------------------------------------------------------------------- DAWN WIRE SERVICE ------------------------------------------------------------------- Week Ending : 9 June 2001 Issue : 07/23 -------------------------------------------------------------------
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CONTENTS =================================================================== NATIONAL NEWS + Search for arms in Jihadi, Afghan DPs camps also + Planning body opposes two-tier power tariff + NEPRA chief concerned over load-verification plan + Pakistan, Italy to boost defence cooperation + National Economic Council okays major uplift projects + Benazir flays India for inviting Musharraf + Irresponsible leaders harming country + WAPDA seeks hike in power tariff: Line losses claim disowned + Vajpayee welcomes Musharraf's remarks + CE asked to meet APHC leaders before India visit + Structural changes aim at self-reliance: Shaukat + Washington to discuss National Missile Defence issue + Strong Nepal vital for peace: CE + CE's visit will settle Kashmir dispute: Vajpayee optimistic + House raids in arms drive likely: Moin + 17 fighters killed in Valley + Rs 15 billion cash flow package for WAPDA in doubt + CE tells army to start RBOD project work estimated at Rs16bn + 'Arms drive to continue till meeting of target' + Benazir, Asif facing eight corruption cases, says NAB --------------------------------- BUSINESS & ECONOMY + Big discounting in money market: Rupee down by 25 paisa + Budget to put economy back on track + Country likely to earn $9.16 billion in exports + Rupee up 1% in inter-bank market + State Bank hikes discount rate by 1%: Rupee recovers 2 per cent + Rs 130 billion Public Sector Development Programme envisaged + Planning body finalizes proposals: Budget 2001-02 + Rupee still on decline: $ at Rs 67 in kerb + A chance to break away from zero sum game + Pakistan's haemorrhaging state + Package for investors on cards: Budget 2001-02 + 29.4% growth in ST collection noted --------------------------------------- EDITORIALS & FEATURES + Forty-five days' liberty lost Ardeshir Cowasjee + Educating the warriors Ayaz Amir + The short arm of the law Irfan Husain ----------- SPORTS + Pitch invasion mars Pakistan's victory + Pakistan beat England by 108 runs + Rejuvenated Pakistan face England in tri-series opener today + Pakistan level series + Exciting final day on cards at Old Trafford + Manchester Test delicately poised
DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS =================================================================== NATIONAL NEWS 20010609 ------------------------------------------------------------------- Search for arms in Jihadi, Afghan DPs camps also ------------------------------------------------------------------- Staff Reporter ISLAMABAD, June 8: The campaign to recover illicit arms would be extended to training camps being run by Jihadi outfits and Afghan refugees, a spokesman for the interior ministry said. "There will be no exceptions," the spokesman, Rasheed Khan, said in reply to a question about the government's policy towards training camps run by Afghan refugees and Jihadi organizations, at a briefing. Interior Ministry Secretary Tasneem Norani would meet Afghan ambassador in Islamabad in a day or two to inform him about the government's plan to recover illegal arms from Afghan refugees, the spokesman said. Interior Minister Moinuddin Haider would visit all the four provinces from June 15 to meet governors and finalize a strategy for a crackdown to be launched from June 21, after the end of arms amnesty period, he said. Moreover, he added, surprise checks of police stations would also be carried out to monitor progress of illicit arms recovery campaign. Regarding religious parties, the spokesman said they had assured the government of full support to its arms recovery drive. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010609 ------------------------------------------------------------------- Planning body opposes two-tier power tariff ------------------------------------------------------------------- By Khaleeq Kiani ISLAMABAD, June 8: The Planning Commission opposed introduction of fixed charges under a two-tier power tariff and 75 paisa per unit increase, saying the WAPDA figures were fictitious and meant to burden consumers. Ghulam Haider, chief of Energy Wing of the Planning Commission, pleaded before the National Electric Power Regulatory Authority (Nepra) that WAPDA petitions were not maintainable and the consumers must not be made to bear the brunt of the utility's inefficiencies. NEPRA directed WAPDA to submit within six days relevant information sought by the case officers and interveners so that the authority could come up with a final determination. The Planning Commission representative feared that introduction of two-tier tariff to recover fixed charges from domestic and commercial consumers would open floodgates of corruption as it would require new surveys and verification. He believed that consumers would tend to declare low load in connivance with WAPDA staff to avoid fixed charges. He argued that there was no need to make 26 per cent line losses part of the fixed cost and secondly all the inefficiencies of WAPDA should not be passed on to the consumers twice, once in the shape of fixed charges and other as energy cost. The Planning Commission was of the view that while calculating the fixed cost of generation, transmission and distribution facility, operation and maintenance cost, interest, depreciation and exchange rate variation should not be accounted for as some of the WAPDA facilities were 23 years old that should be charged at book value of the asset. The Commission believed that most of the material and equipment in the distribution system was manufactured locally, therefore no exchange rate variation should be applied on these assets. Ghulam Haider said that WAPDA had used the same figures for fuel price increase on which NEPRA had already increased the tariff. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010609 ------------------------------------------------------------------- NEPRA chief concerned over load-verification plan ------------------------------------------------------------------- Staff Reporter ISLAMABAD, June 8: While the Ministry of Finance and other federal ministries challenged WAPDA's basic financial claims, the utility sought new rates of Rs 55 and Rs 132 per kilowatt for domestic and commercial consumers respectively as "fixed charges" in addition to a 75 paisa per unit increase with effect from July 1. Justice (retd) Saad Saud Jan, the Chairman of National Electric Power Regulatory Authority (Nepra), while hearing the petitions of WAPDA on tariff raise and fixed charges repeatedly said he had concerns about house-hunt by the WAPDA staff in the name of load verification and demanded a categorical assurance from the utility to maintain privacy of the citizens but of no concrete result. The Ministry of Finance placed on record that Chairman WAPDA Lt-Gen Zulfiqar Ali Khan, being himself from the defence division should take care of over Rs3 billion electricity arrears as finance ministry allocated a single-line budget to the defence division and had no lever for at source deductions. Tehsin Iqbal, Joint Secretary Corporate Finance, represented the Ministry of Finance and stated that most of WAPDA claims for public sector dues were not correct. He deplored that WAPDA sent exaggerated bills to government agencies and 23 federal ministries and division had complained in writing that WAPDA never turned up to reconcile billing figures. At times, heated debate was witnessed at the public hearing as the Ministry of Finance, WAPDA and its companies and some interveners accused each other of corruption, incompetence, mismanagement and electricity theft. The NEPRA chairman had to intervene time and again to maintain order. He said the domestic category constituted 82 per cent of total consumers with a consumption of 48 per cent electricity but yielded only 32 per cent revenue. Fourteen per cent commercial consumers consumed five per cent units and contributed 13 per cent revenue. About 1.7 per cent industrial consumers consumed 28 per cent units but contributed 36 per cent revenue. Similarly, bulk consumer had a total share of 0.3 per cent but consumed 7 per cent units and contributed 9 per cent revenue. Agricultural consumers with 1.5 per cent share consumed 12 per cent units and yielded 8 per cent of total revenue. He said under the new package, WAPDA intended to increase the limit of lifeline consumers from 50 units to 100 units without any tariff change though the tariff for units 51 to 100 would come down from Rs 1.72 to Rs 1.40. The fixed charges of Rs 55 per month for domestic consumers would be applicable on those who had sanctioned load of more than 0.5 kilowatt and the five slabs have been reduced to three. The domestic consumers using 100 to 300 units would be charged at Rs 2.50 plus Rs 55 fixed charges. Similarly, the consumers using more than 300 units would be charged at Rs 5.35 plus Rs 55 fixed charges at the rate of 1 kilowatt. Earlier, the tariff for 300 to 1000 units were charged at Rs 5.32 per unit, 1000 to 4000 units at Rs 6.60 per unit and above 4000 units were charged at Rs 7.13 per unit. NEPRA member from NWFP, Eng Abdul Rahim said cross-subsidies could be eliminated through increase in rates instead of fixed charges. He feared if the principle of fixed charges were accepted then WAPDA would come again for increase in fixed charges. He also questioned the need for fixed charges as proxy for peak load demand. Tehsin Iqbal, representing finance ministry challenged WAPDA's claims for public sector arrears and said the federal government had done its best to alleviate WAPDA of its problems but could not go for illegal things. He informed that Rs 36.6 billion worth of WAPDA debts were converted into government's equity to improve its health. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010608 ------------------------------------------------------------------- Pakistan, Italy to boost defence cooperation ------------------------------------------------------------------- ISLAMABAD, June 7: Pakistan and Italy reached a consensus to boost cooperation in the field of defence production. The signing of minutes ceremony was held in the Defence Production Division between Pakistan and Italy. The minutes were signed by Admiral Giampaolo Di Paola, Secretary- General and Director-General, National Armament, on behalf of Italy while the Secretary, Defence Production Division, Air Marshal Zahid Anis( retired), represented Pakistan. Both sides expressed the view that this was the first step towards increasing defence cooperation between the two countries. The secretary, defence production, thanked Admiral Paola for the kind sentiments and hoped that his visit would go a long way in enhancing defence cooperation between the two countries. Meanwhile, the Italian delegation, led by Admiral Paola, called on the Secretary, Defence, Lt- Gen Hamid Nawaz Khan (retired).-APP DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010608 ------------------------------------------------------------------- National Economic Council okays major uplift projects ------------------------------------------------------------------- Staff Reporter ISLAMABAD, June 7: The National Economic Council (NEC) has approved a number of development projects in the new PSDP including Rs6 billion water supply project for Karachi. Deputy Chairman Planning Commission Dr Shahid Amjad Chaudhry told reporters that the chief executive had changed the entire investment strategy with a view to having major development projects. "The Karachi water supply project will get Rs 6 billion in the next PSDP to have another 100 million gallon water for the city", he further stated. The project will be completed in two and half years time. "The NEC has also approved two major projects for Karachi which include Northern Bypass and Lyari Expressway at a cost of Rs4.5 billion and Rs3 billion separately", he said. Similarly, he said that Rs6 billion would be provided for water supply project in Quetta. He said Rs 13 billion had been allocated for Gomalzam dam in the NWFP which would be completed in four years. Overall, he said Rs100 billion would be spent for next 10 years for development of new water resources. He said Rs7 billion had been allocated for Mirani dam in Balochistan to be completed in seven years. He said Rs0.9 billion will be extended during 2001-2002 for the project. Dr Chaudhry said that the Punjab government had been given an offer to undertake either Thal Reservoir project or Greater Thal Canal project. Each project will cost Rs25 billion and during the first year Rs500 million will be extended for this purpose. He said 4.5 million acres feet of land will be covered under the project. He disclosed that the Kalabagh dam had not been included in next 10 year development program. "It has not been abandoned but for the next 10 years it would not be considered". The deputy chairman said that technical study for Basha dam had been approved, which would be constructed in northern areas. "Then the NEC also approved raising of Mangla Dam height for which technical study will be conducted during the next financial year." The Right Bank Outfall Drainage (RBOD) project has also been approved at a cost of Rs15 billion. He said Rs0.2 billion would be provided in next PSDP for the project to be completed in four years' time. In reply to a question, he said that agriculture would be given lot of attention and as a first step, considerable areas under rice cultivation would be shifted for cotton and other crops. "The NEC has approved Rs 0.7 billion for investment in the agriculture sector". He said Rs1.1 billion would be spent for replacing Sargodeh model for increasing agricultural productivity in other parts of the country. The deputy chairman said that Rs1.2 billion had been allocated for Pindi Bhaatia-Faisalabad road to be completed in 2003. Likewise, he said, Rs1.5 billion would be extended for Islamabad-Peshawar Motorway during the next financial year to be completed in 2003. "Then Makran Coastal Highway project will get Rs2 billion in the new PSDP". The total cost of the project is Rs12 billion and it will be completed in four years. "The NEC has further approved Rs15 billion Gawadar Port project for which one billion rupees will be given during the next financial year." He said the government was expecting some funding by China for the project. He told a reporter that some funding for these projects would be provided from the new PSDP while rest of funding would be mobilized during next two to three years. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010608 ------------------------------------------------------------------- Benazir flays India for inviting Musharraf ------------------------------------------------------------------- Monitoring desk NEW DELHI, June 7: Benazir Bhutto has said that she is disappointed by the Indian government's decision to invite Gen Musharraf for talks. In an interview with the Times of India on Thursday, she PPP advocates dialogue between India and Pakistan for a resolution of outstanding disputes between the two countries, including the Kashmir dispute. However, it is double-minded about the world's largest democracy dealing with a military dictatorship in Pakistan. She opined that an agreement signed by an unelected and unrepresentative government would be of no legal binding on a future parliament or government in Pakistan. This is the view of the opposition alliance for the Restoration of Democracy of which the PPP is a part, she added. Replying to another question she said the PPP has proposed a Camp David type solution envisaging a step-by-step approach. In that we proposed to open borders between the two Kashmirs, allowing for free movement of the people from one part to the other whilst India and Pakistan agree on how to maintain a safe open border. She said that she hoped to visit India some time later this year. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010607 ------------------------------------------------------------------- Irresponsible leaders harming country ------------------------------------------------------------------- ISLAMABAD, June 6: Chief Executive Gen Pervez Musharraf said that Pakistan was being regarded as a terrorism-sponsoring country due to irresponsible statements and actions by irresponsible leaders. Speaking at the inaugural session of a two-day National Seerat Conference here, Gen Musharraf asked religious scholars to look deep into the damage caused by irresponsible statements and actions and do not allow the use of religion for political ends. The chief executive urged the Ulema to help create religious harmony which was necessary both for attracting foreign investment and stability of the country. He said both the foreign and domestic investors were not ready to invest in Pakistan "because of the law and order situation." "The law and order situation is the first thing to be corrected to lure foreign investment," he told the gathering. Gen Musharraf said it was not easy to attract foreign investment once the image of the state was marred. He said because of the law and order situation, there was talk of even declaring Pakistan a "terrorist state," while others referred to it as "a failed state."-Agencies DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010607 ------------------------------------------------------------------- WAPDA seeks hike in power tariff: Line losses claim disowned ------------------------------------------------------------------- By Khaleeq Kiani ISLAMABAD, June 6: Amid strong opposition from various consumer groups, WAPDA sought 75 paisa per unit additional increase in electricity tariff with effect from July 1, 2001, to cover its Rs35 billion projected losses next year. The cross-examination by the chairman and members of National Electric Power Regulatory Authority (Nepra) and interveners representing various consumer groups however forced the WAPDA team to disown statements and presentations of WAPDA chairman Lt Gen. Zulfiqar Ali Khan of having reduced line losses from over 42 per cent to 24 per cent since the 1998 army take over in WAPDA. Five interveners namely Association of Cooperatives Housing Societies Punjab (ACHSP), Islamabad Chambers of Commerce and Industry (ICCI), Consumer Right Commission of Pakistan (CRCP), Liberals Forum Pakistan (LFP) and Pakistan Poultry Association (PPA) opposed any tariff increase on various grounds but with one conclusion that it would cripple the economy and the consumer as well and reduce electricity consumption. He said that there had been devaluation of 23 per cent since last year and resultantly WAPDA had suffered Rs17 billion losses as capacity payments to IPPs were made in dollars. The six per cent inflation had an impact of Rs1.3 billion while 107 per cent increase in furnace oil and 72 per cent increase in gas prices have put additional burden of Rs17.7 billion on the organization. He said that tariff increases allowed by Nepra four times recently helped bridge this gap but the Rs9.7 billion remaining gap required to be covered by the proposed petition. The revised agreements with IPPs increased the capacity payments from Rs23.6 billion in 1999-00 to Rs36.9 billion in 2000-01. "Next year the situation is going to be more disastrous", said Mr Nizam as he revealed that payments to IPPs would touch Rs105.5 billion from Rs80 billion this year. Energy purchase price (EPP) would go up from Rs43 billion to Rs45 billion while capacity purchase price (CPP) would jump to Rs59.8 billion from Rs36.9 billion. WAPDA's total income for the current fiscal year is estimated at Rs185 billion against its liabilities of Rs201 billion, a shortfall of Rs16 billion. Next year, the income is projected to come down to Rs183 billion while expenditure will go up to Rs218 billion, an expected shortfall of Rs35 billion, the Nepra was informed. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010607 ------------------------------------------------------------------- Vajpayee welcomes Musharraf's remarks ------------------------------------------------------------------- MUMBAI, June 6: Indian Prime Minister Atal Behari Vajpayee has welcomed the speech by Gen Pervez Musharraf asking religious hardliners to stop making statements against India. "India has always been asking for an end to the propaganda war between the two countries. This is the first step in the direction of lasting friendship between the two countries," Vajpayee said while talking to reporters. "I want to see a full text of the statement. But, from what I have read, it is a good sign and I welcome the statement," Vajpayee said after arriving in Mumbai to have surgery on his knee. "We met in the battlefield and now we will meet in the house of peace. Right from the beginning, India has been ready to discuss all issues with Pakistan including Kashmir," Vajpayee added. Gen Musharraf sent his "best wishes" to Vajpayee ahead of the operation.-AFP DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010607 ------------------------------------------------------------------- CE asked to meet APHC leaders before India visit ------------------------------------------------------------------- Staff Correspondent ISLAMABAD, June 6: The Pakistan Muslim League has called upon Gen Pervez Musharraf to take all political parties into confidence before his visit to New Delhi for talks with the Indian leadership on important issues, including Kashmir. He said since the central executive committee (CEC) had decided to re-name the party as Pakistan Muslim League after Nawaz group registered itself with the Election Commission as Nawaz group of PML, the media should no more call or write it as like-minded or Quaid-i-Azam group of PML. While discussing the possibilities of revival of democratic order in the country, he repeated his party's demand for restoration of the suspended assemblies as being the most appropriate option for the regime to be immediately recognized by the international community. Mr Khan said a mechanism had to be evolved under which no future elected assembly could be dissolved. He said the party had constituted 27 committees to give recommendations on various issues. He said the finance committee would prepare and present its recommendations on the ensuing budget to the government by June 12. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010605 ------------------------------------------------------------------- Structural changes aim at self-reliance: Shaukat ------------------------------------------------------------------- By Our Reporter ISLAMABAD, June 4: Finance Minister Shaukat Aziz has said the government instituted structural changes in the economy with the underlying aim of achieving self-reliance by reducing dependence on foreign assistance and enhancing reliance on domestic resources. He said the government had also devised a strategy to rid the country of growing debt burden. Simultaneously, the minister stated, broad-based governance reforms were being implemented, which would ensure the sustainability and effectiveness of economic reforms. He said the government had identified four major drivers of growth, namely, agriculture, oil and gas, small and medium enterprises (SMEs) and information technology. He at length on the devolution plan and termed it a powerful concept allowing people to control their destiny. This plan, he said, would devolve financial and administrative authority to local tiers of government, empowering elected local authorities to effectively administer departments like education, health etc, at the district level. He said the devolution plan was the most potent mechanism for social changes and empowerment of the people at the grass-roots level. The finance minister also spoke on the negative fallout of sanctions imposed on Pakistan in the wake of nuclear tests. He said the sanctions were adversely impacting the efforts of the government in increasing growth and reducing poverty which were essential for the prosperity of people. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010605 ------------------------------------------------------------------- Washington to discuss National Missile Defence issue ------------------------------------------------------------------- By Tahir Mirza WASHINGTON, June 4: Pakistan's attitude towards the Bush administration's National Missile Defence (NMD) system will be among the important points of discussion with senior United States officials during Foreign Minister Abdul Sattar's three-day visit to Washington beginning on June 18. Pakistan's position on the controversial NMD has been unenthusiastic and closer to that of China, Russia and America's own allies in the European Union, all of whom are concerned at the abandonment of the anti-ballistic missile treaty (ABM) inherent in the proposed new system, arguing that the treaty has been a mainstay of the disarmament regime. India, on the other hand, has welcomed the scheme. Mr Sattar will meet National Security Adviser Condoleezza Rice on June 18 and Secretary of State Colin Powell, on June 19. The question of sanctions and Islamabad's expectations of the proposed Musharraf-Vajpayee summit can be expected to figure prominently in the talks, and US officials will obviously be interested in learning how Islamabad intends to deal with the Taliban regime in Afghanistan. Mr Sattar can also expect to be closely questioned on General Pervez Musharraf's plans to hold general elections and restore the democratic process. On the international front, non-proliferation will be an obvious talking point on the agenda and also Pakistan's contribution to the international peace-keeping force in Sierra Leone. The Bush administration has asked Congress for a waiver in sanctions against Pakistan that prevent the sending of US military equipment to the military, which needs to be properly supplied if its offer of a 4,000-strong detachment of peace-keepers has to have any meaning. The waiver asked for by the Bush administration should have gone through Congress by now, but has been delayed because of the change in the complexion of the Senate resulting from the defection of Republican James Jeffords. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010605 ------------------------------------------------------------------- Strong Nepal vital for peace: CE ------------------------------------------------------------------- ISLAMABAD, June 4: Chief Executive Gen Pervez Musharraf said that a strong and prosperous Nepal was vital for peace and stability in the region. In a message of felicitation to King Gyanendra, Gen Musharraf expressed his confidence that Pakistan and Nepal would continue to work together "in our shared quest for peace, stability and development of our region and for the betterment of our peoples." He also reaffirmed Pakistan's abiding commitment to the enhancement of close ties between the two countries. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010604 ------------------------------------------------------------------- CE's visit will settle Kashmir dispute: Vajpayee optimistic ------------------------------------------------------------------- NEW DELHI, June 3: Indian Prime Minister Atal Behari Vajpayee said he hoped the upcoming visit by Gen Pervez Musharraf to New Delhi would help solve the Kashmir dispute. "I am hopeful we will find a solution to the Kashmir dispute," Mr Vajpayee told a televised public gathering in Gujarat. "We are ready for discussions on any subject, including Kashmir," the premier said. "We want peace in our country, in our neighborhood and the world. I invited General Musharraf to achieve this goal." "I am happy Musharraf has accepted my invitation, and we will talk on all issues. I am sure some concrete way will emerge out of the talks," said Mr Vajpayee. Addressing reporters in New Delhi last Monday, Foreign Minister Jaswant Singh said he approached the talks "with realism." "It is a long road to walk together again," he said. However, Parliamentary Affairs Minister Pramod Mahajan, a key aide of Premier Vajpayee, meanwhile warned the summit would not lead to immediate peace between India and Pakistan. "No one is thinking that overnight one summit between Vajpayee and Musharraf should solve all the problems," Star TV quoted Mr Mahajan as saying. "It may set out a process of motion, which may finally solve the problem." Mr Mahajan said Mr Vajpayee should discuss with opposition leaders the subjects he planned to discuss with Gen Musharraf. -Agencies DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010604 ------------------------------------------------------------------- House raids in arms drive likely: Moin ------------------------------------------------------------------- Staff Correspondent KARACHI, June 3: The government does not want to unnecessarily trouble the masses, but it may carry out house raids during the planned campaign for deweaponizing the country. This was stated by Interior Minister Moinuddin Haider during a brief chat with newsmen. In response to a question, the minister said: "No army in the world wants to unnecessarily trouble the common people. We also don't want to harass our masses. "However, we cannot rule out raids in the forthcoming deweaponization campaign. This is so because we want to rid the country of weapons," said Moin. He said that from June 5 to 20, people would be invited to surrender their arms voluntarily: so, this is an amnesty period. "From the 21st we are going to force people to hand over their weapons. And we will be using all the means at our disposal to recover these weapons. If need be we will use strong tactics like raids, etc." The minister warned that the people found to be in possession of illegal weapons after June 21 would have to face strong punitive action spelt out in the relevant laws. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010604 ------------------------------------------------------------------- 17 fighters killed in Valley ------------------------------------------------------------------- JAMMU, June 3: Police claimed 14 Mujahideen belonging to Lashkar-i- Taiba, Jaish-i-Mohammed and Hizbul Mujahideen were killed in a gunbattle with Indian troops in Poonch district. "Up to now, we have information that 14 militants have been killed," Kamal Saini, superintendent of police in charge of Poonch district said. In another incident, three militants were killed by Indian troops near Surankote, in Poonch district.-Reuters/AFP DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010604 ------------------------------------------------------------------- Rs 15 billion cash flow package for WAPDA in doubt ------------------------------------------------------------------- By Khaleeq Kiani ISLAMABAD, June 3: The Karachi Electric Supply Corporation (KESC) has refused to transfer around Rs4.2 billion to WAPDA as decided by the finance minister and chairman of WAPDA and KESC last month. This has apparently called into question the sustainability of a Rs 15 billion cash flow package agreed to by the finance minister Shaukat Aziz and chairman of both the power utilities (WAPDA and KESC) Lt-Gen Zulfiqar Ali Khan on May 15, sources in the finance ministry told Dawn. The package was finalised following months of correspondence and meetings between the WAPDA and finance ministry wizards to melt down Rs 23.4 billion WAPDA dues stuck up till end-March with the public sector consumers. This figure has since been reduced slightly by Rs 2.9 billion but Rs 20.5 billion arrears against the public sector are still intact. Under the decision, the KESC was required to pay Rs 4.2 billion in two parts. First, by paying Rs 2.4 billion out of a bank borrowing of Rs4.76 billion guaranteed by the federal government and, second, by releasing Rs1.8 billion out of the rupee proceeds of a US$30 million loan from the Asian Development Bank. The KESC has clearly indicated the federal government that "because of its cash flow problem it would not be possible to transfer any funds to WAPDA," the finance ministry sources quoted a KESC communication. The finance ministry did not waste too long to bring this to the knowledge of the World Bank Power Sector Mission at a wrap-up meeting on May 26, these sources added. The finance minister had also agreed that the federal government will pick up Rs1.6 billion liability as book adjustment (debt service liability) of the Azad Kashmir government as it did not have enough money to pay. The federal government also agreed to pay Rs400 million through another book adjustment of debt service liability to WAPDA on account of agricultural tubewells in Balochistan. The finance minister promised that Rs540 million outstanding against the NWFP would be deducted on receipt of confirmation from WAPDA of having paid Rs one billion to the province on account of net hydel profit. For the payment of Rs 7.5 billion outstanding against the Sindh government, it was agreed that Rs two billion would be deducted at source in May and June, 2001. Another Rs one billion payment of WAPDA would be made through an overdraft during the first quarter of the next fiscal year while the balance of Rs4.53 billion would be paid during the first quarter of the next year. Of the total public sector receivables, federal government owed Rs5.5 billion to WAPDA at the end of March. Rs1.5 billion were outstanding against AJK, Rs4.12 billion against FATA, Rs1.2 billion against agricultural tube wells in Balochistan, Rs2.5 billion against Punjab, Rs7.6 billion against Sindh, Rs682 million against NWFP, and Rs203 million against Balochistan. However, Punjab, Sindh and Balochistan paid Rs2 billion, Rs700 million and Rs187 million during April and May, official sources said. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010603 ------------------------------------------------------------------- CE tells army to start RBOD project work estimated at Rs16bn ------------------------------------------------------------------- KARACHI, June 2: Chief Executive Gen Pervez Musharraf has directed the army engineering corps to start work on the multi-billion-rupee Right Bank Outfall Drain on August 14. He issued the directive after a presentation made by Commander 5-Corps Engineering, Brig Asif Ghazali, at the Governor House here on Saturday. The RBOD project was assigned to Planning Commission for analysing and finalizing its feasibility report. Brig Asif Ghazali informed the chief executive that the army engineers planned to carry out the project at a cost of Rs16 billion and complete the same in four years. He said that in the first phase, Rs2 billion will be needed and the remaining amount in subsequent years. The estimates for RBOD project submitted by another agency were also taken into consideration. The other agency's estimates stood at about Rs76 billion with eight years as completion time. On completion, the 270-km long Drain will have a capacity to carry 2,276 million cusecs of effluent to be drained out into the sea.- APP DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010603 ------------------------------------------------------------------- 'Arms drive to continue till meeting of target' ------------------------------------------------------------------- ISLAMABAD, June 2: The ongoing campaign for recovery of illegal weapons will continue till the government achieves the set targets. The government started a phased countrywide campaign to recover illegal weapons from people in a bid to improve the law and order situation. In the first phase, a media campaign is being run to raise awareness among the people about the prevalent social problems due to abundance of arms. In the second phase starting from June 6, people possessing illegal weapons will be asked to surrender these weapons by June 20. Rasheed said, this will be an amnesty period for people to voluntarily surrender their illegal weapons. Rasheed said people failing to deposit illegal weapons will be liable to punishment under the law. After expiry of amnesty period raids will be carried out on the reports of intelligence agencies and informers for recovery of illegal arms. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010603 ------------------------------------------------------------------- Benazir, Asif facing eight corruption cases, says NAB ------------------------------------------------------------------- ISLAMABAD, June 2: Chairman National Accountability Bureau (NAB) General Khalid Maqbool has said that NAB is currently processing eight cases of corruption against former ruling couple Ms Benazir Bhutto and Asif Ali Zardari. This he stated in a recent interview with British Broadcasting Corporation during his visit to The Hague where he attended "Global forum on fighting corruption and safeguarding integrity." While speaking on the possibility of Ms Benazir Bhutto's conviction on corruption charges, he said, that NAB as an anti- corruption institution is not targeting any individual. Instead, he added, it has an institutional role to transform society into a corruption- free social order. "The government, however, is making all out efforts to bring the culprits to task," he remarked. He said, "the government's reform agenda, in our part of the world, is targeted to eradicate political tradition of institutional or individual corruption culture to mature the democratic process in a developing society." -APP
BUSINESS & ECONOMY 20010609 ------------------------------------------------------------------- Big discounting in money market: Rupee down by 25 paisa ------------------------------------------------------------------- Staff Reporter KARACHI, June 8: Banks resorted to heavy discounting of Rs 17 billion as the inter-bank money market remained tight. The State Bank raised the discounting rate from 13 to 14 per cent on to stabilize the rupee. Senior bankers said a basic reason for this heavy discounting was that banks had to average out their weekly cash reserves at five per cent of total deposits. They are allowed to keep cash reserves at four per cent of total deposits on any working day but are supposed to maintain it at five per cent on the weekly basis. Bankers said the market was also tight because of outflow of billions of rupees in the wake of the corporate debt payments for which the State Bank had provided foreign exchange last earlier this week. The one per cent increase in SBP discount rate announced on June 6 also contracted liquidity in the banking system. Bankers said because of heavy discounting, call rates remained pegged to 13.90-13.95 per cent throughout the day. The inter-bank market had seen a discounting of Rs 6.3 billion on Thursday also. Earlier in the week banks had resorted to a discount of about Rs5 billion. THE RUPEE: Meanwhile the rupee lost 25 paisa to a US dollar on Friday after making a three per cent recovery in earlier days. Bankers said the rupee closed at 62.60/62.65 to a dollar on Friday against the previous close of 62.30/62.40. They said the rupee fell chiefly because of commercial demand for dollars by a big corporate group engaged in staple fibre manufacturing. In the open market the rupee lost 20 paisa to a dollar. Currency dealers said the rupee closed at 65.70/65.90 to a dollar for spot buying and selling on Friday against the previous close of 65.50/65.70. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010609 ------------------------------------------------------------------- 'Budget to put economy back on track' ------------------------------------------------------------------- ISLAMABAD, June 8: Growth-oriented and investors' friendly economic strategy will serve as major plank in Budget for fiscal 2001-2002 to retrieve the economy back on sound and sustainable footing along with vibrant role of private sector. "Four sectors will receive principal focus in the budget including Agriculture, Information Technology, SMEs and Oil and Gas, identified as mega drivers of growth," Economic Adviser, Dr Ashfaque Hasan Khan said. The budgetary strategy, he stated, would accord top priority to these sectors to check the menace of poverty, adding that even an impressive growth rate is unable to address the poverty issue. For this purpose, he continued, the government would thus have to make intervention to arrest this scourge through different measures including investments in the social sector. Agriculture sector, linchpin of the economy, is posting negative growth this year owing to drought impact, he said adding, an impetus needs to be injected by addressing major constraint - water shortage through construction of small dams for water conservation and augmentation. Describing the budget as an instrument to accelerate economic growth, Dr Ashfaque said concrete measures would be adopted to boost the role of private sector in the growth process. Highlighting the salient aspects of economic situation looming over current fiscal, Dr Ashfaque Hasan said the inflation is likely to hover at 4.7 per cent against the budgetary target of 6 per cent which was however pegged at 3.4 per cent during previous financial year owing to diminishing propensity in petroleum prices at the international market. Having these projections in the agriculture and industrial sector, GDP growth rate is likely to slide down to 3 per cent against the budgetary benchmark of 4.5 per cent for fiscal 2000-2001. Record growth in large scale manufacturing is attributed to positive performance by all the eleven major groups including textile, chemical, leather, food and beverages, paper and paper printing and publication, machinery and equipment�s, automobiles, basic metals, petroleum, tyre and tubes, non metallic material etc. About the slippage in revenue collection against the budgetary target, he said, revenue collection target was too ambitious adding the government collected around Rs100 billion access revenue in two years against the collection of similar amount in the previous five years.-APP DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010608 ------------------------------------------------------------------- Country likely to earn $9.16 billion in exports ------------------------------------------------------------------- ISLAMABAD, June 7: The country's exports during first 11 months of the present fiscal totalled around $8.25 billion as against $7.69 billion, during the corresponding period of last year, showing an increase of 7.2 per cent or $1.2 billion. Minister for Commerce, Industries and Production, Abdul Razak Dawood while giving the details at a press conference on Thursday, expressed his confidence that the country will realize around $9.16 billion of exports this year, coming close to budgetary target of $9.2 billion. He, however, added that as per the target of $10 billion set by himself, the country has achieved around 92% of that target. The minister said, the crossing of $9 billion mark in exports will be a record in the history of country. The exports in the month of May, the minister informed, amounted to $793 million showing over 93 per cent achievement against the target. The exports of $793.1 million in May are also up by 7.8 per cent and 4.4 per cent when compared to previous month and the corresponding month of last fiscal, respectively. The minister underlined global slowdown with less industrial activity and fall in commodity prices as the major factors of not exactly meeting the exports target. "We have lost at least $100 million due to fall of commodity prices in terms of rice exports." Razak Dawood said, the country registered 30 per cent increase in rice exports in terms of quantity this year, but 3 per cent decrease in value terms, adding, "we have exported all of irri-6 and irri-9 this year, and the new crop will have no backlog." The minister in response to a question informed the newsmen that the Trade Policy for 2001-2002 will be announced on June 29. Dawood said, in the backdrop of Chinese Premier's recent visit to Pakistan we are hopeful of having enhanced bilateral trade with China, adding, a Chinese delegation is coming here in this respect. To a question, he said, polyester fibre and grey cloth are among the items to be exported to China, adding, our exports to China will register increase next year. The minister in response to a query informed that the country's imports during July-May this year were to the tune of $9.797 billion with $1.5 billion of trade gap as against $1.6 billion of trade gap last year. Razak Dawood while giving the comparison of exports as per cent of imports this year said, 84.2 per cent of imports were covered by exports during July-May of this fiscal as against 82.7 per cent last year. -APP DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010608 ------------------------------------------------------------------- Rupee up 1% in inter-bank market ------------------------------------------------------------------- Staff Reporter KARACHI, June 7: The rupee on Thursday gained 70 paisa or one per cent against the US dollar in inter-bank market on renewed supply of dollars, on relatively low demand. Bankers said the rupee finished at 62.30/62.40 to a dollar at the end of normal trading hours in inter-bank market up 70 paisa over the previous close of 63.00/63.10. The rupee regained more of its lost strength as local and foreign banks continued to sell dollars on renewed supply. Bankers said the pro-rupee sentiment was strong as at one time it was quoted as high as 62.10 to a dollar. In the past two weeks the rupee had lost four per cent of its value against the dollar but it made a swift recovery of two per cent on Wednesday and more than one per cent on Thursday. Bankers said the one per cent increase in SBP discount rate announced on Wednesday boosted the rupee by making dollar holding an expensive affair. SBP on Wednesday raised the discount rate by one per cent to 14 per cent to shore the rupee up. This made the money market a little tighter on Thursday with call rates hovering around 13.95 per cent. Bankers said a discounting of Rs6.3 billion also took place on Thursday adding that tight rupee market also helped the local currency recover its lost value. "The rupee gained chiefly because it had lost its value in the past two weeks not due to any weakness in economic fundamentals but due to mismatch in cash flow timings," said treasurer Mumtaz Yousuf of Hong Kong & Shanghai Banking Corporation. Yousuf who is also secretary general of Financial Markets Association said the banks that had overbought dollars in the past two weeks began to sell them. He described the one per cent increase in SBP repo rate a right step towards stabilizing inter-bank exchange rates. In the open market also the rupee gained 30 paisa on Thursday. Currency dealers said the rupee closed at 65.50/65.70 to a dollar for spot buying and selling against the previous close of 65.80/ 66.00. They said the rupee made a smart recovery in kerb as the decline of dollar in inter-bank market drove many speculators and fund managers to sell greenbacks. On Wednesday the rupee had gained over 1.5 per cent against US dollar in the open market. On Thursday it made a modest half per cent recovery. Earlier, the rupee had fallen in kerb by about four per cent in past two weeks chiefly in line with its fall in inter - bank market. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010607 ------------------------------------------------------------------- State Bank hikes discount rate by 1%: Rupee recovers 2 per cent ------------------------------------------------------------------- By Mohiuddin Aazim KARACHI, June 6: The inevitable has happened. The State Bank has raised its repo or discount rate by one per cent to 14 per cent, effective from June 7, says an SBP circular. The central bank had to take this decision to keep the rupee from falling further. SBP repo or discount rate is the interest rate at which it lends money to banks for up to three days against government securities. Senior bankers said the rupee opened at 64.30 to a US dollar on Wednesday but rose to 63.00/63.10 toward normal closing of inter- bank foreign exchange market thus showing a major recovery of two per cent in a single session. In post closing transactions meant for next day the local currency gained further and was quoted as high as 62.40 to a dollar. Bankers said what enabled the rupee to recover grounds, so impressively, was heavy dollar selling in the market initiated by Citibank with other local and foreign banks following the lead. For the past two weeks many banks had been buying more and selling less dollars anticipating further decline of the rupee. On Wednesday several banks ran out of this space and had no option but to sell dollars thus allowing the rupee to make a quick recovery. Senior bankers said what else drove even those banks that were well within their net open position limits, was the one per cent increase in SBP repo rate. They said the increase was a clear signal from the central bank that it would not let the rupee slip further. The State Bank had last raised its repo or discount rate by one per cent to 13 per cent on October 4, 2000 to support the rupee when it had touched a record low of 59.75/59.80 to a dollar in the inter- bank market. At that time SBP had also enhanced the cash reserve requirement for banks from five to seven per cent. This time around, the central bank has only raised its repo or discount rate and has left cash reserve requirement unchanged at five per cent. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010607 ------------------------------------------------------------------- Rs 130 billion Public Sector Development Programme envisaged ------------------------------------------------------------------- By Ihtashamul Haque ISLAMABAD, June 6: Gen Pervez Musharraf said that Rs130 billion Public Sector Development Program (PSDP) has been envisaged for 2001-2002. According to informed sources, he told the 8th meeting of the Economic Advisory Board (EAB) that substantial funds will be provided for development projects during the next financial year. And that was why, he said, Rs130 billion PSDP has initially been worked out for 2001-2002 against Rs120 billion of the current financial year. The PSDP for the current financial year, which had earlier been slashed from Rs120 billion to Rs110 billion, has again reportedly been cut to Rs 100 billion due to unexpected revenue shortfalls. The Planning Commission had proposed Rs 134 billion new PSDP which was being opposed by the Priorities Committee of the Finance Ministry. The Committee had told the Annual Plan Coordination Committee (APCC) meeting held on May 19 that due to paucity of funds the 10 per cent usual increase could not be made and that Rs120 billion could only be made available for the new PSDP. The chief executive underlined the significance of exports, reserves, economic growth and revenues for being critical variables where the country had to significantly improve its performance during the relief period. On the exports front, he said, achieving 8 per cent growth was satisfactory, but "we would like to improve it further". On the issue of reserves, he said, government was targeting 3-4 billion dollar in the medium term so that dependency on external assistance was minimized. Talking about the privatization, the chief executive pointed out that some major deals were about to be brought to the market. In this regard, he specially mentioned public sector banks and PTCL, which were likely to be disinvested before the end of the calendar year. He urged business leaders to come forward and to take advantage of the opportunities. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010605 ------------------------------------------------------------------- Planning body finalizes proposals: Budget 2001-02 ------------------------------------------------------------------- By Ihtashamul Haque ISLAMABAD, June 4: The Planning Commission has finalized its own consolidated budgetary projections for 2001-2002, estimating Rs 845.1 billion total expenditure including Rs 707.9 billion current expenditure. According to the details, total revenues have been estimated to be Rs655.2 billion - Rs548.9 billion tax revenues and Rs106 billion non-tax revenues. The Public Sector Development Program (PSDP) has been estimated to be Rs 137.2 billion, although the finance division was not ready to make available more than Rs120 billion for this purpose. The overall fiscal deficit target has been set at 5 per cent of the GDP (Rs189.9 billion). The amount of debt servicing has been kept at Rs271 billion. The amount of bank borrowing has been estimated to be Rs42.3 billion with total budgetary support estimated at Rs.52.3 billion including Rs.10 billion from other sources. Non bank borrowing will be to the tune of Rs63.5 billion, and the external (net) borrowing has been kept at Rs84.1 billion. Monetary expansion has been estimated to be Rs155.5 billion. Rs135.4 billion have been envisaged as private sector investment. Official sources said that if the government wanted 4 per cent GDP growth during the next financial year, it would have to make available funds as proposed by the Planning Commission. Generally, the sources said, all the four provinces and the federal ministries and divisions were supporting the Planning Commission for seeking more funds with a view to achieving 4 per cent GDP growth rate in 2001-2002. The Three Year Development Program 2001-2004 has also been finalized by the Planning Commission to be discussed and approved by the NEC, the highest economic decision making body. The program, the copy of which was obtained by Dawn, said the policy and resources have to focus on lifting the economy by its own bootstraps and overcoming structural deformities. The thrust of future economic policy should be to transfer the existing slow growth and financially constrained economy to a higher growth and relatively self-reliant economy. Thus the broad elements of the strategy during the next three year would be: a) Strengthening of investment and growth process by (1) transformation of agriculture into a dynamic and high yield sector with emphasis on self-sufficiency in respect of wheat, edible oils and pulses; and (ii) creation of a broad-based manufacturing structure oriented towards export promotion; (iii) Human Resource Development, besides promotion of science and technology and R&D activities for enhancement of agricultural and industrial productivity; and (iv) addressing the distributional concerns. (b) Investment will be increasingly financed out of national savings, both private and public, to ensure that growth is self- sustained and self-reliant. Structural problems will be addressed by broadening the tax base through documentation of the economy, reducing multiplicity of taxes, improving elasticity of federal and provincial and local government taxes. (c) Rationalization of the tariff structure will continue to reduce anti-export bias in the trade region. The high degree of concentration of exports, both commodity wise and market wise will be broken. Maximum advantage will be taken of the new environment generated by WTO in the fields of liberalised agricultural trade, textile and clothing sectors. (d) Since there is a trade-off between technology improvement and employment opportunities, the issue needs to be resolved carefully. Special efforts would be made in this connection to promote small and medium enterprises (SMEs) for employment generation, keeping the input (specially energy) prices at reasonable level to maintain the productive competitiveness and profitability and maintenance of the existing infrastructure and adequate addition of good quality infrastructure. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010605 ------------------------------------------------------------------- Rupee still on decline: $ at Rs 67 in kerb ------------------------------------------------------------------- Staff Reporter KARACHI, June 4: The State Bank on Monday sold more than $40 million to a state-run bank to help it absorb the additional pressure on the rupee in the wake of $43 million debt servicing by Pak Arab Refinery. A senior official of the public sector refinery said that by meeting the debt servicing requirement successfully the company had sent a positive signal abroad. He said the debt servicing payment was in connection with the $500 million that Parco had raised last year for setting up its mid-country refinery. The $886 million refinery located in Mehmoodkot (Muzaffargarh) had gone into operation in September 2000 - two months ahead of schedule but it was formally inaugurated by Chief Executive General Musharraf in February this year. Senior bankers said the rupee closed around 64.20/64.25 to a US dollar in inter-bank market on Monday down 35 paisa overnight adding that some deals were transacted even at 64.30/64.35 per dollar. "Had the SBP not sold dollars in the market the rupee might have headed for a free fall," said a foreign banker. In the open market the rupee touched a new low of 67 per US dollar. Currency dealers said the rupee closed at 66.90/67.00 per dollar in spot buying and selling. They said the rupee went down in kerb in line with its fall in the inter-bank market. Since May 21 when the rupee started falling on debt payments and corporate demand for dollar it has lost about four per cent of its value in both inter- bank as well as open currency market. It was for the first time on Monday, however, that the State Bank came to the rescue of the rupee by selling dollars to a state-run bank that remitted out $43 million on behalf of Parco. Currency experts say the rupee may remain under pressure in the remaining days of this fiscal year as SBP cannot supply enough foreign exchange in the inter-bank market to support it. Under the terms of $596 million IMF standby credit program SBP is to keep its net foreign assets at a level that requires foreign exchange reserves worth $1.6 billion at the end of June. Currently it has a around $1.2 billion. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010604 ------------------------------------------------------------------- A chance to break away from zero sum game ------------------------------------------------------------------- By Qazi Alimullah Since mid-nineties annual budgets have been a zero-sum game for the economy and a losing game for the people. According to the Economic Survey 1999-2000,(Table 3.1), the growth in the GDP, having dived to 2.27 per cent in 1992 - 93 from the previous year's level of 7.71 per cent due to extensive devastation by floods in 1992, resurged to 4.51 per cent in 1993 - 94, to 5.26 per cent in 1994 - 95 and to 6.76 per cent in 1995 -96. Unfortunately, this growth trend could not be maintained in the second half of nineties because of overwhelming reliance on development and operation and maintenance expenditure cuts for fiscal correction committed to the IMF and the World Bank as a result of repeated failure, by successive governments, to extend GST to retail stage and to provide institutional arrangements to deal with the massive problem of tax avoidance and evasion and related corruption. The overall fiscal deficit or in other words,. net additional debt burden because of the budget, was brought down from 8 per cent of GDP in 1992-93 to 5.9 per cent of GDP in 1993 - 94, an unprecedented reduction of 2.1 per cent unbeaten so far, and then further down to 5.6 per cent of GDP in 94-95. Thereafter, the net additional borrowing for the budget reached new heights of 7.7 per cent of GDP in 1997 - 98, much before the post-nuclear economic sanctions. Thanks to improved revenue collections by the present regime, it declined to 6.1 per cent in 1999-2000 and is expected to go down further to 5.3 per cent of GDP in the current fiscal year against a target of 4.5 per cent of GDP. As regards the external sector of the economy, though the gains were fragile due to chronic structural problems, it was able to service all its payments obligation in the first half of nineties without any extraordinary measures, thus maintaining the confidence of foreign investors. The exports at $ 6.1 billion in 1990-91, recovered from the aftermath of 1992 floods and moved up to $ 8.1 billion in 1994-95 and $ 8.7 billion in 1995-96. As a result of erratic exchange rates policy adopted by the State Bank in which real exchange rate appreciation was accumulated of and on and then shed repeatedly in large quantum. As a consequence exports, remittances and domestic economy received severe jolts. In the second half of the nineties, exports had a poor showing and dived to new low of $ 7 billion by the year 1999-2000. Thanks to cheaper cotton-led revival of the textile sector, steady depreciation of Pak-rupee and above all the efforts of the energetic and imaginative industrialist running the ministry of commerce and industries, the exports in the current fiscal year are expected to surpass the mid-nineties record of $ 8.7 billion by a substantial margin of $ 300 - 400 million. This is the only growth we shall be seeing in five years. Cash foreign exchange reserves which were $ 604 million at the end June 1993, dipped to $ 300 in July but during the course of the year soared to $ 2.5 billion, the accretion was way beyond the accretion in short term liabilities including foreign currency deposits. At end June 1995, the reserves further escalated to $ 2.9 billion. In the later half of nineties the reserve position was, if any thing, precarious despite rescheduling and assistance from IFIs. For the last 3 years, the State Bank has been purchasing on an average about $ 1.5 billion from the open market to meet the requirements of formal trade and payments system. Thus it is quite clear that as far as the economy is concerned the budgets in the second half of nineties were a zero-sum game. Indeed for the people, this was a losing game. According to a presentation by the incumbent Deputy Chairman on poverty reduction strategy in the national high level forum on poverty reduction program (2001 - 04) head count poverty ratio for urban areas was lowest ever in 1993-94 at 16 per cent. The rural poverty ratio was at its lowest in 1992-93 at 23 per cent. The overall poverty ratio was lowest in 1992-93 at 20 per cent. Rural poverty was adversely affected by flood, phasing out of agricultural input subsidies and a sharp decline in home remittances. Since 1994-95 there was a sharp rise in all the three ratios till they all converged at 30 per cent in 1999-2000. The urban poor got a raw deal. Poverty aggravation was sharp in their case. Fiscal correction affected them most. Every government during the period had at the top of their national agenda the tax reforms, and, in particular, the extension of sales tax at the retail stage. It has remained a dream of the last millennium. On the other hand, the pressure remained on them to cut down fiscal deficit with its all pervasive destabilising effect on the economy. The result was another unkind cut for the poor. The development spending underwent a drastic cut down to less than 3 per cent in 2000-01. The ministry of finance treated it as a residual item for adjustment of recurrent shortfalls in revenue. Consequently there has also been a squeeze on asset creation for the people as well as the quality of service to them. I have reviewed the performance of the nineties in some details to put the problems inherited by the present regime in sharp focus and to correlate the expectations from the next budget to them. To sum up, Pakistani economy is still in crisis. Due to drought, growth in the GDP this year is not expected to rise beyond 3 per cent. Overall fiscal deficit is not expected to go below 5per cent, a magical figure defying all efforts in the past. Trade deficit has improved but foreign exchange reserve position is still difficult. Having come down to 4 per cent last year, inflation rate has re-escalated to 5 per cent. National saving at 13 per cent is far too short of real investment requirements to generate a GDP growth of over 4 per cent. All this is a doing of many decades, in particular the eighties and the nineties. After the second oil crisis in 1979 many developing economies were severely affected and fell into debt trap. Many of them including the ASEAN and Latin American countries responded by structural reforms and they overcame their difficulties. India and Bangladesh started late but they were able to revitalize their economies in early nineties. Pakistan initiated its structural reforms in 1980 but abandoned the program in 1982 after initial success. The country was getting home remittances of $ 3 billion annually. After Afghanistan's occupation by USSR, Pakistan became a front-line state and therefore got generous assistance from the US and its allies. Having accumulated foreign exchange reserves of $ 2 billion by December 1982, there was no pressure for reforms. There was no compulsion on fiscal deficit. The entire emphasis was on growth at high future costs. During eighties cumulative borrowing for the budget aggregated to about 60 per cent of the GDP sowing the seeds of serious macro instability in the nineties, in particular the later half. Intermittent efforts for structural reforms brought some relief in the first half that camouflaged the emerging crisis. The present government took over a crisis ridden economy in October 1999. It presented a seven-point national agenda of economic stabilisation, good governance and institutional reforms. Revival of economy and its stabilisation was one of the most important items of the agenda. The new regime proceeded on systematic basis. An economic advisory board was constituted with a host of subject specialists task forces to make recommendations to the board and through them to the government. Based on these recommendations and deliberations in the board a plan of action was developed which was approved by the government for implementation through the next budget for 2000-01. Fiscal reforms proposed in the budget were documentation of the economy, tax surveys and introduction of GST at retail stage. The most crucial item was introduction of GST at all levels of value addition on which hinged the future viability of fiscal balance. More importantly the gap in the chain of GST at retail stage was causing serious setback to small and medium enterprises (SMEs)and exporters. SMEs generally purchase their raw materials from the domestic market. While the price includes a mark-up on cost plus GST paid by retailers to manufacturers and importers, SME producers and exporters do not get a receipt for the GST element included in the price with a mark up. Hence they cannot claim credit in their own GST returns. Private limited companies are at a further loss. They are supposed to deduct GST at source from unregistered suppliers. The suppliers refuse to accept this deduction and these companies have to bear an additional cost which makes them more uncompetitive because they cannot claim a credit for this additional payment. This is one of the reasons why SMEs have not so far played decisive role in export development. Though the retailers are recovering the element of GST with a mark up from their consumers, they resisted attempts for enforcement of GST and engaged the government in procrastinating discussions. The government has declared that it would start enforcing GST at retail stage in May 2001, a little too late considering the setback to fiscal system caused by the delay. Another important program of tax survey underwent a number of revisions and dilutions by the government. To his credit, the finance minister replied that he had to take into account the "ground realities", which is an euphemism for last ditch efforts by traditional tax evaders, avoiders and hijackers to stall the bold initiatives on far reaching fiscal reforms. Collection and fiscal deficit reduction have been missed and development expenditure further squeezed. Additionally, the severe drought and water shortage have depressed the growth rate once again to less than 3 per cent and investment in the economy by the present government. Next year's budget will be the last one that will be implemented by the present government. It must take decisive steps to consolidate and further the initial gains. People of Pakistan have lot of expectations from a government that claims credit for integrity, decisiveness and the wisdom to determine what is best for the nation. This in not the time to contest these claims but to trust them while they are in power and then evaluate their performance on the basis of results. Problems arising out of national indebtedness will take a long time to be resolved. The issue on which the performance will be judged, is the needed space in the fiscal system to (i) support orderly growth at a rate that creates substantial additional employment, and makes significant dent on poverty, and (ii) reduces fiscal deficit in the next two budgets to restart the process of unmanageable growth in debt burden. That will bring social and economic stability. This is the best time to do this. * Thanks to their initial efforts, there is popular understanding and support for tax and credit compliance. The finance minister has made too much allowance for ground realities. Now is the time to do justice with objective realities. Ground realities must be catered for but the objective reality is that the people who are occupying the ground, have created for themselves a tax haven and, have in the past resisted and threatened all attempts to enforce GST at retail stage, which is sine qua non for documentation of the economy and enforcement of data-based self-policed system of assessment of taxes replacing a system based on collusion, arbitrary assessment evasion and corruption. Notwithstanding the criticism from some quarters on dilution of some of the measures, and excessive attention to ground realities, so far finance minister has proceeded in a systematic and concerted manner on all fronts including legal, institutional and operational. He has now available with him the report of tax administration reform committee, which has proposed complete self assessment system, abolition of discretionary powers, market-based pay structures, induction of private sector professionals at top positions and assurance of a reasonable tenure and independence for the chairman. On the operational side, substantial work has been done on tax survey and preparations have been made for full enforcement of GST. It is expected the next budget would embody all the reforms to create the needed space in the fiscal system, and achieve the objectives, eloquently stated by the finance minister off and on. Now is the time for the final act through the Budget 2001-2002. The budget for 2002-2003 could be used for debugging the newly created systems and consolidating the gains of these reforms. Another issue that has to be dealt with effectively for long term gains is poverty alleviation. Poverty has sharply escalated in the last six years. It should not therefore, be difficult to reverse the trend. Indeed, the government has taken a number of measures as direct intervention. However, at last these can be described as interim relief. These measures include development works under Khushhali programme, establishment of Khushhali bank, food assistance program and zakat financed package of social security assistance. However, sustainable poverty alleviation can be achieved through sustained growth in the economy. The average growth between 1996-97 and 2000-01 has not been more than 3 per cent. This rate of growth will aggravate poverty causing disillusionment and disenchantment with the system of governance. Indeed the government can rightly claim credit for institutional reforms, cleaning up of the systems but, these fine values are not understood by the poor. They see the growing monster of poverty devouring them. Poverty issue can be resolved only through higher investments both in the public and private sector. * One can argue that in the current year the growth has been low because of drought. Climatic disasters have wrecked the economy time and again. This shows the vulnerability of the economy. Higher investments are needed to diversify the economy and stabilize growth. However, public sector investment has been our weakest area, both in terms of quantity and quality of implementation in particular during the last five years. The budget makers have treated development expenditure as a residual item. It has received low allocations to be put to further squeeze to accommodate recurrent shortfalls in revenue. Actual development expenditure during the last 5 years has seldom been higher than the insignificant 3 per cent of GDP. If there is throwing up an average of 3 per cent growth in GDP, we should consider ourselves lucky. This is the time for us to break away from the zero-sum game started in mid-nineties. It is unfortunate that the APCC considers Rs 137 billion as minimum development expenditure for achieving 4 per cent growth but finance ministry is turning its back with an offer of only Rs 120 billion. It should not be difficult to find another Rs 15 billion from Rs 600 billion target. After all, fiscal correction is not an end in itself. It is means to an end- the march towards prosperity for all. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010604 ------------------------------------------------------------------- Pakistan's haemorrhaging state ------------------------------------------------------------------- By Khurram Dastgir Khan The Pakistani state has historically failed to curb its expenditures in line with its revenues. The state runs a chronic fiscal deficit. The shortfall was Rs. 206 billion in the fiscal year 1999-2000 (FY'00). It is to cover this shortfall that our governments have borrowed both domestically and internationally. But the spending pattern does not change. The federal and provincial governments of Pakistan spent a total of Rs. 743.6 billion in FY'00. This huge amount failed utterly to improve the lives of most Pakistanis, and similar amounts in previous years came to the same sorry end. Delivery of basic services did not improve, and the fundamental duties of the state-law and order, justice, economic policy-remained mired in dysfunction. By all appearances, the Rs. 770.7 billion expected to be spent in the current fiscal year has gone to the same bottomless black hole that sucked all government expenditure in the past. The question that must be asked is: where did the money go? The federal current expenditure in 1999-2000 by items in a descending order is as follows: (in billions of rupees). 1. Repayment of interest on domestic debt-183.9 2. Defence-143.4 3. Repayment of principal and interest on foreign debt-129.7 4. Grants and subventions-41.0 5. Development-19.7 6. General administration-19.5 7. Subsidies-14.4 8. Social services-10.3 9. Law and order-9.1 10. Community services-6.3 11. Unallocable-5.1 12. Economic services-2.1 Source: State Bank of Pakistan: Annual Report 1999-2000 The debt: There is a surprise at the outset. Debt servicing is the largest single item of the state's current expenditure, and it is assumed that the debt being serviced is foreign debt. A glance at the FY'00 statistics shows that domestic debt is the largest single item of state expenditure, and not foreign debt. FY'00 was the first in which the rupee value of the state's domestic debt exceeded its foreign debt: Rs. 1558.8 billion principal was owed to domestic investors as compared to Rs. 1536.7 billion to international lenders. Within domestic debt, the share of short- term, high-interest floating and unfunded debt has been rising without respite in recent years, and currently stands at an alarming 85 per cent. The recent government report on debt management by the Pervez Hasan committee dismisses domestic debt as a problem. This attitude conforms to half a century of economic illiteracy and profligacy at the finance ministry, whose motto can be summarized readily: when in trouble, print money. But the finance ministry cannot print US dollars, and this is the reason that foreign debt has overwhelmed Pakistan's all other fiscal issues. Our foreign debt in FY'00 was more than half as large as the value of all goods and services produced in the economy that year, and equal to $ 32.746 billion with additional foreign exchange liabilities of $ 4.558 billion. Foreign loans require an annual repayment of $ 7.8 billion in principal and interest; an amount nearly equal to Pakistan's realized export earnings. The core of our foreign debt 'problem' is this: if Pakistan makes the repayment instalments in full, it would not have any foreign exchange left over for any imports. Pakistan, therefore, has to beg its creditors perennially for rescheduling of debts-a gambit that merely muffles the knell of bankruptcy, and is manifestly not a sustainable option. The Pervez Hasan debt-management committee report is a flimsy structure, built on rickety pillars dug not in the ground realities, but in the quicksand of optimistic assumptions. It exposes its intellectual bankruptcy when as a solution to Pakistan's debt-management problem, it recommends taking on even more foreign debt, to the tune of $7 billion per year. It assumes that international donors will not only come up with these sizable loans, but will also do so on soft terms. Presently, these donors are making Pakistan grovel for a few hundred million, and justly complain about the neglect of poverty alleviation, delivery of basic services, and environmental protection in the state's list of priorities. One question that the debt-management committee ignored as being outside its purview is in fact the bedrock issue for the nation's fiscal future: whether the Pakistani state will be able to reorganize itself to collect revenue and deliver services efficiently? Reduction in domestic and foreign debt is necessarily a long-term enterprise that requires steady commitment and sage policy from successive governments. The present evidence indicates a firm negative answer. In all its sprawling functions, the Pakistani state is simply incapable of undertaking and promoting collective action effectively. Defence: Defence expenditure is an enigma. It has appeared customarily as a single-line item in government budgets. Pioneering research by Dr. Ayesha Siddiqa Agha has, however, unravelled a few strands. In her recent monograph "Pakistan's Arms Procurement and Military Build-up 1979-1999", she estimates that approximately 30 per cent of defence budget is wasted, and blames "wasteful imports such as cars and other luxury items for senior officers, duplication of activities, and corruption... Financial corruption was ingrained in the system owing to lack of transparency in the policy-making process and the influence of military's top brass in decision-making." Dr Agha provides four crucial insights into Pakistan's defence expenditure: 1) on many occasions, weapons have been financed from funds not allocated to the defence budget, a reference to the nuclear program; 2) the armed forces have internal auditing structure, but for all intents and purposes they are accountable to no outside agency. They routinely deny needed documents to the Auditor General, so that their audit is never completed; 3) contrary to its claims, the military does not have foolproof institutional checks against corruption; and 4) the military's contract-management and cost-accounting system are inadequate. The military's budget also finances its substantial commercial activities, especially the Fauji Foundation and the weapon factories. Operations of ordnance factories are cloaked in secrecy, but some information is available on the Fauji Foundation. This vast, Rs. 9 billion industrial conglomerates haemorrhages Rs. 1.2 billion annually, and its losses were tripled in the last six months by the massive Rs. 2.4 billion loss in the FFC Jordan Fertiliser Company alone. The Fauji Foundation does valuable welfare work, but its industrial operations have been beneficiaries of massive subsidies and exemptions by the exchequer. Until 1992, it was exempt from taxes, and even now pays only marginal taxes. The utilities and some of overhead costs of Fauji Foundation operations are met from the defence budget. Two more facts about defence expenditure are worth noting: 1) Despite spending an average of Rs. 141.2 billion annually in the last half decade, various sections of the armed forces owe more than Rs. 3.7 billion to WAPDA in back dues. 2) The budget figures for current FY 2000-01 showing a reduction in defence expenditure are misleading. As the State Bank admitted in its most recent annual report, "The reduction of Rs. 9.9 billion in defence expenditures is due to the shift of military pensions (of Rs. 26.1 billion) to general administration. If it is shifted back to the defence budget to keep the figure comparable with the previous year, defence spending actually rises by Rs. 16.2 billion." Development expenditure: The aggregate federal expenditure on development, social services, law and order, community services, and economic services was Rs. 50.5 billion in FY'00, or slightly more than one-third of the annual defence expenditure. This expenditure is insignificant compared to the need. The numbers are appalling. The most recent figures released by the World Bank show that 34 per cent of Pakistani citizens live below the absolute poverty level, and 85 per cent of Pakistan's population subsists on less than $ 2 a day. Of children of age 5 and below, 38 per cent suffer from chronic malnutrition. And almost two out of every three Pakistani adults above age 15 are illiterate. The tragedy is that even this negligibly small expenditure is embezzled, misused, and lost in red-tape. The provincial development budgets are gobbled up by salaries of workers. To present just a few facets of this continuing calamity: $ 400 million was embezzled from Social Action Program (SAP); $ 17 million in SAP funds is lying unused; the Punjab government has failed to spend even half of its development expenditure in FY'01; and the Asian Development Bank (ADB) has threatened to cancel 44 projects worth $ 667 million because of quality and pace of implementation. The development budget ends up ultimately in the same place all government expenditures repose-in the pockets of greedy manipulators, state employees and contractors alike. And there is no reasonable estimate of losses due to inefficiency. Dr Agha's estimate of 30 per cent waste in defence expenditure gives us a conservative baseline of waste in the development budget also: a staggering Rs 5.9 billion out of the total of Rs. 19.7 billion in FY'00. The actual figure is likely to be much higher, but this careful wastage estimate alone is one-sixth of what the IMF promised to loan Pakistan under its harsh stand-by facility last November. Other expenditures: The Rs. 41 billion "grants and subventions" head might as well be renamed "inefficiency and corruption", and is ripe for ruthless downsizing. This is the cash cow for departments of state e.g., WAPDA and railways, who always obtain annual grants to hide and continue their graft-infested and inept ways. The way out is evident, but disagreeable to our policy-makers: to radically reform, downsize, privatise, and reinvent these corporations so they are financially self-sustaining and fully accountable to their consumers. What justifies Rs. 14.4 billion in subsidies in the last FY? The hit-and-miss and arbitrary process of policy formulation by SROs ensures that subsidies persist far beyond their original justification, and new subsidies are added because they are a ready source of corruption for recipients and dispensers alike. Most of the current subsidies are economically unjustifiable, as they distort prices and primarily help the affluent. The total general administration expenditure of the federal government in 2000 was about the same as its total development expenditure. This is a damning demonstration of the Pakistani state's distorted priorities. This head has an impact many times its rupee value, as its bad practices ripple through the economy and cause massive inefficiency, not to mention corruption. Given the pervasive dysfunction of the Pakistani state, the massively over-employed general administration can be cut substantially without any apparent loss in performance. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010603 ------------------------------------------------------------------- Package for investors on cards: Budget 2001-02 ------------------------------------------------------------------- By Ihtashamul Haque ISLAMABAD, June 2: The government has decided to offer new concessions to foreign and domestic investors in the budget 2001- 2002. Foreign investment, which is an important yardstick for overall GDP growth rate, has been less than $100 million during the first ten months of 2001-2002. Although promises were made and the Memorandums of Understanding (MoUs) signed, specially in the Information Technology (IT) sector, practically there was no hard foreign investment. The sources said a comprehensive package was being worked out by the budget planners, which would protect foreign investment. The government in this regard will promulgate an ordinance. Finance Minister Shaukat Aziz told this correspondent on Friday that the government would not commit a blunder of freezing foreign currency accounts. The sources said the government was expecting 2 to 3 billion dollar new foreign investment by overseas Pakistanis in 2001-2002 by making what was termed a "big favor" of asking no question about the source of the amount. On the domestic front, the government was considering 10 to 15 per cent reduction in excise duty on cement to encourage the dormant construction industry. The move, the sources said, could help bring sizeable domestic investment in this big sector. "The excise duty on a number of items is likely to be removed and general sale tax imposed on them," he said. The removal of excise duty on different kinds of imported raw material was also being contemplated. Another budget issue, he said, causing differences between the ministry of finance and the Planning Commission was the size of the Public Sector Development Program (PSDP). The Commission continued to insist that this development budget should be to the tune of Rs 130 billion while the finance ministry officials were just unprepared to make available more than Rs120 billion in this behalf. The matter will be discussed and finalized at the National Economic Council (NEC) meeting being held on June 7 under the chairmanship of Chief Executive Gen. Pervez Musharraf. The sources said that further reduction in the interest rate of commercial banks and national saving schemes was also being worked out in the next budget. The International Monetary Fund (IMF) was particularly insisting on lowering the interest rates of banks and the saving schemes. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010603 ------------------------------------------------------------------- 29.4% growth in ST collection noted ------------------------------------------------------------------- By Parvaiz Ishfaq Rana KARACHI, June 2: There had been sustained growth of 29.40 per cent in sales tax collection during the first 10 months (July-May) of present fiscal. The closer monitoring of accounts of taxpayers by audit department of ST collectorates minimized leakage�s and evasion to a greater extent, sources maintained. The sales tax collection of both collectorates during the out-going month of May rose to Rs2.080 billion as against Rs1.848 billion in the corresponding period of last year. As per other details the Sales Tax Collectorate (East), during the period under review, maintained its robust growth in sales tax collection at Rs19.515 billion or 35.24 higher than the collection made during the corresponding period of last year when Rs14.429 billion were collected. During the out-going month of May the collectorate recorded a growth of 14.53 per cent at Rs1.640 billion compared to Rs1.431 billion collection achieved in the same period of last fiscal. However, a single month record collection by the collectorate (East) was achieved in July, 2000, when ST collection at Rs1.608 billion was 162 per cent higher than the corresponding period of last year. The ST collectorate (West), also maintained its growth by improving 12.17 per cent in its collection over the previous year. During the period under review there had been a collection of Rs5.488 billion as against Rs4.892 billion a year ago. A single month record collection by the collectorate (West) was achieved in August 2000, by recording a growth of 69.35 per cent at Rs578.012 million compared to Rs341.300 million collection made in the same period of previous year.Back to the top
EDITORIALS & FEATURES 20010603 ------------------------------------------------------------------- Forty-five days' liberty lost ------------------------------------------------------------------- By Ardeshir Cowasjee MARCH 28, 2001: Notice received by Navroze Patel. Case No.100/98 FIR NO.58/98, FIA, CBC, KYC. In the Special Court (Offences in Banks) at Karachi, Sindh, at old Circuit House Adjacent to American Consulate Karachi (Criminal Jurisdiction) XXXI Summons to witnesses (See Section 69 252). Addressed to N S Patel s/o Savak Behramji Patel, chief cashier ANZ, Allama Iqbal Road Branch KYC, R/o 3 Lodha Homes, Parsi Panchayat Wadi, Johar Street, KYC. "Whereas complaint has been made before me that Wilayat Noor Khan u/s 406/PPC has (or is suspected to have) committed the offences of and it appears to me that you are likely to give material evidence for the prosecution. You are hereby summoned to appear before this court on the 2nd day of April 2001 at 8.30 am in the forenoon, to testify what you know concerning the matter of the court, and you are hereby warned that if you shall without just excuse neglect or refuse to appear on the said date a warrant will be issued to compel your attendance. Given under my hand the Seal of the Court this 10th day of March 2001. By Order." April 2, 2001: For the first time in his life, Navroze Patel entered a courthouse. He appeared before Judge Ekram Hussain Jafri. He was appalled by what he saw and heard. His idea of a court was what he had seen on his television screen whilst watching Perry Mason defending a client. The others concerned and called were not present. The case was adjourned to May 14, 2001. April 11, 2001 : An FIA man, Rafiq Moghal, the investigating officer of the case, appeared at Navroze's home and asked him to accompany him to the FIA office, without specifying why. On arrival there, at Baloch Colony, he was told that he had been arrested and he was put in the lock-up. He was kept overnight. The following morning he was allowed to make a telephone call, which he did to a friend and neighbour, also working in ANZ Grindlays, and informed him that he was being held by the FIA. Thereafter, he was handcuffed and taken to the court of judge Jafri. In court, Rafiq Moghal of the FIA had a conversation with the judge which Navroze was unable to hear. What he did hear was the judge ordering that he be remanded and sent to Karachi Central Prison and produced again in his court on April 25. April 25, 2001: He was not taken to court. I visited him that day in jail and was amazed to find him calm and composed, not at all worried by what was happening to him. He turned out to be an Old Virbaijeeite, a former student of the Bai Virbaijee Sopariwalla Parsi High School from where he had matriculated in 1970. The principal during his school years was Mrs Dinoo Mistri and he was sent out into the world and told : This is your world, go and live in it. We sat down and he related to me the chain of events which had brought him to prison. On May 29, 1998, the day after Mian Mohammad Nawaz Sharif exploded the Bomb, the cashiers in his bank were instructed to transfer all the foreign currency notes they held to the chief cashier, Navroze. Whilst handing in his currency notes, one cashier, Wilayat Noor Khan, was $ 20,000 short of what he should have had and this was duly recorded and reported to the branch manager. In August 1998, the bank lodged an FIR against Wilayat Noor Khan in which Navroze's name did not figure. I checked with the bossman of Standard Chartered Grindlays (ANZ has since been bought over) who unequivocally certified "that Mr Navroze Z. Patel was with ANZ Grindlays Bank from June 16, 1975, to November 15, 1999. In 1999, he opted for the voluntary retirement scheme. At this time he was working in the capacity of assistant manager, sales and service, cash department, at the Allama Iqbal Road Branch based at Karachi. During his tenure with us, we found him honest, hard-working, and efficient. We have not had nor have any claim or charge against him. We wish him success in his future endeavours." The bank also gave me a photocopy of the letter which teller Wilayat N. Khan had written to his ANZ manager on June 2, 1998 : "Subject - Loss of $ 20,000. I would like to inform you that it has been noted on 2nd June, 1998, at about 5 pm while delivering my foreign currency cash to my chief cashier that $ 20,000 was missing from my teller box." Artist and social worker Jimmy Engineer, a neighbour of Navroze and a member of the helping gang, asked his friend, famous criminal lawyer Khwaja Naveed, to apply for bail. April 26, 2001: Khwaja Naveed appeared before judge Jafri who informed him that he had no time to hear the bail application and adjourned the matter to May 15. I was not at all surprised by the behaviour of the judge and his concern for the liberty of his fellow man. I asked Khwaja to request Judge Jafri to reject the bail application which would enable us to move on to the High Court. Jafri refused, but ordered that the bail application hearing be brought forward to May 5. May 5, 2001: Navroze was taken to court handcuffed to another man under trial. The FIA man had no objection to the grant of bail. Judge Jafri rejected the bail application. May 14, 2001: Navroze was taken to court, this time handcuffed to two others undergoing trial. The case against Wilayat was not heard. It was adjourned to May 30. May 18, 2001: Khwaja Naveed had managed to fix a bail hearing at the Sindh High Court. It came up for hearing but no FIA man was present, so the hearing was adjourned to May 22. May 22, 2001: The presiding High Court judge, realizing the importance of a bail application and concerned about the liberty of his fellow man, granted bail. The court decided that Navroze would have to provide security for an amount which happened to be half the sum of his golden handshake. May 25, 2001: Navroze was released from Karachi Central Prison. It had taken Jimmy Engineer and his helpers three days and much hassling to get the paperwork done and they had to pay far more than the official fees to do so. July 4, 2001: American Independence Day, when we will all remember the famous words: Life, liberty and the pursuit of happiness. The case against Wilayat is to be heard in judge Jafri's banking court and Navroze will have to appear. Who will pay, and what can they pay, for the loss of 45 days of liberty in the life of Navroze Patel, for his suffering and bewilderment? I can make no comment for at present I myself still have against me a charge of contempt of court. In 1999, the then Chief Justice of Pakistan, having been alerted by one of his learned brothers that my utterances on PTV were prima facie contempt of court, summoned me to the Supreme Court to show cause why I should not be proceeded against for contempt of court. I duly appeared before a bench of 14 honorable judges of the Supreme Court of Pakistan, headed by the Chief Justice, and on October 26, 1999, was formally charged by them with "having committed contempt of this Court and the High Courts of the Country and rendered myself liable to punishment under Article 204 of the Constitution of the Islamic Republic of Pakistan read with sections 3 and 4 of the Contempt of Court Act 1976". I was called upon to show cause why I should not be punished and was asked if I pleaded guilty. My response was: No. The hearing of the case was fixed for December 13, 1999. An adjournment was sought as I had, as is always said in Pakistan, 'rushed' to the States for treatment for my chronic heart problem and in fact on that day was lying in the George Washington Hospital in Washington DC. The case was adjourned to the first week of March 2000, by which time I expected to be back in Pakistan. The case has still to be fixed, heard, and disposed of. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010608 ------------------------------------------------------------------- Educating the warriors ------------------------------------------------------------------- By Ayaz Amir The warriors were not amused. This was plain to see. Their faces wore glum looks; the desk-thumping when it came was conspicuously half-hearted. Any other speaker in the like situation would have been cut short, the podium stormed, the mikes seized, and the man sent running for his life. But this was no ordinary speaker. Here was the commander of all of Pakistan's armies, and its nuclear forces to boot, giving the fathers of the church a taste of their own medicine. They were not liking it at all, neither his audacity nor their own helplessness. The annual Seerat Conference in Islamabad on the Holy Prophet's birthday is not a setting for dramatic happenings. Speeches delivered on the occasion are of the predictable kind and therefore easily forgotten. But when I accidentally tuned into the live recording of the event on PTV I sat transfixed. For there was General Musharraf uttering no homilies or pieties but talking serious business. His message was simple if also a trifle blunt: start living in the real world. And the more effective for being plain and direct with no frills or oratorical flourishes. Here's a precis (not a literal rendering) of what he said. Why did the sectarian fathers squabble amongst themselves? First it was Sunnis and Shias at loggerheads with each other, now another variation had crept in: Barelvis vs Deobandis. A man's faith was his own affair. In such matters what right had anyone to sit in judgement over others? This was God's prerogative, not that of mortals. How could we call ours an Islamic state? In it was no brotherhood, unity or tolerance. Nor justice for the poor and needy. We cited with pride the exalted place given to women in Islam. But the facts on the ground told a different story. We were hypocrites. What lay in our hearts came not on our lips. By speaking irresponsibly we gave a handle to others to malign us. Little wonder Pakistan was called all manner of things: failed state, terrorist state. We should learn to relate our utterances to our strength. We were a weak country, left behind in the race for development. While there was no question of discarding principles, it was not wise to speak intemperately. Let us first acquire strength. Then, if we wanted to, we could abuse others to our hearts' content. What need to talk of planting the banner of Islam on the Red Fort in Delhi? Did we not realize the difficulty we thus caused our brethren-in-faith across the border? We were committed to the Kashmir cause and would advance it in whatever way we could. But it was also a fact that a lot of the money collected for Kashmir went into private pockets. Our economy was not in sync with our military strength. Japan's GDP was four times the size of the GDP of the entire Muslim world; Germany's was two times bigger. Wherein lay the fault? We lagged behind in human development (at which point the CE compared figures of universities and Ph.Ds in other countries and those in the Muslim world). Precis ends. Newspaper reporting can often be misleading, conveying the outer impression of an event while leaving its essence untouched. So it can be with General Musharraf's speech. Mr Vajpayee has already welcomed it, a circumstance which almost ensures that it will be read in the context of India-Pakistan relations whereas to isolate it thus is to give it a wrong meaning. High-flying rhetoric, tall claims, bigotry and intolerance are not specific to the warriors of the faith. To assume as much is to do the holy warriors an injustice. These things are true of Pakistan as a whole. As a nation are we not victims of inflated rhetoric? Intolerance, militancy and sectarianism may be the special wares hawked by the fathers of the faith but jingoism, militarism and nuke-brandishing are follies that can be laid more appropriately at the doors of the permanent establishment: the generals and mandarins who sit at the high table of national security. General Musharraf not only sits at this table; he presides over it. But notice the irony of his performance. While he called attention to the verbal excesses of the religious armies, he studiously avoided any mention of the profligacy and practical excesses of the permanent establishment. We should bring our economic strength up to par with our military strength, he urged. But he was careful not to say we might consider scaling down our military strength to reflect more accurately our economic circumstances. Other caveats can also be sounded. A leader cannot afford the luxury of permanent diagnosis. In his position he must not only point out the sickness; he must also do something about it. The military government has now been in power for some time. What has it done to improve law and order (a subject regarding which the CE waxed eloquent)? What victories can it claim in the fight against militant sectarianism? How has it improved the administrative functioning of the Pakistani state? If the military's record on these scores is uneven or unconvincing, is it not proper to ensure that sermonizing not outstrip performance? Reading a lesson in realism to the accredited barons of the church may be the thing to do (they certainly deserve it). But shouldn't there also be an element of humility and self- criticism in the exercise? In the coming days count on more such objections being heard. Even so, it pays to remember that while discourse in the realm of statecraft cannot be an end in itself, the right kind of discourse can influence political behaviour and even raise it to a higher level. Churchill's Iron Curtain speech helped define a critical moment in post-war Europe. Eisenhower's "military-industrial complex" speech drew attention to an important aspect of the modern state (besides giving a revealing phrase to the language). Far-fetched analogies are obviously misplaced but this much perhaps can safely be hazarded: in such open terms no Pakistani leader before has addressed the bugbear of national over-reach and religious fanaticism. While military leaders are not above speaking the language of hypocrisy - we need only remember the irrepressible General Zia in this connection - only a military leader sure of himself and not worried about his back could have spoken in these terms. Only a military leader could have sacked the one-man public relations firm that went by the name of A. Q. Khan. Only a military leader could have called the fathers of the faith to account without the windows being smashed and he being chased from the hall. This only goes to show the power of the army in a politically- repressed and retarded country like Pakistan - the power to do good and, as the history of the last 53 years amply illustrates, the power to inflict evil. In any event, this was a speech waiting to be delivered: a necessary corrective to the nonsense which fills the national atmosphere. In ladling out this corrective Musharraf also provided a glimpse into his evolution as a leader. Not long ago his government went about in mortal fear of the mullah. The fiasco over the minor changes in the anti-blasphemy law, when a solemn word given had hastily to be retracted, will not be forgotten in a hurry. Nor will images of free-wheeling religious gatherings where wild calls for jihad were made against the backdrop of gun-toting bodyguards in masks and battle fatigues. India could have asked for nothing better. We were proving more adept at self-defamation than our enemies could have imagined. In between came the comic relief provided by the antics of a small- time cleric from my home district of Chakwal whose threats to march on Islamabad were taken seriously by the authorities. To the alarmed outsider, Pakistan seemed a ripe candidate for Talibanisation. Juxtaposed with those exaggerated fears when the military was still testing its political strength, General Musharraf's present boldness comes across as a giant leap. Indeed herein lies an irony to beat all others. For the author of Kargil to become a leading espouser of realism is a transformation, admittedly on a much reduced scale, to set beside Nixon's journey from communist-baiting to drawing the grand design of d�tente. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010609 ------------------------------------------------------------------- The short arm of the law ------------------------------------------------------------------- By Irfan Husain AS last week's successful strike called by the Sunni Tehrik showed yet again, the state's writ does not extend much further than the confines of Islamabad. True, the city of Karachi came to a grinding halt purely out of fear and not sympathy for the ST cause. But the fact that a military government can do little more than haul up a few hundred activists, only to release them as part of a deal with this fundamentalist organization a couple of days later, indicates the low esteem authority enjoys in Pakistan. When a quasi-religious outfit can hold the nation's biggest city hostage without any fear of official retribution, we are in serious trouble. Over the years, corruption, inefficient government, political bickering, military interventions and judicial somersaults have steadily eroded the authority of the state. From such mundane, everyday actions like stopping at a red light to paying taxes, everything is subject to the individual's perception of what he can get away with. And in today's Pakistan, he can literally get away with murder. Even if our notoriously inefficient police make an arrest, chances are that the suspect will be released by our courts. Everything is open to negotiation, everything is up for grabs. Successive governments have attempted to impose sales tax across the country, but each time, traders have successfully agitated to get delays and exemptions. This government has been firmer than its predecessors, but there are still huge gaps and loopholes in the system. Electric meter inspectors who attempt to collect dues from the tribal areas are often beaten up, and so far, WAPDA, the utility company, has been unable to recover a penny from these armed and dangerous worthies. Not coincidentally, these same tribals are involved in smuggling, gunrunning and drug trafficking on a massive scale. They pay no taxes, and yet remain immune from any legal action. But to be fair to them, they are not alone in being exempt from prosecution for law-breaking. Every fortune in Pakistan has been made by cutting corners; many opulent (and vulgar) houses and shopping plazas across the country have been financed through some racket or the other. Homes with half a dozen air-conditioners pay a fraction of their energy bill by cutting a deal with the meter readers; large and profitable businesses pay off officials on a monthly basis to reduce duties, taxes and all kinds of other levies. But they do not pass on their legitimate and illegitimate profits to shareholders, preferring instead to fiddle the books to siphon off the proceeds into offshore accounts. To a considerable extent, officialdom is responsible for this state of affairs: a factory owner in Karachi told me that his industry is subject to the inspection of fourteen different federal and provincial agencies, each of whom demands a set amount which, if it isn't paid, can lead to extortionist fines and even closure. Most industrialists find it easier and cheaper to pay up, charging these bribes to the cost of doing business in Pakistan. Those few businessmen who buck the system and insist on paying their legal dues find their competitiveness being eroded through higher costs. The state's own inability to enforce its writ leads it to squeeze those who do pay and are subsidizing those who don't. Thus, electricity rates keep gong up because of the extraordinarily high rate of line losses and outright power theft; despite the army's heavy involvement in WAPDA at every level, this white elephant continues to haemorrhage money and megawatts. Similarly, because of massive tax evasion, fixed-income earners who cannot avoid this burden find themselves having to pay more every year to underwrite the state's bloated expenditure. When people see others getting away with all kinds of scams around them, they start feeling like suckers being taken for a ride by a system that is stacked against the honest individual. So it is hard to blame them for taking short-cuts when they can. When multimillionaires flaunt their dubious fortunes - usually built on defaulted loans and evaded duties and taxes - the ordinary mortal feels justified in diddling the state out of whatever he can. Respect for the rule of law can only come when it is uniformly applied. In Pakistan, only fools and ordinary citizens obey the law; the privileged are above it. About fifteen years ago, a friend told me a story that illustrates the general contempt for rules: he had stopped at a red light and the car behind him started honking incessantly. When the light turned green, he proceeded, only to be blocked by the noisy driver who accelerated violently to overtake him. He got out and proceeded to abuse my friend who lowered his window to ask what the problem was. "Why did you stop at the lights, you so and so?" the aggressive driver demanded. My friend pointed out that the light was red. "Are you a government chamcha that you stop at red lights?" was the next question. One major reason why we are where we are is that the rich and the powerful openly break the law without a second thought, and their children follow their parents' example. President Bush's daughters have been fined for under-age drinking; if memory serves, Ms Cherie Blair, wife of the British prime minister, was fined when she forgot to buy a train ticket; and several members of the British royal family have been charged with speeding. But if a general's or a senior official's son is caught for a crime, not only will he be let off, but the arresting cop will be lucky to keep his job. After a while, demoralized policemen will no longer stick their necks out by apprehending the well-connected. If the rule of law is to be enforced and the writ of the state is to have any meaning, two things will have to happen. Firstly, laws need to be rationalized and simplified; next, they have to be uniformly applied without exception. Both steps need political will that is currently not in great evidence. The ill-trained, underpaid and demoralized bureaucracy as well as the venal and inefficient lower courts are simply not capable of implementing any meaningful reforms; nor are the Pakistani elites very likely to follow rules made for the rabble. And since this government (or any foreseeable one for that matter) shows no inclination to use its considerable authority to take on powerful vested interests, nothing is likely to change. Around forty years ago, Ayub Khan, another military ruler, introduced the Family Laws Ordinance, a very liberal piece of legislation for its time. He took on the religious lobby and pushed this pro-women law through. Since then, successive rulers, both military an civilian, have capitulated before vested interests. But if things don't change, we will continue being held hostage by any two-bit outfit with a grouse.
SPORTS 20010609 ------------------------------------------------------------------- Pitch invasion mars Pakistan's victory ------------------------------------------------------------------- BIRMINGHAM, June 8: Pakistan routed England by 108 runs at Edgbaston on Thursday in the opening match of a triangular one-day tournament on Thursday, but the contest was almost abandoned after a pitch invasion threw the match into chaos just before the finish (briefly reported in Friday's edition). England, chasing Pakistan's 273 for six, were on 159 for nine in the 44th over when hundreds of fans, the vast majority wearing Pakistan colors, ran on to the ground, forcing the players off and stealing the stumps as they swarmed all over the playing surface. Pakistan captain Waqar Younis and team manager Yawar Saeed made appeals to the team's fans, warning them the match would be abandoned unless they moved back behind the boundary boards. The pleas followed a meeting between match referee Brian Hastings, the umpires and the two team captains. Pakistan captain Waqar Younis helped to restore order by persuading fans to go back in the stands. "Most of the crowd were Asian," he said. "It was necessary for me to go out there." Waqar played down the trouble, however, saying: "This is nothing new for me. When you play in Pakistan and India this is quite common. It's a shame but it happens. It's part of the game. "We do really need some more security, (but) I don't know what they can do. They can't really put up fences overnight." His opposite number Alec Stewart retorted: "He (Waqar) might be used to it, but it shouldn't be happening. I can't remember anything like that around the world." Waqar admitted that match referee Brian Hastings had considered calling the game off after a meeting with the umpires and two captains, and said the International Cricket Council, the sport's governing body, could have been forced to intervene if the game had not been finished. The second game sees Pakistan take on Australia in Cardiff on Saturday. Thursday's incidents were reminiscent of similar crowd invasions during the 1999 World Cup, with extra security and army personnel drafted in after several crowd invasions. England, who accepted their status as the tournament's also-rans before a ball was bowled, ended the game in disarray. Their cause had not been helped by losing Andrew Caddick 24 hours before the match and Graham Thorpe a few hours before the start, leaving them short of five first-choice players. Their feeble batting, however, followed two batting collapses in the second Test ending on Monday, while their support bowling was again shown up as short on both variety and teeth. Australia and Pakistan must already have their thoughts on their Lord's rematch. KNIGHT INJURED: Knight was hit by a spectator during a pitch invasion, Stewart said. "He told me he was struck," Stewart told reporters. "I don't know where." -Reuters DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010608 ------------------------------------------------------------------- Pakistan beat England by 108 runs ------------------------------------------------------------------- Monitoring Desk BIRMINGHAM, England, June 7: England lost the first opening match of triangular one-day series to Pakistan, when the visitors routed the hosts by 108 runs, at Edgbaston on Thursday. Pakistan, who opted to bat, had made 273 for six (opener Saeed Anwar's 77), his 40th half-century in one-day internationals, and Inzamam-ul-Haq's 79, his 60th. In reply, England collapsed when their early wickets fell quickly without adding sufficient score on the board. At one stage they were 69 for 3. The combined attack by seamers and spinners confined the English batsmen to a paltry 159 for nine on 42nd over when the enthusiastic spectators streaked the ground stopping the match proceedings for quite some time. When the order was restored and the match resumed finally, it took another three overs to Pakistan bowlers to finish the match. DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010607 ------------------------------------------------------------------- Rejuvenated Pakistan face England in tri-series opener today ------------------------------------------------------------------- BIRMINGHAM, June 6: Australia, Pakistan and England all go into the triangular one-day series that starts at Edgbaston here on Thursday with a point to prove. Australia, who beat Pakistan at Lord's in the 1999 World Cup final, will want to extend their run of one-day successes and prove that Tuesday's six-wicket defeat by Middlesex was no more than a blip. Not since Australia captain Steve Waugh was a junior player in 1986-87 has his country lost a Test series campaign against England, their oldest opponents. Success in the one-day series would further erode England's confidence about their ability to beat Australia in the longer game. The home team's collective belief was dented Tuesday when Pakistan took eight wickets in the final session at Old Trafford to win the second Test. For England's part this marks the start of a rebuilding programme in limited overs cricket. Their run of four wins and a draw from their last five Test series has obscured the fact that their one-day form has been poor. They won the triangular tournament here last season but that was against a fledgling Zimbabwe side and a West Indies team that was one of the weakest to visit here since World War II. During the winter England played six One-day Internationals and lost five on the trot, including two to Pakistan before being thumped three-nil in Sri Lanka, their last one-dayer ending in a 10-wicket win for the Sri Lankans. If the 1999 World Cup was a disaster for England - on home soil they went out in the group stages - the final was a crushing disappointment for Pakistan. At Lord's they were bowled out for 132, Australia winning by eight wickets and allegations of match-fixing following almost as quickly as Pakistan batsmen departing the field. Pakistan captain Waqar Younis and fellow fast bowler Wasim Akram are making what seems certain to be their final tour of England and they will want to finish with a flourish. The smart money says Australia and Pakistan will contest the final again - both teams have greater numbers of bowlers and batsmen who can turn a game in the blink of an eye than England. But smart money is often wrong and England opening batsman Marcus Trescothick - England captain Nasser Hussain is still out thanks to a thumb fractured by Shoaib Akhtar in the first Test - insists Alec Stewart's side can compete. "It's going to be hard work. You've only got to go back to the 1999 World Cup when they were both in the final. They are both very, very good sides, Australia in particular," said the 25-year-old Somerset left-hander. "Pakistan are not far behind but I'm sure we can overcome both of them. "If we perform to our maximum we've got a good chance. It's a big stepping stone. We've not done that well in One-day Internationals so this is a great opportunity to turn it around as we did with the Test matches." Time will tell if Trescothick's optimism is well-founded. The final is at Lord's on Saturday, June 23. Meanwhile, England's chances were dealt a blow on Wednesday when pace bowler Caddick was ruled out of his team's opening two matches. Coach Duncan Fletcher said: "He's got a niggle in his back that's been hurting him. He's played through it before but because of his workload we won't be looking at him until Lord's." Caddick, who led the attack with Darren Gough in the Test series against Pakistan, has been replaced in the squad by paceman Matthew Hoggard. Alec Stewart, stand-in captain for Nasser Hussain, said: "We will probably start as third favourites the other two teams reached the 1999 World Cup final. "We're an inexperienced side - I've played 140 one-day games, while players like Steve and Mark Waugh and Wasim Akram have played two or three times more than me." The host side have included two young players, Surrey's Ben Hollioake and Durham batsman Paul Collingwood, in their squad but Fletcher would not commit himself to playing either inThursday's match.-AFP/ Reuters DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010605 ------------------------------------------------------------------- Pakistan level series ------------------------------------------------------------------- MANCHESTER (England), June 4: Pakistan, inspired by Saqlain Mushtaq, Wasim Akram and Waqar Younis, snatched a 108-run victory over England in a dramatic climax to the second Test at Old Trafford on Monday. England, chasing 370 to win, were 174 for one just before tea on the fifth and final day but slumped to 261 all out as their hopes of a fifth series win in a row were dashed. Wasim made the key break though by removing centurion Marcus Trescothick before he combined with off-spinner Saqlain in an extraordinary passage of play as four wickets fell for one run in 13 balls, three of them to Saqlain. England plunged from 229 for four to 230 for eight in this telling phase. Saqlain finished with four wickets, Wasim took two and skipper Waqar had three, Pakistan winning with just 6.5 overs left as their supporters invaded the pitch at the end. It was a extraordinary turn-around after opening batsmen Trescothick, who made 117, and Michael Atherton, who made 51, had put on 146 for England's first wicket.-Reuters DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010604 ------------------------------------------------------------------- Exciting final day on cards at Old Trafford ------------------------------------------------------------------- MANCHESTER (England), June 3: England, set a record 370 to win the second Test, saw off a fierce assault by Wasim Akram and Waqar Younis as they raced to 85 without loss with a day left at Old Trafford. Left-arm pace bowler Wasim, playing in his final Test in England, unleashed a barrage of bouncers and short-pitched deliveries in an attempt to unsettle the openers in the last 22 overs of Sunday's fourth day. Michael Atherton, though, responded with two boundaries off the first over while Marcus Trescothick joined in with a cover-driven four off Waqar Younis, followed by a top-edged six over fine leg as 25 came off the first four overs. The scoring slowed with the introduction of off-spinner Saqlain Mushtaq, who turned a ball from the rough to beat left-hander Trescothick as he groped forward in the gathering gloom. But Atherton, who closed on 30 not out, then cracked him through extra cover before bringing up the 50 in 78 balls. Trescothick (48 not out) completed the day with two boundaries off the last two balls from all-rounder Abdur Razzaq, the second a full-blooded hook, leaving England needing 285 to steal the game from a minimum of 90 overs on Monday. England have never scored as many as 370 in a fourth innings to win a Test. Their record came against Australia at Melbourne in 1928-29 when they scored 332 for seven. Their best fourth innings winning total against Pakistan came in 1982, when they made 219 for seven at Headingley. Pakistan, however, will still feel well placed to level the two- match series after Inzamam-ul-Haq and Yousuf Youhana shared a 141- run fourth-wicket partnership to help them amass 323 in their second innings. The fourth day, like the three preceding days, provided enthralling cricket in front of a 15,000 crowd on an excellent pitch still favouring the batsmen. Pakistan, resuming their second innings on 87 for three after dismissing the home side for 357 on Saturday, dominated the morning as they added 94 without loss. The home side, however, gave themselves a glimpse of a chance by removing danger man Inzamam for 85 as four wickets fell for 37 runs in the afternoon. Inzamam, chasing his second century of the game after making 114 in the first innings to pass 5,000 test runs, had looked set to attack after lunch. But, after a hooked six off Andrew Caddick and a four in the same over, he chipped pace bowler Matthew Hoggard straight to Trescothick at short mid-wicket. Two balls later Youhana was controversially given out for 49, caught at first slip off Caddick to make it 208 for five as a short-pitched delivery appeared to clip his helmet rather than his gloves on the way to Atherton at first slip. Youhana, struggling for form throughout the tour, left shaking his head in frustration. Dominic Cork then removed Younis Khan lbw for 17 and Caddick scattered Azhar Mahmood's stumps before Wasim celebrated his 35th birthday with a 41-ball 36 and helped to put on 59 for the eighth wicket with Rashid Latif. Waqar provided a final flourish with a flat-bat six over mid-wicket off Gough as he hit 14 not out. England, who dropped four catches during the match, were left to rue a crucial missed chance on Sunday morning. Singled out as the key wicket by his captain on the previous evening, Inzamam was on 36 with the total on 108 for three when he had edged Caddick to second slip. A diving Nick Knight appeared to have taken the catch, only for the ball to dislodge as he hit the ground. Inzamam went on to bat for six hours 43 minutes and hit 10 fours and a six from 186 balls. Caddick, Hoggard and Gough all took three wickets, as they had done in the first innings, with Caddick the pick with three for 85 off 22.5 overs. England won the first Test at Lord's by an innings and nine runs within three days. English coach Duncan Fletcher was confidents that his team can win the game. He said: "Michael likes a good scrap, he showed he's up for it. They showed tremendous character under tremendous pressure. "There's a lot of mental strain after four days. You saw how fired up Wasim was. It's going to be a pretty difficult total to get but having scored 85, we must have a chance." "It's a wicket which encourages positive cricket," Fletcher said. "We'll play it session by session. But all the bowlers are a threat, they're world class." -Reuters DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS*DWS 20010603 ------------------------------------------------------------------- Manchester Test delicately poised ------------------------------------------------------------------- MANCHESTER, June 2: Pakistan rekindled their victory hopes in the second Test after an England collapse in which their last eight wickets tumbled for 75 on the third day on Saturday. The touring team scythed through the England order after centuries by Graham Thorpe and Michael Vaughan, and then forged 133 runs ahead with seven second innings wickets remaining before bad light ended play early. Waqar Younis's side, needing to win to level the two-match series, turned the game on its head by reducing England from 282 for two to 357 all out for a 46-run first innings lead. Then, after starting their second innings by hitting 41 runs off six overs for the loss of two wickets, they adopted a more cautious approach to close on 87 for three when they accepted the umpire's offer to go in at 1726 GMT. There was no hint of a collapse as Thorpe and Vaughan shared a record partnership by England for any wicket against Pakistan of 267 - surpassing the 248 second-wicket stand of Colin Cowdrey and Ted Dexter at The Oval in 1962. Thorpe equalled his Test best of 138 while Vaughan recorded his maiden Test century with 120 in a display mixing fine stroke play with aggressive running after England had been tottering on 15 for two on Friday. But then Thorpe was run out by a yard following a fine turn and throw from Wasim Akram off his own bowling to make it 282 for three and one run later Vaughan shaped to avoid a Waqar Younis bouncer with the new ball and was caught behind down the leg side off his glove. -Reuters ------------------------------------------------------------------- You can subscribe to DWS by sending an email to <subscribe.dws@dawn.com>, with the following text in the BODY of your message: subscribe dws To unsubscribe, send an email to <unsubscribe.dws@dawn.com>, with the following in the BODY of you message: unsubscribe dws ------------------------------------------------------------------- Back to the top.
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