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DAWN WIRE SERVICE
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Week Ending : 11 July 1998 Issue : 04/27
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Contents | National News | Business & Economy | Editorials & Features | Sports
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CONTENTS
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NATIONAL NEWS
Stocks crash to all-time low as rupee dips
Gohar wants Vajpayee to talk on Kashmir
IMF team satisfied but makes no pledges
Forward cover fee on $ raised to 7 percent
Multi-metering on Internet calls to go from tomorrow
MQM wants full role in decision making
No respite from power failures
Kalabagh dam strongly opposed
US has no plan to bail out Pakistan
---------------------------------
BUSINESS & ECONOMY
KSE 100-share index crashes to all-time low
CBR conference to improve tax collection
Population swells to 130.58m
Islamabad ready to sign no-war pact with India: FO
104 cos get ISO-9000 certification
Massive outflow of funds aggravates banking crisis
Restoration of business confidence demanded
Moratorium on loans repayment may be sought
Ehtesab Bureau seeks CBR verification on Rs25bn loss
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EDITORIALS & FEATURES
Winter Pakistanis Ardeshir Cowasjee
Hanging on Irfan Husain
Karachi's web of terror M.H. Askari
When they meet in Colombo Mahdi Masud
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SPORTS
Davis Cup squad leaves for Teheran on 12th
PCB approves a list not signed by selectors
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NATIONAL NEWS
980711
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Stocks crash to all-time low as rupee dips
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Mohiuddin Aazim
KARACHI, July 10: The ban on release of foreign exchange for
overseas travellers and students at the official rate coupled with
rumours of all sorts pushed up the price of dollar to Rs59 in the
open market on Friday.
Meanwhile, the Karachi Stock Exchange (KSE) 100-share index fell
from 800 points to all-time low of 777.26.
On Thursday the dollar was sold for Rs54.25. Thus the rupee lost
Rs4.75 or 8.75 per cent to a dollar within a day widening the gap
between the official and open market rates of the green bill to
Rs12.54 or 27 per cent. Official selling price remained unchanged
at Rs46.46 per dollar.
As the markets opened on Friday there was a great demand for the
dollar and other foreign currencies by people intending to travel
abroad and the pressure kept rising as the day progressed.
Money changers said rumours of further rupee devaluation and
Pakistan nearing default also hit the market which turned people
crazy about buying hard currencies including the dollar.
The statement of Finance Minister Sartaj Aziz that Pakistan might
have to seek moratorium on foreign debt payment gave weight to
these rumours. His statement made at the end of the talks with
visiting IMF delegation on Thursday was reported in detail on
Friday.
At the end of the day money changers were buying the dollar for
Rs58 and selling for Rs59. On Thursday buying and selling prices
were Rs54 and Rs54.25.
"The demand for the dollar was so high that at one point the rupee
nose-dived to 62 to a dollar", claimed Anwar Jamal of the Galaxy
International money-brokerage.
On Friday the prices of other major foreign currencies also rose
sharply including the pound sterling by Rs3.20 to Rs 91; Canadian
dollar by Rs3.05 to Rs39.40 and Kuwait dinar by Rs3.90 to Rs178.50.
The Saudi riyal and UAE dirham were sold for Rs15.10 and Rs15.40
respectively on Friday up from Rs14.30 and Rs14.67 on Thursday.
Senior bankers said the State Bank had stopped selling them foreign
exchange on Wednesday and did not resume it till Friday which made
people believe that the devaluation of rupee was on the cards. They
said it also fuelled rumours that importers might be asked to buy
part of the foreign exchange they need from the open market.
"That is why the demand for the dollar shot up and the price sky-
rocketed", said senior executive of a bank.
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980710
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Gohar wants Vajpayee to talk on Kashmir
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Reporter
KARACHI, July 9: Foreign Minister Gohar Ayub Khan on Thursday urged
the Indian leaders to come to Colombo with an open mind to discuss
the core issue of Kashmir so that substantive progress is made
towards the restoration of peace in the region.
"If there has to be security in the region and there has to be
friendship between the two countries and we want to solve our
problems then we must ensure substantiative progress on the core issue of
Kashmir and the Indian leadership must come with an open
mind to Colombo," said Mr Khan while talking to newsmen at the PN
Dockyard after the induction of Pakistani made mine-sweeper PNS
Mujahid in Pakistan Navy.
Asked about the possibility of Prime Minister Nawaz Sharif's
meeting with his Indian counterpart Atal Bihari Vajpayee during the
SAARC summit in the Sri Lankan capital, the foreign minister said
"bilateral meetings would take place on the sidelines of the
conference and we welcome the Indian prime minister's letter to Mr
Nawaz Sharif."
The Colombo meeting has become the focus of world attention as the
two leaders will be coming face to face for the first time since
India and Pakistan tested their nuclear devices.
The foreign minister was not very hopeful about the outcome of
these meetings and referred to India's reneging on the agreement of
June 23, 1997 between the foreign secretaries of the two countries
in which India had agreed to put the core issue of Kashmir on the
agenda for bilateral talks.
He also said that bilateral approach has not produced any result in
the past and emphasised mediation by third party and referred to
the Indus Basin Treaty for sharing river Indus waters.
Asked why Pakistan was not adopting a policy of reconciliation by
taking other confidence building measures as was suggested by the
former Indian prime minister I.K. Gujral, the foreign minister said
the "whole thing is that a series of meetings with Mr Gujral have
not led to any progress on Kashmir or any other issue during the
past eight nine months."
He said that unless the fundamental problem is addressed the desire
of a durable and lasting peace will not be achieved.
The foreign minister said the UN resolutions on Kashmir were not
time barred.
Referring to Indian nuclear tests, he said, this removed the
ambiguity with regard to Pakistan's nuclear and missile
capabilities and proved that Pakistan's nuclear and missile
programmes were superior to that of India.
He said Pakistan was not taking steps that would further vitiate
the atmosphere but India was taking advantage of the situation and
committing gross human rights violation in occupied Kashmir.
He regretted that the world leaders, despite Pakistan's repeated
warnings, had not anticipated the Indian nuclear explosion plans.
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980710
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IMF team satisfied but makes no pledges
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ISLAMABAD, July 9: Pakistan faces a "major financial crisis" if a
multi-million dollar International Monetary Fund (IMF) loan package
is blocked because of sanctions sparked by nuclear tests, Finance
Minister Sartaj Aziz said on Thursday.
Mr Aziz warned of the impending crisis at the end of talks with an
IMF mission led by Paul Chabrier, amid fears Pakistan looked headed
toward a partial moratorium on foreign debt repayments, reports
AFP.
The finance minister, speaking at a news conference also attended
by IMF Middle East director Chabrier, said the delay in releasing
IMF financing because of the sanctions over the nuclear tests would
hit Pakistan's balance of payments.
A "major financial crisis...is likely to occur in Pakistan due to
the sanctions," he said. Unless the IMF programme was activated
quickly Pakistan would be "left with few options," Sen Aziz warned.
The IMF official linked the delay in the release of 226 million
dollars the second and third instalments from a 1.5 billion loan
package agreed last year to the "totally changed environment" in
the wake of nuclear testing.
Chabrier said he would tell the IMF board about Pakistan's good
economic performance in meeting macro-economic targets under the
loan package and also of the difficulties that it faced as a result
of the sanctions. But he declined to prejudge the response, noting
that while the IMF was not bound by the sanctions the squeeze in
aid by donors affected its programmes.
Mr Chabrier, director of the IMF's South Asia Operations, is due to
brief the Group of Eight industrialised countries represented on
the IMF board in Washington on Monday.
Mr Aziz said Prime Minister Nawaz Sharif had written to major
industrialized powers asking for the "immediate restoration" of
support from international financial institutions.
The finance minister announced new measures to conserve Pakistan's
foreign exchange resources. He said the State Bank had withdrawn
from banks the authority to make payments on account of suppliers'
credits and other related disbursements.
Citizens would now obtain foreign exchange for travel from the open
market and not from the central bank.
Foreign exchange requirements of all federal and provincial
ministries would from now on be considered on a case to case basis
and all "low priority" spending would be cut, he said.
Our Bureau adds: International Monetary Fund director Paul Chabrier
said that IMF was not bound by international sanctions and might
take a decision to offer assistance to Pakistan specially when it
had met the IMF criteria to qualify for loans.
Mr Chabrier, who is here to assess the post-sanctions situation
said he would brief the IMF headquarters on Pakistan's economic
performance and the difficulties being faced by the country in the
wake of sanctions.
When asked whether Pakistan had fulfilled the IMF conditionalities
to qualify for the loan, the IMF director said Pakistan had made
substantial progress and achieved most of the targets. He said he
would report to the IMF management about his assessment of the
situation in Pakistan.
To a question he said that the IMF was not bound by sanctions, but
the G-8 countries, which opposed loans to Pakistan, were the major
aid donors to the IMF as such their point of view was considered
important on certain issues.
He told a reporter that the IMF had earlier completed the second
review of the economy and found that the ESAF/EFF programme was
being implemented satisfactorily.
Earlier, the finance minister said that during the last 16 months
the government had been implementing a comprehensive programme of
structural reforms and macro-economic stabilisation with support
from the IMF as part of a $1.5 billion ESAF\EFF facility.
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980710
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Forward cover fee on $ raised to 7 percent
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Mohiuddin Aazim
KARACHI, July 9: The State Bank raised the forward cover fee from
5.5 to 7 per cent on the US dollar and from 3.9 to 5.1 per cent on
pound sterling from Thursday July 9, 1998. It also increased the
fee from 7.2 to 8.9 per cent on Deutsche Mark and 10.1 to 11.9 per
cent on Japanese Yen.
Bankers said the State Bank had told them that the new rates would
apply to foreign currency deposits mobilized or renewed or rolled
over under the old foreign currency accounts scheme. The rates
would not apply to the new foreign currency accounts scheme
announced on June 20, 1998 under which banks are not supposed to
surrender the foreign currency to the State Bank and obtain the
forward cover.
In Pakistan, more than 80 per cent of all foreign exchange business
is transacted in dollars and the remaining in other major foreign
currencies including pound sterling, Deutsche Mark and Yen.
The rise in the forward cover drew an immediate reaction from the
money market where the forward trading of the dollar for 2 months
and more came to a halt. This coupled with the ban on the release
of foreign exchange by the banks to the overseas travellers forced
the rupee to shed 85 paisa to a US dollar in the kerb market. The
move also pushed up the call rates from 10 per cent at the
beginning of the day to 15 per cent at the close of the business as
banks feared pressure on their rupee resources in the wake of
increased conversion of foreign currency deposits into rupees.
Senior bankers say the increase in the forward cover fee is aimed
at compelling the banks to convert the foreign currency deposits
into rupees to help the government reduce its foreign exchange
liabilities.
Forward cover fee is the fee charged by the State Bank for booking
exchange rates of foreign currency deposits at a given level for a
specified period. The increase in the fee would make these deposits
costlier compelling the banks to cut the profit paid to the deposit
holders which would accelerate their conversion into rupees.
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980706
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Multi-metering on Internet calls to go from tomorrow
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Anjum Herald Gill
LAHORE, July 5: The Internet subscribers will be exempted from
multi-metering from July 7, says federal communications secretary
Muhammad Akram Sheikh.
While talking to Dawn on Sunday, Mr Sheikh said the government was
in favour of encouraging the Internet users, and would provide them
more facilities.
Lahore Telecom's south region general manager Sheikh Afzal, who
assisted the communications secretary during the talk, said the
discrimination between digital and non-digital telephone
subscribers regarding metering of calls would end within two to
three months.
He said the PTCL authorities would now allot different codes to
Internet service providers.
Mr Sheikh said the PTCL's privatization would be finalized within
next six to nine months. He said the home work in this regard had
already been done.
He said the video conferencing and pre-paid card system would be
introduced by the end of this year.
The communications secretary said he wanted to improve the
efficiency of the PTCL staff. He said he had been holding review
meetings with the PTCL authorities and other departments in their
offices to monitor the targets set by the government.
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980707
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MQM wants full role in decision making
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Bureau Report
ISLAMABAD, July 6: Muttahida Qaumi Movement (MQM) has sought the
full partner status with the PML in Sindh to "remove their
differences and establish permanent peace in Karachi."
A four-member MQM delegation headed by Senator Aftab Sheikh held a
detailed meeting with the minister for petroleum and provincial
coordination, Chaudhry Nisar Ali Khan, and Chief Minister Liaquat
Jatoi on Monday and demanded the assurance that the MQM would be
given full role in the decision making process.
"We have told them today that they will have to ensure the MQM's
full participation in the provincial affairs because of their
position as active coalition partners," Dr Farooq Sattar. He told
Dawn after the meeting that the situation in Karachi was fast
deteriorating which needed the combined efforts of the PML and the
MQM to achieve the desired result.
He regretted that the MQM had been kept completely out of the
recently formed two high-level committees to supervise the affairs
of the Sindh government. "They are not taking us into confidence on
various issues nor are they ready to accept our recommendations to
improve the law and order situation in Karachi," he said.
"But they will have to share the authority with us in Sindh for
running the provincial administration effectively," Dr Sattar
asserted.
Asked what was the response of Chauhdry Nisar and Mr Jatoi to the
MQM's demands, he said certain assurances were once again given by
them. "We do not want any bickering with our political allies and
are still sincerely trying to sort out issues amicably so that the
peace is restored to Karachi."
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980705
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No respite from power failures
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Reporter
KARACHI, July 4: There was no respite in power breakdowns in many
areas of the city on Saturday despite public outrage.
The concluding session of a six-day workshop "Recent advancement
and use of Information Technology in Libraries" at Karachi
University was delayed owing to a power failure at the university.
The workshop which was scheduled to begin at 10 am started at
11.30am.
Staff had to hurriedly rush to acquire a generator so that
participants could be awarded their certificates.
University authorities said the power failure affected other
departments where computers, air-conditioners, and fans failed.
Residents of many parts of Gulshan-i-Iqbal and Gulistan-i-Jauhar
complained they were being subjected to power breakdown of three to
four hours after midnight almost daily, besides the outages during
the day time.
The general complaint is that of voltage fluctuation which has
rendered electrical appliances almost inoperable.
Residents of Gulshan-i-Iqbal Block-2 (flat side) is deprived of
electricity after midnight for atleast three hours regularly. All
attempts to invite attention of the KESC staff have so far failed.
Resident allege the KESC staff was in league with the sprawling
marriage halls on the main Rashid Minhas Road.
KESC consumers in the Federal B Area said frequent power breakdowns
and unannounced loadshedding have made their life miserable as they
have to invariably live without electricity in a hot and humid
weather for at least two to three hours at a stretch.
The residents said disgusted with the indifferent attitude of the
KESC staff, consumers have stopped registering their complaints
because the KESC staff just don't bother to register them.
Voltage fluctuation is another problem which has hit perturbed the
people.
On Saturday, consumers of block 10, 11, 12, 13, 14 & 16 of Federal
B Area were hit by power breakdown twice, each stretching over
three hours. The first breakdown occurred at 1.50pm. The power was
restored at 6.15pm and then again at 7.20pm power supply was again
disrupted, residents said.
Complaining about the breakdowns, the people also agitated over
inflated billings without any meter-reading.
An agitated consumer said what was the moral justification of
sending inflated bills when the KESC could not ensure regular power
supply.
Amir Ali, a resident of Garden East, while complaining about
frequent power breakdowns and excessive billing, urged the chief
justice of Sindh High Court to take suo moto action against the
KESC.
He pleaded for privatising the utility which has become a big
problem. He said the action should not be delayed because at stake
is the peace and security of millions, not to mention of the damage
done to the economy.
Mr Muzaffar, a resident of Bath Island, complained of frequent
power failures and said no one at the complaint centre responded to
his calls.
Almost everyday the area is without power from 3pm, he said.
Residents of Sector 48-A said they were facing power failures
everyday since Tuesday. The hide and seek with electricity and
voltage fluctuation had become a big problem.
Meanwhile, Sindh Chief Minister Liaquat Jatoi has taken serious
notice of the power breakdowns and public outrage against the KESC
staff's attitude.
He directed the KESC officials and Area Electricity Board Hyderabad
to take measures ensure uninterrupted power supply.
The chief minister also called for increasing the number of
complaint centres besides improving the performance of those
already functioning.
He said the government is well aware of the problem faced by people
and that contacts at higher level in the federal government are
also being made so as to overcome the issue related to disrupted
power supply in Karachi and other parts of Sindh.
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980710
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Kalabagh dam strongly opposed
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Correspondent
MULTAN, July 9: Pakistan Seraiki Party (PSP) has rejected the
proposed construction of Kalabagh dam saying it is not in the best
interests of the masses of this country.
These sentiments were expressed in the party's annual national
council meeting held here the other day.
Addressing a huge gathering of the party workers, PSP chief Mr Taj
Mohammad Khan Langah said it was ironical that the proposed Kalbagh
dam had been planned to be constructed on certain parts of the
Seraiki region but no one was talking to them (Saraikis), as
Punjabis, Sindhis and Pakhtoons were quarrelling among themselves
as to the merits and demerits of the plan. He warned if the point
of view of the Seraiki region was not given due weight in this
regard, PSP would launch an agitation movement against the
construction of the dam. The senior vice president of the party, Mr
Afzal Masoud, said the construction of Kalabagh dam would lead to
the disintegration of the state as no person with foresight would
favour this project.
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980710
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US has no plan to bail out Pakistan
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Shaheen Sehbai
WASHINGTON, July 9: A US State Department official said on Thursday
that no plan was in the works to bail out Pakistan from its present
economic situation.
Reacting to almost panicky reports emanating from Pakistan that the
country was close to a default, the official told Dawn: "This is
not a sanctions issue and Pakistan cannot expect the rest of the
world to bail it out from a situation which has been developing for
over 18 months."
This blunt State Department position on Pakistan's economic woes
was seen by diplomatic experts and analysts as the result of
conflicting messages and signals coming out of Pakistan about the
possible impact of the sanctions and Islamabad's reaction to
demands about signing the CTBT and other non-proliferation
treaties.
The State Department official was asked to give his comments in
view of repeated statements made by senior administration
officials, including Assistant Secretary of State Karl Inderfurth,
that the US would not let the Pakistan economy collapse under the
weight of sanctions imposed by Washington.
"We do not want to break any economy," Inderfurth has been saying,
explaining the impact of US sanctions.
But the official reacted in a different tone on Thursday when told
that even the finance minister of Pakistan was now talking about
the prospect of a Pakistan default and a moratorium on its foreign
loans.
"The sanctions imposed by the US have not had a big impact on
Pakistan yet, there have been no votes against Pakistan in the IMF,
they have not yet been hurt," he said.
Nevertheless, he said the State Department was discussing the issue
with the IMF as well as the Pakistan government but "we are not
discussing any bailout plan at this point in time."
He said the economic crunch that was being reported was not a
creation of sanctions. "This has come because the Pakistan
government did not undertake the reforms in the economy that were
needed to be taken. The IMF mission is already there to assess what
Pakistan has done, or not done, in that context and we will wait
for their report," he said.
"There are established channels through which Pakistan and the IMF
can have their discussions and we are also a participant in these
discussions," he said.
Asked specifically about the prospect of a default, as it now
appears imminent from the finance minister's statement, the
official said: "This is a matter of speculation and we will have to
see what happens.
"Pakistan would not have been here if they had taken the steps they
were supposed to take," the official said, almost distancing
himself from the sympathetic line that was evident in Inderfurth's
recent statements.
Analysts recalled that after Pakistan's nuclear tests and when
sanctions were imposed, Pakistani leaders deliberately made
unsubstantiated claims and misleading statements about the impact
of sanctions, knowing well that either these claims were wrong or
politically motivated.
They recalled Prime Minister Nawaz Sharif's speech to a Manchester,
UK audience on June 13 in which he said: "Pakistan is not afraid of
any economic sanctions imposed by the international community...
These sanctions are a blessing in disguise as these will help the
nation stand on its own feet and become self-reliant...Till now
sanctions have had no effect on the economy."
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BUSINESS & ECONOMY
980711
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KSE 100-share index crashes to all-time low
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Reporter
KARACHI, July 10: The KSE 100-share index on Friday breached the
psychological barrier of 800 points to fall to an all-time low
level of 777.26 points as investors sold in panic amid rumours of
an imminent default on foreign debt and run on the dollar.
The worst might not be over as the prevailing panic and most basic
fundamentals point to a sustained bear-run and the developing
situation demand some quick official corrective steps to avert an
imminent collapse, said leading floor broker.
"The money is outflowing from the share business to gold and dollar
as panicky investors are out to find safe havens in view of the
developing economic uncertainty", analysts said.
The full marks to economic performance by the visiting IMF
delegation should have lured investors back in the rings but its
reluctance to give positive hints about the aid resumption seemed
to have worked against the sentiment.
"The economy might not collapse as widely speculated owing to
economic sanctions, but the vested interest has made it look like
that after adding to the existing speculation", said a member of
the KSE.
The index has lost about 60 per cent since Pakistan became a
nuclear power on May 28, as it has fallen from 1500 points to
777.26 points, wiping out Rs250 billion from the market
capitalization at Rs237 billion, analysts said.
The financial markets are in a virtual turmoil since the central
bank allowed travellers and students to buy dollar from the open
market and its price soared to Rs62.00 to a dollar at one stage,
they added.
But the chief destabilizing factor appears to be the visiting IMF
team silence on the release of third and fourth tranche of $287
million out of the $1.5 billion credit line agreed last year
despite its satisfaction about the economic performance, some
analysts said.
The index hit the previous low at 811.03 points on June 29, after
4.4 per cent devaluation of the rupee but the breach of the 800
barrier could take it new lows in the subsequent sessions.
"The market is passing through a very difficult period of its
history and it is pretty difficult to predict at this stage whether
or not the collapse is imminent", a top official of the KSE said.
Analysts said rumours of fresh 20 per cent devaluation of the rupee
and a possible freeze on gold in the lockers and the current run on
the dollar all point to "worst is still to come", he added.
All the blue chips, having some capital gains fell in unison as
investors hastened to get out of the market but some of the textile
shares rose under the lead of Khyber Textiles and Gadoon Textiles,
which rose by Re1 to Rs3.00. Among the MNCS, Shell Pakistan and
Lever Brothers were top losers falling by Rs9.00 and 56.00.
Other prominent losers were led by Adamjee Insurance,BOC Pakistan,
Engro Chemical, Fauji Fertiliser and Pakistan Refinery, which
suffered fall ranging from Rs3.50 to 8.90.
Steep decline of Rs7.50 in the share value of blue chip for the
second session in a row in Fauji Fertiliser was not backed by any
negative news but reflects the existence of some genuine investors
owing to the developing situation.
Orix Leasing, 22nd ICP, Askari Bank, MCB, Metropolitan Bank and
Bank Al-Habib also came in for active selling falling by Rs2.00 to
Rs4.00, largest decline of Rs4.00 being in Bank al-Habib.
Trading volume rose to 104 million shares from the previous 103
million shares, while out of the 102 actives only six rose, 68 fell
and 28 were held unchanged.
Both PTCL and Hub-Power, the market received fresh massive
battering off Rs1.05 and 1.80 at Rs16.60 and 8.35 on 63 million and
28 million shares; followed by ICI Pakistan lower 65 paisa at
Rs11.40 on 6 million shares; FFC-Jordan Fertiliser easy 60 paisa at
Rs13.00 on 1.305 million shares and MCB off Rs1.65 on 1.70 million
shares.
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980710
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CBR conference to improve tax collection
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Correspondent
ISLAMABAD, July 9: The Central Board of Revenue has chalked out a
detailed plan for improving tax collection and tax procedures, in
fiscal 1998-99, with an emphasis on minimizing evasion.
These issues would be the focus of a four-day collectors'
conference opened on Wednesday, at the CBR headquarters in
Islamabad. The conference agenda, said officials, includes an
appraisal of the performance on targets set for the financial year
1997-98, the loss of tax money due to reduction in tax rates for
the financial year 1997-98, the changes made in the procedures of
tax collection and implementation and the impact thereof, the
rationale of the targets set for the past financial year and the
new (1998-99), head-wise failures and achievements in collection of
duties and taxes in 1997-98, a perusal of the prospects of
continuing these changes as such during the financial year 1998-99.
The collectors and commissioners of customs, sales tax, central
excise duty and income tax expressed their reservations regarding
certain changes made in the set up of the tax collecting apparatus,
though it was found that there has been no major complaint against
the CBR functioning under a private sector boss, said officials.
The revenue targets asked to be met by each collectorate and
commissionerate were also the focus of debate, as some of the
collectors expressed doubts these were rational enough, in view of
the slump that is widening in the local market.
The failure of certain mid-fiscal schemes started by the CBR for
improving the tax collection, especially the Retail Sales Tax
Scheme and the documentation of all tiers of the business and
industry, was also discussed. It was resolved that broader view be
taken for implementation of such schemes in future, before
launching them for implementation.
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980709
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Population swells to 130.58m
-------------------------------------------------------------------
Ihtasham ul Haque
ISLAMABAD, July 8: The government here on Wednesday announced
provisional results of the fifth population census, showing an
increase in the proportion of Sindh's population to the country's
from 22.6 per cent to 23.
On the other hand, the figure for Punjab fell from 56.1 per cent to
55.6.
According to the census figures, Pakistan's population rose to
130.5 million from 64.2 million, as recorded in 1981.
"I can almost claim that this was the most authentic and fair
population and housing census ever conducted in the history of
Pakistan", Finance Minister Sartaj Aziz said at a news conference.
He said local and foreign agencies were wide of the mark in
projecting the country's population at 135 million or even 140
million.
The census figures show the population growth rate to have declined
to 2.61 per cent per annum, as against 3.06 per cent in the 1981
census.
Sindh's total population was put at 29.9 million _ an increase of
more than 50 per cent over the 19 million figure of 1981.
There has been a substantial decrease in the population growth rate
from 3.56 per cent in 1981 to 2.71 per cent this year.
The population of Punjab rose from 47.2 million in 1981 to 72.5
million this year, but as a proportion of national population, it
fell from 56.1 per cent to 55.6 per cent.
The rate of population growth in Punjab also decreased from 2.74
per cent in 1981 to 2.55 per cent.
The population of NWFP went up to 17.5 million from 11 million,
while its growth rate declined from 3.32 per cent to 2.75 per cent.
The proportion of its population to the national figure increased
from 13.1 per cent in 1981 to 13.4 per cent.
Balochistan's population increased from 4.3 million (1981) to 6.5
million. Its growth rate registered a staggering fall to 2.42 per
cent, compared with 7.09 per cent recorded in the last census.
Like Punjab, the percentage of Pakistan's population declined,
albeit marginally, from 5.1 to five.
The population in FATA increased from 2.1 million to 3.1 million
and its annual growth rate was 2.11 per cent, against minus 1.47
per cent in the 1981 census. Its percentage of the country's
population increased from 2.4 to 2.6.
In Islamabad, there was an increase in the number of people from
340,000 to 799,000 _ a growth rate of 5.15 per cent, compared with
4.34 per cent of the 1981 census. It raised its percentage in the
nation's population to 0.4 from 0.6.
RURAL-URBAN DIVIDE: According to the census, 67.5 per cent
Pakistanis live in rural areas, down from 71.7% in 1981. The
proportion of urban population increased from 28.3 per cent to 32.5
per cent.
The highest concentration in urban areas is in Islamabad 65.5%,
followed by Sindh with an urban population of 48.9 per cent.
Three major cities _ Karachi, Hyderabad and Sukkur _ accounted for
73.1% of the urban population in Sindh and 35.7% of Sindh's total
population.
The comparative position of provinces and areas shows a similar
trend, with a slightly higher increase in Balochistan, followed by
Sindh, Punjab and NWFP.
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980709
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Islamabad ready to sign no-war pact with India: FO
-------------------------------------------------------------------
Hasan Akhtar
ISLAMABAD, July 8: A foreign office spokesman said on Wednesday
that Pakistan was willing to sign with India a non-aggression pact,
including non-use of nuclear weapons, as part of a comprehensive
disarmament pact based on a just and fair settlement of the Kashmir
dispute.
Reacting to a statement of Indian Prime Minister Atal Behari
Vajpayee that in his proposed talks with Prime Minister Nawaz
Sharif, he (Vajpayee) would suggest an agreement between Pakistan
and India pledging not to launch nuclear attacks against each other
in the event of a conflict.
The prime ministers of the two countries are scheduled to hold one-
to-one talks at the sidelines of the SAARC summit later this month
at Colombo.
Prime Minister Nawaz Sharif had reiterated Pakistan's desire for
utilizing the SAARC forum for resolution of regional disputes at
talks with Sri Lankan foreign minister Lakshman Kadirgamar, who
called on him earlier this week to hand over a formal invitation
for the SAARC summit.
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980707
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104 cos get ISO-9000 certification
-------------------------------------------------------------------
Reporter
KARACHI, July 6: As many as 104 companies have acquired the ISO-
9000 quality certificate compared till date as compared to 64 uptil
February.
The Total Quality Management Experts Cell (TQMEC) of the Federation
of Pakistan Chamber of Commerce and Industry (FPCCI) has prepared a
list of certified companies.
According to a TQMEC official, the trend has now changed and more
local companies have acquired the certificate comparison to
majority of multinationals in the previous list of 64 companies.
However, he said that the export-oriented companies are still less
than 40 in the new list, adding specially when foreign buyers are
demanding certificate.
An official in a foreign-based certification agency said that as
many as 500 companies are likely to be certified by the year 2,000
since awareness among local companies has increased.
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980706
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Massive outflow of funds aggravates banking crisis
-------------------------------------------------------------------
Sultan Ahmed
THE GOVERNMENT which presumed it had liquidated its major foreign
currency burden by repudiating its commitment to repay the $11
billion deposits of private individuals and institutions in our
banks in dollars immediately after the nuclear explosions of May
28, now finds it has created another major problem in the process:
fast outflow of funds after conversion into rupees to foreign safe
havens through the Havala chain.
While the small savers may keep their savings at home by investing
in the better schemes, or in gold or by acquiring property, the
large depositors are tending to send the money outside by paying
the difference between the Rs 46 for a dollar they get from banks
after conversion and the market rate of the dollar that varies from
Rs 52 to Rs 55 for a dollar, according to the time and place.
If this frightful haemorrhage of banks funds continues,
particularly after the addition, of the six monthly profit earned
on those funds up to July, the banks will first lose the deposits
of $7.2 billion of resident Pakistanis and the $2.1 billion of
overseas Pakistanis, while the foreign banks may retain the $1.7
billion they had brought in here to earn interest as well as expand
their lending capability and business as a whole.
Mr Shaukat Tareen, President of the Habib Bank, has spoken about
drying up of the capital markets, while banks and financial
institutions are suffering from liquidity problems. Along with
that, there is pressure on home remittances as overseas Pakistanis
have become wary of sending foreign exchange home.
Those who are sending money abroad fear the gap between the
official and market exchange rates may widen a great deal over the
period and secondly the government may come up with new
restrictions on sending money abroad, legally or illegally.
The picture might have been different if Prime Minister Nawaz
Sharif had been able to obtain substantial aid commitments, even
for a short period, from Saudi Arabia, UAE, Kuwait and Qatar which
he visited personally, and from Malaysia to which he had sent
Commerce Minister Ishaq Dar. All that Dr Hafeez Pasha, Deputy
Chairman of Planning Commission, could say at the 'Financial Post'
conference last week was "some success" had been achieved in
tapping new sources of economic assistance. And while finance
minister Sartaj Aziz talks of sanctions not biting hard, and easing
within six months, Dr Pasha talks of the "heavy sanctions imposed
on us."
And since our foreign exchange reserves have come down and now
stand at $913 million, as stated by the State Bank Governor, Dr
Muhammad Yaqub, even if those who have large foreign exchange
deposits want to believe the government for patriotic reasons, they
find the government does not have the capability to honour its
domestic foreign currency commitments even after restoring the
foreign currency accounts as he did on Tuesday following pressure
from Pakistanis in Kuwait.
The inconsistency in the official approach to the foreign currency
deposits and contradictory pronouncements add to the confusion and
multiplies fears of the depositors even after the restoration of
the foreign currency accounts in a qualified manner.
For example the circular of the State Bank issued on Thursday to
clarify the PM's statement in Kuwait cancels four earlier circulars
No. 12, 17, 18 and 25 issued last month, and each one had given
rise new questions. Such frequent changes and ultimate reversal in
parts of the May 28 freezing of foreign currency accounts, do not
create confidence in the depositors or hope for the better in
future.
Resident Pakistanis who have kept $7.2 billion in the FC accounts
are of several kinds: they include small savers with honest
savings, others with legitimate incomes, tax-evaders and those who
had earned most of their deposits through corruption and crimes,
including drug trade.
The last category would not want to cash their savings in rupees
and transfer them to a new account, which may not enjoy protection
from questions regarding the source of the funds and get them into
trouble on that score.
Such elements would like to transfer their deposits abroad,
although that could mean earning far lower interest than they have
been enjoying here so far and gaining much less overall.
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980709
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Restoration of business confidence demanded
-------------------------------------------------------------------
Reporter
KARACHI, July 8: The businessmen have called upon the government to
take immediate measures to help restore the confidence of trade and
industry which was eroded through its recent actions, such as
mishandling of foreign currency accounts and issuance of a very
large number of circulars by the State Bank of Pakistan.
A representative meeting held Wednesday under the chairmanship of
president FPCCI, called for consistency in policies to create
confidence among the businessmen.
The participants were critical of frequent changes in policy with
regard to foreign currency accounts and opined that it has created
confusion among the public in general and business community in
particular. They strongly felt that there was a need to create
conditions within the country so as to stop the outflow of funds.
The meeting called by FPCCI to consider proposals for the revival
of economy and as to how to come out of the present crisis was
unanimous in its view that the issuance of a large number of SBP
circulars betrayed the failure in formulating a well-thought out
policy to deal with the situation.
They said the urgent requirement was to boost exports and immediate
issuance of notifications to implement the various measures
announced in the Trade Policy.
It was stressed that FPCCI should be involved in ensuring that the
notifications being issued are in accordance with the Trade policy.
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980709
-------------------------------------------------------------------
Moratorium on loans repayment may be sought
-------------------------------------------------------------------
Bureau Report
ISLAMABAD, July 8: Minister for Finance Senator Sartaj Aziz on
Wednesday hinted at the possibility of seeking moratorium on loans
in case the international sanctions lasted beyond three months.
"In the first place we do not have any idea as to how long these
sanctions will continue and if they go beyond three months then we
will have serious thinking about seeking moratorium on loans," he
further stated.
Speaking at a news conference he said the sanctions had created
certain difficulties for Pakistan. However, he expressed the hope
that the sanctions would not last more than three months. "This is
our understanding that these sanctions are not for an indefinite
period and would end in three months time," he added.
Mr Aziz also informed reporters about the meeting between Prime
Minister Nawaz Sharif and IMF director Paul Chabrier held on
Wednesday in Lahore. He said he was also present during the meeting
and termed it as positive.
He said: "We discussed with Mr Paul the on-going ESAF/EFF programme
and I would again be meeting him on Thursday for further talks."
Responding to a question Mr Sartaj said he could not say whether
the IMF would release $226 million as part of the third and fourth
instalments of ESAF and EFF. "I would be meeting you again tomorrow
and would answer all your questions which relate to this issue".
The finance minister was also asked why the government was avoiding
to officially tell the nation as to how much money it has been
promised by four Middle East countries and whether they would be
offering oil on deferred payments. "Let us concentrate on
population census today for which this news conference was
convened," he said smilingly.
Mr Sartaj Aziz said the prime minister has informed the IMF
director about the circumstances that forced Pakistan to conduct
the nuclear tests in view of Indian N-test on May 11 and 13 which
badly altered the power of balance in the region. He said the prime
minister also told the IMF director that since Pakistan had
successfully implemented the conditions attached to the ESAF/EFF
during the last three quarters, it would be only fair for the donor
community to proceed with the programme.
The finance minister said that Paul Chabrier had stated that he was
in Pakistan as the head of the IMF mission to assess the current
economic situation and to submit his assessment to the Fund's
Management Board of Directors in Washington.
"Mr. Chabrier appreciated the progress made by Pakistan in the last
15 months in respect of the economy and in regard to progress made
in implementing important structural policies," said a press
release which was also issued during his news conference.
The finance minister and the secretary finance were also present at
the hour-long meeting of the prime minister with the IMF team. Mr
Furtado and Mr Tareq Shamsuddin, the local IMF chief accompanied Mr
Paul Chabrier.
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980709
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Ehtesab Bureau seeks CBR verification on Rs25bn loss
-------------------------------------------------------------------
Ikram Hoti
ISLAMABAD, July 8: The Ehtesab Bureau has asked the Central Board
of Revenue to verify the loss of Rs25 billion in customs duty due
to over-fixation of import quota for hundreds of industrial units,
over the past four financial year, including 1997-98.
The huge loss of duty has been pointed out to Ehtesab Bureau by
organizations of the industrialists who have been making complaints
that over-fixation of the quota for these units has been rendering
the other units uncompetitive in the local market.
The CBR has looked into the matter and has found out that the old
rules for fixation of quota and the implementation of the import
rules have been twisted to the extent that these units have been
over-importing duty-free raw materials needed for their
consumption, and have been selling them in the black market.
Under the old rules, the fixation of the quota has been a
compensation allowed to the manufacturing importers in lieu of
other lucrative incentives in tax and other areas which had been
withdrawn by the government.
These incentives were agitated against, by organizations of
industrialists in various sectors, terming them as too lucrative
and helping a set of manufacturers, rendering others in the market
uncompetitive.
The rules allowing generous fixation of the quota were revised in
1997, but there has been no investigation into the fact that the
misapplication of these rules has been causing the loss of duty and
establishing monopoly of a number of industrialists in the local
market.
These industrialists have been getting the capacity of their
units/plants over-rated, and the officials who have been involved
in allowing this over-fixation, have been causing the flooding of
the local market by certain raw materials imported duty-free. This
misapplication has also been causing growth of import-based black
market in certain sectors of industry in the country, says the CBR.
The Ehtesab Bureau, said CBR officials, plans to substantiate on
grounds of record-scanning that certain elements of the government
allowed the duty-free import of raw materials over and above the
capacity of hundreds of units, misapplication of the rules in
fixing the capacity, sale of the duty-free imported raw materials
in the black market, actual loss of duty incurred through this
malpractice.
Back to the top
===================================================================
EDITORIALS & FEATURES
980705
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Winter Pakistanis
-------------------------------------------------------------------
Ardeshir Cowasjee
THERE is a flock of winter Pakistanis, friends and acquaintances,
who land in Karachi every winter. Whether I like it or not, whether
anyone else likes it or not, they insist on telling us all exactly
what we should do, how we should deal with the problems of the
country, how we should counter the corrupt, holding forth
endlessly.
Guilt-ridden as many of them may be, even if given a wide berth,
they impose themselves upon us perennials, insisting that they know
best, and at the end of the day they proclaim: "Well, I'm off. Back
home to the civilized world. Look after yourself and remember you
are dealing with vengeful people who can do more harm than good.
Good luck, old boy. See you next year."
They always remind me of the old story our family physician, Dr
Gustad Behramjee Mehta, used to relate about a patient of his, of
undisclosed name, a jolly portly hirsute fellow who enjoyed the
good things of life and smoked a charas-laden hookah. He had
produced 14 children from his four wives. Each evening in rotation
he would return home to evenly fulfil his marital obligations. His
old retainer, Abdullah, minded the coop.
One evening, noticing Abdullah's furrowed brow, he enquired: "I
presume all is not well, trusted friend?" "How discerning you are,
my master. Senior Begum suffers from her chronic headache. Number
Two has had an attack of migraine. Number Three's eye problem has
recurred. And the Fourth, as you will remember, is precariously
pregnant, ready to pop".
"Alors, send Jooma with the Buick to fetch Dr Gustad to tend to
Wife One, telephone his son, Dr Jemi, and ask him to get here
quickly to comfort Wife Two, fix an appointment for tomorrow with
Dr Wania, to take care of Wife Three's eyes, and get the Lady
Dufferin Hospital into top gear tonight for Four. That settles
that. All is well. I'm off to the byscope." ('Byscope' being the
local pronunciation for bioscope, which is what the cinema was
known as in those far gone days.)
On the other hand, reactions and feedback from the E-mailers
students, scholars, researchers, professionals, businessmen and
others, mostly of Pakistani origin has been enlightening. As our
troubles mount, more and more E-mail messages pour in. There is
genuine anxiety. All seek detailed information and clarifications.
The e-mail bombardment began after the affair of the government's
attack upon the judiciary at the end of last year, increasing after
Nawaz Sharif went 'nuclear,' reneged on his promise, and froze the
foreign currency accounts. An analyst working at Moody's is
distressed. He should be.
The bank loan default figures, of which over 98 per cent are from
the public sector banks and institutions, as at the end of March
1998 were as follows:
Defaults: amounts of repayment of loans overdue over 365 days:
Total amount of defaults of loans of Rs.1 million and above =
Rs.144.920 billion (by now, say, over Rs.145 billion). The figures
pertain to loans of Rs.1 million and above and of these, Rs.111.066
billion are defaults of loans, each worth Rs.30 billion and above.
Non-performing loans: amounts of repayment of loans overdue over 90
days = Rs.130,524 billion (by now, say, Rs.131 billion). This
figure is only for non-performing loans of Rs.30 million and above.
Most of the defaulters/non-repayers are those who could not have
obtained their loans without political clout.
Inter-circular debt amongst just the government energy sector
(WAPDA owing to OGDC, OGDC owing to Sui Gas, KESC owing to Sui, and
so on and so forth and vice versa) amounts to Rs.82 billion.
If you are still sitting, with spectacles perched on the end of
your nose, read on.
Now, to top it all, Nawaz Sharif has shattered whatever credibility
his Government had by reneging on foreign currency accounts
belonging to us, the people, worth $11 billion.
The State Bank is not independent. The governor of the bank does
not sit on a constitutionally protected chair. He is at best a
hired factotum of the ministry of finance headed by Sartaj Aziz,
who is there because he is docile and faithful to Nawaz Sharif and
incapable of saying anything which may cause his boss to frown.
What Nawaz Sharif says, Sartaj accepts, and thereafter the rule-
bound State Bank issues a notification or a circular. So far, it
has issued some 40 circulars relating to the freezing of the
foreign currency accounts, which, when read in sequence, would
boggle the mind of even a senior wrangler.
The intentions of the government, to say the least, are far from
honourable. Every step of governance taken has smacked of the
stifling of dissent through intimidation or coercion, the
government having armed itself by vesting itself with "emergency"
powers, depriving us of our constitutionally guaranteed fundamental
rights.
When the FCAs were frozen, the first circular ordered authorized
dealers to notify the number of accounts held by: (a) residents;
(b) non-residents other than banks/financial institutions; and, (c)
non-resident banks/financial institutions, together with the total
of balances in various currencies held in each category.
Though 'no questions asked' immunity had been granted to holders of
FCAs, the very next day after the freeze the State Bank collected
information by its second circular which asked for details of (a)
the names and addresses of the account holders; (b) their account
numbers; and, (c) the closing credit balances as of 28.5.98. Why
was this necessary?
The State Bank maintains that these details are held in secrecy,
but, at the same time, it knows that all that is needed to vitiate
the secrecy is a telephone call from the finance ministry.
When he was surrounded by expatriate Pakistanis in Kuwait last
month, the prime minister informed them that their FC accounts
would be unfrozen. When he returned home, and his sayings in Kuwait
were clarified, we were told that the accounts had indeed been
unfrozen but that withdrawal in foreign currency was 'temporarily
suspended.' ('Temporarily' has not yet been defined.) Money could
only be withdrawn in rupees at the artificial rate of Rs.46 to the
dollar. Moreover, these sums, though unfrozen, could not be used as
collateral.
All this is meaningless. What the prime minister more or less said
to us is: 'I have finished off all your foreign currency that you
entrusted to me, and now I will allow you to open fresh foreign
currency accounts from which you can withdraw at will.' Does he
really believe that anyone will trust his word?
An e-mailer researcher of the Kennedy School at Harvard, a Ph.D in
political science from MIT and a JD from NYU Law School, who is now
writing a paper on our judiciary and the storming of the Supreme
Court, will be pleased to learn that Nasir Aslam Zahid J. , and his
brothers Munawar Ahmad Mirza J, and Abdur Rehman Khan J., have come
up trumps. Nasir Aslam Zahid's judgment, handed down on July 3, on
the November storming leaves no doubt that the attack was a
premeditated exercise launched by the ruling party to pervert the
course of justice, that the flack-jacketed police force controlled
by the ruling party anticipated the attack and were there as part
of the plan to facilitate the smooth entry of the stormtroopers.
The troops came from the street-fighter wings of the Muslim League,
led by its street-fighter parliamentarians and other toughs.
The people must come to the aid of the competent unapproachable
judges to help them regain their confidence and their credibility,
so sadly lost (howsoever lost) at the end of last year.
As for Karachi, the federal ministerial force that descended upon
the city last week has realized that the cost of keeping this
coalition government alive in Sindh at the expense of 10 lives a
day is really not worth it. They have at last accepted that the
killings are not wanton, but are a part of the highly organized
ethnic turf war that has been waged in this city for over a decade.
The chief minister has finally conceded that if the police force is
left to itself and completely freed of political intrusion and
interference, and is led by a man of capability and vast experience
in the province of Sindh, it may be able to do something to control
the situation. The Federal Chaudhry who tries to look after the
interior, has empowered the Rangers. If this force, now led by a
competent general, is also allowed to do what it is meant to do, we
may be able to survive, albeit uncomfortably.
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980711
-------------------------------------------------------------------
Hanging on
-------------------------------------------------------------------
Irfan Husain
ONE of the most pathetic sights known to man is the spectacle of a
civil servant currying favour to get an extension or a contract at
the fag-end of his career.
The reason why so many senior government officers choose to debase
themselves in this fashion is that once they are shorn of their
official position, not only do they lose their many perks, they
also become non-entities overnight. One day they are all-powerful
heads of vast bureaucratic empires, and on their sixtieth birthday,
they are transformed into has-beens who bore everybody within
earshot by their endless recitals of their triumphs during their
long bureaucratic careers. To postpone this sad destiny, government
officials spend the last couple of years of their working lives in
attempting to muster up clout among the ruling party of the day to
somehow manoeuvre a stay of execution through an extension or a
contract. Most fail, but a fortunate few manage to hang on in
government service.
One civil servant who has clung on is currently principal of the
Administrative Staff College. This is normally a prized sinecure
that is given as a reward for meritorious service towards the end
of a distinguished career. The college trains senior civil servants
to man top positions and three years ago, I did a course there
shortly before I took early retirement from government service. As
a result of the four months I spent there, I have grown rather fond
of the place.
Apart from the fact that participants were expected to come to
class at the crack of dawn (i.e., eight in the morning), I had a
splendid time. The college is housed in the old Punjab Club
premises on the Mall, and has extensive lawns and hundreds of old
trees. The rooms are comfortable, and I used my bureaucratic skills
to organize transport, a phone and computer. Since I have many
friends in Lahore, I was out most evenings.
The principal then was Salman Qureshi, an eminently civilized
person, who wisely decided early in his stint, that the college
could not hope to transform senior bureaucrats with more than
twenty years of experience in a four-month course. Consequently, he
tried to ensure that the experience was as pleasant and painless as
possible for the participants. As a result, most of us came away
with warm memories of the place and the people we met there.
Unfortunately for them, the last group of trainees did not have the
same experience I did. The present incumbent, Mr Khalid Javed,
officially retired two years ago as chairman, WAPDA, but managed to
continue on extension. He then moved on to run the Civil Services
Academy, and has now taken over the Staff College. The interesting
thing about these post-retirement assignments is that, according to
the rules, a civil servant can only be given an extension if he is
irreplaceable. Now whatever else Mr Javed may be, even his most
loyal supporters will not assert that he cannot be replaced.
One of his innovations on coming to the Staff College was to stop
the lectures on art and architecture. The purpose of these two
talks was to expose civil servants to our cultural heritage, but Mr
Javed has deemed them unfit to be included in the curriculum. He
then tried to get foreign affiliation to conduct "executive MBA"
courses, but was politely told that this was a trifle ambitious,
given the fact that most participants were in their fifties, and
were present for only four months.
While Mr Javed's tinkering with the curriculum deserves our
admiration, I must confess that I learned very little in the
classroom. For me, the most useful part of the course was the
insight I gained from the experience and views of the other
participants who came from different services and different
backgrounds. Some of them have become good friends. But such
camaraderie thrives in a relaxed environment; the current thrust
seems to be towards transforming the college into a boarding school
with endless rules.
Another of the new principal's innovations is to discourage faculty
and their families from playing tennis at the college courts.
Earlier, the college subsidized the sport to the extent of
supplying free balls. As a result of this cost-cutting measure, Mr
Javed has saved all of Rs 2,000 per month. One only wishes his
concern for the taxpayer extended to his own perks.
It is traditional for the principal to take a class or two, meet
participants and attend a few lectures and group discussions. The
present incumbent, however, has only come to a couple of talks,
including one given by Mr Mushahid Hussain, the information
minister. He has also moved his office from its perfectly adequate
space into one of the classrooms. This speaks volumes for his
commitment to training and higher education.
The world over, civil servants retire to write their memoirs or
tend their gardens. Here, because bureaucrats tend to focus
singlemindedly on their careers (as opposed to their jobs), few of
them have any hobbies to sustain them after retirement. The result
is that they either drive their wives up the wall by trying to
micro-manage the household, or bore younger colleagues with long
tales of bureaucratic battles fought and won. One reason why senior
civil servants are generally so spineless when given illegal orders
by their political bosses is that they are looking ahead to the
evil day when they have to retire, and will need political support
to ensure that they can cling on.
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980710
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Karachi's web of terror
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M.H. Askari
IF an all parties' conference a full year ago perceived Karachi as
a city "with violence and terror stalking its streets round-the-
clock", the outlook is vastly more bleak today and getting worse
with each passing day.
With as many as 171 persons killed in the month of June (according
to the police authorities themselves) and many more since, the
scale of violence has obviously escalated several times in the last
12 months. The people are hostage to murderers, dacoits and armed
bands of militants functioning under the label of political and
factional groups. No market, no public place, no residential
locality is out of their reach. If one escapes the web of terror
spun all round, it is only by a stroke of good luck.
When this writer spent a great deal of his time recently in what is
looked upon as a major centre of trouble, he heard several first-
hand accounts of gangs of young men going from door to door
demanding bhatta, of grievously wounded persons found half-dead in
the backstreets and of women in respectable households being
molested by militants. In most of these cases, people were too
scared to report these incidents to the police or seemed to have
lost trust in the police to do much about them.
The state of affairs has naturally aroused much concern among all
classes of people, but a public expression of concern is mostly
confined to the better educated and socially more secure classes
professionals, journalists, lawyers, doctors, middle- level
government employees or business executives. One seldom hears of
people living in the lower middle class neighbourhoods or in slum-
like tenements, even though they are the most affected, getting
organized to hold rallies, peace marches and public meetings. This
class of people is perhaps much too demoralized or much too
harassed by the sheer effort to survive to be able to think of the
ways and means of extricating themselves from the web of terror.
The chronic shortages of essential utilities and the apathy of the
officials especially at the level which is accessible to them leave
them with little hope to be able to do anything effective about the
state of affairs.
The proliferation and easy availability of weapons in Karachi is at
the centre of what has contributed to the making of the pattern of
life in this brutalized city. In his meticulously researched study
of politics and ethnicity in Pakistan, the eminent Sindhi scholar,
late Dr Feroz Ahmad, came to the conclusion that it was Zia
government's active involvement in the happenings in Afghanistan
that facilitated a "dramatic increase" in the crime mafias in
Karachi and that the notorious smugglers' market at the head of the
Hyderabad-Karachi highway became the main conduit for supply of
drugs and illicit arms. Although the Zia regime ended more than a
decade ago, the pattern has endured and even proliferated. It has
been actively encouraged by the patronage extended to it by people
enjoying social respectability because of their wealth and social
and economic power.
It is difficult to make even a rough estimate of the number of
weapons floating around in Karachi. The first demand by people
disturbed by the prevailing state of affairs is for the de-
weaponization of the city. But there is little to suggest that
there has ever been a serious attempt at achieving that. Most of
those who are in a position to do anything about it seem to have a
vested interest in letting the status quo continue. Unearthing
secret dumps or caches of arms may not be simple or easy, but there
has hardly ever been a call for the surrender of arms, whether
known or hidden. Too many people go about displaying arms. There
are known neighbourhoods controlled by leaders of various factions
which are teeming with people armed with the most lethal automatic
weapons.
There is no reason why a deadline should not be fixed for putting
an end to the display of arms even by people in authority, except,
of course, the members of the law enforcement organizations. It is
deplorable that feudal customs in which the carrying of arms has
traditionally been a status symbol should have been allowed to
manifest itself in urban culture. The zamindars and waderas and
their hordes of armed private security guards have no reason to be
visible in cities like Karachi.
The foremost demand of the all parties conference held in Karachi
in July last year was for "a solemn undertaking by all political
parties to deweaponize the political culture... and to take
immediate steps to cleanse their own ranks of militants prone to
violence." This has never happened and even the political parties
which participated in the conference never took the demand
seriously.
The main inner core of a group of concerned citizens, the Citizens'
Alliance for Peace (CAP), held an informal get- together in Karachi
the other day and drew up a programme for mobilizing public opinion
against the prevailing state of affairs in the city through public
rallies and peace marches. However, many of the prominent activists
of CAP are now aligned to a political party which has a political
programme of its own aiming to capture power. While the CAP's
commitment to peace in Karachi and to the launching of a sustained
campaign for that purpose are admirable objectives, it has to face
the reality that it is likely to be seen as a partisan body because
of its party affiliation and may not have the same sort of response
to its agenda as it did three years ago when it first came into
prominence. However, it has reaffirmed its call for a total ban on
the display, sale and use of arms and ammunition in support of a
political programme, a call that must be endorsed by all sane
elements.
Following a series of consultations between the federal and
provincial authorities last week, Federal Interior Minister
Chaudhry Shujaat Hussain announced the setting up of two committees
as part of the strategy to bring the ongoing violence to an end. It
is not clear whether the Muttahieda Qaumi Movement (MQM) which is
allied with the Muslim League (Nawaz) in the Sindh Cabinet is to be
substantively associated with the working of the committees or not.
The Interior Minister claimed that the decision was by consensus
and had the blessings of the MQM; the MQM's senior spokesman,
Senator Aftab Shaikh, immediately came out with a rejoinder
dissociating his party from a good deal of what the Chaudhry Sahib
said. Following Chaudhry Sahib's statement, there were reports that
the Rangers had been empowered to carry out a search-and-arrest
operation; Mr Aftab Shaikh was emphatic that withdrawal of the
Rangers was an integral part of the PML-MQM agreement to cooperate
with each other and that the Rangers or any other para- military
forces had no role in the maintenance of law and order and their
presence in Karachi was therefore not acceptable. How any plan of
action which is adopted without the whole-hearted endorsement of
the PML's major ally in the Sindh government can produce useful
results is difficult to understand.
Even if it is distasteful, Islamabad has to accept the fact that
the MQM (led by Altaf Hussain) is representative of the majority of
Karachi's population and it, unfortunately, is in a position to
obstruct any action plan for Karachi which does not meet with its
aspirations. At the same time, the MQM must realize that it cannot
be permitted to behave as if it (and it alone) owns Karachi. It has
to be willing to work in cooperation with other important political
elements. Karachi has had more than its share of discord and
mistrust and only a spirit of cooperation and accord can cure it of
its ailments. The war for control over territories in Karachi
between MQM and its breakaway faction must come to an end.
The decision to break up the Karachi Metropolitan Corporation
(taken during the last regime) was in no sense either wise or
practicable. Four different administrative authorities cannot work
a cohesive system for operating the various administrative and
civic agencies which must function effectively to give the people
of Karachi a feeling of homogeneity and being looked after.
Otherwise they will remain fragmented and even perhaps have
conflicting perceptions of how Karachi should be governed.
Decisions concerning Karachi should be taken in Karachi and by
those who represent Karachi.
This places a special responsibility on the MQM, which is the major
element in Karachi's civil society and must be more tolerant of
dissent and disagreement than it is. In conjunction with other
political parties it must also commit itself not to indulge in
politics of violence.
The people of Karachi have, by and large, lost trust in the police
force and Rangers as presently constituted. What the city probably
needs is a metropolitan police which has to be better trained,
better motivated, better equipped than the police force operating
in the smaller cities and towns. It must also be so restructured
that it wins the confidence of the communities that it serves and
be accountable to them. This was one of the most worthwhile
recommendations made by CAP in a declaration issued by it in 1995
but appears not to have received much serious consideration by
those in authority.
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980706
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When they meet in Colombo
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Mahdi Masud
A Foreign Office spokesman has confirmed that the prime ministers
of India and Pakistan would meet on the sidelines of the SAARC
conference in Colombo coinciding with Sri Lanka's fiftieth
independence anniversary towards the close of this month. The
spokesman expressed the hope that the two prime ministers "would
send the foreign secretaries back to the conference table."
Mr Atal Behari Vajpayee has made a plea for bilateral talks between
India and Pakistan 'on all issues, including Kashmir', while
remaining opposed to the idea of any third party role in the talks.
Pakistan's willingness to refrain from seeking outside mediation
depends entirely on India's readiness to negotiate a Kashmir
settlement on the basis of international legality and the wishes of
the people of the disputed state.
It is not realistic to expect that just as it took an arch-
conservative like President Nixon to achieve the politically
hazardous opening to China in seventies, Mr Vajpayee's BJP
government with its Hindu nationalist credentials would play a
similar role in the context of India-Pakistan reconciliation.
However, the fear of uncompromising public opinion on either side,
proffered in the past as an excuse for failure to move towards a
rapprochement in South Asia, is less valid today with the BJP
government in office in Delhi and a Muslim league government in
Islamabad.
While it may sound like a cliche, the fact remains that no less
than the fate and future of a billion people in South Asia hinge on
the ability of the two prime ministers to bring a healing touch to
this troubled region suffering from self-inflicted wounds. Never
since 1947 have the prime ministers of the two countries faced a
greater peace-keeping responsibility than the present incumbents do
after having crossed the nuclear watershed.
If a move by Prime Minister Vajpayee to break the Kashmir deadlock
is not forthcoming at the talks in Colombo, the least he could do
is to agree to revive foreign secretary-level talks on the basis of
the June 23 agreement in Islamabad on the formation of working
groups on Kashmir and security. If restarted, the process may,
hopefully, lead to substantive talks on bilateral issues.
A settlement through bilateral means is obviously a more desirable
course. However, if the Colombo meeting foils to achieve any
positive results, and if the international community is seriously
interested in countering the threat to regional peace and stability
posed by recent developments in the subcontinent, it would have to
take a stronger line on the resolution of Kashmir and other
disputes. In the words of Nicholas Platt, former US ambassador to
Pakistan, and currently the head of Asia Society, New York: "It is
only through a resolution of the Kashmir issue that the US (and the
world community) can achieve their principal objective in South
Asia non-proliferation."
In her latest statement on the subject, US Secretary of State
Madeleine Albright said, "What we would like to happen is for India
and Pakistan to seek the world community's help in resolving the
(Kashmir) dispute. The international community would respond
immediately. It would happen in a heartbeat."
The least that important organs and institutions of the world
community (including the Security Council, the UN secretary-
general, the P-5 and G-8) can do is to sustain pressure for the
achievement of a Kashmir solution which holds the key to peace in
South Asia. Mere references to Kashmir as the "root cause" of
tensions between India and Pakistan are not enough.
If the nuclear tests of May have lessened the danger of an Indo-
Pakistan war by concretizing the concept of mutual deterrence, they
have also heightened the possibility of triggering a catastrophic
conflict by blunder, miscalculation or accident the last by, say,
a failure or malfunctioning of the controls or surveillance system.
It is this latter possibility that adds a cutting edge to post-
nuclear tests situation in the strife-torn subcontinent.
In this context, Pakistan's former air chief, Air Marshal Zafar
Chaudhry who had earlier opposed the option of Pakistan responding
to the Indian tests with tests of its own, maintained later that
Pakistan's nuclear capability did not provide a suitable deterrent
against India's conventional superiority because since both the
sides now possessed nuclear weapons, they cancelled each other out,
leaving India's conventional superiority in the field.
The argument is fallacious since Pakistan's nuclear capability is
meant to deter an aggressive attack by India, irrespective of
whether this is launched by nuclear or conventional means. Nuclear
capability is the world's first truly political weapons system,
designed to prevent, not to wage, war. In the case of Pakistan, it
is a deterrent against any attempt to drive this country to the
wall as India has done at least twice in the past.
As for the contention that since India has a greater destructive
capacity in nuclear weapons, Pakistan is in no position to risk
ever using nuclear weapons, the position is not so clear-cut and
definitive. As long as India knows that Pakistan will defend its
independence and sovereignty, even if this involves the use of
nuclear weapons, it will not risk endangering its major centres,
military or civilian, by launching an aggression against Pakistan
even though ultimately it may be in a position to inflict greater
nuclear devastation on this country.
===================================================================
SPORTS
980710
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Davis Cup squad leaves for Tehran on 12th
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Reporter
ISLAMABAD, July 9: Pakistan Tennis team's preparations for the
Davis Cup Asia Oceania Group-II second round tie against Iran here
at PTF complex ended today.
The team would fly to Teheran from Karachi on July 12. The tie is
scheduled for July 17-19 at Teheran.
There is no change in Pakistan team that played the first round
Davis Cup tie against Pacific Oceania here in April this year.
Aisamul Haq, Pakistan's ace junior who has jumped 10th in the world
ITF junior ranking recently, turned down the PTF selection
committee decision to appear in trials for selection in the
Pakistan Davis Cup squad. Aisam was asked to appear in trials by
July 7 at Islamabad.
During the final one-week training phase at the PTF complex,
emphasis were laid on ground stroke and physical endurance of the
players. Davis cuppers Mushaf Zia and Omer Rashid supervised the
training.
Meanwhile, the list of Iranian team members which arrived at PTF
office today, contains three new players apart from Ramin Raziani
who defeated Omer Rashid in the reserve singles last year. Both,
Tavakali and Bahrami, the last year number one and two, are not
part of the team.
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980707
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PCB approves a list not signed by selectors
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Reporter
KARACHI, July 6: The Pakistan Cricket Board (PCB) executive council
approved the list of players for the Pakistan Under-19 team on
Sunday which was not signed by any of the three selectors.
According to well placed sources in the cricket headquarters, the
original list of 20 players finalised by the selectors was signed
by the three selectors viz Abdul Raquib, Azhar Khan and Maazullah
Khan.
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