capture
Collecting the bargaining chips
Crackdown against Quetta Shura Taliban is seen by many as a major policy shift
By Amir Mir
The ongoing Pakistani crackdown against the Quetta Shura Taliban (QST), led by Mulla Omar, is being seen by many inside the country as a major policy shift to abandon the former rulers of Afghanistan. There are many others, who believe that the arrest of Taliban Shura members following the London moot on Afghanistan might be an attempt by the Pakistani military establishment to lock the stable doors and save the valued Taliban studs from being stolen by the Americans.

Disaster-struck
The devastating avalanche that struck Attabad poses even greater threat to the people in Hunza
By Shabbir Ahmed Mir
Avalanches are familiar to the people in this mountainous region but not of the magnitude that struck the small hamlet of Hunza called Attabad on January 4, 2010. The unfortunate settlement, located on a slope on the famous Karakoram Mountain Ranges, suddenly broke off plunging a major part of the settlement into the river that flows towards Gilgit.

In the wrong lane
There were 7,244 reported underage driving violations in 2009. Imagine the numbers that went unreported.
By Haneya H Zuberi
Sometimes we behave funny. We can commute in Range Rovers but would want a concession at the doctor's office. We prefer to send our children to English medium schools but then get morose when their native linguistic skills are average. We might be seen in an eastern attire, but would prefer to converse in a western language. Similarly, we would earnestly queue up at foreign zones where the laws are strict. Upon return to our pure land we would advocate the "system abroad" and praise people as they are so "law abiding". Paradoxically, at the same time, many of us do not really seem to mind if our teenager drives around the city sans a driving license. Juvenile driving, in Pakistan, is almost as common as loadshedding.

interview
"I expect 3.5
percent growth rate this year"
Born in Multan to an army doctor, Shaukat Tarin, 56, had most of his early education in cantonment schools. After completing MBA from Punjab University, he joined Citibank in 1975. During his 22-year association with the top financial institution, he rose swiftly to become its County Manager. He is credited for introducing Consumer Banking in Pakistan. Nawaz Sharif asked him to turnaround Habib Bank. He bought, revamped and sold Union Bank at a good profit in 2006. Then with help of some investors, he took over Saudi Pak Commercial Bank in 2008. The same year, the present government appointed him as finance minister in the worst of times. His team quickly negotiated with IMF to avoid a balance of payment crisis. But he left as abruptly last month, leaving behind a lot of unfinished plans and many more question marks. TNS interviewed him at the head office of his bank housed in a colonial-era building in Karachi.
By Saad Hasan
The News on Sunday: Is it true that you stepped down as finance minister after developing differences with some government functionaries over the manner the state was being run?

Route cause
Nato seeks alternative routes for Afghanistan as supplies through Pakistan risk growing attacks
By Javed Aziz Khan
Being the shortest and most economical route, almost 70 per cent of ammunition, vehicles, foodstuff and around 40 per cent of fuel for the US-led Allied Forces fighting against Taliban across the border in Afghanistan are being transported via Peshawar and Khyber Agency. The route is troubled for the last couple of years with convoys transporting goods for Nato forces coming under frequent attacks in Peshawar and the nearby tribal Khyber Agency.

 

Collecting the bargaining chips

Crackdown against Quetta Shura Taliban is seen by many as a major policy shift

 

By Amir Mir

The ongoing Pakistani crackdown against the Quetta Shura Taliban (QST), led by Mulla Omar, is being seen by many inside the country as a major policy shift to abandon the former rulers of Afghanistan. There are many others, who believe that the arrest of Taliban Shura members following the London moot on Afghanistan might be an attempt by the Pakistani military establishment to lock the stable doors and save the valued Taliban studs from being stolen by the Americans.

Since the beginning of Feb 2010, the Pakistani authorities have captured ten of the 18-member Quetta Shura Taliban, including Mullah Abdul Ghani Baradar, the second-in-command of Mulla Omar, Motasim Agha Jan, the son-in-law of Mulla Omar and at least half a dozen shadow governors of the Afghan provinces. These high-profile arrests, combined with the ongoing US-led military offensive in Helmand and the unending spate of American drone attacks in the tribal areas, have adversely damaged the command and control structure of the Afghan Taliban, which is called the Quetta Shura Taliban.

The Quetta Shura has its origin following the US-led military offensive against the Afghan Taliban in Nov 2001, in the aftermath of the 9/11 terror attacks. The Taliban remnants coalesced around Kandahar in the south of Afghanistan. While Kandahar was occupied by Allied Forces in Dec 2001, much of the top Taliban leadership escaped into Pakistan. Mulla Omar, the one-eyed ameerul momineen of the Afghan Taliban and the former de facto ruler of Afghanistan, quickly reconstituted an insurgent force now basing itself in Quetta. The Quetta Shura was meant to act as a nerve centre for the military operations of Taliban, formulation of their political strategy, appointment of their field commanders and managing a shadow government of Taliban in the war-torn Afghanistan.

Senior American government officials have frequently suspected Afghan Taliban leaders of finding shelter and sympathy in big urban cities of Pakistan, with the authorities in Islamabad constantly refuting the same. Hence the million dollar question: what actually prompted the Pakistani establishment to proceed against the well-entrenched Taliban network?

Informed circles say Mullah Abdul Ghani Baradar was shaping up as a key interlocutor for AfPak diplomacy and Baradar and many of his aides were darting in and out of the Persian Gulf to hold secret meetings with senior US officials. The agenda of the back-channel diplomacy was none other than a possible American reconciliation with the Quetta Shura. Although these developments were in the knowledge of the Pakistani military and intelligence establishment, the fact remained that neither the Pakistan Army nor the ISI was being given any mediatory role by the Americans, mainly due to the ever-growing trust deficit between the actual decision makers in Washington and Rawalpindi.

Then came the Jan 28, US-sponsored London conference on Afghanistan, that showed the desperation of the western powers to broker a deal with the Afghan Taliban, making many wonder whether the international coalition is indirectly admitting to its inability to defeat the al-Qaeda-linked militants. But the bitter truth is that the United States and Britain have already been engaged in secret parleys with the Afghan Taliban for nearly two years. America's AfPak special representative Richard Holbrooke did achieve a notable success in London by rushing an agenda of reintegration and reconciliation of Afghan Taliban through the London moot, which was attended by some chronic critics of the doctrine of the "good Taliban" including India, China and Russia. But Holbrooke managed to keep the lot together against all odds.

However, as soon as the London conference concluded, the Pakistani authorities launched a major crackdown against senior Afghan Taliban leadership hiding in Pakistan. They first arrested Mullah Mir Muhammad, the shadow governor of Baghlan on Jan 30 from Faisalabad, hardly two days after the London moot was over. The next arrest was that of Mullah Abdul Salam, the shadow governor of Kunduz province, who was also nabbed from Faisalabad on Feb 2, 2010. The third arrest was that of Mullah Abdul Ghani Baradar, who was detained on Feb 11, 2010 from the premises of a Sunni-Deobandi-run religious seminary in Karachi. The seminary, Khudamul Quran, is located 10 to 25 kms from the toll plaza on the Super Highway in the jurisdiction of the Lonikot police station in Hyderabad district.

The significance of Mullah Baradar's arrest can well be gauged from the fact that he is credited by the Americans for having rebuilt the Afghan Taliban into an effective fighting force besides coordinating its military operations against the US-led Allied Forces in Afghanistan. There are reports that Baradar represented Mulla Omar in all the peace talks, which were in fact mediated by Saudi Arabia, in the past two years. Representative of the government of Hamid Karzai and the Afghan Taliban held secret talks in Mecca between Sept 24 and Sept 27, 2008 and the Taliban delegation was led by Mullah Baradar. Senior American and Saudi officials supervised the Mecca parleys that failed to break the logjam. The Mecca talks remained futile due to the inflexibility of the Taliban who first wanted the withdrawal of the Allied Forces from Afghanistan before initiating a formal dialogue.

Almost a week after Mullah Baradar's arrest, the Pakistani authorities arrested Maulvi Abdul Kabir, the shadow governor of Nangarhar province on Feb 20 from Nowshehra. Three other arrested members of Quetta Shura include Mullah Abdul Qayyum Zakir, who used to co-supervise the military affairs of the militia, Mullah Muhammad Hassan, a former foreign minister in the Taliban regime, Mullah Abdul Rauf, the former chief operational commander of the Taliban in north eastern Afghanistan, Mullah Ahmad Jan Akhundzada, the former governor of Zabul province and Mullah Muhammad Younis, an explosives expert who had served as a police chief in Kabul during Taliban rule. The latest prized catch is Motasim Agha Jan, the Taliban's head of political affairs and the son-in-law of Mulla Omar. Jan was arrested on March 4 during a raid on a house in the Ehsan Abad area of Karachi.

Yet the Pakistani authorities have so far only confirmed the arrest of Baradar, since he was nabbed during a joint operation carried out by the Pakistani ISI and the American CIA. The remaining eight members of the Quetta Shura, who are still at large, are believed to be Mullah Hassan Rehmani, the former governor of Kandahar province in Taliban regime, Hafiz Abdul Majeed, the former chief of the Afghan Intelligence and the surge commander of the Taliban in southern Afghanistan, Amir Khan Muttaqi, a former minister in Taliban regime, Mullah Abdul Jalil, the head of the Taliban's shadow interior ministry, Sirajuddin Haqqani, the commander of the Haqqani militant network, Mullah Abdul Latif Mansoor, the commander of the Mansoor network in Paktika and Khost, Mullah Abdur Razaq Akhundzada, a former corps commander for northern Afghanistan and Abdullah Mutmain, a former minister in the Taliban regime who currently looks after the financial affairs of the extremist militia.

Western diplomatic circles in Islamabad say keeping in view the ongoing action against the Quetta Shura, the message from the Pakistani establishment is simple and clear: any future dialogue with the Afghan Taliban leadership has to be conducted through the proper channel, to be precise the Inter Services Intelligence. And the decision-makers in Pakistani establishment are certain that it is not too much to demand in view of the services they have been rendering for the former rulers of Afghanistan, both before and after the 9/11 terrorist attacks. Therefore, the Pakistani establishment seems in no mood to let Uncle Sam steel the crown jewels -- key members of the Quetta Shura Taliban -- especially when the hour of glory is nearing and the Americans are already planning their exit strategy for Afghanistan.

The bitter truth for Washington is that Pakistan is now in a strong position to make or break the Obama administration's much-trumpeted AfPak strategy because it holds the trump cards now -- ten key members of the Quetta Shura -- to be delivered to the negotiating table in any US-sponsored talks between the Karzai regime and the Quetta Shura Taliban. The intentions of the Pakistani establishment can well be gauged from the recent refusal of Islamabad to hand over Mullah Baradar and other detained Afghan Taliban leaders either to the US or to Afghanistan. The Pakistani refusal has left little doubt its establishment intends to keep physical custody of the key QST members in a bid to influence the pace of peace negotiations in Afghanistan and the ultimate terms of a settlement with the Taliban.

 

 

Disaster-struck

The devastating avalanche that struck Attabad poses even greater threat to the people in Hunza

By Shabbir Ahmed Mir

Avalanches are familiar to the people in this mountainous region but not of the magnitude that struck the small hamlet of Hunza called Attabad on January 4, 2010. The unfortunate settlement, located on a slope on the famous Karakoram Mountain Ranges, suddenly broke off plunging a major part of the settlement into the river that flows towards Gilgit.

About 20 people, including women and children, died with most of them buried under the rubble while several others sustained injuries when the avalanche hit Attabad. According to initial figures, about 1,700 people of Attabad and the adjacent Sarat and Salmanabad hamlets were rendered homeless and were registered and accommodated in camps set up in schools and also with host families.

The volume of debris was so huge that it completely obstructed the once fast flowing river, turning it into a lake that ever-since has kept swelling, warning the authorities of an impending threat a possible outburst of the dam in the coming days.

According to the information gathered by TNS, the debris that blocked the river is about 3,000 meters high, 600 meters wide and around 11 km long. "We are aware of the danger and are doing to minimise it," says the Chief Minister of Gilgit-Baltistan, Syed Mehdi Shah, who along with Speaker Wazir Baig made several visits to the affected area. He says the engineers of Wapda, Frontier Works Organisation and army are not only closely monitoring the situation, but also working on it to stave off the crisis. So far the Frontier Works Organisation has been able to remove about 15,000 cubic metres of debris while a lot more is yet to be done.

The chief minister informs TNS the daily use items are being dropped in areas cut off by the damaged Karakoram Highway (KKH) and people are being airlifted to safety, adding that boats are also being used in the lake to ferry people from Gojal to Hunza.

Federal Minister for Kashmir Affairs and Gilgit-Baltistan, Mian Manzoor Ahmad Wattoo, who also visited Attabad said they had contacted the Chinese government to construct an alternative route for the calamity-hit people of Attabad and other valleys of Gojal.

Hafizur Rehman, provincial president of PML-N, criticised the government, saying the 'inept' government had failed to overcome the crisis in Attabad. "The region is passing through a hard time, while the chief minister GB is in Islamabad to avoid public fury," charges Rehman.

In the initial days, local volunteers from surrounding areas, later joined by local administration, though attempted to rescue marooned people, but with little success as the damage had already been done.

Awed by the disaster, a large number of people from far-flung areas started pouring in to Hunza to catch a glimpse of what the nature had done to the inhabitants of the once beautiful tiny village. "It was awesome. We haven't ever heard of such a tragedy before," says Karim, a resident of Hunza, referring to the disaster that also swept away about three kilometers of the Karakoram Highway, cutting off about 30,000 people living in scattered villages beyond Attabad from the rest of the country.

The local administration of Gilgit-Baltistan has set up a disaster management authority in a desperate move to streamline the rescue work, also shouldered by some non-governmental organizations (NGOs), especially Focus Humanitarian Assistance and Pakistan Red Crescent Society. But that couldn't address people's complaints who termed the role of government after the disaster even more pathetic than before. "The equipment and other machinery came to the rescue on the third day of the disaster," says Bakhtullah, another resident of Gojal. He thought it wasn't possible for the government to feed such a huge population by using helicopter services. Rather, he opines, the government must do something to remove the debris before it is too late.

The governor Gilgit-Baltistan, Qamar Zaman Kaira, accompanied by the chief minister and the speaker of GB, met with various delegations of people in Hunza to discuss the relocation of displaced people. As usual, he also distributed cheques among the affectees to compensate for the losses.

The teams of Pakistan Army, Wapda, and Focus Humanitarian had conducted surveys to find ways to release the water from the lake. "It's really a gigantic task to control the water once the lake breaks off," warns a schoolteacher. About 6,000 people living in Ayeenabad, Shishkat and Gulmit on the banks of the river are at risk of being submerged in the coming days as the level of water in the river is likely to increase.

The longest bridge between Shishkat and Gulmit has already been submerged. If the lake bursts due to increasing pressure of water, more than 15,000 people in several villages downstream will likely be flooded.

Whatever has happened is the past now, while what is in store needs to be deliberated upon as the biggest challenge before the government is to deal with the impending disaster that can strike anytime in the shape of a devastating flood.

 

 


In the wrong lane

There were 7,244 reported underage driving violations in 2009. Imagine the numbers that went unreported.

By Haneya H Zuberi

Sometimes we behave funny. We can commute in Range Rovers but would want a concession at the doctor's office. We prefer to send our children to English medium schools but then get morose when their native linguistic skills are average. We might be seen in an eastern attire, but would prefer to converse in a western language. Similarly, we would earnestly queue up at foreign zones where the laws are strict. Upon return to our pure land we would advocate the "system abroad" and praise people as they are so "law abiding". Paradoxically, at the same time, many of us do not really seem to mind if our teenager drives around the city sans a driving license. Juvenile driving, in Pakistan, is almost as common as loadshedding.

What shocked me was the reply I received when I dished out this very question to a table full of teenagers; "how many of you are/ were underage drivers?" They all replied in the positive. According to Mr. Baber Bin Dilawar, DSP traffic police Lahore, there were 7244 reported cases of underage challans in 2009 alone. Whereas there were 3937 in 2008, 1109 in 2007, 5345 in 2006, 1453 in 2005, 1829 in 2004 and 2874 in 2003. The numbers of underage drivers remain more or less the same throughout and the fluctuations in the figures shows the probability of luck of underage drivers when it comes to the cases being reported. None of the teenagers that I had asked had ever been caught. Sadly, if such a huge number figure like 7244 went reported in 2009; imagine the numbers that went unreported.

According to the Traffic Police, more than 50 percent of underage drivers are the Qingqi/ Riskshaw drivers. There is no check at the moment regarding them, as the Qingqi/ Riskshaw owners are ready to hand over their vehicles to almost anyone who comes for them. When they hit the poverty line, families send their young ones off to work regardless what their age is. They are inexperienced and young. Those who decide to earn their bread through driving public vehicles are blinded when it comes to the consequences. They are desperate for money even if it costs them a road accident. Traffic police Lahore's statistics say that 80 percent of the underage Qingqi/ Riskshaws drivers are concentrated in areas near the Lahore Railway Station, Miner-e-Pakistan and Data Darbar. They have been reported and caught. But unfortunately one challan cannot put an end to this whole practice. Around 50 cases have been reported with more than one challan in the past two years.

Underage car drivers take the lead in posh areas like Model Town, Gulberg, Defence and Johar Town in Lahore. There are more reported cases of male underage drivers as compared to the females. Speaking to traffic police, it was found out that many times, they look at young girls driving, but do not stop them due to "respect" for the females. Ironically, the term respect is a little superfluously used here. Does respect constitute of respecting the law? Do you respect a female if you tell her how to respect a law or do you respect her if you allow her to drive the law away with her? When at the same time, you do not mind giving her an age long stare when she is dressed up in public. Which part of respect are we really talking about here?

Sometimes, the traffic police issues warnings to underage drivers, that if they are seen again, there will be a challan. But what happens after the challan? The parents give in the required money and get all the documents back. Do they take the cars away from their sixteen-year-olds after a challan? Is that challan an eye opener for them? Not in many cases. "He runs all the household errands so I give him the car now, he even picks up Munni from school on his way back, I am so relieved that he drives," says Iffat about her sixteen-year-old son who proudly drives around the city.

We will be the residents of utopia if we ignore the number of accidents that take place due to underage driving. Newspapers are full of such incidents. Everyone has a story about "an accident that happened due to underage driving". Why is that so? Dr. Yandell Henderson, professor of applied physiology in Yale University, read before the National Academy of Sciences, a paper on driving reflexes. He attributed this situation to the "self-righting" reaction which is instinctively and irresistibly excited by any sudden severe disturbance of equilibrium. This happens most in youngsters as they have hyper nerves and a greater affinity to becoming emotional. Hence they are more prone to accidents than mature drivers.

These drivers pose a serious danger to their own and others' safety. For example, an underage driver killed a labourer and seriously injured three others in Karachi's DHA a few weeks ago; another one broke his arm and injured his friend's spine in Lahore last month. The issue with underage drivers is not just that a simple law is being broken. It is also that a proper theory exam followed by a practical must be passed before a driving license can be issued. A vehicle cannot just be handed over to a minor with no prior training and no driving licence. Underage drivers may be entirely unaware of road and driving rules. The means of preventing such potentially life-threatening infringements of the law is two-fold. Firstly, a systematic method must be devised and strictly enforced for penalising underage drivers, and traffic wardens must remain vigilant. Not letting go off girls drive just like that and catching boys at random. Due to the weak law enforcement, just a challan is taken for granted by many teenagers, sadly even their parents. So more importantly, the parents and guardians of underage children must instil in them a respect for the law and educate them about the dangers of driving without the proper qualifications.

Underage children do not own the vehicles they drive. One must ask why their families are allowing them to put themselves and others at risk? Pakistani parents need to take a step forward and stop this menace from spreading as most of the underage drivers come from posh families who are the so called "educated elite" of Pakistan.

 

 

interview

"I expect 3.5

percent growth rate this year"

Born in Multan to an army doctor, Shaukat Tarin, 56, had most of his early education in cantonment schools. After completing MBA from Punjab University, he joined Citibank in 1975. During his 22-year association with the top financial institution, he rose swiftly to become its County Manager. He is credited for introducing Consumer Banking in Pakistan. Nawaz Sharif asked him to turnaround Habib Bank. He bought, revamped and sold Union Bank at a good profit in 2006. Then with help of some investors, he took over Saudi Pak Commercial Bank in 2008. The same year, the present government appointed him as finance minister in the worst of times. His team quickly negotiated with IMF to avoid a balance of payment crisis. But he left as abruptly last month, leaving behind a lot of unfinished plans and many more question marks. TNS interviewed him at the head office of his bank housed in a colonial-era building in Karachi.

By Saad Hasan

The News on Sunday: Is it true that you stepped down as finance minister after developing differences with some government functionaries over the manner the state was being run?

Shaukat Tarin: I think differences are healthy. The good part is that we discussed all the differences openly and I am thankful to the president and the prime minister that they allowed such a healthy debate. If you look at it, the PM formed committees on all those areas where I pointed out there was need for improvement whether it was austerity, governance or public sector enterprise reform. And he made me chairman of all these committees. Even on the issue of RPPs (rental power plants), he took my advice and opted for an Asian Development Bank audit.

TNS: You are said to have left the government to save Silkbank, formerly Saudi-Pak. Isn't it unfair to leave at a time when the country needed you?

ST: I did not rejoin the bank to protect my interest. I have come here to protect the bank because no one else could raise the kind of money needed. Some of the investors I had wooed walked away. Now I can't raise money being the finance minister because that would have been a conflict of interest. I have lost a lot of money since I joined the government. But, I didn't care about it. I could have easily raised the capital (for the bank) being the finance minister, but it would have been a bad example of governance.

TNS: What have been your achievements as finance advisor and later on as a minister?

ST: The first achievement is obviously to stabilise the economy. It was in a very bad shape. Now you can see what I say early green-shoots of growth. Large scale manufacturing has turned around, agriculture is already in positive territory and services sector will do better than last year. I think we should see 3.5 percent economic growth rate this (2009-10) year compared to 2 percent growth in previous year. As we move into next year, we will be doing better than 3.5 percent.

Second was to put in plans for future growth of economy. Those plans emphasize on sustainable growth for longer periods rather than boom and burst scenarios. Every time there is a burst, the poverty level goes up. These plans are about good governance, the austerity measures which the government has to follow and restructuring of public sector entities. And then there is this plan to revamp the entire tax structure. Now the government has to take action on all those plans.

The third major accomplishment was consensus and signing of National Finance Commission (NFC) after 19 years. There was mistrust between the provinces and the federation and we were able to produce a win-win situation for everyone.

Also, the perception of Pakistan as a country has changed. If you look at rating agencies and also reverse flows of investment into the stock exchange it shows confidence in Pakistan has started coming back.

TNS: If asked to be self-critical of your performance, what were the things you were not able to do?

ST: I wish I could have completed all the initiatives which have been taken. One of them is tax reform. Clearly, this is one area where the government has to keep working and move towards the target of 15 to 20 percent tax to GDP ratio. In one year, we have gone up by more than 1.8 percent. If you look at eight years of Pervez Musharraf's era, they went up from Rs300 billion to Rs1,000 billion, which is an increase in tax by Rs700 billion. In two years, we have increased it by Rs500 billion. I am still not satisfied. We should have done better.

We still have to work on the nine-point agenda which means spending more to alleviate poverty, more on social sector like education and healthcare, agriculture and manufacturing, infrastructure and power. There is regret that I could not see all these things happening because of my personal business.

TNS: What was the economy like when the present government took over? Because the country saw good economic growth before 2007!

ST: This government did not come in and create 25 percent inflation. It did not create fiscal deficit of 7.6 per cent and the current account deficit of 8.6 percent. So when you say things were good then you must check your statistics.

All these problems were there because the previous government had no strategic thought process in the last few years. When the economy was growing, they lost the vision which is needed for sustainable growth. They forgot real sectors of economy are agriculture and manufacturing. As a matter of fact, agriculture never grew by more than 1 and 1.5 percent for the entire decade. Manufacturing was coming down after growing rapidly in early part of the decade. It was because the cost of doing business went up.

One of the reasons for high cost was unrealistic exchange rate. The overvalued rupee had made your own goods more expensive than international competitors.

Tax to GDP ratio never went up more than 9 and 9.5 percent in all those years. That meant the minute you stopped receiving aid and grants from outside, you went burst. We inherited all this. Now you can see early signs of recovery. We have to keep working on the reform process for two or three years to see the results.

TNS: Why is Pakistan's external debt increasing?

ST: External debt is a short term phase in the sense that there is mismatch between foreign exchange receipts and expenditure. Sitting in 2008, there were not many options to raise money.

One is to increase exports. But exports around the world went down. Foreign investors were not putting money in any country and with war going on in Pakistan it was hard to attract investors anyway.

Thirdly, you could sell your own family silver through privatisation or issuance of Global Depository Receipts at throwaway prices. Another option was issuance of bond. But because the risk for Pakistan had gone up to over 21 percent and we could have borrowed at 24 percent, that wouldn't have been a very intelligent thing to do. So, the only option left was that to go and borrow at cheap rates from multilateral agencies and other friendly countries.

If you look around, the debt to GDP ratios have gone up dramatically around the world. But as we move forward from next year or so, when capital markets have stabilised, we will be able to sell some of our assets, sell GDRs and also be able to increase exports and remittances. Remittances have been growing by 25 percent. It was one of those areas where we have been successful.

TNS: When do we start repaying IMF loan and how would the country be able to repay it?

ST: The repayment instalments start by 2012 or so. We would be able to generate additional resources, going forward from capital market, GDR issuance and through higher remittances. We have incorporated this aspect in the medium term budgetary plan. It has been included even in our numbers for NFCs. People say it's going to be a disaster, but we have worked out all the numbers. As a matter of fact repayments as percentage of GDP will start going down from next year.

TNS: Successive finance ministers have said increasing tax net is not an easy task. Where are the bottlenecks?

ST: Well I haven't complained. I am the guy who stood up in parliament and said that everyone has to pay taxes. We made policies for taxing agriculture which is a provincial subject. Tax on real estate transactions has been imposed and instructions have been issued to levy gains on stock's trade. Sales tax on services was introduced from last year. So I am the only finance minister who did what he said. We have already increased absolute taxes by Rs500 billion in two years.

TNS: How could the retailers and wholesalers be brought under the tax net?

ST: We will have to remove the exemptions and then create an incentive programme for general public to get receipts when they pay taxes at retail level. We also need to talk to all the stakeholders whether they are retailers, wholesalers or services providers. Tax payers feel harassed by FBR (Federal Board of Revenue) and I think we have to remove this mistrust.

TNS: PML-N's Ishaq Dar had alleged that economic figures were fudged. Didn't it hurt the image of the country?

ST: My own sense is that Ishaq Dar was concerned about the previous government's borrowing from banking sector and SBP to fund election campaign. They had created special vehicles. If you had put them into equation then fiscal deficit was more like 10 percent and not 7.6 percent.

Now we have prepared a comprehensive law to make Federal Bureau of Statistics autonomous with international collaboration for its oversight, having nothing to do with the Ministry of Finance. So it would be truly independent, and numbers which come out of the FBS would not be questioned.

TNS: What happened to all the assistance which was due from friends of Democratic Pakistan?

ST: You may not see the total $2.1 billion they had promised for the year. But over next two years, we will see the total quantum of $4 billion plus. Issues with delay were there, but we took action by taking IMF's bridge facility to fill the gap.

TNS: Some people say that IMF loan could have been negotiated on better terms like duration of repayment could have been extended.

ST: It can still be extended. You cannot say we did a bad job because IMF did not put additional conditions except for raising interest rate by 2 percent. They asked me if interest rate could be increased by 5 percent, but we agreed at 2 percent.

 

Route cause

Nato seeks alternative routes for Afghanistan as supplies through Pakistan risk growing attacks

By Javed Aziz Khan

Being the shortest and most economical route, almost 70 per cent of ammunition, vehicles, foodstuff and around 40 per cent of fuel for the US-led Allied Forces fighting against Taliban across the border in Afghanistan are being transported via Peshawar and Khyber Agency. The route is troubled for the last couple of years with convoys transporting goods for Nato forces coming under frequent attacks in Peshawar and the nearby tribal Khyber Agency.

Apart from tonnes of small commodities that are being transported through the route everyday, even choppers and Humvees were transshipped via this route in the last few years. The stunning disclosure in this regard was made last year when suspected militants reportedly hijacked complete set of parts of three choppers from an Afghanistan-bound convoy. The choppers were reportedly sold to the Afghanistan-based Taliban, later. A Humvee hijacked from one such convoy was being used as staff car by the then Orakzai chief and later head of the Tehrik-e-Taliban Pakistan (TTP), Hakimullah Mahsud.

Goods for the Nato forces were being supplied through Peshawar-Kabul route for the last seven years. However, the road is no more safe as parking lots and container terminals in Peshawar and vehicles on way to Khyber and on Ring Road faced innumerable attacks in the last one and half years. The growing Taliban insurgency in NWFP coupled with assaults on supply lines forced Nato to seek alternative supply routes through Pakistan.

In January last year, Nato secured an agreement with Russia to allow supplies to pass through the Central Asian republics. Nato authorities are also exploring the possibility of establishing routes through Turkey and Gwadar and a meeting is likely to be held in this regard in the current month.

Rare attacks on convoys in Khyber Agency and in parts of Balochistan had started years back, but the facilities for Nato supplies in Peshawar came under attack for the first time in late 2008 when groups of armed militants hurled grenades, petrol bombs and fired rockets on container terminals on both sides of Ring Road, near Pishtakhara, Landi Akhun Mohammad, Hazarkhwani and other localities.

In a single attack on December 7, 2008, suspected armed militants torched around 160 vehicles and containers inside a parking lot on Ring Road near Landi Akhun Mohammad. At least 62 Humvees were set ablaze in the attack.

"A Humvee values around 100,000 US dollars while some are even more expensive," a senior security official tells TNS. Around 300 military vehicles, including Humvees, trucks, trailers, cranes and containers filled with expensive goods were reduced to ashes in six attacks on these parking lots only between December 1 and 13, 2008. Three people, including two drivers and a watchman, were killed and three others wounded in these attacks carried out on World Port Logistics, Bilal Terminal, Farah Terminal and Faisal Terminal.

The practice continued in the following many weeks, forcing the truckers associated with the Khyber Transport Association to stop supply to the American-led Allied Forces in Afghanistan in a bid to secure their lives and vehicles.

"Some 3,000 to 4,000 trucks, trailers and tankers, which made the major share of vehicles transporting the Nato supplies, are owned by tribesmen of the Khyber Agency alone. We have lost around 80 tribesmen and around 500 vehicles in attacks on Nato logistics during the past seven years," said a trucker, Shahid Afridi.

Proximity of terminals to adjacent tribal areas, open parking lots and terminals without boundary walls, poor lighting system, and lack of fire-fighting system were described as the main reasons behind frequent attacks on Nato terminals. The government had to launch a military operation in Jamrud sub-division of Khyber Agency last year to secure the main supply route that was being used by over 400 supply trucks every day. Measures were also taken by the security agencies to secure 16 parking lots on both sides of the Ring Road in Peshawar, including Pak-Afghan Terminal, Waqas Terminal, Khyber P Terminal, Bilal-I, II, III Terminals, Faisal Terminal, Insaf Terminal, Pak-Kabul Terminal, Rahman Baba Terminal, World Port Logistics, Sindh Terminal, Khatoot Terminal, Farah Zaman Terminal, UF-2 Terminal and Digro Terminal.

The contractor of most of the terminals was said to be a close relative of former President Pervez Musharraf. Even the deployment of Quick Response Force of the Frontier Constabulary and setting up a control room at the FC Headquarters for this purpose did not change the situation, resulting in anger among the residents of the nearby villagers who asked the government to shift the facilities to some secure place. The matter was even taken up by the NWFP Assembly after which the federal government first planned to move all the parking lots to Mianwali, but later shifted them to Hassan Abdal after the idea was strongly opposed by the Mianwali people.

Though a few of the container terminals are still there on Ring Road, attacks are not taking place there for a simple reason that no valuable goods are being kept there. After a calm for sometime, vehicles carrying fuel for the foreign forces in Afghanistan came under attack in areas between Chamkani, Hazarkhwani and Tor Baba areas.

"After attacks on these vehicles, the government hired a private security company, Venus, to provide security to these vehicles. The company had directed all oil tanker drivers not to enter Peshawar before 6:30 am," said Karim Khan, Senior Superintendent of Police (SSP) Operations, Peshawar. The security company decided to properly escort oil tankers and trailers up to the Torkham border. But on a number of occasions, when vehicles were attacked by militants, the security guards and even drivers and their assistants were found missing from the spot.

"After poor performance by the security company, we decided to provide security for these vehicles at our own. Our strategy worked and we finally busted the ring behind these attacks. One of the attackers was killed and two were apprehended when they bombed an oil tanker in Hazarkhwani on March 1 and were planting a bomb with another vehicle," disclosed Syed Atiq Shah, a police officer heading an operation against the attackers on Ring Road. This was the first time in the last two years that a gang behind attacks on Nato vehicles and parking lots was busted.

Raids are still being conducted to nail other members of the network that had forced the Nato authorities to look for alternate routes. Though members of the gang operating against Nato supplies in Peshawar are on the run, there is a possibility that more rings might be involved in these attacks. So far, the situation has improved as not a single attack on Nato convoys had taken place in Peshawar since March 1.


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