali Zardari was the most glaring
example of one-sided accountability. He said when the former minister was
arrested it was claimed that an amount of Rs 700 million had been recovered
from him. Later, it was also alleged that a huge quantity of gold belonging
to him was seized. The government had yet to present evidence in support of
these allegations.

US gallery asked to return Gandhara era relic
Shaheen Sehbai

WASHINGTON, May 29: Pakistan has officially accused the prestigious
Smithsonian Institute in Washington of keeping a 2,500 years old piece of
Gandhara Art, stolen from Pakistan, and has demanded its immediate return.
Pakistani officials confirmed that the request for return of the statue
"Uma Mahesvara", sculpture of a Hindu deity, was sent to the Smithsonian
Institute's Freer Gallery of Art a few days back.
A spokesperson of the gallery claimed, speaking to Dawn, that the statue
was purchased by the gallery "legally" and confirmed that an official
request had been received by Pakistan for its return. The spokesperson
refused to answer any further questions, saying the gallery would not
comment "until we have resolved the official Pakistani request."
Asked what was the gallery trying to resolve when it maintains that the
statue was purchased legally, the spokesperson declined to offer any comment.
A list of fresh questions was, however, submitted to the gallery by Dawn
under the Freedom of Information Act seeking all details of when the statue
was purchased, at what price, from whom, and how it was brought to the US.
All details of the correspondence between the gallery and the Pakistan
embassy was also sought under the Freedom of Information Act which makes it
obligatory for all agencies to reply to the questions within 10 working days.
Some unconfirmed reports here have suggested that the statue had been
smuggled into the US by a senior minister in the Benazir Bhutto government
under the cover of diplomatic baggage. These reports have also hinted that
the Scotland Yard in Britain had originally seized the statue and handed it
over to the Pakistan High Commission in London for return to Pakistan but
it mysteriously showed up in Washington.
Art experts said the Smithsonian Institute was a reputed organization and
had no history of keeping stolen property. If it were proved that the
statue had been stolen, it would be the first case in which the Smithsonian
Institute would have been found to be involved in a shady deal.
On Tuesday when Dawn made the initial inquiry from the Freer Gallery, the
spokesperson said the gallery had no budget to buy pieces of art costing
$1.5 million, as reported by some newspapers.
A Pakistan embassy spokesman said Islamabad had taken up the issue with the
Smithsonian Institute under UNESCO conventions which prohibit pieces of art
to be purchased by other countries, either legally or illegally.
Experts said even if the statue was purchased by the Smithsonian Institute
legally, it would be a violation of the UNESCO conventions.
A Pakistan official has been accused of issuing an unauthorized "no
objection certificate" for the sale of the statue but that official now
claims what he did was wrong and irregular. 
Experts said the whole case had a mysterious ring around it.

Consulate employees evacuated, says FO 
Bureau Report

ISLAMABAD, May 30: A spokesman for the Foreign Office said that there had
been a number of speculative reports in the Press about the safety of
officials posted at Pakistan's Consulate General in Mazar-i-Sharif.
The spokesman said the factual position was that the Government had
evacuated all 13 officials of the Consulate General with the help of Gen
Malik from Termez by a special UN aircraft. The evacuation was arranged
because of the precarious situation in Mazar-i-Sharif and the Consulate
General would be reopened as conditions permitted.
"The Government is deeply appreciative of the support and assistance
provided by Gen Malik, the Government of Uzbekistan and the United Nations
in arranging the safe evacuation of the personnel from Mazar-i-Sharif," he

Benazir says Bill aimed at victimization
Staff Reporter

LAHORE, May 30: Rejecting the Ehtesab Bill, PPP chairperson Benazir Bhutto
said the legislation had scuttled powers of the superior judiciary and
empowered the government to victimize political opponents.
"The Nawaz regime has used its brute majority in the parliament to give
cover to the most corrupt elements and impose a one-party dictatorship in
the country", she said while speaking at a seminar on "accountability and
corruption" organized by the PPP's federal council.
Reading out a paper, Ms Bhutto cited "specific cases of massive criminal
cover-up by the Nawaz regime". Referring to a State Bank report, presented
to the National Assembly in September 1996, she said the report held the
prime minister's family as the biggest defaulter whose loans stood at Rs5
billion borrowed from different banks. Similarly, the report contained
names of some members of President Farooq's family. But it did not include
even one member of the family of Benazir Bhutto.
She alleged that after assuming power, the PML was threatening banks for an
out-of-court settlement to whiten the entire bank loan of the Sharifs who
had also sued banks for billions of rupees. "Now when prosecutor and
defendant are one (Mr. Nawaz Sharif), we fear that Mr. Sharif's family
would get away with tax-payers' money in billions of rupees".
The former prime minister demanded retrial of Prime Minister Nawaz Sharif
in bank loans borrowed in the name of several Ittefaq Group industries,
particularly the Hudaibia Engineering Works, and some of the new ventures
for which fresh loans were being obtained. She also called for an
investigation by the chief justice into less revenue collections by the
government despite levy of new taxes. 
She said during the last few months of the fiscal year 1996-97, her
government had made bigger revenue collections and it was a matter of
concern that despite new taxation, the revenue collection had fallen. "We
fear that an amount of Rs100 billion has been embezzled".
Recalling that the opposition had rejected her government's proposal of
setting up a parliamentary committee, having equal representation of the
ruling party and the opposition, to appoint investigation and prosecution
teams to initiate the process of accountability, she said she renewed her
offer that a similar committee be constituted by the government in
consultation with the opposition for the same purpose.
As for the Ehtesab law enacted by the parliament on Thursday, she said it
usurped powers of the judge heading Ehtasab commission who stood reduced to
a clerk to Senator Saifur Rehman who was now virtually the in-charge of all
matters relating to accountability. She said the bill was presented without
a prior notice and it was got enacted with the help of the ruling party's
brute majority.
Ms Bhutto was of the view that the "Redco" (a reference to Senator Saifur
Rehman's construction company which was involved in a number of
controversies in the past) law was empowered to look into all issues before
references were sent. It also amounted to whitening black money "plundered
during the period 1985 and 1990) and would allow the Ittefaq to run away
with bank loans in billions of rupees.  The law also empowered the
government to arrest any person and put him behind bars on non- bailable
charges. It provided room for victimization of political opponents.
She charged the government that the law provided for bureaucrats becoming
approvers and frame corruption charges against political opponents. Ms
Bhutto demanded that powers given to the government Ehtesab cell be
transferred to the Chief Justice of Pakistan and two senior-most judges of
the high courts where references were to be sent. Similarly, she demanded
that Ehtesab Commissioner should be appointed from among sitting or retired
The former prime minister named her spouse Asif Ali Zardari, Hakim Ali
Zardari, Mir Munawar Ahmad Talpur, Ms Naheed Khan, Ahmad Sadik, former
foreign secretary Najmuddin Sheikh, Masood Sharif, former high commissioner
to the UK Wajid Shamsul Hasan, former FIA chief Ghulam Asghar, additional
director-general Rehman Malik, Zafar Leghari, Nisar Khuhro and others who
had been charged with corruption as "cases of political victimization".

Benazir made opposition leader
Bureau Report

ISLAMABAD, May 30: A decision to nominate PPP Chairperson Benazir Bhutto as
the leader of opposition in the National Assembly was made.
Speaker Illahi Buksh Somroo later met with the prime minister at which the
issue was discussed and they agreed to accord status of opposition leader
to Benazir Bhutto, he added.  "The formal announcement to this effect is
likely to be made in a few days," he said.
Maulana Mohammad Sheerani, a parliamentary leader of JUI was also aspiring
for the prestigious slot of opposition leader and had submitted a request
to the Speaker.
The PPP had been demanding that Benazir Bhutto should be nominated as the
leader of the house as it was the only party sitting in the opposition
benches having a strength of 17 members.
Ms. Benazir Bhutto at her recent Press conference had declared that she
would not request the ruling party to accept her as the opposition leader
in the National Assembly. She had said that she had directed her party not
to pursue her case any more with the Speaker.

                 B U S I N E S S  &  E C O N O M Y
5 percent difference on identical imports allowed
Mohiuddin Aazim

KARACHI, May 24: The Karachi Customs Appraisement Collectorate has
tightened the rules governing the assessment of value difference of
identical imports from the same source. The move is apparently aimed at
boosting customs revenue that are bound to witness a shortfall after the
lowering of import tariff from a maximum 65 to 45 percent.
The collectorate has notified that in future the difference in assessable
value of identical imports from one source should not be more than 5.0
percent. The notification provides room to accommodate a 10.0 percent
difference with the condition that it should be allowed only by the
additional collector concerned, "after proper scrutiny of records."
The notification further says that value of identical goods imported from
Europe, USA and Japan should be ascertained on the basis of highest value
as per evidence, printed price or price inquiry. It says the value of
similar imports from South East Asia, Gulf countries, ECO countries and
Central Asian States should be ascertained on the basis of lower than the
highest evidence or assessed value as in the case of Europe, USA and Japan.
Union Texas acquires stakes
Staff Reporter

KARACHI, May 26: Union Texas Petroleum, USA has decided to take 10% of the
stake in Liberty power project. An announcement by Infrastructure Capital
Group,(ICG) Washington, said the UTP would provide and operate maintenance
services of the project.
Other Liberty shareholders include: Tenaga National of Malaysia 40%, ICG
25%, Commonwealth Development Corporation (CDC) 5%, Asia Infrastructure
Development Co 10%, Energy 2%. The total equity is estimated at $79.5m
Total debt financing, according to ICG, would amount $186m including
contingencies. Of these CDC will provide $20m and AIDEC 37 million. A
consortium of banks, with ANZ, as financial advisor will extend debt
Sources close to the Liberty said that 75% of the first phase 235MW project
has been completed with all turbines and major equipment's delivered at the
site. The power generation capacity will finally be raised to 470MW. UTP's
investment, sources said, will help wrap up equity and debt financing for
the first phase project cost of $265 m.
ICG announcement said that transmission line linking the power plant to
national grid is expected to be completed by end May.

Wyeth Lab dissolved
Staff Reporter

KARACHI, May 26: The Wyeth Laboratories (Pakistan), a leading multinational
listed on the Karachi Stock Exchange, stands dissolved but without winding
up after its merger with Cyanamid Pakistan since April 30, 1997.
In a communication to the Karachi Stock Exchange, the board of directors of
Cyanamid Pakistan said the change has occurred in terms of scheme of
arrangement and amalgamation approved by the Sindh High Court on February
27, 1997.
The board also announced the share entitlement of over 0.823 million shares
of Cyanamid Pakistan, with a face value of Rs 100 each, to the existing
shareholders of Wyeth Lab, previously holding 3.5 million shares of Rs 10
Despite having a modest paid-up capital of Rs 35 million, Wyeth Lab was
considered among the blue chip shares as its share value was stable around
Rs 150 for a 10-rupee shares. It was not easy to find its share on the open
market even at this high price. The board of directors of Wyeth Lab has
already declared an interim dividend at the rate of 25% for the year ending
November 30, 1997, while it paid final dividend of 60% for the year 1996.

Appeals process in NWFP annuls Rs270m in tax dues
Bureau Report

PESHAWAR, May 28: Out of the Rs 420 million tax money which was blocked
under appeals, in NWFP, a major crunch of Rs 270 million has been annulled
after the competent authority declared the tax department's order as
An official who is holding a very important post in the tax department
confided to Dawn that, " A formerly Peshawar based income tax commissioner
washed out Rs 270 million by declaring as defective the orders, of income
tax inspectors, under Section 132 of the Income Tax Ordinance" the source
said. He added that a total of over Rs 420 m tax money was blocked under
appeals against notifications of the two income tax zones [A & B] of NWFP.
Out of this amount a major crunch of about Rs 380 million was payable as
tax by some very big shopping plazas, hotels and medicine markets of the
provincial capital while, the remaining Rs 40 million covered petty amounts
involving appeals of small shopkeepers, traders and a few of the salaried
"Contrary to denial of relaxation to appeals involving small stake holders
some of the appeals involving huge amounts were accepted and the tax money
was completely annulled under section 132 of the income tax ordinance which
gives vast powers to Commissioner Appeals to turn the balance in favor of
plaintiff", the source said.
The strange thing about the whole episode is that none of the income tax
assessment inspectors have been charge-sheeted after their orders were
declared defective by the higher authority. "No action has ever been taken
against any of the inspectors for making assessments which turned out to be
declared improper and defective by the highest authority", the official said.
The official made a point that except for few cases in which wrong
assessment were found made mistakenly, in most of the cases, he continued,
the tax levying authority intentionally leave loopholes in the orders so
that at a later stage "patch up" could be possible with the appellant.
He said in some cases the IT inspectors intentionally levy inflated tax
money and later the matter is settled, during the appeal stage with the
connivance of higher authorities, on commission basis with accepting ten to
15 percent of the total taxed money, he concluded.

Recovering defaulted loans
Sultan Ahmed

AT a time when the country is deeply indebted, both externally and
internally, talk of possible default persists despite firm official
denials, and the premier banks are on the verge of bankruptcy, three bills
have been passed by Parliament to recover the long defaulted loans of Rs
140 billion speedily.
The new strategy is to recover the loans which keep on snow-balling without
excessive intervention of courts which delay the process indefinitely and
force the borrowers honor their commitments to the banks. And that may take
the form of foreclosure of the assets pledged, their sale to recover the
loans if the loan is not paid quick or to liquidate the assets if they are
greatly damaged or obsolete.
The earlier efforts to recover the loans through banking tribunals, which
were to be raised to 50 in number, failed to produce positive results.
Borrowers filed cases in other courts as well and delayed repayment for
long, and in the process the lawyers were the greater gainers.
As a result, the defaulted loans exceeding Rs one million which stood at Rs
90 billion in August, 1993, when the caretaker government of Moeen Qureshi
came in, rose to Rs 100 billion by March, 1996 - after about 20 per cent of
the amount had been repaid - and now stands at Rs 140 billion. It has been
said that if the infected portfolios of banks and development finance
institutions were combed more carefully the total default would be far more
out of the total bank advances of Rs 523 billion as they stand today.
The courts could not be blamed exclusively for delay in recovery of the
loans and the prolonged litigation. Many dishonest senior bank executives
prepared grossly defective loan documents, did not demand enough collateral
from borrowers or inflated the value of the securities pledged in return
for large kickbacks from the borrowers. In some cases the defaulting
borrowers were close relatives of the colluding bank executives. Some of
them have left the public sector banks, some have retired and many are
still serving the banks and have been promoted in a big way because of
their political pull, bureaucratic cover or simple profit-sharing in a
blatant manner. But now action is proposed against three bankers while
others are being brought in from foreign banks to oversee them.
The time has come for a pragmatic or realistic approach to the massive
default. The default was accumulated not in years but over decades. Almost
two-thirds of the Rs 140 billion form interest on the loans and interest on
interest. And the more we try to reduce the total default, the larger it gets.
Various remedies had been suggested. Mr. Shahid Javed Burki as adviser to
the caretaker Prime Minister Meeraj Khalid on Finance set up a Resolution
Trust to take away the bad loans and try to recover them separately while
leaving the good loans with the banks and DFIs. But the Nawaz Sharif
government wants to recover as much of the loans as possible quick through
its drastic new procedures and hand the left-over bad debt to the
Resolution Trust.
What we have to realize is that large bank default today is not a peculiar
Pakistani problem, but a global issue. India's banks are afflicted by this
problem. France has this malaise in a big way. In the US the Savings and
Loan Association debacle caused a loss of 240 billion dollars to the
government. In Japan following the burst of what is described as the bubble
economy total loss to the banks is estimated at 400 billion dollars
eventually. The bad loans in China following the failure of too many state
enterprises is estimated by the Western Press experts at 700 billion
dollars. And now after some upsets to Malaysian banks, the Thai banks have
suffered enormous losses as they were allowed to borrow foreign exchange
and lend it. The collapse of property values in Japan has become the
nightmare of Thai banks.
A detailed assessment of the default crisis in Pakistan will make us
realize that some of the borrowers are dead and some have fled from the
country. Some of the industries are dead, and about 4,000 industrial units
are sick. Some of them are worth only their enhanced land value while the
machinery has to be sold as scrap. If some of the borrowers have valuable
houses or other lands, they have been mortgaged with banks separately. Some
of them had borrowed foreign exchange when it was Rs 3.33 to a dollar and
are asked to repay at Rs 41 along with the accumulated interest. If some of
them can borrow from banks and repay, the interest rates have soared to 22
to 25 per cent. They have now to borrow enormous sums to repay the little
they had borrowed decades ago.
Some of the industries which are sick are victims of fast changing official
policies, particularly the import policy which now allows manufactures once
forbidden, or high import duties on them have now been brought down to 45
per cent from 130 per cent or more. They are the victims of massive
smuggling as a result of which the government is losing Rs 50 to Rs 100
billion as revenues.  They are also victims of technological changes as a
result of which new investors are able to produce better products cheaper.
Consumer preferences, too, have changed over the years in favor of new
products. The severe setback to TV and electronic industries in Pakistan as
a whole from massive smuggling. The two million Pakistanis overseas, who
bring a vast variety of goods tax-free, is a classic example of how some of
our industries have been hurt by the legalized and hidden smuggling.
Many of the industries have been hurt by frequent load-shedding, shortage
of water, excessive holidays, frequent violence and prolonged riots as in
Karachi and Hyderabad. The security cost of the industries too has gone up
with private guards protecting the industries, the homes of the owners and
their family members, and directors in case of large companies. For some
having too many guards wherever they are have also become a status symbol.
All these enhance the cost of production, reduce domestic consumption or
arrest growth of consumption and reduce exports.
Of course, many of the industries owned by Pakistanis are born sick as a
result of large kick-backs obtained by the owners at the time of importing
the machinery. They become sicker as more kickbacks are obtained when
constructing the factory and office premises. And when the owners take too
much of the income for themselves and their family members mentioned as
directors without the requisite qualification and when family members go on
holiday which are billed as sales trips and when sons studying abroad are
shown as sales representatives and paid heavily, the company's losses have
to mount rapidly. When further loans are obtained they are abused in the
same manner.
Such abuses are not visible in multinational companies as they are not
private companies and are managed by professionals who have to repatriate
adequate profits to their headquarters for distribution among the
shareholders; otherwise the chairman and chief executive get the boot. The
Pakistani owners have no such threat or fear. Foreign companies build
enough reserve for expansion and to tide-over temporary losses, they
mobilize all the additional capital they need from the public for large
scale expansion, as the ICI did recently.
What is striking about many of the Pakistani entrepreneurs is while their
industries are sick, their owners are in robust health and living in
palatial homes with a fleet of Mercedes. I have been told that chief
executive of a small new bank has 13 domestic servants paid for by the
bank. He told his envious neighbor to buy shares of his bank when it was Rs
13, predicting it would be Rs 40 soon. But now it is selling at Rs 3 but
the 13 domestic servants have not become even 12, laments the neighbor who
lost heavily on those shares.
Such stories are plentiful and plainly visible. If such abuses are not
checked by the government, the State Bank, income tax authorities, and if
the auditors who now condone all such immoralities for a little payment do
not show a touch of honesty, we will have far more sick units raised on
large bank loans.
The government talks of 4,000 sick industrial units. Has it asked for a
detailed study of the real cause of sickness of five per cent of them by
competent auditors? No. We are still dealing with such issues at the level
of slogans with politicians blaming each other for the industrial collapse.
How can we remedy these problems without proper scientific data when Mr.
Nawaz Sharif has fixed August 31 as the deadline for the revival of sick
Such problems are not solved by edicts from the top. The PPP government had
declared that if the banks chiefs would not recover 25 per cent of the
defaulted loans by October 21 last stern action would be taken against
them. President Farooq Leghari had directed in December last that 30 per
cent of the defaulted loans should be recovered within two months. Instead
the loans which stood at Rs 130 billion then have become Rs 140 billion.
Clearly nothing much can come out of edicts from the top when those below
are aware of their limitations. Positive results cannot be achieved if the
government is in dark about statistics and get little of cost studies done
in the industrial sector. As the government does not make any cost studies
the Federation of Chambers of Commerce and Industry and affiliated chambers
do not do any statistical work or research either. The businessmen know
what is profitable for them but their account books will not show the real
In such an environment only a fraction of the defaulted Rs 140 billion can
be recovered. That will be very hurting to the victims of the financial
system who did not benefit by the loan boom. But it is better for the banks
to start again with a clean slate, and reduced staff devoid of dishonest
bank executives than keep too many dead accounts artificially alive. And if
the Resolution Trust can recover more of the loans and auction the worst
among them, and some brave buyers can recover them from borrowers like the
Tawakkals and Schon that is well and good.

Govt. to be restricted on bank borrowing
By Mohiuddin Aazim

KARACHI, May 28: The State Bank of Pakistan (SBP) may ask the government to
pay mark-up on commercial rates - higher than the yield on security papers
- if it borrows from banks beyond the fixed ceiling.
"The indication came at a meeting of the National Credit Consultative
Council (NCCC) held in Islamabad on Tuesday," said a source privy to the
meeting. He said the meeting, fixed a ceiling of Rs 5.5 billion for
financing commodity operations and Rs 2.5 billion for lending to autonomous
corporations. The total public sector borrowing thus comes to Rs 58 billion.
The working paper of the NCCC meeting gives the same break-up of targets.
But an SBP Press release says the SBP Board of Directors, set the
government borrowing target alone at Rs 58 billion - Rs 30 billion from the
SBP and Rs 28 billion from commercial banks. The release did not mention
what targets were set for borrowing for financing commodity operations and
autonomous corporations.
The source said Dr. Yaqub made it clear that the SBP would not allow the
government to exceed its borrowing target at any time during the entire
fiscal year. The source said the NCCC set a target of Rs 82 billion for the
private sector in 1997-98. He said the SBP would ensure that it met the
private sector's credit requirement. He added that in credit disbursements
top priority would be given to exporters.
Selective support emerges strong on extensive buying
Staff Reporter

KARACHI, May 30: After early recovery, stocks finished with an extended
loss amid light trading. Selective support, however, emerged strong as some
of the institutional traders and speculators made extensive buying at the
lower levels followed by news of higher interim profits and expectations of
increased dividend.

However, the KSE 100-share index finished lower at 1,507.76 as compared to
1,507.98 a day earlier, showing a fractional fall of 0.22 points. Earlier
in the session it was up 3 points. Out of the 304 actives, 157 shares fell,
76 rose with 71 holding on to the last levels. In the evening session some
of the index shares came in for active support and ended only 0.02 point
lower at 1,507.96 as compared to 1,507.98 in the morning session.
Most of the market leaders, notably ICI Pakistan, PTC, Hub-Power and Dewan
Salman, did attract a lot of support at the lower levels, enabling the
index to resist larger fall but bargain-hunters were not inclined to follow
the rising trend owing to weekend considerations.
Although an interim dividend at the rate of 7.5% by Pakistan
Telecommunication Company for the year ended December 31, 1996, was on the
lower side of the market thinking in view of a big increase of Rs 6 billion
in profits to Rs 38 billion, the news was well-received in the rings as its
share value rose to Rs 66.10 on 0.174 million shares.
An interim dividend of 25% by Fateh Textile Mills, a leading exporter, was
on the higher side of the market and halted current decline in its share

Service Industries maintained its upward drive for the fourth session in a
row and was marked up further by Rs 2, making the week's total gain to Rs
12.  Sana Industries followed it, which also showed a good gain of Rs 4 on
news of higher interim profits. Losers were led by BOC Pakistan, Cyanamid
Pakistan, Engro Chemicals, Brooke Bond Pakistan, Hinopak Motors and
Paramount Spinning, falling by one rupee to Rs 2.
Volume at 14.563 million shares was light. Thursday's total turnover was
about 17 million shares. ICI Pakistan topped the list of most actives, up
five paisa on 8.004m shares, followed by Dewan Salman, steady 10 paisa on
5.030m, Hub-Power, lower five paisa on 1.399m, Schon Bank, up 50 paisa on
0.470m, Sui Northern, up 25 paisa on 0.437m, ICP SEMF, easy five paisa on
The other actively traded shares were led by Pak Apex Leasing, higher 25
paisa on 0.215m shares, and LTV Modaraba, unchanged on 0.110m shares. Other
deals were modest and below 0.1m shares.

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              E D I T O R I A L S  &  F E A T U R E S
These so-called 'encounters'

THE killing of two alleged hitmen in a police "encounter" near Lahore adds
another gory chapter to the mounting record of death of suspects in
custody. Naji Butt and Humayun Gujjar, involved in several cases of heinous
crime, were being brought by the police to Lahore from Gujranwala jail for
interrogation when the incident occurred. The police claimed that on the
way they were pursued by a private car ridden by accomplices of the accused
who opened fire on their van with automatic weapons, forcing the driver to
pull aside. According to the police vision, in the exchange of fire that
followed Naji and Humayun were killed. Their feet were still in shackles,
but it is said that they had tried to get to the car of their accomplices
which is not easy to explain.
Though two policemen were also wounded, if only slightly, what tends to
cast suspicion on the official version are some eyewitness reports which
deny any crossfire at the scene of the incident. Several policemen in plain
clothes were said to be standing near the scene of occurrence. They are
alleged to have started firing in the air and blocked the road. Statements
made by relatives of the dead men that the two were killed according to a
plan assume some significance. The father of Naji had in fact filed a writ
in the Lahore High Court some time ago, saying he feared that his son might
be killed in a faked police encounter.
There have been scores of police encounters in the past also which created
similar controversy. Police claims in some instances have been negated by
subsequent inquiries. Both the police and the public may be convinced of
the guilt of a criminal against whom no evidence is easily forthcoming - in
many cases, because people are afraid to testify - but the cold-blooded
murder of even such suspects cannot be seen as anything but an effort to
short-circuit the course of justice and will be considered to be a case of
extra-judicial killing. This no civilized society can countenance under any
circumstances. Even if the authorities feel that their action in getting
rid of a notorious gangster or terrorist would have the support of many
citizens, the police cannot be permitted to take the law into their own
The remark of a senior Lahore police official that it was not important how
the encounter happened but that the criminals "have met their fate" betrays
the perverse mentality of the force. The responsibility of a government is
not to appeal to the baser instincts of the people, but to uphold the norms
of justice and establish standards of fair play and morality. More often
than not, police encounters appear to run contrary to this precept, and
should therefore be judicially scrutinized every time they occur.
Weaknesses in the system of justice should also be removed and procedures
for collection of evidence and investigation improved wherever these hamper
the course of justice and enable outlaws to remain out of law's reach.

Legislation in haste

THE undue haste with which three bills were rushed through the National
Assembly, with the suspension of the normal rules of business, is difficult
to understand. The importance of transferring the responsibility for the
collection of zakat and ushr to the provincial governments or of the
setting up of a national university of science and technology in Islamabad
or of the establishment and operation of a book-entry system for the
transfer and operation of securities by the central depository companies
cannot be minimized. But what is plain to see is that there was no urgency
about any of the three matters that could have conceivably warranted a
departure from the normal rules and procedures and made it absolutely
unavoidable for the treasury benches to short-circuit the whole process.
The approach of the movers of the bills were so hyper-tensive and heedless
that they did not allow reasonable time for a proper debate and discussion.
If the opposition members fell affronted by this inexplicable haste and
protested against what they called "bulldozing" of legislation, they had
abundant justification for it. The enactment of a law is too serious a
business to be toyed with and its passage through various stages of debate,
discussion scrutiny, amendment and final voting simply cannot be handled in
a perfunctory or cavalier manner. Considering the sanctity of law-making,
it is vital that all sections of the House have a fair opportunity to
discuss a particular legislative proposal and deliberate upon it before it
is put to vote.
Any piece of legislation that would appear to have been rushed through the
house without sufficient reason and by waving aside the normal rules of
business is likely to carry the odium of having been enacted in haste and
on the basis of the brute majority of the ruling party. This is giving
law-making a bad name and downgrading it in the public eye. It is a healthy
sign that during Friday's proceedings some sections of the treasury benches
themselves realized that a hasty approach to law enactment was inherently
wrong and that the views of the opposition should have been accommodated as
far as possible. Several members from the treasury benches, including some
ministers, felt that the process should not have been unduly rushed through
and that any differences between the government and the opposition on the
legislative proposals in question should have been sorted out or minimized
before the bills were actually tabled.
The setting up of a business advisory committee, with representation from
both sides of the house, as proposed by certain members from the treasury
benches during Friday's heated discussion, is indeed positive and deserves
to be followed up. The passage of a piece of legislation, once the
opposition has walked out in protest, which is what happened on Friday, is
not in keeping with the established parliamentary norms and practices, and
should be avoided as far as possible. The responsibility to dispel the
impression that legislative business is being conducted in a contentious
spirit since the opposition, with its meager strength in the house, is
hardly in a position to out-vote the government lies with the ruling party.
It should take necessary steps to take the opposition into confidence on
this score and ensure that the legislative process is scrupulously kept out
of the pulls and pressures of partisan politics. The setting up of the
various standing committees, as required under the rules of business,
should also be expedited, so that mistrust and misunderstanding that
sometimes spill over into the domain of law-making can be tackled at the
committee level.

Streamlining the banking system

THE passing of three bills by the National Assembly relating to the banks
and development finance institutions is a step forward in the current
efforts to restore solvency and health to the financial sector. However,
what was strange was the bulldozing of the bills through the assembly,
without giving the parliamentarians time and opportunity to express
themselves on the detailed provisions of the proposed laws and move
amendments which they might have thought would improve the laws. Certainly
the final enactment could have waited for a few days as no urgency in this
regard was manifest and no case was made out justifying the suspension of
normal rules and procedure for the passage of the bills in question. There
was no need whatsoever for the treasury benches to choose to short-circuit
the process of debate and discussions on the bills. Logically, with their
overwhelming majority in both houses of the parliament, they could not have
apprehended any strong resistance or delaying filibuster from the
opposition that they could not have easily overcome.
Besides, there was nothing palpably questionable about the intent behind
the move for amending certain banking laws of a procedural nature or about
the amendments themselves that the government would not want to be exposed
to the full glare of a parliamentary debate and scrutiny. Why then this
summary process of law-making - not just in this particular case but in
quite a few other instances in the recent past? The law officers of the
government must not arrogate to themselves the sole monopoly of legal
acumen and wisdom. Whatever their skills of draftsmanship, it is the
privilege of the elected members of the National Assembly and the Senate to
debate and discuss every legislative proposal, change it, reject it or pass
it as they think it. To deny them this right is a breach of their
privilege. What is more, legislation passed in haste is often defective,
incoherent or inconsistent and need to be frequently amended as is being
done in the case of the law relating to Ehtesab.
Reverting to the legislation passed by the assembly, an informed comment on
this would be possible only when detailed information becomes available on
the contents of the amended laws. The first of the three bills is meant to
consolidate the existing two laws on recovery of loans of all types and to
enable the State Bank to scrutinize the cases of write-offs of loans since
January 1,1986, and reopen those which smack of corruption or where the
favour appears to have been extended on questionable grounds. Write-off
cases are numerous and involve billions of rupees. The prime beneficiaries
are the privileged ones who are adept at getting close to the powers that
be and exploiting their clout and connections for personal benefit. It is
too much to expect in our circumstances that the reopening of the cases
will not, again, follow a selective pattern and is meant to catch the guilty.
Under the new law the banks will have a single forum for recovery and may
not have to face innumerable legal and procedural delays that now beset
their path and make recovery extremely difficult. At present, thousands of
cases are known to be pending before the banking tribunals and superior
courts, with borrowers successfully prolonging them by taking advantage of
the lacunae in the laws. The second bill, the Banking Companies (Amendment)
Bill, empowers the State Bank to monitor the working of the finance
institutions more closely and process cases of malpractice's and
mal-administration by the officials of the banks and DFIs. The law requires
the establishment of a Mohtasib for banks who would be authorized to hear
grievances of the borrowers and take speedy steps to redress them. That the
present predicament of the financial institutions is largely due to the
unethical conduct of senior bank officials is not in doubt. Strict
accountability of these officials must be taken in hand but such a process
should be undertaken along with sufficient guarantees against political and
bureaucratic interference with the working of these officials.
The third bill, the Offenses in Respect of Banks (Special Courts)
(Amendment) Bill, comes as a consequence of the March 20, 1996, judgment of
the Supreme Court which makes consultation with the chief justices of the
high courts in the matter of appointment of the judges of the superior
courts binding on the government. This bill makes the above verdict
applicable in respect of the appointment of the judges of the banking
courts as well. The three enactment's taken together, no doubt, would lay a
solid base for a sound banking system, provided the provisions of the law
are implemented without any favor or bias. In this country, it is the
implementation that is always flawed and, in this case, the credibility of
the move would have been strengthened if a free debate on the bills had
been allowed.

Body parts for sale?
By Mazdak

JUDGING from the evidence, it would appear that the dead are dearer to us
than the living.
Every day, hundreds of Pakistanis die in road accidents, random and
motivated  crimes, from criminal neglect by the medical fraternity and from
old age, malnutrition and disease. Just recently, a bus driver facing trial
for running over a boy went unpunished  because the boy's parents "forgave"
the accused; he is now free to take more lives. None of these daily
tragedies move us if we are not directly concerned. But if I want to leave
my organs to a hospital or a member of my family after my death, I cannot
because there is no provision in the laws. OK, so my liver may not be in
such great shape, but the rest of my body parts are in reasonable nick and
it seems a pity to consign them to the grave when they can save lives.
Granted that this is a morbid subject, but I am happy to report that the
situation is being corrected with the introduction of legislation being
tabled before the Senate in the next few days. Called the "Transplantation
of Human Organs Bill, 1994", the draft has got as far as it has through the
unrelenting efforts of Dr. Adeeb Rizvi and his team from the Sindh
Institute of Urology and Transplantation (SIUT).
Readers of this newspaper will recall a recent fund-raising campaign which
detailed the achievements of this remarkable and unique institution. But to
refresh your memory, it is with great pleasure that I briefly describe here
the oasis of dedication and professionalism Dr. Rizvi and his colleagues
have created within the hellish confines of Karachi's Civil Hospital.
Although SIUT is at the cutting edge of medical science and technology and
has  state-of-the-art equipment, all examinations, operations and
medication are totally free. Last year 75,000 people were treated at the
Institute, and inexorably, the numbers continue to swell. Given this
growing pressure on SIUT's limited manpower and resources, it is just as
well that the Institute's new building is ready. Built with extremely
generous help from the Dewan Group of Industries, all that is needed is
money for new equipment. Unfortunately, there is no foreign or local
financing available to complete the project which would allow more patients
to be treated. The French government was interested at one point, but has
now pulled out. Our own provincial and federal governments have been fairly
Last week, I had the unique privilege of watching Dr. Rizvi performing
keyhole surgery to break a kidney stone using ultrasound, and then remove
the shattered pieces with a miniature grapple. The entire operation took
about 45 minutes, and I was told that the patient would be released the
next day. Watching the fine instruments acting as extensions of Dr. Rizvi's
rock-steady hands as they performed their precise tasks on a TV monitor, I
began to get a faint idea of the level of skill required. Later, the
world-famous surgeon told me that his colleagues took turns performing
different operations so there is no monopoly on any of the highly demanding
procedures that are performed daily at SIUT.
>From a humble start 23 years ago when Dr. Rizvi returned from England after
completing his medical studies, SIUT has grown not just in size but in
reputation. Now, a number of foreign universities and hospitals seek
collaboration with the Institute in various research projects. An
international conference on urology is held bi-annually, and is attended by
some of the leading specialists in the field.
Half of SIUT's running costs are met from public donations, which is quite
remarkable considering there are no VIP or private rooms. But to cope with
the constantly increasing demand on their services, the Institute has to
resort to some highly innovative and yet safe economy measures.
Manufacturers are often prepared to sell at rock-bottom prices because SIUT
obtains their costs from colleagues across the world. The SIUT website on
the Internet (www,SIUT,org) gives an update on what is new at the Institute.
Given this level of dedication and commitment, it is easy to see why the
absence of a law permitting organ donations must have frustrated Dr. Rizvi
and his team. Although they perform an average of two kidney transplants a
week, the organs of cadavers cannot be used because it is currently
illegal. The world over, people routinely will their organs to hospitals
that remove them as soon as the donor is clinically dead. But hopefully,
the new legislation will soon be enacted, and more lives will be saved.
Unfortunately, there is a catch: an amendment has been introduced in the
draft by a member of the Senate committee that permits the commercial
exploitation of the new law. In Dr. Rizvi's original draft, you had to be
genetically related to the recipient; this provision was designed to ensure
that the rich could not pay to get a body part. Indeed, this is basically
the same law that prevails in other countries that allow organ
transplantation. Out of the blue, the good member from NWFP, a man with no
medical background at all, insisted on a clause that would allow
non-genetically related individuals to donate their organs.
This has opened a Pandora's box where a rich patient needing, say, a kidney
or even an eye, can pay off a healthy man whose blood-type and other
characteristics match his and get him to place his thumb-impression on a
document, and get a transplant. Private hospitals can build entire
organ-banks based on body parts from desperately poor people and offer
transplants to the wealthy. The commercial possibilities are immense, and
without casting aspersions on the motives of the senator who introduced
this amendment, one wonders how he suddenly became so well-informed about
transplantation laws.
All in all, this is a much-needed and progressive law that will give many
people a chance to live, and allow the living to will their organs to the
dying. It is a tribute to Dr. Rizvi, Dr. Naqvi and the rest of the SIUT
team that their lobbying is finally about to bear fruit. But if the
obnoxious and clearly commercially-oriented amendment is not removed, much
of the good work will be wasted, and enormous misuse will become possible.
Indeed, we might witness the kind of macabre trade in organs here that has
been taking place in India for years.
Unfortunately, our legislators are not given to reading the fine print of
the legislation they are required to vote on. Specially now that the ruling
party has such a huge majority, there would be less of an incentive for MPs
to do their homework. Recently, we have seen several pieces of legislation
become law at supersonic speed. One can only hope this bill will not meet
the same fate. Sensible senators - and I know several of them - must have
the proposed amendment deleted and vote the original draft into law.

                            S P O R T S 
Arshad disallowed to play in finals
Samiul Hasan

KARACHI, May 24: The Tournament Committee of the Independence Cup did not
allow Pakistan's reinforcement Arshad Khan, off-spinner, to take part in
the finals.
Arshad Khan was rushed to New Delhi on Friday to join the Pakistan cricket
team in Mohali (Chandigarh) where it played Sri Lanka in the first final on
According to well informed sources in the Board of Control for Cricket in
India (BCCI), the request was originally spurned by Sri Lanka.  "The Sri
Lankans said since they have the option of finalizing their team from the
14 available players, similar principle applies to Pakistan.  "The world
champions added that none of the Pakistan players is injured or being sent
back. An additional player is only allowed when any of the playing member
is ruled out from further participation in the tournament which is not the
case here," sources in the BCCI, requesting anonymity, quoted Sri Lankan
manager Duleep Mendis as saying.
Duleep Mendis, sources continued, was inflexible emphasizing that the
allowance of an additional player meant a tilt in the balance of the two
sides in favor of Pakistan.  "Arjuna Ranatunga was equally against allowing
Pakistan an additional player," sources said.
Sri Lanka whip Pakistan to win Independence Cup

CALCUTTA, May 27: Arjuna Ranatunga's Sri Lankan one-day wonders took the
Independence Cup title with an emphatic 85-run victory over Pakistan in the
second final at the Eden Gardens.
The world champions, who routed Pakistan by 115 runs in the first game of
the best-of-three finals at Mohali, outplayed their rivals. The Sri Lankans
piled up 309 after electing to take first strike - before bowling out the
Pakistanis for 224 in 43.1 overs.
Sanath Jayasuriya smashed a typically aggressive 55 off 40 balls, Aravinda
De Silva made 57 off 49 balls and skipper Ranatunga contributed 59 in Sri
Lanka's run riot.
Pakistan stayed on course till the 25th over as a 98-run stand between
captain Rameez Raja (76) and Ijaz Ahmed (55) lifted them to 132 for two.
But the dismissal of Ijaz and veteran Salim Malik in successive overs took
the sting out of Pakistan's chase and handed the versatile Sri Lankans the
winners' purse of 40,000 dollars.
Openers Jayasuriya and Marvan Atapattu put on 69 by the 10th over and by
the time Jayasuriya was dismissed in the 12th over, the score had raced to 90.
The introduction of the spinners after seamer Aquib Javed conceded 49 runs
in six overs made little difference as Aravinda and Ranatunga smashed a
brisk 67 in 72 balls for the fourth wicket.
Sri Lanka moved to 177 for three by the 27th over when off-spinner Saqlain
Mushtaq uprooted Aravinda's middle-stump to give Pakistan a vital break.
Hashan Tillekeratne (38) added 73 for the fifth wicket with Ranatunga and
Roshan Mahanama struck a run-a-ball 27 in the slog overs to lift Sri Lanka
past the 300-run mark.
Saqlain finished with four for 53 as the Sri Lankans were bowled out with
two balls remaining in the innings. Another off-spinner Arshad Khan, shared
the new ball with Aquib. Bowling his 10 overs at a stretch, the tall Arshad
removed both Jayasuriya and Atapattu, but at a personal cost of 54 runs.
Pakistan made a disastrous start as openers Saeed Anwar and Shahid Afridi
were removed by the sixth over. Anwar, who smashed a record 194 against
India last week, made only six when he drove Chaminda Vaas to Muttiah
Murlitharan at mid-off. Afridi hit 17 off 14 balls before top-edging a
drive off Sajeewa De Silva into the cover region where Aravinda De Silva
ran back to hold a well-judged catch.
Raja and Ijaz launched an impressive counter-attack before Muriltharan and
Jayasuriya hit back to contain the Pakistanis. Jayasuriya deceived Ijaz
with a flighted ball to have him stumped and in the next over Murlitharan
trapped Malik leg before as Pakistan slipped to 135 for four.
Pakistan's fate was sealed when Kumara Dharmasena bowled Raja in the 37th
over and Murlitharan had Muhammad Wasim, the last recognized batsman,
stumped in the following over.

Notts terminate Zahid's contract
Qamar Ahmed

LONDON, May 30: Mohammad Zahid, the young Pakistan medium-fast bowler who
was signed early this month to play for English county Nottinghamshire, has
been released of his contract because of injury.
Last night he was diagnosed to have stress fracture of the lower back and
has been thus asked to quit without having played a single game for the
county. For 21-year-old Zahid this must have come as a big blow, for he was
hoping not only to enrich his skill and experience but also gain monetarily
through a lucrative one-season contract worth 60,000 pounds.
"I am heart-broken. This is a big blow for me. I did not realize that the
injury is that serious. But now I have to take a long rest and prescribed
exercise," says a dejected Zahid.
His replacement has been requested by the county and the England Cricket
Board (ECB) is likely to make a decision in a couple of days to allow or
disallow the club to have another signing. But the county officials are
optimistic that they will be given the permission for another overseas
It could be Paul Reiffel of Australia who himself have an unreliable track
record because of recent injuries and also at any time likely to be called
to join the Australian touring team in case of injuries to any fast bowler.
The likely candidate to replace the injured Zahid is his compatriot
Ata-ur-Rehman who has been seen bowling in the nets at Nottingham county
ground. Ata is playing in league cricket around the area and is fit.
Another Pakistani, a Rawalpindi-born youngster Usman Afzaal, who is still
in his teens, has however become the toast of the county in the current
summer having scored four scores of over fifty in his last five innings for
the county. Having made his first class debut in 1995 for the county,
Afzaal, a left-handed batsman and a slow left-arm bowler, is being tipped
to play for England in the near future if he continues to impress people on
the county circuit.
Mushtaq quitting job, says he is not greedy
Samiul Hasan

KARACHI, May 30: Mushtaq Mohammad said he was told by the Chief Executive
of the Pakistan Cricket Board (PCB), Majid Khan, that India's tour was his
last as Pakistan team's cricket manager.
"I don't want any controversies but the fact of the matter is that Majid
Khan had conveyed the decision to me two hours before the team was to
embark on the Indian trip," Mushtaq told Dawn referring to his statement of
quitting the job because he was under-paid.
Mushtaq's contract with the PCB was due to expire on Aug 31. The switch in
the PCB decision means that there will be a new coach of the team when it
plays the Asia Cup in Sri Lanka between July 14 and 27.
Mushtaq refuted claims that he was greedy. "Cricket is my livelihood. Every
professional goes for better opportunities but that doesn't mean everybody
is penny-pinching. I ask the people who have criticized me that haven't
they changed loyalties as professional cricketers when they were offered
better packages," questioned Mushtaq? However, Mushtaq emphasized that no
one but he was responsible in this issue. "I made the mistake of signing
the contract. No one forced me.
"I had signed the contract hoping that if the team performed well and my
show was equally good, I would be offered an enhanced contract. The
performance of the team from Canada to India is no hidden secret but even
if my services are not being acknowledged, I would rather back out than beg
for a contract.
"I am extremely grateful to the cricket administrators who have given me an
opportunity to serve the country," said a dejected Mushtaq.

Dawn page