------------------------------------------------------------------- DAWN WIRE SERVICE ------------------------------------------------------------------- Week Ending : 3 February 2001 Issue : 07/05 -------------------------------------------------------------------
Contents | National News | Business & Economy | Editorials & Features | Sports
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CONTENTS ===================================================================
NATIONAL NEWS + Pakistan quake aid reaches Ahmedabad + Musharraf and Vajpayee agree to keep in touch + India to pull out additional troops from LoC + Drowning of fishermen confirmed + Minimum deterrence vital: CE + Ulema suspend protest for one month: Inquiry tribunal constituted + Mangla Dam height to be raised by 40 feet: Musharraf okays plan + Azhar fails to win over rivals + Pakistan, Saudi Arabia agree to boost trade: JMC meeting ends + Perception about Pakistan improving: CE discusses vital issues + Peshawar newspaper press set ablaze + Kashmir Day to be observed officially + Constitutional amendment not needed + Six killed; vehicles, property torched in Karachi + Benazir considers high-risk return --------------------------------- BUSINESS & ECONOMY + US rejects request for revising F-16 payment accord + FCY deposits at 50pc of reserves: Dollarization spell again? + Banks seek 100% cash margin from Kabul importers + Rs 8 billion paid in sales tax refund: July-Jan figures + Guideline for DFIs, banks merger soon + Pulses, atta, egg strain consumer pocket + World Bank seeks speedy privatization + SBP raises paid-up capital: Investment banks, housing finance cos + Ceremonial, video taxes abolished --------------------------------------- EDITORIALS & FEATURES + N.E.D. University Ardeshir Cowasjee + Servitude and the daily grind Ayaz Amir + Stagnation vs creative chaos Irfan Husain ----------- SPORTS + Moin retained captain as PCB ends suspense

Pakistan quake aid reaches Ahmedabad
Jawed Naqvi

NEW DELHI, Jan 30: Kashmiri freedom fighters donated blood, a 
Pakistani army plane rushed tents and blankets to homeless and 
shivering earthquake victims, while Hindu and Muslim groups in 
otherwise communally-polarised Gujarat state, suspended their 
hostilities to tend to the dead, and living dead, on Tuesday, 
officials and media reports said.

A C-130 Hercules transport plane landed in Ahmedabad on Tuesday, 
ferrying 13 tones of relief material, including 200 tents and 
thousands of blankets, a Pakistani diplomat told Dawn.

It's a human tragedy, said the diplomat, who did not wish to be 
identified. Countries forget their differences in this kind of 
agony. Its a humanitarian gesture of the government and people of 
Pakistan, he said.

Ironically, Gujarat's Kutch region, the worst affected part of the 
earthquake's footprint, was the site of a major incident between 
Indian and Pakistan in the post-Kargil weeks when a Pakistani naval 
plane was shot down near the border.

The diplomat said two more planeloads of supplies were expected in 
the next two days.

The Rashtriya Swayamsevak Sangh (RSS) and Shiv Sena are usually 
associated with religious bigotry and Hindu revivalism. Both were 
reported to be actively helping to mitigate the tragedy across this 
devastated border state, with scant concern for which community the 
victims belonged to. Muslim volunteer groups who have a major 
presence in Gujarat were reported to be working feverishly to save 
lives no matter of which religion.

Musharraf and Vajpayee agree to keep in touch 

ISLAMABAD, Feb 2: Indian Prime Minister Mr Atal Behari Vajpayee 
telephoned Chief Executive Gen Pervez Musharraf on Friday to thank 
Pakistan for helping India in the hour of need and said that 
Islamabad's goodwill gesture would help in improving relations 
between the two countries.

The Indian prime minister reportedly told the chief executive that 
Pakistan government's decision to dispatch relief goods for 
earthquake victims in Gujarat province would help both the 
countries to get closer to each other.

Till Thursday Pakistan had sent three planeloads of relief goods 
for the earthquake victims in India. The relief goods included 
tents and blankets.

A source said that during the eight-minute telephonic conversation, 
the two leaders also agreed that the two countries should remain in 
touch with each other.

A source told Dawn that the two leaders agreed that both the 
countries should help each other in the hour of need of any 

Gen Musharraf told Mr Vajpayee that Pakistan was ready to offer 
whatever assistance was required by India, the source said, and 
added that the chief executive told the Indian prime minister that 
Pakistan government and the people of Pakistan were grieved over 
the loss of human lives and property caused by earthquake in India.

An official handout issued by the government said that Mr Vajpayee 
"expressed appreciation" for the relief goods provided by the 
government of Pakistan.

India to pull out additional troops from LoC 
Jawed Naqvi

NEW DELHI, Feb 1: The Indian government has ordered a phased 
scaling down of its troops along parts of the Line of Control (LoC) 
in Kashmir even as it dispatched two top ranking officials to rally 
support with foreign interlocutors for Prime Minister Atal Behari 
Vajpayee's conditions for resuming talks with Pakistan, informed 
sources and media reports said on Thursday.

The Hindustan Times and The Hindu, citing highly placed security 
officials, said that a sizeable number of its troops and heavy 
equipment moved along the Line of Control following the Kargil 
conflict, would be withdrawn, according to an AFP report. The 
process will take three months.

Kashmiri groups welcomed news of a gradual troop withdrawal from 
the LOC as a positive step but warned that Vajpayee's tenuous 
ceasefire in Jammu and Kashmir was getting increasingly subverted 
by trigger-happy paramilitary troopers in the valley.

In Paris, India's National Security Advisor Brajesh Mishra held a 
meeting with academics and intellectuals who debriefed him on 
Vajpayee's ceasefire initiative he announced on November 19 and 
which he has twice extended despite opposition from Hindu 
nationalist hardliners.

"India's latest decision to extend by yet another month the 
suspension of actions against militant groups (in Kashmir) 
demonstrates our sincere effort to go the extra mile in search of a 
peaceful solution," Mishra was quoted by an Indian news agency as 
saying on Wednesday.

"But terrorism and violence continue unabated and there is no 
indication that Pakistan is inclined to give up its hostility 
towards India," Mishra said. Indian External Affairs Minister 
Jaswant Singh for his part was in Damascus on Wednesday sharing a 
similar perspective with President Bashar al Assad.

The fact that the two officials, both topmost foreign policy aides 
to Vajpayee, were visiting foreign capitals in the middle of a 
major calamity in Gujarat, explaining and seeking support for 
India's Kashmir policy may be rooted in a small but significant 
diplomatic advantage Islamabad appears to have wrested over New 

The fact is that Pakistan has already initiated a partial troop 
withdrawal from the LOC, several weeks ahead of the Indian 
announcement. Chief Executive General Pervez Musharraf has 
pointedly distanced himself from some of the recent attacks by 
Kashmiri Mujahideen in Delhi and Srinagar. 

And, as recently as on Wednesday, senior Pakistani diplomat in 
Washington Zamir Akram was describing Islamabad's material help in 
the Gujarat earthquake relief operation as an olive branch by his 
country to India.

Whatever the impulse behind New Delhi's diplomatic missions, as far 
as the news of Indian troop withdrawal went, it evoked an instantly 
favourable response from some of the people to whom it should 
matter most, including from groups such as the Jammu and Kashmir 
Liberation Front (JKLF).

"If Indian troops are being phased out from Kashmir, it will 
strengthen Vajpayee's pragmatic approach of which we had a glimpse 
in the initial phases of the ceasefire," said JKLF chief Yasin 

Drowning of fishermen confirmed
By Our Staff Reporter

 KARACHI, Feb 1: As many as 35 fishermen died when a Karachi-based 
boat capsized in Arabian sea some three days back, an official of 
the Fishermen Cooperative Society (FCS) confirmed here.

The accident took place between Ormara and Basol, coastal towns in 
Balochistan province. The boat with 37 fishermen left from Karachi 
Fish Harbour on Jan 24 on a routine hunting trip.

The FCS official told Dawn that the incident was confirmed on 
Thursday when Mahar Wali Khan, brother of the boat owner, informed 
the FCS office.

He said the boat was owned by Zarwali Khan, a resident of Daryabad, 

The FCS official, Haji Ghazanfar Ali Boota further said the 
accident was reported by two surviving fishermen Abdul Shakoor and 
Mohammad Farooq, who reached a coastal town of Daam on board a 
small fishing boat after the accident.

Minimum deterrence vital: CE

ISLAMABAD, Jan 30: There is no substitute to a strong air force in 
the modern day warfare and the government is determined to provide 
all available resources for the modernization of Pakistan Air 

This was stated by Chief Executive Gen Pervez Musharraf at the 
195th Air Staff Presentation held at Air Headquarters Chaklala on 

Speaking on the occasion, the Chief Executive said: "Pakistan is 
for peace but its sovereignty, honour and dignity cannot be 
compromised. Keeping in view the situation on our borders a 
strategy of minimum deterrence has to be followed.

"PAF has the central place in our strategy of deterrence. I am 
confident that PAF can perform far beyond the mission assigned to 

The ceremony was attended by Vice Chief of the Air Staff, Deputy 
Chiefs of the Air Staff, Air Officers Commanding, Base Commanders 
and Field Commanders. - NNI

Ulema suspend protest for one month: Inquiry tribunal constituted
Ahmed Hasan

PESHAWAR, Feb 1: All the major religio-political parties and trade 
bodies decided on Thursday to suspend for a month the protest 
campaignagainst the publication of a blasphemous letter in a local 

The decision was taken in the light of a meeting held between Ulema 
and the local administration late Wednesday evening and another 
meeting held at the historic Qasim Ali Khan mosque on Thursday 

Speaking at a press conference, Maulana Amir Hussain Qadri, 
provincial chief of the JUP, said that a meeting attended by the 
leaders of JUI(F), Sipah-i-Sahaba, JI, Jamiat Ahle Hadith, Tanzim 
Islami, Majlis Tahaffuz Khatme Nabuwat, PML, Jamiat Ittehad Ulema 
and JUI(S) decided to suspend the protest campaign for one month to 
give the administration time to complete investigation into the 
incident and to bring the culprits to book.

The city commissioner also briefed Ulema and traders about the 
steps being taken in this regard.

Maulana Qadri said that the Ulema and traders accepted government's 
point of view and decided to give it time to fulfil its promise.

Meanwhile, the journalists community has welcomed the Ulema's 
decision to withdraw strike call and termed it a great gesture of 
goodwill for the pressmen.

tribunal set up: The NWFP government on Thursday appointed a 
Tribunal of Inquiry consisting of a judge of the Peshawar High 
Court to probe into the publication of a blasphemous letter against 
the holy Prophet (PBUH) in a local English daily on Monday. The 
tribunal will submit its report within a week.

The Tribunal will investigate the circumstances under which the 
blasphemous letter was published in order to find out motive behind 
the offence. 

Mangla Dam height to be raised by 40 feet: Musharraf okays plan 
Ansar Abbasi

ISLAMABAD, Feb 1: The government has decided to raise height of 
Mangla Dam by 40 feet to enhance its storage capacity, it is 

Chief Executive Gen Pervez Musharraf has approved the proposal put 
forward by the Water and Power Development Authority on the basis 
of a feasibility study undertaken by the authority, which 
maintained that raising height of Mangla Dam by 40 feet was 
technically and economically feasible.

Detailed designing of the project has also been ordered and it has 
been decided that Wapda will bear the cost of detailed designing up 
to the tendering stage.

The raising of Mangla Dam height will cater, though partially, the 
growing demand of water by all the provinces. It is feared that if 
the country's water storage capacity is not increased up to a 
satisfactory level, water will become a major irritant among the 
provinces in the coming years.

The government has also decided to launch small water storage 
schemes of less than 0.2 MAF (million acre feet) and costing less 
than Rs200 million. These schemes would be executed by the 
provinces while Wapda would provide the required technical 
assistance wherever required.

Regarding Wapda's deficit, the chief executive has constituted a 
high-level committee headed by finance minister Shaukat Aziz. 
Chairman Water and Power Development Authority Lt-Gen Zulfiqar Ali 
and Chief of Staff (COS) to chief executive Lt-Gen Ghulam Ahmed 
will act as members of the committee which will forward its 
proposals to the Chief Executive by Feb 10 on how to resolve 
Wapda's deficit of Rs18.8 billion.

Azhar fails to win over rivals
Ashraf Mumtaz

LAHORE, Feb 1: Initial contacts made by Mian Mohammad Azhar, an 
aspirant for the office of PML presidentship, with some pro- Nawaz 
Sharif party leaders on Thursday in a bid to settle differences and 
create unity in the party, failed to break the ice as the two sides 
stuck to their positions.

The former governor said there was a need for party elections so 
that leadership could be changed. However, the leaders he met were 
of the view that the procedure he was going to adopt to achieve the 
target was not acceptable to them. "We gathered the impression that 
Mian Azhar plans to set up his own faction of the PML, although he 
does not clearly say so", Rai Mansab Ali told Dawn after the 

Others whom Mian Azhar met were: Rana Tanvir Husain, Shahid Mehdi 
Nasim and Chaudhry Nazir.

They told Mian Azhar that the central leadership should be 
approached for party elections, if at all it was necessary for the 
sake of unity.

The idea of requisitioning a meeting of the general council, they 
said, was not in the interest of the party.

Rai Mansab said the former governor had been told in plain terms 
that, at present, Raja Zafarul Haq and Makhdoom Javed Hashmi were 
leading the party and they alone, or the party's central working 
committee, could take a decision about elections.

He said those with whom Mian Azhar held talks had also told him 
that they were with the deposed prime minister and would remain 
with him.

A statement issued later by Mian Azhar said that he had told the 
leaders that everybody should shun differences and rise above all 
conflicts for the unity of the party. A united PML alone, he said, 
could get majority in the next elections and play a role for the 
restoration of democracy.

Admitting that Rai Mansab and Rana Tanveer had certain reservations 
about Mian Azhar's ideas regarding the party unity, the statement 
said that Mian Azhar wanted that the party leadership should be 
elected and not nominated by anyone.

Mian Azhar plans to meet more leaders in the days to come.

Meanwhile, Rai Mansab and others called on party Vice-President 
Mian Yasin Wattoo and briefed him on their talks with Mian Azhar.

Mr Wattoo, according to Rai Mansab, endorsed the viewpoint of his 

 Punjab PML President Zulfikar Khosa, whose ouster was being sought 
through the general council, was furious over reports that he might 
be given some position in the central organization of the party if 
he stepped down in favour of Chaudhry Pervaiz Elahi.

Mr Khosa said he did not know whether Mian Azhar had either stooped 
so low or he had such a lowly opinion of him (KHosa) that he wanted 
to hold conciliation talks through the media.

Pakistan, Saudi Arabia agree to boost trade: JMC meeting ends 
Syed Rashid Husain

RIYADH, Jan 31: The sixth Pak-Saudi Joint Ministerial Commission 
(JMC) has stressed on improving the role of private sector in 
enhancing the trade relations between the two countries.

The JMC ended its meeting on Wednesday on a positive note stressing 
the need and the desire of both the countries to bring their 
economic relations at par with the excellent political relations 
between the two states.

It decided to intensify their economic relations and take special 
measures to strengthen this relationship.

Pakistan Finance Minister Shaukat Aziz and Saudi Commerce Minister 
Osama Jaffer Faqeeh, later signed the minutes of the sixth JMC.

At the end of the JMC, it was announced that Pakistan and Saudi 
Arabia have agreed to renew the existing agreement on protection 
and promotion of investments in each of the two states. Emphasis 
was also laid on more regular visits by private sector 
entrepreneurs of the two states. In this regard, the Saudi 
authorities agreed to look at the problems of the Pakistani 
businessmen in obtaining visas for Saudi Arabia. It was also 
decided to give a greater and more enhanced role to the Pak-Saudi 
Joint Business Council, which was established last year in the 
private sector.

 The JMC decided to explore possibilities of further cooperation in 
a number of fields, including investments in petroleum, gas and 
other related energy sectors, food and agro-based industry, 
banking, information technology, cement industry, textile goods and 
readymade garments, leather industry and fertilizer.

The possibilities presented by the ongoing process of privatization 
in both the states also came under review. Already 26 joint venture 
projects exist between the two countries.

After the initial session, the JMC was divided into four sub-
committees on commerce and investment, science and technology, 
education and culture and a separate panel of businessmen to 
promote interaction between private sector of the two states.

Pakistan also offered training to Saudi railway personnel and 
students in its institutions. Increasing the number of Saudi 
students in Pakistani educational institutions, specially the 
medical colleges, also came under review and it was agreed that 
these would be looked into.

It was also decided to jointly review the existing tariff regimes 
in both the states so as to give a boost to trade between them. The 
next Pak-Saudi JMC session has now been scheduled to take place in 
Islamabad after about a year and a half.

Earlier, the Pakistani Finance Minister Shaukat Aziz called on King 
Fahd and Crown Prince Abdullah. He also met the Saudi finance 

Meanwhile, Riyadh Chamber of Commerce and Industry hosted a lunch 
for Pakistani delegation. The Pakistani side during the meeting 
gave a detailed review of the existing economic climate in Pakistan 
and urged for more Saudi investments in Pakistan. The presentations 
made by Shaukat Aziz and the other members of the delegation were 
well received by the almost packed hall of the chamber.

Perception about Pakistan improving: CE discusses vital issues
By Ihtasham ul Haque

ISLAMABAD, Jan 31: Chief Executive Gen Pervez Musharraf told the 
federal cabinet here on Wednesday that perception about Pakistan in 
the outside world had improved and was now helping the country 
forgebetter political and economic relations with foreign countries 
as well as international donor agencies.

Informed sources said that the chief executive who presided over 
the meeting believed that the international community now better 
understood Pakistan's point of view on various issues. He said 
change in the perception of the world community was helping 
Pakistan to forge better economic ties with the international donor 
and other multilateral agencies.

"The chief executive told his cabinet colleagues that change in the 
perception of foreigners about Pakistan was helping both 
economically and politically", Secretary Information Syed Anwar 
Mahmood told Dawn after the meeting.

Secretary General Finance Mr Moeen Afzal briefed the cabinet about 
the meeting of Finance Minister Shaukat Aziz and his team with the 
Paris Club members recently. The secretary general informed the 
cabinet that Pakistan had successfully negotiated the rescheduling 
of $1.8 billion loans with the members of the Paris Club. He said 
that there was a broad-based appreciation of the economic revival 
programme of the Pakistan government by the Paris Club members.

The Club also appreciated the expenditure control mechanism and 
reduced borrowings being pursued by Islamabad. The Club members 
also praised the overall performance of the government during last 

HUBCO ACCORD: The cabinet approved the settlement agreement reached 
with the Hub Power Company last December. The cabinet observed that 
the agreement was a positive development which reduced Hubco 
receivables by $63 million annually. "This translates into a saving 
of nearly Rs4 billion in foreign exchange every year. The agreement 
also reopens doors for foreign investment in the country", the 
meeting was told.

QUAKE: The meeting expressed deep sorrow at the loss of life and 
property caused by the devastating earthquake in India and 

The chief executive described it as a great human tragedy for India 
and thanked Allah for sparing Pakistan with only minor losses. He 
extended his heartfelt sympathies to the people of India in their 
hour of grief.

KYOTO PROTOCOL: The cabinet accorded approval to a proposal of the 
Ministry of Environment for accession to Kyoto Protocol to the UN 
Framework Convention on Climate Change to demonstrate Pakistan's 
continued commitment to the protection and preservation of global 

AIR SERVICE: The meeting also approved signing of a new air 
services agreement between Pakistan and Switzerland. The agreement 
provides more freedom in terms of flight operation between Pakistan 
and Switzerland.

DEMONETISATION: The cabinet extended the last date of 
demonetisation of Re1 and Rs2 currency notes to Dec 31, 2001. It 
also approved minting of Rs5 coins from Dec 31, 2001.

The cabinet also approved adoption of the International Convention 
for the Safety of Life at Sea. The accession of the protocol will 
facilitate Pakistani flagships to reduce commercial time loss and 
extra expenditure when engaged in international trade and when 
visiting ports of the states having adopted SOLAS Protocol 1988.

The meeting reviewed implementation of the decisions of the cabinet 
and the chief executive's directives by the Ministry of Local 
Government, Environment and Rural Development.

During the meeting, Gen Musharraf observed that recently-elected 
representatives at union council levels should be motivated to join 
the process of development and participate in nation building 
efforts. "The elected representatives at grass-root level can play 
an effective role in creating unity, sectarian harmony, promoting 
an atmosphere of tolerance and in curbing extremism and 
sectarianism in our society", he said.

The devolution plan, he said, when implemented, would revolutionise 
the entire society as the new system would inculcate confidence and 
spirit of leadership and service in the elected representatives at 
grass-root level.

Peshawar newspaper press set ablaze
Mohammed Riaz

PESHAWAR, Jan 30: Angry protesters on Tuesday attacked the office 
of the daily Frontier Post and set ablaze the printing machinery. 
The fire gutted the machinery, newsprint rolls as well as other 
printing material kept in the building.

Despite the presence of police personnel posted at the newspaper 
office, no efforts were made to prevent the mob which walked away 
after ransacking the office and burnt the printing press, housed in 
a nearby building.

The fire, which continued for several hours, turned everything into 

Various students organizations also held demonstrations to protest 
against the publication of blasphemous material in the newspaper.

Students started their rally from Peshawar University and after 
marching through city streets they gathered at the Hayat Shaheed 
Chowk near the US Consulate, where the rally was diverted by the 
police to Saddar.

Heavy contingents of police were deployed on all roads and bylanes 
leading towards the US Consulate. After marching through Saddar 
streets, the slogan-chanting students gathered outside the 
Governor's House where the rally was addressed by their leaders who 
demanded of the government to award exemplary punishment to the 
newspaper management. Although, most of the students later 
dispersed peacefully, a group of students carrying batons entered 
the Peshawar Press Club and damaged signboards.

Leaders of various religious parties also held a meeting at Madni 
mosque in Namakmandi. The also took out a procession from the 
mosque under the leadership of Maulana Abdul Malik of the Islami 
Muttahida Mahaz, and marched up to the Qisa Khawani Chowk.

Kashmir Day to be observed officially 

LAHORE, Jan 30: The government is learnt to have decided to 
officially observe the Kashmir Day on February 5 and is making 
elaborate arrangements for the purpose.

The main events will be human chains and demonstrations that will 
be attended by three provincial ministers at the three bridges 
connecting Azad Kashmir with the Punjab, official sources said on 

They said ministers of the Azad Kashmir government would also 
attend the demonstrations at Mangla, Azad Pattan and Karor Hullar 
(Kotli) bridges. Here human chains will be made to show solidarity 
with Kashmiris struggling to get their right of self-determination.

The sources said the demonstrations would be held in the morning 
and the names of the participating Punjab ministers would be 
announced later.

Symposia and seminars will be organized in major cities of the 
province on that day. There will be declamation contests and 
speeches on Kashmir issue in colleges and schools and intellectuals 
and artistes will take out rallies.

Arrangements will be made to facilitate the Kashmir Day processions 
by political parties.

Meanwhile, Lahore commissioner Shahid Najam told a news conference 
that the administration would play facilitator's role in the 
holding of Kashmir Solidarity Day functions.

He said that section 144-CrPC would be lifted but elaborate 
security arrangements would be made on the occasion as there would 
be great temptation for the enemies to sabotage the functions.

There would be a strict screening of participants in the rallies to 
be held on Shahrah-i-Quaid-i-Azam. All hotels and guest houses 
would be checked a couple of days before the event.

On February 5, the Shahrah-i-Quaid-i-Azam would be divided into 
various sectors as activities of various political parties and 
religious groups would be staggered to avoid any clash.

There will be a seminar and a photo exhibition on Kashmir at 
Alhamra Art Centre at 3pm. There will be a balloon display on The 

The commissioner said that a three-day Kashmir Food Festival in the 
Old Anarkali on February 4 to 6 and Kashmir Craft Show at Cultural 
Complex, Ferozepur Road, would be special features on the occasion.

There would be a special rally of writers, intellectuals and 
artistes from Alhamra Art Centre to LDA Plaza on Kashmir Road at 
3pm, while there will be special functions in Kashmir Block, Allama 
Iqbal Town, on Feb 5. 

Constitutional amendment not needed
Ansar Abbasi

ISLAMABAD, Jan 29: The government announced on Monday that it had 
made several changes in the proposed devolution plan, unveiled on 
August 14 last, maintaining that the implementation of the revised 
would neither require any constitutional amendment nor would need 
any extra cost or further employment in public sector.

Speaking at a press conference following a high-level meeting 
presided over by the chief executive on devolution plan, Chairman 
National Reconstruction Bureau (NRB), Lt-Gen (retd) Tanvir Naqvi 
said that in the future set up the provinces would retain their law 
and order responsibility which would only be partly shared by the 
district governments.

Naqvi said that implementation strategy of the devolution plan had 
been finalized under which provincial finance commissions (PFCs) 
and provincial and district transition teams (PTT & DTT) were being 
set up to evolve mechanism for financial and administrative 
devolution and to smoothen district's transition from present to 
future set up.

He said that the PTTs and the DTTs would evolve different 
strategies for different districts keeping in view their cultural, 
economic, demographical and geographical conditions. These teams, 
he said, would decide how the decentralization of power be done and 
what sort of re-organization was required to change the face of the 
district departments according to the future demands.

These teams, to be set up in next month, would also estimate the 
immediate as well as recurring cost on the implementation of the 
devolution plan.

Referring to the Monday's meeting, the NRB chief said it had been 
decided that neither extra cost would be allowed nor further 
employment would be made. The government, he believed, would be 
able to restructure/reorganize the existing official machinery to 
mould it to meet the future demands.

The NRB chief said that the draft law earlier prepared to cover the 
devolution plan had been changed to great extent and all 
unnecessary details had been omitted. He said there had been 
detailed and indepth consultation between the provinces and the 
centre on issues connected with the devolution plan.

The proposed Local Government Act covering the devolution plan, he 
said, had been finalized and would be sent to provinces in a couple 
of days for their final views on the draft law. He said that 
deliberations with regard to the revision of Police Act and 
constitution of citizen's tribunal were also in final stages.

To a question, Naqvi said that the law and order responsibility 
would remain with the provinces, but added hastily that the 
district government would also have a role in the maintenance of 
law and order. However, he did not offer any explanation as under 
which constitutional or legal authority the district governments 
would share this authority with the provincial government.

When asked whether the setting up of provincial finance commissions 
or the sharing of law and order responsibility by the districts 
would require any constitutional amendment, he said, "no". With 
regard to the number of amendments required to cover the devolution 
plan, the retired general took a complete somersault to what he had 
been saying in the past and said, "No constitutional amendment is 
required to provide legal cover to the devolution plan." He, 
however, said that the provinces might have their own views with 
regard to the constitutional amendment required.

Six killed; vehicles, property torched in Karachi
Arman Sabir

KARACHI, Jan 28: Six people were shot dead and 14 others wounded in 
various parts of the city in sectarian violence on Sunday.

The killing sparked violence in which police officials were beaten 
up, many vehicles torched and private and public property was 
damaged. Tension gripped Shah Faisal Colony, SITE, Banaras, 
Sabzimandi and Nagan Chowrangi, etc.

Although patrolling by the police and rangers was intensified in 
troubled and sensitive localities, the law and order situation 
remained volatile. Later, the army had to be deployed in Shah 
Faisal Colony to control the situation.

Eyewitnesses said a Toyota Hiace (EF-0079), carrying nine people, 
was fired upon by unidentified men while passing through an 
underpass near Natha Khan Goth. The travellers were going to Jamia 
Farooqia in Shah Faisal Colony No 4.

"As the vehicle crossed Sharea Faisal to enter Shah Faisal Colony, 
unidentified armed men started firing on it. First, they targeted 
the driver and then continued spraying the vehicle with bullets, 
targeting other people before fleeing," said a witness.

As a result, five people died and four others suffered serious 
wounds. The dead were shifted to Jamia Farooqia and the wounded 
were taken to the Jinnah Postgraduate Medical Centre.

The deceased were identified as Shaikhul Hadees Maulana 
Inayatullah, 70; Shaikhul Hadees Maulana Hameedur Rehman, 50; Mufti 
Mohammad Iqbal, 60; his 12-year-old son Talha; and van driver Abdul 
Hameed, 40.

The injured were identified as Constable Mohammad Ramzan, Maulana 
Abdus Sattar, Bilal and Yasir Iqbal, son of Mufti Iqbal. The 
condition of Abdus Sattar was stated to be serious.

Benazir considers high-risk return 

LONDON, Jan 30: Former prime minister Benazir Bhutto has said that 
she intended to return soon to Pakistan to play a role in country's 
future - a move that may put her on a collision course with the 
military regime.

In an interview she told the London-based Guardian newspaper that 
she intended to go home "sooner rather than later", and that she 
was determined to play a political role in country's future.

Ms Bhutto, whose both terms as prime minister ended in dismissal by 
presidents on the ground of corruption and mismanagement, said she 
hoped to revive democracy. After governing from 1988 to 1989 and 
1993 to 1996, she fled in 1999 shortly before a court sentenced her 
to five years in jail for taking huge kickbacks.

There is a warrant for her arrest. But she said she would return 
home, even if the "regime jails me, disqualifies me, or seeks to 
restrict me in anyway" from trying to revive democracy.

She shrugged off the prospect of imprisonment. "I remain the 
single-most important political force in the country," she said, 
adding that her family's history reflected Pakistan's own struggle 
with dictatorship.

Five corruption cases are pending against Ms Bhutto in Pakistan. 
Her husband, Asif Ali Zardari, has been charged with eight and is 
in jail.

The critics accuse Ms Bhutto and Nawaz Sharif of driving Pakistani 
politics and the economy ever lower.

 However, Benazir said the euphoria which came when Gen Pervez 
Musharraf deposed Nawaz Sharif and assumed the title of Chief 
Executive had evaporated.

"His plans to revive the economy and restore accountability were a 
shambles. Pakistan was divided and on its way to being failed 
state. The only beneficiaries were clerics who wanted the 
"Talibanisation" of the country.

Benazir also bitterly condemned the recent decision by the British 
Home Secretary, Jack Straw, to help Pakistani prosecutors who have 
begun investigating her overseas wealth.- Dawn-Guardian News 

US rejects request for revising F-16 payment accord 
Rauf Klasra

ISLAMABAD, Feb 1. The United States has rejected Pakistan's request 
for revising or modifying F-16 payment settlement agreement saying 
it is too late to accommodate such a request, official sources told 

Under the agreement signed in September 2000, the United States had 
agreed to return Pakistan's $140 million, which Islamabad had 
deposited a decade ago for the purchase of F-16 fighter planes that 
were never delivered.

Washington forcibly deducted $60 million from this money for 
300,000 tons of wheat which it had earlier provided to Pakistan as 

It asked Pakistan to buy soya bean oil and oilseed for the 
remaining $80 million and that too at exorbitant rates.

Islamabad had recently asked the United States to allow it to 
import wheat instead of 165,000 tons of soya bean seed and 50,000 
metric tons of oil as their import will hurt the local oilseed 
production programme.

While categorically refusing to accept Pakistan's request, the 
United States has warned Islamabad that if soy bean is not 
imported, Washington will not pay a single penny and Pakistan will 
be responsible for the loss of its $80 million.

If Pakistan does not import soya bean, "Washington will take the F-
16 deal chapter as closed once for all and there will not be any 
liability on the US," the source quoted Washington as saying.

However, Washington has accepted Islamabad's another request for 
changing the shipment schedule of soya bean seed and has sent a 
revised schedule to the Trading Corporation of Pakistan (TCP) to 
import the commodity before September, 2001.

Last month, the sources said, Islamabad had requested the US 
government to allow it to bring about some changes in the nature of 
F-16 settlement after the local press disclosed that the US was 
selling soya bean at much higher rates than those prevailing in the 
international market.

Soya bean seed is selling in the international market at around 
$200 per ton but, under the agreement, the United States is selling 
it to Pakistan at $250 per ton.

Similarly, it is also charging $50 extra per ton for the shipment 
cost. Pakistan will be paying $24 million as shipment cost to US 
shipment companies out of a total of $80 million.

When the issue was raised in the Press, the Finance Ministry called 
a meeting to consider the import of soya bean. 

 After long deliberations, it was decided to import wheat instead 
of soya bean seeds as Washington was selling it at unrealistic 

The decision to import wheat was taken on two grounds. Firstly that 
wheat production was likely to be short in 2001 and secondly the 
import of soya bean would play havoc with the local oilseed 
development programmes.

Accordingly, the Finance Ministry officials held a meeting with the 
officials of the US embassy in Islamabad and requested them to 
modify the accord. Pakistan's request was forwarded by the embassy 
to the US Department of Agriculture (USDA), which refused to make 
changes to the agreement.

FCY deposits at 50pc of reserves: Dollarization spell again?
Mohiuddin Aazim

KARACHI, Feb 1: Fresh foreign currency deposits of banks rose by 35 
per cent to about $570 million in January 2001 exposing Pakistan-
once again-to the perils of dollarization of economy.

Bankers told Dawn that their fresh foreign currency deposits placed 
with the State Bank rose to about $570 million on January 31 2001 
from about $423 million on December 30 2000-an increase of 35 per 
cent or $147 million.

Now these deposits account for more than 50 per cent of total 
liquid foreign exchange reserves of around $1.132 billion as on 
January 31. If these deposits are subtracted from total reserves 
net liquid foreign exchange reserves stand around $563 million 
only-barely enough to foot two-week import bill.

Bankers cite several reasons for an unusual growth in foreign 
currency deposits of banks in January including half a per cent cut 
in US interest rates and consequent fall in global interest rates. 
They say that falling interest rates in the international market 
had reduced the temptation for holding dollars abroad and made the 
meagre returns SBP pay on these deposits look a little better. In 
early January when the US benchmark overnight lending rate was 6.5 
per cent six-month LIBOR (London Inter-Bank Lending Rate) was being 
quoted around 6.2 per cent. After half a per cent cut in the US 
discount rate (from 6.5 to 6.0 per cent) in mid- January LIBOR fell 
gradually to about 5.4 per cent by the end of the month-a fall of 
80 basis points in one month.

"This fall in LIBOR reduced the temptation for holding dollars 
abroad," said treasurer of a foreign bank. "And at the same time it 
made the SBP rates of return look better encouraging banks to 
mobilize foreign currency deposits and place them with the SBP."

In January the SBP offered 4.5 per cent return on the foreign 
currency deposits placed with it for three months. The same rate is 
valid this month.

Bankers close to SBP say the sudden growth in foreign currency 
deposits is a cause of concern for the central bank that has to 
return these deposits to the banks by end-March. The $596 million 
IMF standby credit requires Pakistan to do several things and 
returning these deposits to the banks is one of them. Earlier in 
July 2000 Pakistan had to free-float the rupee just to qualify for 
the standby loan.

Bankers say another half a per cent cut in the US repo rate (from 
6.0 to 5.5 per cent) on Wednesday would trigger further rate-cuts 
in global market encouraging people to hold dollars within 
Pakistan. "And that is nothing short of re-dollarization of the 
economy," said a senior central banker. After burnings its finger 
deep into dollarization Pakistan had to freeze $11 billion worth of 
foreign currency deposits after going nuclear on May 28 1998. The 
freeze has shook the confidence of local and foreign investors as 
well as overseas Pakistanis and efforts to restore the lost 
confidence are yet to produce real results.

Banks seek 100% cash margin from Kabul importers
Sabihuddin Ghausi

KARACHI, Feb 2: International banks, operating in Dubai and other 
states of the UAE, are now demanding a 100 per cent cash margin 
from the Afghan importers, following the imposition of UN sanctions 
on Taliban administration in Kabul.

A recent phenomenon, the demand for a 100 per cent cash margin by 
the international banks, is reported to have brought a virtual 
suspension in the opening of the letters of credits by the Afghan 

According to the local bankers and traders in Karachi this 
suspension of opening of Afghan importers' letters of credit in 
Dubai would impact the Afghan Transit Trade as a considerable 
quantum of goods imported against foreign exchange passes through 
Karachi port on its way either to Chamman in Balochistan or Torkham 
in NWFP.

At the same time traders report a considerable slowdown in the 
bilateral trade between Pakistan and Afghanistan following a 
virtual suspension of overland transport links and telephonic 
communications between Torkham and Jalalabad-Kabul and Chamman- 

Those Pakistani traders, mostly based in Peshawar and Quetta, who 
are regular supplier of essential goods to Afghanistan on deferred 
payment basis for last many years are now reported to be stuck up 
with severe cash flow problem.

"Almost Rs1 billion is stuck up against ghee supply", Amjad Rashid, 
a well known Pakistani food merchant who supplies about 1,000 tons 
of ghee to Afghanistan every year informed Dawn by telephone from 
Islamabad on Friday. His estimate is that a total of about Rs2 
billion is stuck up in bilateral trade with Afghanistan which, "by 
all accounts and considering the severe recessionary conditions is 
a crippling blow on the small traders".

The Afghan Consul General in Karachi Moulvi Rahmatullah Kakazada 
however appeared to be unaware of the implications of UN sanctions 
on the bilateral trade. Talking to Dawn in his office Moulvi 
Kakazada said that his government has requested Pakistan for 
inclusion of 17 items in the Afghan Transit Trade which were 
deleted by the Pakistan government.

Pakistan's bilateral trade with Afghanistan is mostly conducted in 
Pakistani rupees, in accordance with the relevant provisions of the 
Export Policy and Procedure Order 2000. Under these provisions, all 
goods and commodities produced in Pakistan can be exported against 
Pakistani currency to Afghanistan via overland routes Torkhan-
Jalalabad and Chamman-Qandhar.

The exports to Afghanistan against foreign currency received 
through advanced payment or letters of credit is allowed a maximum 
duty drawback of 7.5 per cent of the FOB. This low and a fixed duty 
drawback rate of 7.5

Rs 8 billion paid in sales tax refund: July-Jan figures
Parvaiz Ishfaq Rana

KARACHI, Feb 2: There is a sizeable rise of 19.92 per cent in sales 
tax refund payments to exporters, during first seven months (July 
to January) of current fiscal, official sources disclosed on 

The sales tax collectorates (East and West), Karachi, have paid 
Rs8.019 billion in refunds during first seven months of current 
fiscal as against payments of Rs6.687 billion made in the 
corresponding period last fiscal.

But a quantum increase in refund payments during last month 
(January 2001) speaks volumes of facts, in the background of 
ongoing brawl between CBR and exporters over SRO-417, which lays 
down method for claiming sales tax refunds.

According to official figures, sales tax refunds payments by both 
the collectorates (East and West) during January 2001, rose by 
118.17 per cent over a corresponding period of last fiscal. In 
total Rs2.244 billion were paid against Rs1.028 billion in the same 
period last year.

The exporters had been agitating against the SRO-417 for being 
stringent in claiming refunds. Because of non-payment of refunds, 
their liquidity was badly effected during first six months of 
current fiscal.

The CBR on the other hand had been claiming that the new refund 
rules under the SRO-417, had helped a lot in countering fake refund 

Even recent amendments in SRO-417 were rejected by trade and 
industry and the minister for commerce is also on record to have 
criticized the "twist and turns" placed by bureaucracy in these 

According to details, the collectorate of sales tax (East) during 
first seven months of current fiscal paid Rs5.21 billion or 41.95 
per cent higher than the corresponding period of last year, when 
refund payments were to the tune of Rs3.67 billion.

The sales tax collectorate (West) during first seven months under 
review paid Rs2.809 billion as against Rs3.016 billion of the 
corresponding period last fiscal.

However, a sharp rise in refund payments were noted last month, 
when a total of Rs558.68 million were paid compared to Rs396.963 
million of a corresponding period last fiscal - an increase of 
around 41 per cent over the previous year's payments of refunds.

Guideline for DFIs, banks merger soon 
Jawaid Bokhari

KARACHI, Feb 2: A new official policy guideline backed by 
facilitating rules would be unfolded soon to promote financial 
supermarkets through mergers of banks and financial institutions, 
offering a broad spectrum of services.

Under the proposed scheme of things, sources revealed that any 
financial institution or bank would be eligible to offer the widest 
range of financial services. And within a corporate identity, 
administrative divisions would be allowed to be set up for diverse 
businesses -leasing, investment banking, securities services, 
Modarabas etc. The main line of business would determine the 
corporate identity.

The diverse financial services under one umbrella would be modelled 
on the latest global trends in the financial sector. There is a 
growing realization among bankers that lending alone, getting 
riskier, cannot sustain profitability. 

 Global corporate restructuring, uncertain business environment and 
the regional economic cyclic crises recurring with unprecedented 
frequency makes it imperative that institutions should be reshaped 
to grapple with changing realities. The banks are also facing many 
facet competition from the capital market.

Though acquisition and mergers would remain a voluntary affair, the 
regulators would lay down the rules of business. The present 
impediments in mergers and acquisitions would also be removed.

Sources said that regulators want strong financial institutions 
that are able to induct modern technology and become cost 

 A large number of financial institutions operate with rudimentary 
technology, low skill and manpower which do not match the modern 
banking requirements.

 The financial sector has been allowed to expand, ignoring the 
viability of such large numbers in the current size of the real 

To encourage mergers, the State Bank has raised the minimum paid up 
capital of commercial and investment banks, allowing them some 
breather to manage investment or seek mergers.

According to a study conducted by a leading industrial group, the 
economy is being serviced by 252 commercial banks, leasing and 
Modaraba companies, unit trusts, venture capital firms, investment 
banks, insurance firms, DFIs and mutual funds which have together a 
paid-up capital of Rs. 124 billion or about $2billion which is less 
than the paid-up capital of any one multinational bank. Sector-wise 
the number of units and their aggregate paid- up capital (in 
bracket) is as follows :

There are 42 commercial banks (Pakistani banks Rs.51.64 billion and 
foreign banks Rs.18.2 billion), 32 leasing companies (Rs.4.84 
billion), 48 Modaraba companies (Rs.8.14 billion), 15 investment 
banks (Rs.5.12 billion), 10 DFIs (Rs.10 billion), 39 mutual funds 
(Rs.4.76 billion), 2 unit trusts (Rs.14billion), 2 venture capital 
firms (Rs. 4.8 billion) and 39 insurance companies (Rs.2.93 

Financial analysts identify three major hurdles in acquisition and 
mergers, the absence of modern corporate culture, lack of funding 
to promote acquisition and mergers and regulations not conducive to 
corporate marriages. 

 The merger of two financially weak institutions cannot produce a 
single strong financial entity. The injection of funds is needed to 
improve the financial health of the new unit. The other option is 
that financially viable and bigger institutions take over the weak 

Pulses, atta, egg strain consumer pocket

KARACHI, Feb 1: A price increase in pulses, wheat flour, eggs, and 
ginger during the last one month has hit hard the low and middle 
income group, who have to contribute greater part of their earnings 
to the kitchen budget.

Wheat flour and pulses claim a substantial share of low and middle 
income group people who are the hardest hit by this price spiral.

A market survey (from January 1 to February 1) reveals price surge 
in gram pulse to Rs32-34 per kg in posh localities as compared to 
Rs29-30 last month. In Nazimabad area, retailers are charging Rs32 
per kg followed by Rs28 in Landhi, Quaidabad and Malir areas.

Moong also shot to Rs32 per kg in areas like Tariq Road, KDA 
Scheme, Bahadurabad, Defence and Clifton from Rs25 per kg. In 
Nazimabad, F.B. Area, North Nazimabad - moong is available for Rs28 
per kg, while in Malir and Landhi it is retailed at Rs27.

Mash rose by Rs4 to Rs48 per kg the whole of the city. Last month, 
it was charged at Rs44 per kg.

Masur now ranges between Rs34-36 per kg in posh areas as compared 
to last months's price of Rs32-34. However, people living in middle 
income group areas can get masur for Rs32 per kg.

However, wholesalers did not agree with the current increasing 
trend saying that the prices have come down by at least Rs2-4 per 
kg due to over supply position and paucity of buyers in the market. 
They said pulses import rose by 82 per cent in July-December 2000-
2001 in terms of quantity as compared to the same period of last 

Fine atta price also soured to Rs13 per kg in upper income group 
areas as compared to last month's price of Rs11.50 per kg. 
Disparity in the prices of atta from area to area also looms large 
as fine atta is available at Rs12 per kg in Landhi, Korangi, 
Nazimabad, North Nazimabad, F.B. Area and Gulshan-e-Iqbal. 
Similarly, atta no.2.5 also increased to Rs11 per kg from Rs10. 
However, in some areas, it is available at Rs10.50 per kg.

In poultry, only egg prices are higher by Rs2 per dozen at Rs34 
from Rs32 per dozen due to rising cold wave. The live bird rates 
fell to Rs60 per kg as compared to Rs64, while its meat ranges 
between Rs101-105 per kg as compared to Rs112.

World Bank seeks speedy privatization

KARACHI, Feb 1: The World Bank Managing Director Shengman Zhang 
said here on Thursday that Pakistan should contain its population 
growth rate and take long-term measures for a sustained growth of 
its economy.

Speaking at a meeting of top bankers and industrialists at the 
State Bank he said a lower population growth rate might help 
Pakistan move faster toward economic development.

The participants of the meeting told Dawn that Mr Zhang was of the 
opinion that Pakistan had recently showed some signs of improvement 
but it had to go a long way in exploiting its potential for a 
sustainable economic growth.

Mr Zhang said that Pakistan should speed up its privatization 
programme to fill in the gaps in its foreign exchange earnings and 
expenses. They said the World Bank official observed that under 
present circumstances Pakistan could find it difficult to fill in 
external financing gaps.

Zhang arrived here on a five-day visit to Pakistan during which he 
is expected to meet Finance Minister Shaukat Aziz and Chief 
Executive General Pervez Mushrraf also. At the State Bank meeting 
he was accompanied by the WB representative in Pakistan John Wall.

The bankers briefed the World Bank official on several key issues 
of Pakistan's economy as a whole besides informing him about the 
problems and prospects of certain sub-sectors of the economy. They 
said SBP Governor Dr Ishrat Husain spoke about the economic 
policies put in place in the recent past and briefed him on how 
these policies had contributed in improving the economic 

Mr Saqib Shirazi informed him that a 30-35 per cent growth in the 
sales of motorbikes indicated improvement in the income levels in 
rural Pakistan. And against that a 5-6 per cent growth in car sales 
indicated that in urban parts of the country the situation was not 
that promising.

SBP raises paid-up capital: Investment banks, housing finance cos
Mohiuddin Aazim

KARACHI, Jan 31: The State Bank has raised the minimum paid-up 
capital for investment banks from Rs 200 million to Rs 500 million. 
But it has given the investment banks two years to meet this limit.

An SBP circular said on Wednesday that "no investment bank shall 
commence or carry on business unless it has a minimum paid-up 
capital of Rs 500 million." But it gave them time to make up for 

It said if an investment bank fell short in meeting the new paid-up 
capital limit it should meet 50 per cent of the shortfall by 
January 1, 2002 and the remaining by January 1, 2003. This means 
that an investment bank whose paid-up capital is Rs 200 million 
will have to raise it to Rs 350 million by January 1, 2002 and to 
Rs 500 million by January 2003.

Bankers close to SBP said the raising of paid-up capital limit was 
aimed at weaker non-efficient investment banks to seek mergers with 
stronger ones or get out of this business. They said the move was 
also aimed at minimizing the risks for depositors of investment 
banks. But investment bankers said since they were not allowed to 
raise deposits worth more than seven to ten times their paid-up 
capitals risk coverage for their depositors was adequate.

Three out of total fifteen investment banks already have paid- up 
capital worth Rs 500 million or more; two have Rs 300 million or 
more and four others have paid-up capitals of Rs 200 million each.

Following is the list of investment banks with their paid-up 
capitals: (i) Al-Faysal Investment Bank (Rs 978m); (ii) Al-Meezan 
Investment Bank (Rs 901m); (iii) Al-Towfeek Investment Bank (Rs 
310m); (iv) Assets Investment Bank (Rs 100m) (v) Atlas Investment 
Bank (Rs 118m); (vi) Crescent Investment Bank (Rs500m); (vii) 
Escorts Investment Bank (Rs 200m); (viii) Fidelity Investment Bank 
(Rs 345m); (ix) First International Investment Bank (Rs 200m); (x) 
Islamic Investment Bank (Rs 197m); (xi) Jahangir Siddiqui 
Investment Bank (Rs 140m); (xii) Orix Investment Bank (Rs 200m); 
(xiii) Prudential Investment Bank (Rs 100m); (xiv) Security 
Investment Bank (Rs 201m) and (xv) Trust Investment Bank (Rs 100m).

Ceremonial, video taxes abolished 

KARACHI, Jan 31: The Sindh government has abolished Video Tax and 
Ceremonial Tax on marriage halls and clubs, says a handout of the 
provincial excise and taxation department issued here on Wednesday.

The tax amnesty has been granted in an ordinance entitled "The 
Sindh Finance Laws (Amendment) Ordinance, 2001" promulgated by the 
Sindh Governor on Jan 27.

The ordinance also provides relief to taxpayers on immovable 
properties, buildings owned by widows, minor orphans, disabled 
persons and private vehicles registered 10 and 15 years ago.

The handout said that the property tax would not be leviable in 
respect of immovable properties whose estimated gross annual rent 
does not exceed Rs864. 

The buildings and lands owned by widows, minor orphans or 
permanently disabled persons will also be exempted from property 

Private vehicles (cars and jeeps only) on completion of 10 years 
and 15 years of payment of motor vehicle tax since first 
registration of the vehicles, will be liable to pay tax at the rate 
of 75 and 50 per cent, respectively. 

The people engaged in the business of video films were no more 
required to obtain licences as the Video Tax had been abolished, 
the handout said.

The people engaged in running the affairs of marraige halls, lawns, 
hotels, clubs or community halls were no more required to obtain 
licences from the excise & taxation department to allow ceremonial 
parties and other gatherings on their premises as the Ceremonial 
Tax had been abolished, the handout concluded.-PPI

Back to the top
N.E.D. University
Ardeshir Cowasjee

'FLAWED, flawed, flawed is what we are,' said I last week, utterly 
exasperated, to the self-styled Maulana Amjad Thanvi, the Alim who 
sits with me on the NED Syndicate. 'Yes, yes, we are frauds,' 
retorted the growing-deafer-by-the-day learned man, who dyes his 
hair black and henna-reds his beard.

Maulana Sahib is now in the process of obtaining an honorary 
doctorate from the Karachi University and the next time we meet I 
may well be addressing him as Maulana Doctor Thanvi. He is a 
pleasant man and claims to be of a progressive bent of mind.

It was in the early 1920s that Sahib Singh Chatur Singh Shahani, 
the forward-looking principal of Dayaram Jethmal Sind College 
(established in 1887), made a plea to Jamshed Nusserwanjee: 
'Jamshed, get me some funds. It is high time Karachi had a full-
fledged engineering college.' Jamshed raised the core money from 
the four sons of Nadirshaw Eduljee Dinshaw (NED) who had just died 
- Hoshang, Minocher, Dinshaw, and Faredoon. The Khilanani family 
and the Hindustan Construction Company of the Birlas made up the 
deficit and the NED college was established. After Pakistan came 
into being, the college finally evolved, in March 1977, into a 
university of engineering and technology.

The college was a highly rated establishment until, as with this 
country and all its institutions it was hit by the general 
downslide and the substantial overall deterioration. The rot was 
stemmed in December 1996 when Engineer Abul Kalam was appointed 
vice-chancellor. He found upon his plate, awaiting him, the case of 
64 students who had been fraudulently passed in their examinations, 
not just once, but several times as they had been allowed to take 
and retake their exams.

Kalam asked the chancellor, Sindh Governor Kamal Azfar, to hold an 
inquiry. The chancellor appointed me to so do in my capacity as a 
member of the Syndicate. Exercising abundant caution, I asked Kalam 
to have the written papers of the 64 reassessed by an independent 
engineer. This he did, appointing Engineering Doctor Shahid Alam. 
Alam failed the lot.

Mr report to Chancellor Azfar was sent on February 16, 1997;

Subject: 'Fraud: The case of NED students.... incapable of passing 
their examinations who were allowed to appear again and again until 
it was contrived to give them pass marks. You have asked me to hold 
an inquiry into this sordid affair, which I have done...'Under 
pressure, or under instructions, the former vice-chancellor, 
Professor A.Q. Qazi, engineered to have passed certain students who 
were not eligible to be passed.

The Chancellor, averse to any decision-taking which may ruffle his 
placid feathers, wriggled out of it by asking his nominee on the 
Syndicate to quietly tell Kalam to ignore my report and do nothing. 
The matter dragged on and the 64 petitioned the Sindh High Court. 
They were heard by Chief Justice Wajihuddin Ahmad and Justice 
Roshan Isani. Wajih knew his onions. He took the decision to remand 
the matter back to the Syndicate.

When a member retabled the matter at a Syndicate meeting, the 
majority was persuaded to resolve that the degree certificates be 
issued to the 64 who had been fraudulently passed.

On December 23, 1998 I wrote to Lt-General Moinuddin Haider, 
Azfar's successor as Chancellor of NED University and Governor of 

'By a process of manipulation, the majority of the NED Syndicate 
members have managed to resolve that degree certificates be issued 
to those fraudulently passed. The vice-chancellor and the minority 
(which includes me) do not wish to be a party to the fraud.

'I am sure that you too would not like to be a party to fraud. It 
is time you intervened and annulled the relevant resolution under 
the powers vested in you in terms of Section 25(1) of the NED 
University Act. Until the matter has been investigated by you, may 
I request that you instruct the vice-chancellor not to take any 
action concerning what has been resolved as recorded under 
resolution No. 108.4 (c).

'Sent herewith for your information and guidance is a copy of my 
letter dated 16-2-97 addressed to Chancellor Kamal Azfar concerning 
this subject.'

Governor Haider took the line of least resistance and slept over 
the matter. In 1999, it was decided to give these aging students a 
refresher course, and to then re-examine them. fifty-four took the 
refresher classes and then passed the exams.

Seven who had refused to take the courses and re-examination 
petitioned the High Court of Sindh. Their case was heard by 
Justices Hamid Mirza and Shabbir Ahmad who decided that, in terms 
of the majority decision of the Syndicate, the seven should be 

NED then appealed to the Supreme Court where the matter was heard 
by Justices Nazim Hussain Siddiqui and Abdul Hamid Dogar. Leave to 
appeal ws refused and the petition dismissed, with the remark. 'The 
Vice-Chancellor was clearly directed to implement the Syndicate 
resolutions Nos. 108 and 110. Taking a lenient view, we are not 
issuing contempt notices to those who passed the resolution No. 
115.6 but warn them to be careful in future.'Kalam had no choice 
but to give the degrees, which he sadly and with much disgust did, 
noting upon the certificates: 'Degree awarded in compliance with 
Sindh High Court decision dated 22-2-2000 on CP D-42 of 1999.

The seven went to their advocate who on 16/1/01 sent a notice to 
the vice-chancellor and the Registrar: 'You are, therefore, called 
upon through this notice to issue the degree to my client... 
without any remarks failing which my clients will be left with no 
option but to approach both the Hon'ble Courts for appropriate 
contempt proceedings...'

An emergency meeting of the Syndicate was called on 23/1/01. 
Thirteen attended. Twelve of us resolved that we approve of the 
action taken by the vice-chancellor in issuing the degrees with his 
notation. One member involved in the original fraud, naturally 
dissented. What are we supposed to do? Resign and go sailing? Or 
press on and attempt to resist blatant mischievous wrongdoing? 
Should men such as the seven be allowed to work as structural 
engineers, unqualified to construct buildings, bridges, etc, which 
with the slightest earth tremor can fall and kill?

Servitude and the daily grind
Ayaz Amir

IN the bright dawn of the Musharraf era when at least for the 
innocent the air seemed full of hope and the promise of renewal, a 
Focal Group was set up to suggest a package of police reforms. The 
godfather of this enterprise was someone who has since emerged as 
the country's foremost orator, Lt-Gen Moinuddin Haider, and its 
chairman was my friend, the ex-senior policeman (and great 
bibliophile) Zafar Rathore.

Around the table were other grizzled veterans of the bureaucratic 
trade, senior civil servants and luminaries of the police service, 
each one of them (not a whit abashed by his own modest record in 
service) behaving as if he had found the Holy Grail. No doubt 
because of some accident, I too found myself a member of this 
distinguished group. Knowing something of the value of such 
conclaves I missed the first couple of meetings. At some stage I 
made an appearance, there to find that the most serious issue 
before the Group was how to end 'political interference' in the 
workings of the police department, this being considered by the 
assembled bishops as the root cause of the department's malaise.

This I found a bit odd. Of what immediate relevance, I asked, was 
'political interference' at a time when the imposition of military 
rule had put an end to the last notion of political interference? 
Eyebrows rising quizzically, I was told that this was for the 
future. And hence, in order to free the angels of the police 
department of any interference, the Focal Group agreed on a package 
of measures more ingenious if not complicated than the hidden 
structure of the pyramids.

The Focal Group's recommendations have not been implemented and 
never will be. But what it was trying to achieve through its 
elaborate proposals is now a fact on the ground, thanks to military 
rule. No wadera or politician has a hand in the posting of SHOs. No 
local grandee can influence an investigation. Has this led to any 
improvement in police performance? Not a bit. Freed from political 
restraint police officials have become more arbitrary and corrupt.

About Chakwal at least I can say with confidence that in every 
matter coming before the police, cognizable or not, the ultimate 
arbiter is money. While this was always the case before, this 
practice has become more enshrined in the last 12 months. Nor 
should this be surprising. Whatever the other consequences of 
military rule, two things happen whenever the military dons the 
garb of national saviour: the bureaucracy becomes coarser and more 
wilful while bribery rates go up. It has been no exception this 
time. Granted, political interference is mostly unwarranted. But 
sometimes it is a salutary check on bureaucratic excess or 

 The banishing of politics removes the last restraint on the 
bureaucracy. If the army monitoring teams think they are a check on 
anything they should take a second look at their effectiveness.

My friend Afzal Shigri, Commandant, National Police Academy, and 
one of the moving spirits behind the Focal Group on Police Reforms, 
often spoke the most vehemently against 'political interference'. 
He should take time out and visit the field, perhaps taking Chakwal 
in his ambit, to see for himself the general happiness resulting 
from the independence not so much declared as assumed by the Punjab 
Police's thanedars.

As for superintendents of police, take Chakwal again where the SP, 
a decent and likeable fellow (qualities not to be scoffed at in 
this day and age), seems content to play the role of postmaster, 
readily receiving complaints and marking each one of them 'for 
inquiry', a process so stretched out in practice that it breaks a 
petitioner's back before it leads to anything. The SP is unable or 
unwilling to sift matters for himself, perhaps because of his 
lameduck status, his transfer having been ordered six months ago 
but no one yet being sent to replace him. Most inquiries he sends 
to the assistant superintendent of police, a lost soul who seems to 
have stumbled into this profession.

In revenue matters sensible people never approach the deputy 
commissioner. They go straight to the patwari. So too in criminal 
cases. Sensible people talk things over with the Station House 
Officer or the investigating officer (usually a sub-inspector or 
assistant sub-inspector). Unless one has an uncle or a son-in-law 
in the service, climbing higher up the ladder is a waste of time, 
so lax has supervision become in this department. Of course police 
officers have long excuses on their lips. But what avail excuses to 
the common man?

With no petro-dollars to burn, and this being neither Taiwan nor 
Singapore, life is hard enough for most Pakistanis. There should be 
no need for a corrupt and predatory administration to make it any 
harder. Notice how ordinary Pakistanis cringe before authority. 
They are stuck with the habits of servitude because authority is so 
fashioned here that it bears down upon the weak and lowly, treating 
them as things of no consequence. But why blame only the poor? 
Notice how better-placed Pakistanis make fools of themselves before 
foreigners. Colonialism alone is not to blame. The young of today 
know nothing of colonialism. Other countries have got over worse 
colonial hangovers. Our predicament seems different.

The arbitrariness of power - the fact that it can be given and 
withdrawn without reference to constitutional sanction - lends a 
sense of precariousness and insecurity even to the elite classes. 
Thus we see the absurdities with which this land abounds. 
Politicians not standing for their own rights or the rights of the 
people but begging favours from the military. The spirit of 
authoritarianism strong and pervading everything, the flame of 
resistance dead. The highest politicians considering it a great 
boon if junior American and British diplomats come calling on them. 
Retired generals vying for ambassadorial appointments. Serving 
corps commanders not considering it a waste of time to head sports 
organizations. Judges every three or five years adjusting 
themselves to the doctrine of necessity. The state itself extending 
a begging bowl before foreign donors. The common man helpless 
before his SHO.

The entire culture thus woven is one of dependence, sycophancy and 
insecurity. Why should we be surprised if the best amongst us are 
also the foremost in corruption? Insecurity of such Mughal 
proportions (advancement and procurement of sinecure in Mughal 
times depending upon the goodwill of the emperor) can only breed 
corruption and flight to sunnier climes. This then seems to be the 
bitterest wage of authoritarian rule: it imposes the habits of 
subservience on a people, makes them bend and teaches them how 
survival is a function of conformity, prosperity the reward of 
being able to swim with the tide.

Then we say we did not speak up when Yahya Khan and the Eastern 
Command performed their macabre dance in East Pakistan. We could 
not have spoken up. We were not 

programmed to speak up. A similar situation recurring, our national 
response will still be the same.

Forget the distant past, where were the howls of protest over the 
transparent folly of Kargil? There was no martial law imposed on 
the country then. It is just that the national intelligentsia has 
been trained, like beasts in a circus responding to the whip, to 
take anything that comes from the defence establishment on trust. 
What hidden dimensions of rocket science were needed to tell us 
that conducting nuclear tests would be a huge mistake? Yet on this 
question the national intelligentsia was mesmerized by the atomic 
lobby which for years, and for mindless reasons, has been 
advocating nuclear belligerence.

So it applauded the nuclear tests just as it has applauded every 
shenanigan Pakistan has contrived for itself these past 50 years.

The only change discernible is now. After the economic knocks of 
the past three years, the atomic lobby has gone quiet. Generals and 
air marshals no longer write so frequently about the imperatives of 
'national security'. 

The national intelligentsia was always obsessed with foreign policy 
almost as if it was a branch of science independent of domestic 
policy. Now it has become slightly more introspective, turning its 
gaze inwards and trying to focus for the first time on the evidence 
of disorder mounting within the Republic's hallowed frontiers.

When the curtains come down finally on the current episode in our 
history, this may well be counted as the foremost achievement of 
the Musharraf regime: that by the very fitfulness of its journey 
across the desert sands, it may have opened the nation's eyes to 
the real nature of its problems.

Stagnation vs creative chaos 
Irfan Husain

I don't normally go to modern western music concerts, but when my 
old pal Masood Hasan rang me to say that his son was playing at a 
local hotel and that I had to come, I couldn't say no.

And I'm very glad I went because young Mekaal not only leads his 
group, but has also composed most of the music they played with 
such verve and energy. While all the (mostly-British) members of 
the Mekaal Hasan Band were clearly very talented, for me Akhlaq, 
the percussionist on the tablas stood out. His use of the local 
drums was original and very skilful as he matched his colleague on 
the normal percussion set beat for beat and riff for riff. His 
solos were inventive and intricate as he revealed aspects of the 
instruments not explored by other Pakistani tabla-players.

This musical experience reminded me of conversations I have had 
with ustads and aficionados of our classical music. Basically I 
have asked them why no new ragas are being composed: most of the 
great ragas are centuries old, with many of them dating back to 
Amir Khusro in the 13th century and Tansen from the Mughal Emperor 
Akbar's era. In all these years, no notation system has been 
developed and the ragas are passed on from ustad to disciple.

The people I have spoken to are almost unanimously of the view that 
the ragas that have been handed down represent such a range of 
melodic genius that no improvement and further addition are 
possible. In support of this position, they cite the great works of 
Mozart, Chopin and Beethoven, and argue that since the time of 
these giants, no composer has matched their works. I have tried to 
argue that nevertheless, composers have continued to write scores 
for symphonies and audiences have enthusiastically flocked to these 

In short, just because brilliant music was created in the past is 
no argument for the absence of any effort to surpass it. But our 
classical music is in a rut without our few remaining maestros 
putting in any thought or effort to explore new themes. Even Ustad 
Raees Khan, one of the subcontinent's leading half-a-dozen or so 
exponents of the sitar, feels that it is not possible to create any 
great new ragas. According to him, audiences are not receptive to 
experimentation, and insist on hearing their favourites. Thus, the 
only innovation taking place in music is being done by enthusiastic 
young musicians who are marrying the western idiom of rock, pop and 
rap to their own musical vocabulary and experience.

The stagnation evident in our classical music is also present in 
our culinary tradition. Not only are we failing to preserve old 
regional recipes, we are not innovating and experimenting. Cooks in 
homes and restaurants are repeating themselves endlessly (I will 
not say ad nauseum) without any attempt at creating exciting new 
dishes. But even those of us who claim to be interested in 
gastronomy are not very demanding, insisting only that the dishes 
we are familiar with should be well-prepared.

And yet South Asian restaurants continue to gain in popularity, not 
just in Britain but also in most western countries. An amazing 
third of the billions of pounds spent by the British on eating out 
every year goes to desi-style restaurants. In many of these 
establishments, especially those at the upper end of the spectrum, 
chefs have introduced dishes that I hadn't ever heard of. Many 
British chefs are using our spices to enhance dishes of western 
origin, creating a 'fusion cuisine' that is currently very 
fashionable. So there is nothing inherent in our cuisine that 
prevents innovation and change: fossilized attitudes and laziness 
are the only barriers.

This stagnation and reluctance to innovate extend to almost every 
walk of life from literature to science. Almost every Pakistani who 
has made a name has done so abroad where originality and 
experimentation are encouraged and rewarded. Here, a status quo 
based on mediocrity stifles creativity, especially among the young. 
Our establishment fears and mistrusts genius; indeed, our only 
Nobel Laureate, Abdus Salam, wasted much of his precious time in a 
futile attempt to convince successive governments to set up a 
centre for research into particle physics here in Pakistan. Despite 
all his dazzling achievements, he died a disappointed man, unsung 
and unwept in his own country where his Ahmadi beliefs outweighed 
his enormous contribution to science.

Others who can be termed intellectual and artistic refugees range 
from the writer Hanif Kureishi to the classical dancer Naheed 
Siddiqi. Thousands of others have been forced to leave these shores 
to make either a name or an honest living for themselves. Something 
in the very air here seems to extinguish the creative spark: while 
the mediocre thrive and the rascals prosper, genuinely talented 
people either sink without a trace or migrate.

An essential prerequisite for the creative process to begin is the 
right and duty of thinking persons to question the basic principles 
and the most cherished beliefs of the majority. If both state and 
society deny this right, then the urge to explore the unknown and 
expand the limits of knowledge shrivels up and dies. Breakthroughs 
only come when an individual is dissatisfied with the given 
theories and decides to test them. If he is discouraged from doing 
so by an environment that is both repressive and self-satisfied, 
nothing new will be discovered. When Galileo refused to accept that 
our Earth was the centre of the universe, he was rejecting 
centuries of Christian orthodoxy.

Culturally, respect for our elders is deeply ingrained in us. Even 
when our parents or our teachers are clearly wrong, we are taught 
from childhood not to contradict them. This attitude has evolved 
into a mind-numbing orthodoxy under whose influence we agree with 
our superiors and elders without thinking. Our educational system 
emphasizes conformity and discourages originality, and our rigid 
administrative structure positively frowns on subordinates 
contributing fresh insights or challenging the fixed ideas of their 
bosses. The result of this hidebound attitude is that nothing 
changes, except for the worse. We are locked into a cycle of 
mediocrity where the products of the system pass on this 
unquestioning behaviour to successive generations.

Moin retained captain as PCB ends suspense
Sports Reporter

 KARACHI, Feb 2: Moin Khan is retained as Pakistan cricket captain 
for the tour to New Zealand after a week of drama and uncertainty 
regarding the wicket-keeper's future.

Brig Munawwar Rana, director Pakistan Cricket Board (PCB), told 
Dawn from Rawalpindi that Moin will continue until March 31 before 
his extension is discussed and decided for the tour to England.

"Our policy is very cleare. We will appoint captain on series by 
series basis after evaluating the performance of the skipper and 
the team," he said.

It was also decided that Moin will represent Pakistan in the Test 
captains meeting slated for Feb 12 at Melbourne and to be chaired 
by International Cricket Council (ICC) chief executive David 

"Moin reportedly had a one-to-one meeting with the PCB chairman on 
Thursday and I am sure they must have discussed several issues," 
declared Rana with reference to the ongoing rift between the 
players and coach Javed Miandad over the share in $1.3million logo 

"The PCB's position on the issue is very clear: the players and the 
coach are getting according to the contract. The perception that 
coach has been paid from the players share is wrong.

"I wouldn't call it misunderstanding but misperception because most 
of the players don't know what their overall contracts are. In 
fact, the players are not likely to know the contract between the 
board and the coach," he added.

The PCB director admitted that the recent scenario must have 
unsettled the players but hoped they would put it behind them and 
look forward to what is a very demanding tour.

"When something unusual happens, it naturally affects everyone 
associated with it. It is sad that the misperception led to 
controversy involving Moin Khan and Javed Miandad.

"But the dust has now settled with and everything is crystal clear. 
The players know what is expected of them and so does the captain 
and the coach."

Moin said from Rawalpindi that he was a relieved man and now can 
concentrate on cricket and additional assignment.

"Frankly speaking it has been the worst week of my career. I had 
never been in situations like this before so it was a nightmare 
experience. But I am glad it's all over.

"It was depressing to read every morning that my place in the team 
was under threat. But I am glad that the PCB chief has lived upto 
his reputation of supporting the players in difficult and testing 
situations," the veteran of 62 Tests said.

Moin refused to be drawn in the controversy regarding the logo 
share but said the matter had been settled amicably.

The PCB director, however, said Moin will not be part of the 
selection committee which will finalize the New Zealand-bound squad 
on Saturday. He said it was the prerogative of the selectors to 
pick the squad. "The captain's role starts when the players are 
handed over to him."

Regarding the tri-nation earthquake series in Sharjah, Rana said 
the PCB was an autonomous body and didn't require government 
clearance to play anywhere no matter if India are participating 

"We don't know officially if India have agreed to play there but as 
far as we are concerned, we have no problems.

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