------------------------------------------------------------------- DAWN WIRE SERVICE ------------------------------------------------------------------- Week Ending : 22 August 1998 Issue : 04/33 -------------------------------------------------------------------

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CONTENTS ===================================================================
NATIONAL NEWS + Clinton explains US stance to Nawaz + PM, President discuss situation + SBP restrained from giving rupee profit on dollar bond + Nawaz to meet Vajpayee at NAM summit + Sanctions not to affect economy: PM + Islamabad tells provinces to mobilize own resources + Altaf urges PM to set up probe body + Pakistan making equipment for N-plants: Qadeer + 24-man Balochistan cabinet sworn in + Benazir denies charges of money laundering --------------------------------- BUSINESS & ECONOMY + Sindh recovers 70pc more farm income tax + IMF not averse to discussing debt relief + Settlement with IPPs soon: Gohar + $2.7 billion FCY deposits withdrawn + Depositors' names to be made public soon + Tariff cut to 35pc in single step opposed + Traders threaten strike on GST issue + Commission recommends more taxes to provinces + No revival of fixed tax for traders, says Moin --------------------------------------- EDITORIALS & FEATURES + The myth makers-I Ardeshir Cowasjee + Riding the tiger Irfan Husain + A sinecure for Sartaj Aziz? Aziz Siddiqui ----------- SPORTS + Coach terms Pakistan's overall performance as satisfactory + England beat Egypt to bag title as Pakistan finish 3rd + Hanif, Hasib hail Miandad's appointment

Clinton explains US stance to Nawaz
Bureau Report

ISLAMABAD, Aug 21: Prime Minister Nawaz Sharif on Friday received a 
telephone call from President Bill Clinton explaining his point of 
view over the US strikesin Afghanistan and Sudan.
Prime Minister Nawaz Sharif told President Clinton that the 
unilateral US action constituted violation of the sovereignty and 
territorial integrity of independent states, said a press release.
Mr Sharif said the attack had caused widespread anguish and 
indignation in Pakistan, it added.
The prime minister further observed that instead of resorting to 
military action against sovereign states the US should have opted 
for dialogue and consultation to achieve its objectives, the press 
release said.
The Prime Minister also reiterated Pakistan's commitment to 
combating terrorism in all its forms as it had itself been a victim 
of state sponsored terrorism, for many years.
The first official reaction over the US strikes was given by the 
Foreign Minister Sartaj Aziz at the floor of Senate after the prime 
minister's telephonic conversation with the US President.

PM, President discuss situation
Ihtasham ul Haque
ISLAMABAD, Aug 20: Prime Minister Nawaz Sharif called on President 
Rafiq Tarar here on Thursday and discussed with him Pakistan's 
relations with Iran and Afghanistan.
Informed sources said the meeting between the two took place in the 
backdrop of tensions in relations with Iran.
Mr Sharif told the president that Pakistan was not interfering in 
the affairs of Afghanistan as continuously being alleged by the 
Iranian government.
Both agreed that the government should try to remove some of the 
misunderstandings of Iran by establishing a formal contact with 
authorities in Tehran.
Sources said they also discussed the situation in Afghanistan and 
expressed the hope that Taliban government will be able to 
establish peace in that country.
Both the president and the prime minister also discussed measures 
to accelerate the pace of Islamization. The president reportedly 
offered various suggestions to enforce Shariah in all walks of 
life. He also appreciated Mr Sharif's speech that he delivered 
during late President Zia's 10th death anniversary on August 17 at 
Islamabad. The prime minister had assured the participants that his 
government would enforce Islamic laws in Pakistan.
The prime minister also briefed the president about the current 
state of the economy and expressed the hope that the Islamic 
Development Bank (IDB) would extend 1.5 billion dollar rescue 
package to help Pakistan avoid default. Advisor on finance Dr Hafiz 
Pasha would go to Jeddah on September 9 to attend the meeting of 
the IDB.

SBP restrained from giving rupee profit on dollar bond
Shujaat Ali Khan
LAHORE, Aug 19: The Lahore High Court on Wednesday restrained the 
State Bank of Pakistan from compelling a petitioner dollar bond 
holder residing in Pakistan to receive his profit in rupees.
Admitting a writ petition against the payment of profit on dollar 
bonds given to frozen foreign currency account holders in dollars 
to the non-resident Pakistanis and in rupees to resident 
Pakistanis, Justice Ihsanul Haq Chaudhry issued notice to the 
respondent SBP.
A notice was also ordered to be issued to the attorney-general as 
the matter involves substantial questions as to the interpretation 
of constitutional law concerning the federal government. Meanwhile, 
the petitioner shall not be compelled to receive profit in rupee, 
he directed.
The judge noted that the petitioner, according to his counsel 
Mansoor Ali Shah, is not keen to immediately receive profit but was 
being compelled to withdraw the amount of profit in rupees at the 
exchange rate fixed by the SBP. On the contrary, non-resident 
Pakistanis are being paid their profit in US dollars. The 
discrimination will cause great financial loss to the petitioner.
The petitioner, Naveed M Sheikh, said that he has two foreign 
currency accounts in two different banks, which are currently being 
used as a collateral for financing extended to his Sheikh Spinning 
Mills. While his petitions against the freezing of his accounts 
were still pending before the Lahore High Court, the SBP allowed 
the frozen account holders to purchase 'special US dollar bonds', 
against their outstanding deposits. These bonds will be for five, 
seven and 10 years and will carry profit at half-yearly intervals 
as per prescribed rates.
However, the profit on the bonds will be payable to resident 
Pakistanis in rupees and to non-resident Pakistanis in dollars. The 
principal amount will, however, be payable to both in dollars.
Arguing the petition, advocate Mansoor Ali Shah submitted that the 
distinction between resident and non-resident Pakistanis in the 
matter of profit violates Article 25 of the Constitution, which 
guarantees the fundamental right of equality and outlaws 
Besides lacking intelligible differentia, the classification bears 
no nexus to the purpose of the decision. If the purpose of the SBP 
is to retain foreign currency, payment to a smaller group of 
citizens with lesser amounts in rupees and a larger group with  
bigger deposits in dollars defies comprehension.
The non-resident Pakistanis, the counsel pointed out, will be 
getting Rs 12 more for each dollar at the current market rate. The 
rate of return not being 'fair' compensation, is thus also hit by 
Article 24 of the Constitution, which allows the state to acquire a 
citizen's property only in certain specified cases and only on 
payment of due compensation.

Nawaz to meet Vajpayee at NAM summit
Hasan Akhtar
ISLAMABAD, Aug 20: Prime Minister Nawaz Sharif will leave here for 
Durban, South Africa, on Sept 1 to take part in a Non-Aligned 
Movement summit. He will possibly have a meeting with Indian Prime 
Minister Atal Behari Vajpayee there and stress the need for 
continuing dialogue on vital issues.
The summit will be held on Sept 3 and 4, where a heavy agenda will 
come up for discussion by leaders of the NAM countries, mostly 
Asian, African and Arab, who face a numerous political, economic 
and security problems and would be keen to seek solution to at 
least some of them which are of greatest urgency.
Besides ongoing civil strifes in different regions, the political 
and socio-economic problems are too complex to receive adequate 
attention from the leaders of about 120 nations who are expected to 
attend the summit.
It is generally believed that the NAM is fast losing the importance 
it previously had in the world affairs, partly because of the 
declining role of its original powers and growing complexity and 
enormity of problems and issues facing a fair number of the member-
states. The very size of NAM , with its members often having varied 
and at times conflicting interests, has become the reason for its 
declining leadership role.

Sanctions not to affect economy: PM
Bureau Report 
ISLAMABAD, Aug 17: Prime Minister Nawaz Sharif on Monday said 
economic hardships being faced by the people in the wake of nuclear 
tests were temporary and would be over soon.
"Those who imposed sanctions on Pakistan are today regretful as 
these sanctions have not worked," he said in a speech at a meeting 
outside the Faisal mosque to mark the 10th death anniversary of 
former president Zia-ul-Haq.
He called upon the people to keep their morale high and not to get 
depressed over economic hardships. "These hardships will be over 
tomorrow, if not today."
The premier again blamed a particular group for creating 
despondency among the people. Without naming anyone he said "these 
leaders" were more worried about the economic situation of the 
country then the people.
"The dollar exchange rate can again come down to Rs 35 and the 
stock market can again shoot up if I tender apology to the 
international community for conducting nuclear tests," he said.
These elements had been clamouring that lockers would be sealed, 
thousand rupee notes would be withdrawn and gold would be seized 
but nothing happened, he said. "The security of the country cannot 
be held hostage to a group of people."
He said the whole world offered lucrative packages to Pakistan for 
not conducting nuclear tests and India "threatened us with taking 
away Kashmir". But the government, he added, took a tough decision 
and responded to India's five tests with six.
Replying to Mr Ijaz-ul-Haq's demand that Islamic laws should be 
enforced in the country, he said it was a cherished desire of his.
Several members of the federal cabinet, a large number of Muslim 
League legislators and local Muslim League leaders were present at 
the Faisal mosque.
Mr Ijaz-ul-Haq in his speech called upon the prime minister to 
conduct accountability in line with the Islamic concept.
The prime minister said the government should recover each any 
every penny from the 847 people who had got written off loans 
running into billions .

Islamabad tells provinces to mobilize own resources
Shaukat Ali
LAHORE, Aug 20: Islamabad has issued fresh instructions to all the 
provinces for mobilization of their own financial resources to 
cater to the needs of their development sectors.
The federal government has expressed concern on what it termed as 
extremely pathetic performance of the federating units in sparing 
funds from their recurring budget for the purpose of development.
The Punjab, informed sources said, had been under bitter criticism 
for not being able to substantially support its Annual Development 
Programme for the present fiscal.
In its Rs 17 billion ADP for 1998-99, the sources pointed out, 
Punjab's own share was less than 1 per cent. The development, they 
said, was mainly based on the federal government loan of around Rs 
7.5 billion. Other chief component in the ADP was the foreign 
assistance to the tune of Rs 6 billion, the sources added.
In fact this largest province had also relied heavily on Islamabad 
during the last financial year when it was provided with Rs 6 
billion cash development loan and almost a matching funding by the 
foreign agencies.
"The federal government apprehends snags in the supply of foreign 
assistance if sanctions are imposed for testing nuclear devices in 
May this year. This may hit the provinces' development plans 
directly as well as indirectly. Islamabad wants the provinces to be 
self-reliant to sponsor their development schemes", the sources 
quoted senior finance ministry officials as telling a high level 
meeting with representatives of all the provinces held recently in 
It is understood that the Punjab is considering a new austerity 
plan to spare around Rs 700 million from the current budget to at 
least maintain funds supply to the ongoing development schemes in 
case it faces difficulties in obtaining funds from Islamabad.
Sources said Sindh and NWFP were also considering to salt away some 
funds from their non-development expenditure to meet any emergency, 
specially to accomplish schemes which were nearing completion.

OPF receives poor response from overseas Pakistanis
A Correspondent
ISLAMABAD, Aug 15: The Overseas Pakistanis Foundation (OPF) sold 
residential plots worth $1.57 million to overseas Pakistanis on the 
final day (August 13) of the submission of applications, and 
extended the date till September 14 to attract more Pakistanis, 
reliable sources told Dawn.
These sources said the OPF had earlier estimated to collect $30 
million through the scheme.
Another reason behind the extension of the last date was a message 
from Federal Minister for Labour, Manpower and Overseas Pakistanis 
Sheikh Rashid who, along with dozens of officials, is visiting 
different foreign countries to persuade Pakistani immigrants to buy 
plots and send home the much-needed dollars to help the country.
Official sources feared that in case the set target of $30 million 
was not realized till the expiry of the extended date (September 
14), the whole scheme would be flopped as the OPF needed a huge 
amount of money to develop the two planned sectors, E-13 and D-13, 
in Islamabad.

Altaf urges PM to set up probe body
Staff Reporter
KARACHI, Aug 17: The present spree of mass killings of Mohajir 
youths is the result of the inability of the prime minister to 
prosecute the culprits as envisaged in the 1997 Supreme Court 
judgment, said Altaf Hussain on Monday.
Addressing a congregation at the MQM's International Secretariat, 
which had gathered to offer Fateha for the 10 party workers killed 
on August 12, the Muttahida Qaumi Movement leader said the verdict 
holding the Benazir government guilty of extrajudicial killings of 
MQM workers had not been legally redressed by the Nawaz government.
He said the inability of the prime minister to constitute a legal 
commission to probe such killings had encouraged thesame culprits 
to continue with the same policy of elimination of his people.
The inaction of the prime minister was contrary to the Constitution 
in which Article 9 guaranteed safety of life and also in direct 
contravention of the written agreement between the Muslim League 
and the MQM in which this issue was given the highest significance.

He reminded the audience that the removal of Benazir Bhutto by the 
president in November 1996 was principally based on the extra-
judicial killings of hundreds of MQM workers.
He said the Supreme Court had upheld this ground in its order when 
Benazir challenged her removal from office.
Mr Hussain demanded that continued injustice to the very existence 
of Mohajirs be immediately redressed if the prime minister did not 
want to be judged by history to have miserably failed in performing 
his duty to safeguard human life.
TORTURE ALLEGED: Muttahida Qaumi Movement has accused police of 
committing torture on its arrested workers and sympathizers.
These workers were arrested on the occasion of mourning day on 
Saturday to protest against the killings of 10 MQM activists in 
North Nazimabad on August 12.
According to an MQM press release, dozens of party workers and 
sympathizers were arrested on Saturday by police and other 
On Monday when six of them were brought to the court for remand, 
there were visible signs of torture on their bodies, said the press 
The deputy convener of the MQM coordination committee, Senator 
Aftab Sheikh, has urged Prime Minister Nawaz Sharif to take notice 
of the alleged torture of MQM workers.
Pakistan making equipment for N-plants: Qadeer
Our Reporter
KARACHI, Aug 18: The leading nuclear scientist, Dr Abdul Qadeer 
Khan, said on Tuesday that Pakistan had not only attained the 
nuclear capability with missile power, it had also started 
manufacturing sensitive equipment used in nuclear plants.
Speaking at a reception organised in his honour by Anjuman-i-
Musannifeen, Dr A. Q. Khan declared amid applause that Pakistan was 
among five or six countries of the world which had this capability.
The father of Pakistan's nuclear programme was given a standing 
ovation as he arrived at the venue for being honoured by men of 
letters for his outstanding accomplishment for the country. He was 
showered with flower petals as he walked towards the dais amid 
Dr Khan said the test-fire of the long range Ghauri missile had 
become imperative after India developed the Agni and Prithvi 
"Although the decision of testing Ghauri and nuclear devices were 
very difficult for Prime Minister Nawaz Sharif, he went for nuclear 
tests and gave a befitting reply to India's nuclear explosions," 
said Dr Qadeer.
He said the missile development programme was initiated in 1993 
because of the looming Indian threat. "We had no choice of whether 
or not. The question was whether it could be done in two years, 
three years or five years."
Describing the test fire of the Ghauri missile from Jhelum on April 
6, which had successfully hit its target at Naukundi in 
Balochistan, Dr Khan said the missile covered 1100 kilometres 
distance within 10 minutes, went up to 262 kilometres high and then 
hit its target.
He said the missile could go up to 365 kilometres high in the sky 
while covering 1,500 kilometres distance and hit its target with 
12,000 kilometres velocity.
"A missile with such a speed cannot be intercepted and is capable 
of successfully hitting its target," said Dr Khan. He revealed that 
Pakistan had acquired nuclear capability in late 1984 and said "no 
foreigner has ever set foot on the Kahuta facilities."
Dr Khan said Pakistan's peaceful nuclear programme had to face  
international opposition and the country had faced many 
difficulties but the objective of providing the country with 
credible deterrent was never let off the sight of the successive 
"Such capabilities cannot be achieved by an individual, it is a job 
done by a team of dedicated people and I am proud of being the 
captain of the team which has the winning capability," said Dr 
Dr Khan recalled that two years after the Indians had conducted 
their first nuclear test in 1974, he offered his services to then 
prime minister Zulfikar Ali Bhutto from Holland. Mr Bhutto gave him 
the assignment to produce a deterrent to the Indian capability. He 
was called to Pakistan and made chief of the Kahuta Laboratories.
The successive governments, he said, had provided support and every 
facility and "we pledged ourselves that we will never disappoint 
the nation".
With that determination, Pakistan had acquired expertise on 
enrichment of uranium within two years and when General Zia visited 
Kahuta he was surprised to see the enrichment facility operational, 
he said.

24-man Balochistan cabinet sworn in
Staff Correspondent
QUETTA, Aug 15: A 24-member provincial cabinet headed by Chief 
Minister Mir Jan Mohammad Jamali was sworn in here on Saturday.
Balochistan Governor Miangul Aurangzeb administered the oath to the 
ministers at a ceremony held on the lawns of the governor house.
Chief Minister Jamali, senators, MNAs, MPAs, former chief minister 
Nawab Zulfiqar Ali Magsi and senior civil and army officers and 
other people attended the ceremony.
It was for the first time in the parliamentary history of 
Balochistan that 24 ministers took oath at one go.
However, Pakhtoonkhawa Milli Awami Party (PMAP), which supported 
the Jan government and given vote on confidence, did not join the 
The PMAP which had two members in the Balochistan Assembly will, 
however, sit on the treasury benches.
Out of 29 supporters of the Jan Jamali government, 24 were inducted 
in the cabinet while Nawab Zulfiqar Ali Magsi was the only PML PMA 
who did not join the cabinet as he had been the chief executive of 
the province twice.
The Jamhoori Watan Party, which had supported the Jan Jamali 
government, also did not join the cabinet.
Chief Minister Jan Jamali later told newsmen that portfolios would 
be allotted to the ministers shortly.

Kashmiris, Sikhs hold anti-India rallies
LONDON, Aug 16: Hundreds of Sikhs and Kashmiris staged separate 
demonstrations outside the Indian High Commission here on Saturday 
on the Independence Day of India to condemn brutalities being 
committed in Punjab and Kashmir and demand an end to occupation of 
their homelands by Delhi.
The Sikhs, who are demanding a separate homeland in Punjab and the 
Kashmiris who are asking India to implement the United Nations 
Security Council resolutions by giving them their right to self-
determination, stood close to each other outside the high 
commission building as a small number of policemen watched them 
from a little distance.
"Quit Kashmir," said a placard held by a Kashmiri leader. "Indian 
dogs, leave Kashmir", said another.
"We want freedom," chanted the Kashmiris. "Implement UN resolutions 
on Kashmir."
The demonstration was organized by All Parties International 
Kashmir Coordinating Committee, UK, which is headed by Haji 
Nuruddin Ahmad. 
A large number of Kashmiris, from all over Britain, took part in 
the rally.
The demonstrators represented almost every Kashmiri party and group 
besides political activists of Pakistani parties.
The Kashmiris also distributed pamphelts which highlighted the 
atrocities being committed by Indian security forces in the Valley 
and asked people to raise their voice against the violation of 
human rights there.
Later, a delegation comprising Haji Nuruddin Ahmad, JKLF leader 
Zafar Khan, Tehrik-i- Kashmir leader H.Ghalib and Azad Kashmir 
People's Party leader Allah Ditta also went to 10-Downing Street to 
hand over a memorandum written on behalf of the Kashmiri community 
living in Britain and addressed to Prime Minister Tony Blair.
The memorandum praised the British prime minister's concern over 
the Kashmir dispute and his appeal to Indian and Pakistan to settle 
it, as well as other issues. 

800 suffering from AIDS in Pakistan
RAWALPINDI, Aug 19: Over 800 victims of fatal disease AIDS have 
been detected while the number of HIV virus carrier has increased 
to 50,000 in Pakistan. This was revealed by speakers at a seminar 
on AIDS organised by the Global Human Right Society of Pakistan at 
the Liaquat Memorial Hall here on Tuesday.
Medical experts Dr Tariq, Samina Shafi and others informed the 
audience that AIDS had been spreading in the country rapidly due to 
lack of awareness and poverty.
They said the impact of western society was also a major reason for 
the spread of the disease in the country.
According to a survey carried out by international agencies, they 
said, some 20,000 to 50,000 carrier of HIV carriers were present in 
Pakistan. The number of those suffering from AIDS was stated to be 
12 million throughout the world out of which 42 per cent were women 
and children.
The experts said only in Asia the number of AIDS patients stood at 
3 million and US $60 bn to 80 bn were being spent on their 
treatment annually. Countries like Thailand, Indonesia, Korea and 
others which had collapsed economically, could not afford the cost 
of treatment of the disease.
"Of the total number of AIDS patients in the world, 60 per cent 
belonged to South African region," they added.
No medicine had so far been invented for the elimination of AIDS 
but its spread could be prevented through proper care and creating 
awareness among the masses.
Responding to a question, they said there were three means of 
transfusion of the disease - sexual practice, transfusion of blood 
and use of contaminated surgical and medical equipment, they added.

They urged the people to take proper care of their health and 
if any symptom of the disease was detected immediately go for a 
medical test. They said some 39 AIDS diagnosis centres had been set 
up in the country but most of the people were reluctant to have an 
AIDS test due to fear of this deadly disease.
They also urged the people not to treat AIDS patients as animals or 
aliens but to take them as normal persons.
The speakers also urged the people not to use used syringes, 
shaving blades and other medical equipments, not to go for blood 
transfusion without necessary tests and avoid sexual relationship 
with others except their wives and husbands.

Benazir denies charges of money laundering
KARACHI, Aug 20: Leader of Opposition Benazir Bhutto on Thursday 
denied the charges of money laundering, on the basis of which a 
Swiss magistrate has demanded her indictment, and said she would 
adopt every possible course of action after consulting her lawyers.
She was talking to newsmen during a break in the hearing of her 
petition against the Ehtesab Bureau chief, Senator Saifur Rahman, 
and the attorney- general in the Sindh High Court.
"The manner in which the Swiss magistrate has proceeded against me 
is marked with irregularities and is not in accordance with the 
provisions of the Swiss constitution," claimed Ms Bhutto, who asked 
Bern to examine these alleged irregularities.
Swiss magistrate Daniel Devaud had on Wednesday declared that he 
had asked the Pakistani authorities to issue indictment on money 
laundering charges related to kickbacks from two Swiss firms - 
Societe Generale de Surveillance and Cotecna - to the tune of $10 
Criticizing the report of her indictment by the Swiss magistrate, 
the chairperson of Pakistan People's Party denied the charges and 
vowed to fight it out.
The leader of opposition said the whole thing was unprecedented and 
added that a Swiss journalist had told her that the manner in which 
the case had been proceeding against her in Switzerland was 
violative of the Swiss constitution.
Ms Bhutto flayed the Swiss magistrate for giving too many news 
conferences before actually giving any judgment and allegedly 
acting at the behest of Ehtesab Bureau chief Senator Saifur Rahman.

Sindh recovers 70pc more farm income tax
KARACHI, Aug 20: The Sindh government has recovered Rs 412 million 
land revenue and income tax from the farmers during 1997-98, which 
the tax collectors claim is 70 per cent more than what was mopped 
up from farmers a year ago in 1996-97.
The Senior Member of Sindh Board of Revenue Javed Ashraf informed 
Dawn on telephone from Hyderabad that Rs 285 million has been 
recovered as income tax from the farmers till end-July and Rs 127.5 
million land revenue during 1997-98.
He said the collection of tax from the agriculturists is made upto 
end-July because what he said the assessment and valuation 
(jamanbandi and partal) of rabi crop continues even after June.
According to the information given by him, the farmers in Sukkur 
division gave the highest amount of Rs 107 million tax on their 
income followed by Rs 88 million by farmers in Hyderabad division. 
A sum of Rs 51 million was collected from Mirpurkhas division, Rs 
37 million from Larkana division and Rs 1 million from Karachi 
He said bulk of the agricultural income tax is generated from 
kharif in which three main cash crops cotton, rice and sugarcane 
are cultivated.
The Board of Revenue has made this collection from the crops grown 
on 8 million acres in the province but has no idea about the number 
of assessees from whom the tax was recovered.

IMF not averse to discussing debt relief
M. Ziauddin
ISLAMABAD, Aug 19: The IMF has indicated that it would not be 
averse to discussing with Pakistan a bail-out package envisaging 
immediate cash assistance 
of about 1.5 billion dollars followed by an equal amount of debt 
The Fund has also reportedly communicated to Islamabad that it 
would help clear the decks for the Islamic Development Bank to 
convert a part of Pakistan's short term loans amounting to about 
800 million dollars into longer term soft credits, and extend 700 
million dollars of immediate foreign trade credit.
According to informed sources, the IMF bail-out package would 
become operative six weeks after the approval of a policy framework 
package by the Fund board and during these six weeks Pakistan would 
be expected to devalue its currency massively, impose the GST and 
agricultural income tax in the true sense of their meanings and 
enhance power and gas charges by at least 25 per cent to begin 
These seven creditors include ABN Amro, Citibank, Standard Charter, 
Bank of America, Emirates Bank, Bank Al Faysal and Prime Bank 
(which has arranged swap for Pakistan from National Commercial Bank 
of Jeddah). These creditors have given short term loans of upto 
about 100 to 150 million dollars each on an average to Pakistan and 
the delay in the servicing of these loans is said to have brought a 
lot of pressure on the local branches of these private commercial 
banks and their liquidity positions.
Under the same arrangement, the IDB would also extend a 700 million 
dollar trade facility to Pakistan to finance essential imports and 
And finally, the Fund would make available to Pakistan cash credits 
to take care of its immediate foreign exchange requirements taking 
into consideration the remaining financial gap after debt relief, 
provision of IDB facilities and stoppage of  assistance under 
sanctions from World Bank and Asian Development Bank.
If the conditions are acceptable, Pakistan is expected soon to 
prepare a policy framework package on the above mentioned lines and 
invite a Fund mission to visit Pakistan for detailed negotiations.
All assistance from the World Bank and the Asian Development Bank 
to Pakistan would, however, remain on hold due to sanctions. 
Informed sources said that this was so probably because India whose 
aid from these multilateral aid agencies has also been stopped 
under sanctions would have regarded any IMF like concession to 
Pakistan in the case of these assistance as an act of partiality. 
This is not the case with IMF assistance as India does not have 
either an on-going programme with the Fund nor does it have one on 
the anvil.

Settlement with IPPs soon: Gohar
Staff Reporter

LAHORE, Aug 17: Federal Water and Power Minister Gohar Ayub said on 
Monday that a settlement would soon be made with the independent 
power producers (IPPs) on reducing the power tariff.

The minister was addressing a high-level meeting of WAPDA, NESPAK, 
NPCC, WAPDA Advisers, power wing's officers at the WAPDA House on 
his first visit to the city after assuming the charge of the water 
and power ministry last week.
He said that negotiations were being held with the representatives 
of the IPPs at Islamabad to discuss ways and means of reducing the 
power rates after taking into consideration the problems of both 
the IPPs and WAPDA. He hoped that a mutual agreement in the best 
interest of the country and both the parties would be reached.

Referring to the question of the construction of the Kalabagh dam 
project, the minister said that the government was dealing it at 
the political level with the politicians of the three smaller 
provinces with a view to evolving a national consensus as 
categorically declared by the prime minister. However, he asked the 
technical experts and engineers to continue their efforts for 
highlighting the technical aspects of the project with a view to 
dispelling the doubts of various sections of the people. These 
efforts would help achieve the consensus.

Mr Gohar Ayub expressed his concern over the increasing 
sedimentation in the Tarbela dam's reservoir which had already 
reduced its capacity to some extent. He asked WAPDA experts to take 
steps to clear the siltation. About two million of stones and silt 
were accumulated daily in the reservoir. He also discussed the 
grievances of the displaced persons of Tarbela dam as a number of 
them were still awaiting payment of compensation from the WAPDA for 
their properties submerged in the reservoir. He asked the WAPDA to 
settle their claims without any delay.

The minister also expressed concern over mounting arrears of WAPDA 
owed by a large number of power consumers who also include 
influential persons. He directed the WAPDA to accelerate its 
recovery campaign irrespective of the social or political status of 
the defaulters. The arrears were reported to as high as over Rs 40 
billion and the defaulters also include a large number of 
government departments, government and semi-government 
organizations, local bodies etc.

The minister was briefed about the Ghazi-Barotha hydropower 
project, Kalabagh dam, national drainage programme, Chashma 
hydropower project, the proposed restructuring and privatization of 
the WAPDA and the future of the power wing, creation of electric 
supply companies replacing the area electricity boards, engineers 
resentment to the formation of PEPCO etc.
WAPDA chairman Shamsul Mulk emphasized the need for a unified 
development and management of water and power resources of the 
country. He said that unified approach was necessary to meet the 
water and power requirements of the 21st century.

Pakistan Indus Waters Commission chairman Jamat Ali Shah, NESPAK's 
acting managing director Akram Khan and NPCC managing director Ejaz 
Malik briefed the minister about the activities of their respective 

$2.7 billion FCY deposits withdrawn
Mohiuddin Aazim
KARACHI, Aug 19: Some $2.7 billion worth of frozen foreign currency 
deposits have been converted into rupees reducing the total 
deposits from around $11 billion on May 28 to $8.3 billion on Aug 
18, 1998. The conversion at the rate of Rs 46 per dollar has 
siphoned off Rs 124.20 billion or 11 per cent of total bank 
deposits from the banks.
Senior bankers say $170 million worth of FCY deposits were 
converted into rupees during the last ten days. Up to August 8 
people had converted $2.53 billion worth of these deposits.
Bankers say the pace of conversion slowed during the last four 
weeks. This has happened despite the fact that banks are offering 
high rates of return through tailor-made rupee deposit schemes to 
get back the funds that flew out of the banking system through 
conversion of FCY deposits.
Bankers say the rapid changes in foreign exchange rules have 
shattered the confidence of the public. That is why the juicy rupee 
deposit schemes launched by literally every bank have not been 
successful in getting back the major chunk of the funds that flew 
out of the banking system through conversion.
The July 21 package had it that people would continue to enjoy 
wealth tax exemption and exemption from disclosing the source of 
funds if they converted their FCY deposits into rupees. The package 
also promised withholding tax exemption on converted funds if 
redeposited with the banks.
It is because of these decisions that the holders of frozen foreign 
currency deposits are not rushing to convert the same into rupees.
The conversion of FCY deposits into dollar bonds is also held up 
due to non-availability the bonds.
The government had announced the dollar-bond scheme on July 21 but 
the bonds are still under printing. 
The State Bank has allowed the banks to start issuing temporary 
receipts in place of the bonds but bankers say people are unwilling 
to accept the receipts. The stock exchanges of the country have 
decided to trade the bonds and the government has indicated it 
would allow it but a final decision is awaited.
Stock brokers say once the bonds start trading at the stock 
exchanges people might be attracted to speed up conversion of FCY 
deposits into these bonds because it would earn them a premium.
Depositors' names to be made public soon
Syed Irfan Raza
RAWALPINDI, Aug 17: Federal minister for commerce and investment, 
Ishaq Dar has revealed that government would issue a list of those 
who had imported vehicles without payment of import duty and 
transferred their foreign currency abroad before the imposition of 
emergency and the freeze of FCA in Pakistan.
He said that the list would be made public within couple of days.
He said that no corrupt person would escape from the net of 
accountability. "We do not allow 900 persons to play with the fate 
of the country and its people," he added.
He said that these 900 loan defaulters had to return the national 
wealth even if they had their affiliations with the ruling party or 
any other political party.
Dar said that an Export Development Bank would be set up by the 
year 1999 with a view to boost export and provide loans and 
incentives to the small exporters.
Speaking at Rawalpindi Chamber of Commerce and Industry Export 
Trophy Award, 1996-97 ceremony held on Sunday night, the minister 
said that government had decided to establish the EDB in the 
current financial year but due to financial constraints after the 
nuclear explosion, the project was delayed and now the bank would 
come into existence next year.

He said that the EDB would have an autonomous status and it would 
give loans to small exporters.
Speaking on the issue of general sales tax, the minister said that 
the demands of jewellers community had been accepted amicably and 
they had called off their strike. He hoped that rest of the traders 
would also give positive response in this regard.
Sohail Altaf urged the government to ensure that the rate of power, 
gas and petroleum remain stable.

Tariff cut to 35pc in  single step opposed
Muhammad Ilyas
ISLAMABAD, Aug 19: The Commission on Tax Reforms has disfavoured 
the reduction of customs tariffs from 45 to 35% before 1999 in a 
single step because of its adverse effects on the local industry.
Pakistan is committed to affect such reduction under its loan 
agreements with the International Monetary Fund.
In its report presented to the Government recently, the Commission 
headed by Saeed Ahmed Qureshi, ex-deputy chairman, Planning 
Commission, has suggested to the Government to consider the 
implementation of customs reforms in two phases, as follows: 
 Primary raw materials: The custom duty should be reduced from the 
present level of 10% to 5% in the first phase, before complete 
withdrawal in the second phase.
Secondary raw materials: The customs duty on items that are not 
locally available, ranges from 15% to 25%. In Phase-I, it should be 
brought down to 5% to 10% in Phase-I, and to 5% in Phase-II.
As regards the secondary raw materials- locally available, the rate 
of custom duty is 10%-65%. While no change has been suggested in 
Phase I, the Commission has suggested the consideration of two 
options for Phase-II - 15% under Option-I or 10% under Option-II.
Intermediate goods: These are subject to 25%-35% custom duty at 
present. This may be reduced to 20%-30% in Phase-I, it has been 
suggested. Under Phase II, in respect of items that are not 
available locally, it should be further reduced to 10% under 
Option-I or 5% under Option-II, the scheme has proposed.
Custom duty on the intermediate goods that are locally available, 
may be reduced to 25% or 15% in Phase-II.   Finished goods: No 
change has been envisaged in the present rate of custom duty which 
ranges from 10% to 65%.
For machinery & equipment, however, on which the custom duty is 
levied at the rate 45%, it has been suggested that it be reduced to 
40% in Phase-I and to 5% in Phase II. This concerns the items that 
are not locally available.
As regards machinery & equipment which is locally available, it is 
now liable to pay custom duty at the rate of 35%-65%. While no 
change has been suggested in Phase-I, the Commission has proposed 
that only under Phase-II, this category be subjected to a uniform 
rate of 35%.
Resins/petro chemical: The present rate of duty on this category is 
35%. According to the Commission's scheme, it should be reduced to 
30% in Phase-I and further to 25% in Phase-II.
But in this category, there are items that are prone to smuggling. 
The current rate of duty on these is 10% to 25%. While suggesting 
retention of this rate in Phase-I, the Commission has proposed a 
uniform rate of 15% for the items in this category, as a further 
measure to discourage smuggling.
The customs duties on many of these items were substantially 
reduced in 1997-98. 

Analysts say the trading of the bonds would afford the people a 
chance to get the bonds from the banks and quickly sell the same at 
stock exchanges. They say the buyers would be those having black 
money to whiten because they would not be required to declare the 
source of income for buying these bonds.

Traders threaten strike on GST issue
FAISALABAD, Aug 20: The traders of the cotton yarn market have 
decided to observe complete strike for an indefinite period, in 
case the government does not drop the idea to levy general sales 
This was announced by the president of All Pakistan Yarn Merchants 
Association, Munawar A. Sheikh while addressing the representatives 
of various trade organizations and hundreds of dealers of the 
cotton yarn market here on Wednesday.
The business community offered to pay Rs 10 billion instead of Rs 5 
billion demanded by the government in case the fixed tax was levied 
instead of GST, the traders proposed.
They said they would by no means pay the GST and if any government 
agency tried to interfere, the traders would put up a strong 
Our correspondent adds from Multan: Khawaja Muhammad Shafiq, 
president Chamber of Small Traders declared here on Thursday that 
the traders would neither pay general sales tax nor would they 
negotiate with CBR on this issue and added that a countrywide 
strike would be observed in near future.
Talking to newsmen here he said that the government persisted to 
hold talks with those who did not represent the trade community. 
That was why, they said, the government had to reopen negotiation 
every time they reached any agreement with them.
Khawaja Shafiq said that an All Pakistan Traders Convention would 
be convened at Faisalabad very soon to work out future strategy if 
the government failed to withdraw the tax. 
He said that Mian Abdul Mannan, MNA and an MPA and a Senator were 
included in the negotiating team who had no concern with the 
traders while real representatives of the traders were not being 
called for parleys.
MCCI POLLS: Multan Chamber of Commerce and Industry held elections 
for the executive committee member of MCCI for 1998-99.
The following were elected unopposed: Ch. Majid Fakhri, Muhammad 
Imran Khan, Shaikh Bilal Ahmed, Dr. Khawaja Muhammad Saqib, Mirza 
Ali Ahmed, Malik Asrar Ahmed Awan, Khawaja Muhammad Shahid and 
Tahir Mehmood Sikhani. They would elect their president for the 

next term.

Commission recommends more taxes to provinces
Mohammad Ilyas
ISLAMABAD, Aug 18: The Commission on Tax Reforms has recommended 
that either wealth tax, capital value tax and excise duties and 
about half of the withholding taxes on domestic transactions (non-
import) or the entire direct taxes now being collected by the 
federal government be transferred to the provinces with a view to 
broadening their resource base.
As regards the federal government, it should collect only indirect 
taxes, it has further proposed.
However, it went on to elaborate that half of the withholding taxes 
on domestic transactions should belong to the provinces - "not by 
transfer but by bifurcating the liability." The proposed new 
arrangements, the Commission added, would not necessitate 
constitutional change.
"After carefully considering the deficiencies in the present system 
of distribution of revenues between the federal and provincial 
governments," the Commission has recommended far-reaching fiscal 
decentralisation to bring provincial resources into line with their 
Another significant recommendation made by the Commission is that 
the federal government should restrict its revenue jurisdiction to 
selected taxes and leave the rest to the provinces.
The Commission, however, did not go into the issue of expanding the 
revenue base of the local bodies which are greatly hampered by the 
lack of resources for fulfilling the development needs of their 
constituencies. Such fiscal decentralisation is considered 
essential for promoting the principle of good governance.
Instead, the Commission has recommended that an independent 
Commission be constituted to look into the present arrangement of 
distribution of revenue resources between fiscal, provincial and 
local governments. The proposed commission, it further stressed, 
should suggest mechanisms for reduction in vertical and horizontal 
fiscal imbalances including equalisation payments to the provincial 
and local governments on the basis of deficiencies in their per 
capita resource basis.
The Commission was established by the last caretaker government in 
January, 1997, with Mr Saeed Ahmed Qureshi, former vice chairman, 
Planning Commission as its Chairman and Malik Ahmed Khan, a former 
senior officer of Central Board of Revenue (and now Member, 
Monopoly Control Authority) as its Member-Secretary. Its other 
members included provincial finance secretaries, Dr Sarfraz Ahmad 
Qureshi, Mr Masood Daher, member, National Tariff Commission, 
President FPCCI, former CBR chairman Ahadullah Akmal, and other 
eminent persons from the private sector.

AGRICULTURAL TAX: The Commission has recommended that the 
agricultural tax be expanded and that it should be land-based with 
an exemption limit of five acres. Land holdings of 12 acres and 
above, it further proposed, may be taxable at the rates presently 
adopted by the provincial governments. Land holdings above five 
acres, but below 12 acres, may be taxed at 50 per cent of the first 
bracket beyond 12 acres.

No revival of fixed tax for traders, says Moin
ISLAMABAD, Aug 18: Chairman Central Board of Revenue, Moinuddin 
Khan has said that there will be no revival of the fixed tax for 
the traders and the government is not going to compromise its 
position on implementing the general sales tax as a value-added 
Answering journalists' questions at Meet The Press programme at 
Rawalpindi Press Club here on Tuesday, Moin said the agreement with 
the traders' leaders provided for only two concessions:
For those with a turnover below Rs5 million, no documentation of 
input and payment of GST at the margin of sale they achieve. He 
added that those traders who have an annual turnover of Rs5 million 
more, the GST is going to be implemented as per the VAT principles 
of documentation: input invoice records, sales records and 
About the reports that the CBR was considering a downward revision 
of the tax collection target for the financial year 1998-99, Moin 
said: "Who knows what parity is going to be achieved by the rupee 
against the US dollar. Tell me what volume of imports are going to 
be this year, and I will tell you how much tax I would be able to 
collect for the government. The slump is not showing any signs of 
going away. No one can say for sure what amount of taxes are 
collectible this year".
He said he had informed the federal government that the powers with 
which he is presently serving as chairman CBR, would not be 
sufficient, and that is what he told the Finance Committee last 
week, when "I was grilled for two hours for not performing up to 
the expectation. I told them that I increased the revenues by Rs14 
billion in seven months, and I am not responsible for the past".
Moin explained the difficulties and hindrances he was facing in 
improving revenue collection and doing away with corruption. "With 
about 80 per cent of the collecting officials unwilling to help in 
eradicating the corruption and implementing the ideas and 
initiatives for bettering the collection, how can one succeed in 
performing according to the perceptions and expectations?"
He conceded that the programme of launching investigations to shunt 
out the tax collecting officials living beyond their means, had not 
taken off, but said: "I have initiated inquiries on 12 anonymous 
letters he received against the tax collecting officials living 
beyond their means.

Back to the top
The myth makers-I
Ardeshir Cowasjee
FIRSTLY, to deal with and discard the camp-followers, proclaimed 
champions of democracy of which they are totally ignorant. Their 
sole claim to fame is their assistance in the myth-making of their 
leaders. Once the myth is made, they help sustain it, shamelessly 
clinging like leeches, waiting for their daily bread, the rewarding 
crumbs, to fall. A dime a dozen, they are a despicable lot.
Last week was the week of Benazir Bhutto. Not only did our media 
make much of her, her doings and sayings (bad news is, after all, 
'News'), the BBC had her on 'Hard Talk.' Of course, no one here, 
except perhaps the odd crumb collector, believed a word she said. 
She was as credible as was Imelda Marcos, as convincing as Emperor 
One moment she announces she has no money to pay her lawyers to 
defend her, her Pipian advocates having moved on to greener 
pastures. She says she has no money to pay for her air tickets from 
Karachi to Lahore or Islamabad, and the next moment she flies off 
to Dubai, London and the US. She is adamant about her oodles of 
inherited wealth, her privileged rich background, her vast 
collection of expensive jewellery, her ability to buy whatever 
diamond necklaces her eyes may alight upon, the money abroad that 
allows her to purchase vast estates and properties. Her accounts in 
Pakistan are frozen, her accounts abroad are not. She laughs when 
she is accused of robbing this nation, aided by her husband and 
family; she is outraged by the suggestion that she has been a party 
to the destruction of her own country.
The dynasty (if that is what it be) to which she is heiress was 
started by grandfather zamindar Shahnawaz Bhutto, the lesser 
landowning member of the Bhutto clan. A clever, affable, well-
mannered, well turned-out man, he got along well with the ruling 
raj. Each liked and used the other. From his Larkana base, he 
involved himself in local Sindh politics and worked his way outward 
and up. He was rewarded. Wadera Bhutto was promoted to Khan Bahadur 
Bhutto and later was knighted and became Sir Shahnawaz Bhutto.
Along the way, he fell in love with Lakhi Bai, a young woman, whom 
he took as his second wife. She converted to Islam and took the 
name of Khurshid Begum. They were a devoted couple, parents of two 
daughters and an only son, Zulfikar Ali, who would rise even 
farther and higher than his father, and then suddenly drop.
In 1937, Shahnawaz lost the elections to the provincial legislative 
assembly through want of support from officialdom and his own 
family. He found the defeat humiliating and asked the government to 
find him a job somewhere out of Sindh, preferably in Bombay as a 
member of the Public Services Commission. The then Governor of 
Sindh, Sir Lancelot Graham, forwarded his request to Lord 
Brabourne, Governor of Bombay, who found it embarrassing but could 
find no way to refuse it. Brabourne felt that as a former minister 
of the governor's council, Shahnawaz's request was "utter lunacy" 
as once accepting the position he could never return to politics. 
It would be the end of his career. "I agree with you entirely'" he 
wrote to Graham, "when you say that if you sent him, he will look a 
coward .... if I were he, I would most certainly not ask to be 
Shahnawaz joined the PSC, abandoning politics for ever, and lived 
for many years in Bombay. In 1945 the British moved him to Junagadh 
as Naib Diwan to assist the Diwan, his fellow Sindhi and civil 
servant from Shikarpur, Khan Bahadur Abdul Kadir Mahommad Hussain 
CIE. On May 9, 1947, Abdul Kadir, having taken ill, the Nawab was 
pleased "...to appoint Sir Shahnawaz CIE, OBE to act temporarily as 
Diwan and Vice-President of my Council on his personal pay and 
existing terms." On August 10, 1947, "at the present critical 
juncture," the Nawab appointed the acting Diwan as permanent Diwan. 
Soon thereafter he lost his state, and both Nawab and Diwan came 
and settled in Karachi.
Shahnawaz was a good man, and a likable man. Unlike his famous son 
and his sons, he died peacefully in his bed.
Good old Dingomal Narayansigh Ramchandani, his lawyer and ours, 
privy to his affairs, knew that he had willed that Khurshid Begum 
be well provided for and that his property was to be equitably 
divided between the three sons and four daughters from his first 
wife, and the two daughters and son Zulfikar born of Khurshid 
Begum. The three elder brothers, suffering from chronic liver 
problems, it was left to Zulfikar to manage the inheritance. The 
usual family squabbles over money followed.
AS a contemporary of Khan Bahadur Mohammad Ayub Khuhro, who like 
the proud King Faisal, wore a perpetual sneer, Shahnawaz's life and 
times are well recorded by historian Hamida Khuhro in her recently 
published biography of her father. The myth began with Sir 
Shahnawaz, transformed by his heirs and their supporters into what 
he was not.
One of the great grumbles of Nawab Mahabatkhan of Junagadh was that 
whereas his Diwans had enriched themselves at his state's expense, 
he found himself impoverished in exile. In those far-off days shame 
existed. If moolah was to slide, it slid discreetly; it was not 
trumpeted to the world at large.
Whilst Shahnawaz was living in Bombay, his son Zulfikar (the next 
Bhutto to enter politics) was sent to the famous Cathedral High 
School on Outram Road. His contemporaries were fellow columnist 
Omar Kureishi, my late wife, Nancy Dinshaw (as she then was), and 
Karan Singh, the heir apparent to Maharaja Hari Singh of Kashmir. 
Omar has promised to write on those happy days.
Zulfikar, like his father, later in life contracted a second 
marriage, a love marriage, with Nusrat Sabunchi, an Iranian. The 
man who arranged the clandestine wedding ceremony, maulvi and all, 
was our mutual friend Ilahi Bakhsh Soomro, who was later jailed, as 
was I, by friend Zulfikar for no good reason. Ilahi Bakhsh had a 
much longer and harder time in his roofles cell in Sukkur jail. I 
was relatively comfortable in the barrack occupied by Mohandas 
Karamchand Gandhi 46 years before me.
Zulfikar's great boast to his friends was that since the day he 
entered politics, in the days of Iskander Mirza, he had never even 
paid for a pair of socks with his own money. He claimed that his 
skill, harnessed in the service of the people, warranted all the 
money he could rob and then spend, and at the end of the day he 
would still be owed a balance. His entry into politics and his 
doings will have to be covered another day.
He left a lot of money to his wife and progeny. Benazir Bhutto 
inherited more than enough and she and her husband have made much, 
much more than enough for them to be truly labelled 'filthy rich,' 
senior members of the Big Rotten League. This time round, Nawaz 
Sharif has organized an Ehtesab bureau to deal principally with 
bringing Benazir Bhutto and Co to book, with the hope that it will 
be able to retrieve and bring back into the country some of the 
wealth allegedly stolen.
Pending Ehtesab cases in the Sindh High Court against her, her 
government and cohorts number nineteen. Easily recognized and named 
amongst the accused are Abdullah Shah, Usman Faruqui Munawar Ali 
Talpur, Jam Mashooq Ali, Admiral Akbar H. Khan, Ahmad Sadiq, Pir 
Mazharul Haq, Nisar Khuhro.
In the Lahore High Court are some thirty Ehtesab cases. The easily 
recognizable accused, apart from Benazir Bhutto, include Asif Ali 
Zardari, Hakim Ali Zardari, Nusrat Bhutto, Jens Schlegelmilch, 
Mohammad Zaheer, Mian Manzoor Ahmad Wattoo, Yusuf Talpur, Chaudhry 
Ahmad Mukhtar, Khalid Ahmad Kharal, Anwar Saifullah, Haji Mohammad 
Nawaz Khokar, Arif Nakai, Ahmad Sadiq, Badruddin Zahedi.
Rather than chasing the major cases and individuals where there is 
incontrovertible evidence, the Bureau has taken on too many issues. 
This is rather like the 1990 to 1993 scenario when Ghulam Ishaq 
filed all his references against the Bhutto-Zardaris none of which 
were brought to their finality. However, whatever accusations 
(often false) may be levelled against Saifur Rahman, the fact 
remains that with inadequate help he has managed to get the Swiss 
and the British to move. No mean achievement. He needs better and 
more help.
Nawaz Sharif should be ashamed of himself that he has so far been 
unable to get Benazir Bhutto and family off our backs. He cannot be 
forgiven for this. To those who say that the Ehtesab process is 
one-sided, the answer is, let it be so. Nawaz Sharif and his lot 
can be caught by their successors.

Riding the tiger 
Irfan Husain

AS the Taliban continue on their relentless advance, there is 
barely muted jubilation among the more fanatical elements in our 
society and administration. Needless to say, there is no shortage 
of such forces in contemporary Pakistan.
For over two decades now, successive governments in Islamabad have 
attempted to install a pliant regime in Kabul. Even during the 
Soviet incursion and the Afghan resistance, Pakistan did its best 
to strengthen pro-Pakistan militant groups; invariably, these 
comprised Sunni Pakhtun elements of Gulbadin Hikmatyar's ilk. This 
is understandable - although scarcely admirable - given Pakistan's 
own substantial Pakhtun population. The underlying idea was that 
once such elements achieved power, they would be beholden to their 
mentors. This gratitude, apart from clan loyalties, would translate 
into an amenable administration in Kabul. Or so went conventional 
wisdom at GHQ and the Foreign Office.
The problem with this scenario has always been that it is out of 
sync with Afghanistan's ethnic and religious realities. Although 
Pakhtuns do constitute the majority, there are significant numbers 
of Tajiks, Uzbeks and Persian-speaking Hazaras living in Northern 
Afghanistan. To compound the problem, most of them are Shias, and 
look down on their Pakhtun countrymen as backward country bumpkins. 
The Taliban have done nothing to improve this image ever since they 
burst onto the scene three years ago.
So when these barely literate graduates of the many religious 
schools being run by some religious parties in Pakistan began their 
explosive and unheralded drive to capture power in Afghanistan, we 
were all taken aback. But not for long. It became clear that they 
had received more than a wink and a nod from the Pakistani 
What does Pakistan hope to gain from this long and costly 
involvement in Afghan affairs? The principal goal is strategic: 
Pakistani military planners have been all-too-conscious of the 
country's geographically narrow centre. The thought of exposed 
lines of communication running within 20 kilometers of the Indian 
border at places has long been a strategist's nightmare. With 
Afghanistan as a reliable ally, GHQ hopes to attain the strategic 
depth that is deemed so essential in the eventuality of hostilities 
with India.
The second objective is economic. With rapidly depleting reserves, 
Pakistan had agreed to buy natural gas from Turkmenistan, and 
UNOCAL, an American conglomerate, was all set to build a pipeline 
at a cost of nearly 2 billion dollars. The project was long held up 
by the fighting in Afghanistan, but with the sweeping victory of 
the Taliban at Mazar-i-Sharif, it seems that work can finally 
Allied with this goal is the opening up of Central Asia to 
Pakistani industry and commerce. When the Soviet army withdrew from 
Afghanistan, it was the fervent hope of economists and businessmen 
in Pakistan that their goods and services would soon find a toehold 
in the newly independent republics of Central Asia. This dream is 
still on hold, but with the possibility of peace returning to 
Afghanistan, the prospects of direct trade have certainly 
During his lifetime, Zia had visions of a Pakistan-led Islamic 
grouping comprising Afghanistan and the Central Asian republics. 
Time for a reality check: the fact is that through our role in 
Afghanistan, we have antagonized Iran, a close and trusted friend; 
and we have annoyed Russia and the very Central Asian states we had 
hoped to befriend. Basically, they all fear and resent the 
emergence of Taliban on their borders. Iran wishes to protect the 
Shia minority in Afghanistan, and Tajikistan and Uzbekistan are 
concerned for their ethnic groups in Afghanistan who opposed the 
Taliban and are now at their mercy.
Finally, India is concerned about the spillover of the Taliban 
victory into Kashmir. Already, some Pakistani religious groups have 
made their presence felt in India held Kashmir; once the Taliban 
have a stranglehold over Afghanistan, extremists will have a 
sanctuary to operate freely from.
So what we can see developing is a convergence of interest from New 
Delhi to Tehran to Moscow aimed at keeping the Taliban in check. 
Pakistan's regional isolation will be complete, and instead of 
gaining influence, it will find itself embroiled in the thankless 
task of defending a government responsible for serious human rights 
abuses against its own population. Afghan women in particular, are 
bearing the brunt of a mindless bigotry that has forced them to 
become invisible in their own cities.
All in all, the Taliban military victory has translated into a 
diplomatic disaster for Pakistan. But potentially even more lethal 
is the very real prospect of a Taliban spillover into Pakistan. 
Already the breeding ground for murderous religious militias of 
varying stripes, the country can ill-afford the menacing presence 
of these "warriors" violently pushing their own bizarre version of 
Islam. And yet that is just what may soon happen, given the support 
they already enjoy among extremist groups in Pakistan.
At a time when sectarian extremism is tearing the fabric of society 
apart, the overt and covert support we are giving the Taliban is 
foolish and potentially suicidal. For questionable short-term 
gains, we have put all our eggs in the frail Taliban basket. How 
long their gratitude will last and how pliable they will be is 
something only time will tell. But given the track record of most 
rickety Afghan governments in recent times, it would be unwise to 
base our economic or foreign policies on Taliban loyalty.
Quite apart from the latest turn of events, the fighting in 
Afghanistan is far from over: after all, Ahmed Shah Masood and his 
fellow warlords defied the mighty Soviet army for years. It is 
unlikely that they will lay down their arms before the Taliban. And 
with external support, we can expect them to resume guerilla 
warfare against Kabul. In such a conflict, a gas pipeline will make 
a very juicy target.
Unfortunately, our policy makers don't realize how dangerous it is 
to get off a tiger once you have mounted it.

A sinecure for Sartaj Aziz?
Aziz Siddiqui
MR Sartaj Aziz's transfer from the finance to the foreign ministry 
must seem to him like a well-earned rest. Compared with the earlier 
assignment, where whether he had the means and ability or not he 
had to keep tooling around, this one should be a sinecure.
A finance minister has to carry the brunt of a quick fix for 
everything that goes wrong, from deficit and devaluation to prices, 
taxes and the tranches that didn't turn up. No fix in fact being 
possible he only ends up carrying much of the flak for it. A 
foreign minister on the other hand has no such day-to-day problem. 
When it comes to it, the failures are easily denied or camouflaged. 
Even when they are not, they can rightly or not-so-rightly be 
blamed on the outsiders.
Much for instance can be put at the doors of the Americans, flowing 
from their Pressler Amendment all the way to their sanctions. Many 
ills can be attributed to the West generally for its being 
discriminatory towards a Muslim country. The Indians can of course 
be panned for all manner of evils, including some of the nasty 
things happening within the country. Patriotism requires believing 
that the country is up against the whole rest of the world. One 
should therefore ask no questions and should accept and further 
build upon whatever one is told or not told.
Take, first, these developments in Afghanistan which are instinct 
with extraordinary consequences for this country. When things were 
happening over the past year-and-a-half there was hardly even a 
day's formal debate on the issue in the parliament here, nor even a 
meeting of the defence committee of the cabinet. People do not even 
now know why Islamabad had to rush in with its recognition of the 
Taliban last year as if there was glory in being the first. It was 
rebuffed by all but two of the rest of the world. It could only 
persuade Saudi Arabia and UAE to follow its example.
Islamabad even continued afterwards to declare that it was neutral 
in the Afghans' internal conflict. Why if that were so could it not 
also maintain the image of neutrality and like almost all others 
bide its time? It could then enjoy some credibility with the other 
side too and play an honest broker if needed. There have been no 
answers to such questions.
Now, with the Taliban suddenly on a decisive offensive, scoring 
lightning victories and all but putting the Northern Alliance to 
rout, everyone around sees Pakistan's fingerprints on the act; even 
hard evidence is claimed, including taking of Pakistani war 
prisoners. The accusers comprise not just the retreating 
commanders, the Russians and the Central Asians, but a traditional 
friend of Pakistan like Iran.
There is obvious plausibility to the charge. Pakistan had already 
put its money on Taliban by its prompt recognition of their rule. 
It had thus seemed to have acquired a vested interest in their 
quickly consolidating their hold over the country. It was the only 
route for all their needs of warfare and daily life. And it had a 
recent history of being so active on the Afghans' behalf. 
Pakistanis may nevertheless believe in its denial of any current 
involvement. But who else will?
With the present turn of events, Islamabad may feel that its early 
recognition of the Taliban has been vindicated. Not so fast. If a 
prolonged bitterly fought civil war ends in a one-sided victory it 
is rarely the end of the story. The two sides do not usually live 
happily ever after. The Northern Alliance may get boxed in and cut 
off from most of its supply routes over the next weeks and months, 
but it is unlikely that it will altogether be defeated yet.

Taliban, even more than others, may keep the will of resistance 
to them alive. The fall-outs of the manner of their rule may nurse 
further alienation among sections of the populace. It will be no 
source of comfort to the bordering states either. Mr Sartaj Aziz's 
hope that 'the world will recognise the ground situation' seems 
already to presume that the ground will remain firm under the 
Taliban feet. That may not be a foregone conclusion yet.
For the outsiders the imbroglio was partly born of a competition 
for the Central Asian and Caspian Sea's fuel and other likely 
resources. That competition may further intensify. If that happens 
it is far from certain that Pakistan, with Taliban's Afghanistan 
and the US will so easily win out against a combination of the 
rival interests of Russia, Iran, India and some others. Pakistan 
will also thus have contributed to edging Iran away from itself, 
which will be a significant geopolitical reshuffle by itself.
Also, surprisingly no serious thought has been given to the 
consequences within Pakistan of the Taliban's unchallenged 
ascendancy in Afghanistan. There has certainly been no public 
evidence of it. Nor of a realisation that the Taliban may not 
necessarily remain unquestioning guarantors of Pakistan's interests 
in the region. They already show a will of their own. Some will 
One major decision in the area of foreign policy and defence which 
has had a public-opinion dimension was that of nuclear testing. 
However there was barely an effort on the part of the officials or 
the state media to educate that opinion, to de-emotionalise the 
issue, to lay bare all the pros and cons - little evidence that the 
decision-makers had considered that necessary for themselves 
either. On the contrary, it was made to look an issue of national 
pride, one of tit for tat, with no consequence that was not 
bearable and none which had long-term implications for the country 
except for the good.
Pakistan's central foreign policy concern, of Kashmir and relations 
with India, has remained the most barren of ideas. This government 
had come in raising public hopes of a miracle solution up its 
sleeves. It had none, and when that fact came out at the Colombo 
SAARC summit, as it had to, the Indians were blamed for sabotaging 
the process. It was not explained why the Indians were expected to 
behave differently in the first place. Not because they were a BJP 
government: all of the past ones were non-BJP and they were no 
The rather childish stratagem of hustling daddy into coming in and 
imposing his authority on the brood, or inducing a compromise among 
them, has also been running out of promise because of India's 
refusal to permit the good offices of a third party. That has made 
the West even more keen for the present on taking the instrument of 
its panic - the nuclear weaponry - out of what it considers 
juvenile hands.
Again there is no effort to formally debate these new pressures on 
the country in respect of the Comprehensive Test Ban Treaty and the 
Fissile Material Cut-off Talks. The government looks fated to get 
driven by circumstances. The decision once again may come much as a 
fait Accompli.
The fact is, a country's longer term foreign interests are not best 
served if steered virtually on a day-to-day and issue-by-issue 
basis. Pakistan's relations with India, Afghanistan or the US, 
China, the Muslim states or the rest of the world cannot be 
appropriately developed each in isolation of others, nor with an 
eye only on the effects of the next move rather than on the chain 
of consequences as far down the road as it is possible to see.
The interests are also not well-served by the country's 
preoccupation with its own principal concerns to a virtual 
exclusion of other international issues. A sound foreign policy has 
to be widely involved. It has to try and build goodwill in unlikely 
Pakistan has rarely ever attempted developing anything approaching 
an integrated working world vision. The absence was never more 
striking than recently. The country now either blunders on because 
of a tunnel vision, stands immobilised, or just drifts along as if 
on an auto-pilot, without a will or capacity for activism or 
retrospection. On issues at one or more removes from it, it is 
mostly content with watching the world pass by the span of 
involvement of the Pakistan delegation on international UN and 
other forums is usually minimal.
Mr Sartaj Aziz may not be able to do much about all this. That may 
not be his brief at all. His leader is not known for his skill or 
interest in diplomacy, at home or abroad. In his national-agenda 
speech last June Mian Nawaz Sharif specially picked on the foreign 
ministry for some caustic comment. He warned Pakistani diplomats 
that their performance would now be judged by what they did to 
boost exports and investments. Diplomats do admittedly have to be 
active in those areas, more now than ever in the past, but they can 
best do that by selling their country as a creative hard-working 
society at peace with itself, and one safe for and from its 
neighbours. Mere hype on this score does not work. Modern means of 
communications have seen to that.
Limited as the scope for Mr Sartaj Aziz seems, he may yet make a 
difference if he concentrates on just two areas to start with: 
inducing a review of foreign policy and initiatives as a regular 
cabinet activity, and bringing some openness to policy-making. The 
Shaharyar committee's recommendation of a cabinet sub-committee on 
foreign policy chaired by the foreign minister and meeting with a 
certain frequency is worth pursuing. Similarly reports to the 
parliament and debate there on developments should be made a 
regular feature.
The country virtually had no foreign minister for about three 
months after the reported resignation of Mr Gohar Ayub. Nobody 
noticed a difference. In name though there was not only a minister 
but also a minister of state, both competing it seemed in not 
opening their mouth without putting their foot into it. Mr Sartaj 
Aziz has thus nowhere to go except up. He has to begin by divesting 
himself of some of the cocksureness of his previous assignment. And 
he should avoid looking on this one as a holiday, which it can so 
easily become.

Coach terms Pakistan's overall performance as satisfactory
Sports Reporter
KARACHI, Aug 18: Team coach Maqsood Ahmed expressed satisfaction on 
the over-all performance of Pakistan team as after a considerable 
long time we reached the semifinals of the individual event and 
also finished third in the recently concluded 30-nation tenth World 
Junior Squash Championship at Princeton, New Jersey, USA.
Talking to the mediamen here after the team's arrival early Tuesday 
morning from USA, former international stated that all the four-
member of team, Mohammad Hussain, Mansoor Zaman, Shahid Zaman and 
Mohammad Ilyas, gave their best.
He said Mohammad Hussain entered the semifinals but lost to 
Malaysian Ong Ben Hee by 1-3. Ben Hee, who had his training in USA, 
emerged new champion by defeating Egyptian Wael Hatem Al-Hendy in 
the final.
Asian junior champion Mansoor Zaman,after defeating his fellow 
countryman Mohammad Ilyas in the fourth round, also earned a berth 
in the quarterfinals, but suffered defeat at the hands of Egyptian 
Al-Hendy. Shahid Zaman lost to England Adrian Grant in the pre-
quarterfinals, added the coach.
Therefore, reaching the semifinals after a long time is step 
Maqsood said Pakistan, who had finished third in the last World 
Junior Championship at Cairo two years ago, thrashed Canada, 
Malaysian and New Zealand by an identical margin of 3-0 to head the 
four-team Pool A of the team championship.
In quarterfinals Pakistan eliminated Wales also by 3-0 to face 
Egypt in the semi-finals, said the coach. Top seeded Pakistan, 
unexpectedly, lost to last championship runners-up Egypt by 1-2 in 
the semifinals. After Egypt Mohammad Abbas defeated Mohammed 
Hussain 3-1, Mansoor Zaman put Pakistan back into the game by 
edging out Al-Hendy 3-1.

England beat Egypt to bag title as Pakistan finish 3rd
Sports Reporter
KARACHI, Aug 16: In a contest highlighted by fluctuating fortunes, 
England beat Egypt 2-1 to clinch the Merrill Lynch Men's Junior 
World Squash Championship at the Princeton University's Jadwin 
Gymnasium in New Jersey, USA, on Aug 15, according to a fax message 
received here today.

Pakistan finished third as they defeated France 3-0. Muhammad 
Hussain beat Nicolas Siri 9-7, 9-7, 9-1 in 30 minutes while Mansoor 
Zaman took 21 minutes to beat Romain Tenant 9-0, 9-0, 9-2. Mohammad 
Ilyas made short work of Remy Aliaga 9-0, 9-2 in 15 minutes. Egypt 
tried to avenge a previous pool play loss earlier in the week to 
England, but the English proved to be too strong.
A fired up Egyptian team took to the courts early, as Egypt's No 2 
player, Wael Hatem El-Hendy found the form that took him into the 
finals of the individual championship last week, to defeat 
England's Adrian Grant 9-2, 9-3 and 9-6.
Nicholas Matthew evened the team score at 1-1 when he defeated 
Mohammed Abbas in five games, a match that lasted over 90 minutes. 
Matthew won the first game in a tiebreaker, lost the second and 
third games but stormed back to win the fourth and fifth contests 
9-4, 9-3 respectively to rekindle the hopes for his team's victory 
after having lost the first tie to Egypt.

Hanif, Hasib hail Miandad's appointment
Sports Reporter
KARACHI, Aug 17: Stars a yesteryear have hailed the Pakistan 
Cricket Board's decision of appointing Javed Miandad as coach and 
Aamir Sohail as captain.
Legendary Hanif Mohammad said the authorities have taken very few 
good decisions in their tenure. "In those few decisions, this one 
is the best. You don't have a better brain than Javed Miandad.
"It's good that the cricket board has realized player's importance 
by giving him (Javed Miandad) a good package. I hope that this is 
the start of a new era," he remarked.
Hanif was of the view that Miandad's status and knowledge of the 
game was more than that of anyone else in the present setup. "I 
would like to see the players utilize his experience. He is the 
best tutor who can give the best advice on the spot. The players 
should cooperate with him and avail the lifetime opportunity."
Hanif added that by this decision the cricket board has taken a lot 
of pressure off them. He said previously the board used to be 
criticised for the team's failure "but now we have Javed Miandad 
"Miandad's induction would put a psychological pressure on the 
opponents as they would know that Pakistan has a strategist who is 
second to none."
Hanif said he would like to see Miandad as coach for at least five 
years. "It's time that the board should have a long term planning 
and Miandad is the ideal man who can groom the youngsters and 
neutralize the lack of production of world-class players at a very 
young age."
Former chairman of selectors Hasib Ahsan said the cricket board has 
picked the right combination but added that he could still smell 
dirty play. "They should have been given long term mandate instead 
of unspecified tenures.

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