"It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of Light, it was the season of Darkness, it was the spring of hope, it was the winter of despair..." Charles Dickens wrote these lines more than two centuries ago, but they aptly describe today's Pakistan. In fact, they present a true picture not only of our country's current socio-political situation, but also of its economy.

With a new government in power, it is imperative to assess the consequences of economic policies followed by the previous government, so as to determine who is responsible for the current mess. Economic managers of the previous government may like to claim that their policies have been a resounding success -- the last eight years have been marked by substantial gross domestic product (GDP) growth, the exports and the foreign direct investment (FDI) have increased, the country's financial health is robust, the economy has never been in better shape, etc. The official version till a few months ago was that when the Nawaz Sharif government was overthrown in 1999, the economy was saddled to the hilt with debt and threatening default, the balance of payment position was adverse, and the fiscal deficit was burgeoning by the day. But the 'brilliant' economic managers transformed the slumping economy into a booming one and, thus, bequeathed unto their successors a brave new Pakistan.

Apparently it is hard to dispute this claim, because statistics show that macroeconomic indicators have improved, a dynamic private sector has emerged, external debt as a percentage of the GDP has decreased and about $ 4 billion of hard loans have been repaid in advance. But on a closer examination we find that the statistics backing these claims have been fudged and economic indicators have been interpreted in isolation to suit one's cause -- but when these figures are analysed in coherence, they tell a completely different story.

The economic 'experts' who exulted in the phenomenal GDP growth rate of the last eight years should have known that the poor hardly benefitted from this growth, because the monetary expansion had been driven by spending on luxury consumer goods, and investment in the banking, communications and automobile sectors. As a rule, rewards in these businesses are skewed towards the entrepreneurs and the share of labourers in such bonanzas is relatively small.

Moreover, a growing GDP is usually accompanied by more job opportunities; but in Pakistan's case, unemployment actually increased from seven per cent in 1999 to 7.5 per cent in 2007. Similarly, real wages in the country declined on account of the increasing inflation. Though the previous government took a great pride in claiming that its policies had resulted in the creation of millions of new jobs, a closer look at the employment indices shows that these figures have been artificially boosted -- most new jobs have been stowed in the newly contrived category of 'Unpaid Family Help'!

While the FDI increased to $ 6 billion by 2006, a negligible investment went into the export-oriented manufacturing sector -- most of the FDI was confined to merger and acquisition activity, which enhances corporate efficiency but does not contribute to capital formation. The previous government, however, deserves to be lauded for repaying some expensive debts, such as the $ 1.171 billion Asian Development Bank loan (ADB) with eight per cent interest rate. Despite this, the total external debt increased from $ 33.60 billion in 1999 to $ 37.36 billion by March 2007.

Coming to the previous government's 'strategic investments', the selection criteria followed to initiate projects entailing infrastructure-building was seriously flawed. Considering the huge sums that have gone into these projects, one doubts whether the previous government did any cost-benefit analysis before earmarking billions of rupees for them. Examples such as the caving in of the Northern Bypass in Karachi and repeated repair work on the Makran Coastal Highway can be cited in this regard. Unbridled government spending on such ventures not only helped increase the overall development spending, considered to be a mark of success, but also fuelled inflation.

Even if the assertion of a brave new Pakistan were to be accepted, the fact would remain that the previous government did little to sustain the economic growth, for example by improving the infrastructure or building a skilled labour force. In the absence of such measures, its economic programme felt short on many counts. In short, when the hype behind the economic 'success' went off the air, the failure of the previous government's economic managers became evident.

Whether the previous government's economic policies were successful or not is bound to remain a subject of intense debate for at least some time to come. What, however, is certain is that the previous government implemented the neo-liberal economic model (a radical form of laissez-faire -- a model entailing free markets, free prices, consumer choice and deregulation) in Pakistan in an unparalleled way. The neo-liberal economic model is based on an idea of a market in which the forces of demand and supply concur elegantly. It is supposed that problems such as inflation and unemployment occur only when the government meddles with the market forces. It is, to be concise, a system that seeks to build an entrepreneur's utopia.

This model has been implemented under the aegis of military juntas in Brazil, Argentina, Uruguay and Chile; and under the garb of democratic regimes in Poland, Russia and Bolivia. Neo-liberalism is conduced by the international financial institutions (IFIs) -- such as the World Bank, the International Monetary Fund (IMF) and the ADB -- by making all forms of financial assistance contingent upon a promise to implement programmes, entailing the unholy 'trinity' of privatisation, trade and financial liberalisation, and market-based pricing. The World Bank and the IMF use the leverage of being the lenders to impose reforms aimed at restructuring the recipient country's economy, so that debt repayment can be ensured. They hand client countries comprehensive economic plans that delineate even minute details, such as when to raise utility charges, and how to adjust water and sewage tariffs. In essence, such plans leave only implementation to the government.

Structural adjustment programmes (SAPs), now renamed as the Poverty Reduction Growth Facility (PRGF), have paradoxically devastated the poor and pushed more people under the poverty line. A report, entitled The Effect of IMF and World Bank Programmes on Poverty, published by the Bretton Woods Project in 2000, concluded that the poor were better off without SAPs. Researchers such as Syed Akbar Zaidi and AR Kemal have proved through research that poverty actually increased in Pakistan after the implementation of IMF-supported poverty 'reduction' programmes. The previous government entered into two loan agreements with the IMF, under which a total sum of $ 1.875 billion was to be received by the country.

A PRGF paper was tacked to these loans and the government was only fulfilling IMF conditionalities when it imposed sales tax on electricity and agriculture; raised petroleum prices; slashed development spending; increased cost of utilities; sold the most profitable public assets, such as the Pakistan Telecommunications Limited (PTCL) and the United Bank Limited (UBL), to fill the fiscal deficit; flung open our borders, drowning our labourers in a flood of cheap imports; deregulated the capital market, subjecting the country to currents of hot money; dismantled price controls; etc.

For declaring such an effective war on the dream of a welfare state, the previous regime earned the unique distinction of being the only government in the country's history to be disbursed all installments of an IMF loan. The World Bank also showed its approval, by ranking Pakistan as the top reformer in South Asia and 10th in the world. Notwithstanding such international acclaim, the success of neo-liberal policies remains in doubt, mainly because the burden of the fiscal crisis has been shifted to the middle-class and the elimination of consumer subsidies has adversely affected the poorest sections of society.

In the final analysis, however, it will not be fair to blame the previous government for giving up our economic sovereignty to the IFIs in return for financial assistance. When the previous government sought help from the IFIs, it was only reinforcing a pattern that has repeated itself since 1988, the year Ziaul Haq accepted a $ 1 billion loan from the IMF with attached strings of controversial reforms. Subsequently, both the late Benazir Bhutto and Mian Nawaz Sharif sought assistance from the IFIs whenever the country was faced with a financial crisis, and avoided tough decisions such as reducing the defence budget.

Though neo-liberalism was introduced in Pakistan a long ago, none of the past governments implemented such controversial reforms as the previous one. The interests of the masses were sacrificed for corporate good. Consequently, the elite grew richer and more than one-third of the population living in extreme poverty did not accrue any economic benefits. When work began on a seven-star hotel in Islamabad in 2006, it affirmed not only the establishment of neo-liberal orthodoxy in Pakistan, but also the widening gulf between the rich and the poor.

Judging from the current state of the economy, it is clear that we need homegrown solutions; policies owned by us and controlled by others have not worked. Our successive policy-makers have failed to take into account the social, cultural, political and institutional needs of the masses. Whatever their intentions may have been, the results of their flawed policies are manifest today. The new government should recognise that the people have not only voted out a political party; they have voted out an economic regime. The new government's economic policy, therefore, should be aimed at reducing income inequality and poverty.

There is no doubt that reforms have to be undertaken, but they should not be pushed too far, too fast and to the exclusion of other policies. This time around, when the mantra of market fundamentalism and reforms is being sung by foreign elements, it would be appropriate to remind them of what Margaret Thatcher, a staunch supporter of neo-liberalism herself, had said in 1982: "Our reform must be in line with our traditions and our Constitution. At times the process may seem painfully slow." If the country's new economic managers learn from past mistakes, there will still be hope of building a brave new Pakistan.

I was recently reading an article by an American in which the author was lamenting the fact that many high school teenagers in the United States today can barely speak English. But then, it could be argued, neither can George W Bush.

Thus a guest from American academia on CNN's 'Larry King Live' television show was not far wrong when he said, straight-faced: "The goal of education in the United States in the twenty-first century is to ensure that when teenagers graduate from high school they at least know enough English to be able to read their high school diplomas."

Language is now something other people use. They use it on television. Execrably. They use it on the Internet, with lots of exclamation marks -- as in: "The rave was great!!!!" They use it on telephone text messages. The word 'text' -- horror of horrors -- has now become a verb.

Since words are not very important in this new dispensation, communication being fabricated for us by an outside world, the teaching system has bypassed its once insistent emphasis on linguistic expression. Hence, the lament of that American in that article the other day. The cultural loss thereby is enormous and, for the most part, people have become sad anonymous creatures. Not quite zombies, perhaps, but nearly.

Language is the method by which we identify ourselves to each other. To communicate by the current method of grunts, stammers, "y'knows", "likes", painful lurching illiteracies is to define ourselves as spastic personalities.

As somebody once said, the great glory of human language communication is that it is not an elitist skill. In Shakespeare's day, at the performance of one of his plays at the Globe Theatre in London, the man sitting in the front row was just as likely to be the local fishmonger or a dockworker as some Oxbridge scholar. Language, in those days, belonged to the workers, not the nobs.

The America of the Old West was a language-rich country, with its wide open spaces, hard-riding cowboys and colourful speech. So was Australia, perhaps because of its Irish component. But once again, one was more likely to pick up a living Australian language at Flemington Race Course than within the portals of the snooty Melbourne Club. "Bernborough is off like a bride's nightie," was once unexceptional for a racing commentator's introduction to the start of a horse-race.

In America, and increasingly even in Britain and other parts of the English-speaking world, people now tend to live life with a minimal language, presented to them by the movies and television, and geared to the lowest common denominator of comprehension. I am not sure whether it is a hopeless rear-guard action by the surviving word-lovers or, the battle lost, curiosity that motivates a nostalgia market for the world of vanished words.

Slang, or what the late American poet Ezra Pound, one of the great masters of the English language, called "the language as she is spoke", was a treasure trove of wonderful words. Slang in early nineteenth century Britain was particularly rich in this respect. Consider:

'Abel-Wackets' were blows given on the palm of the hand with a twisted handkerchief, instead of a ferule, as a jocular form of punishment among seamen, who sometimes played at cards for wackets, the loser suffering as many strokes as he had lost games. 'Active Citizen' was not, as one might think, a civic-minded individual; he was a louse. 'Affidavit Men' were knights of the post, or false witnesses, said to have attended Westminster Hall and other courts of justice, ready to swear anything for hire. We still have a lot of 'affidavit men' in this country; only, here, they're called by other names.

'Alls' is one of my favourites. These were the five alls in a country sign, representing five human figures, each having a motto under him. The first was a king in his regalia; his motto: I govern all. The second a bishop in pontificals; motto: I pray for all. Third, a lawyer in his gown; motto: I plead for all. Fourth, a soldier in his regimentals; motto: I fight for all. Fifth, a poor countryman with his scythe and rake; motto: I pay for all.

'Daisy Cutter' was not the latest thing in fearsome American bombs designed to kill large numbers of people over a wide area. Back in the early nineteenth century, a 'daisy cutter' was a jockey term for a horse that did not lift up his legs sufficiently or went too near the ground, and was therefore apt to stumble.

'Dice' were the names of false dice: a bale of bard cinque deuces; a bale of flat cinque deuces; a bale of flat sice aces; a bale of bard cater traes; a bale of flat cater traes; a bale of fulhams; a bale of light graniers; a bale of langrets contrary to the ventage; a bale of gordes, with as many high men as low men, for passage; a bale of demise; a bale of long dice for even and odd; a bale of bristles; and a bale of contraries.

Even if one doesn't quite know what some of these terms mean, they sound so wonderful, one feels like instantly transporting oneself back in time two hundred years to become a roller of false dice at some English country fair.

'Full of Emptiness' was a jocular term for, yes, you've guessed it, empty. That's what many politicians around the world tend to be these days: full of emptiness. It's a bit like a line I came across many years ago in a Peter de Vries novel about life in American surburbia, which has one character saying of another, "Deep down, he's shallow." What a linguistically insipid world we live in today.

'Ottomised', in early nineteenth century slang, was to be dissected, as in: you'll be scragged, ottomised and grin in a glass case; meaning, you'll be hanged, anatomised and your skeleton kept in a glass case at Surgeon's Hall. Most such expressions were used in jest, however. Nobody was actually kept in a glass case at Surgeon's Hall. But even if they had been, it would still have been better than being blown to smithereens by a 'Daisy Cutter' -- the bomb, that is, not the low-stepping horse.

Known as Haji Sahib in Peshawar, Ghulam Ahmad Bilour hails from Bajaur Agency in the Federally-Administered Tribal Areas (Fata). His forefathers migrated to Peshawar long ago and his father was a successful businessman of the city, as well as an admirer of Bacha Khan. Born in December 1939, Bilour got his early education from the Khudad Model School and Islamia School Peshawar. He did his intermediate from Edwards College and got married soon afterwards. As a youth, Bilour participated in the election campaign of Mohtarma Fatima Jinnah. He, however, joined active politics from the platform of the Awami National Party (ANP) in the 1970s and ever since has remained with the nationalist party.

Ghulam Ahmad Bilour was first elected to the National Assembly in the 1988 by-elections. In the 1990 elections, he again contested for the National Assembly and defeated the late Mohtarma Benazir Bhutto. Bilour recollects that the people of his constituency did not let him down in that crucial contest, which was perhaps the toughest of his long political career. In the 1993 elections, he lost to Zafar Ali Shah but regained the National Assembly seat in the 1997 elections. Bilour did not contest the 2002 elections. He was again elected to the National Assembly in the recent general elections, and is currently the federal minister for local government and rural development.

Only Ajmal Khattak and Afzal Khan Lala -- both no more in active politics -- have been associated with the ANP for longer period than Ghulam Ahmad Bilour. Of his more than 30-year-long political career, he has spent six years behind the bars on different counts. He is widely respected for not compromising on principles and remaining loyal to the party. He considers securing the rights of the people of the province as his greatest achievement; and losing his only son, Shabbir Ahmed Bilour, during the 1997 elections as his greatest loss. Excerpts of his exclusive interview with The News on Sunday follow:

The News on Sunday: Of all the mainstream and nationalist parties, why did you join the Awami National Party (ANP)?

Ghulam Ahmad Bilour: As a youth I participated in the election campaign of Mohtarma Fatima Jinnah, when she was contesting for the seat of president as a candidate of the Combined Opposition Party against Ayub Khan in 1965. I was not affiliated with any political party at that time. Late in the 1970s, I decided to join the ANP as my father was a great admirer of Abdul Ghaffar Khan and his political ideas. I was also impressed by Bacha Khan and the sacrifices he had rendered for the people of this area during the British Raj. Since then, I have strongly adhered to the political manifesto of the ANP, and worked hard to strengthen it in Peshawar in particular and the province in general. It was the result of my hard work that the ANP won many National Assembly and NWFP Assembly seats from Peshawar in the recent general elections.

TNS: How did the coalition evolve between the ANP and the Pakistan People's Party (PPP), because both have different political ideologies?

GAB: Forming a coalition government is nothing new in a democratic dispensation. In India, currently there are more than a dozen political parties in the coalition government led by the Congress. As far as the coalition government in Pakistan is concerned, here it was formed because of the need of the hour to bring the country back on a democratic track after a lapse of eight years, when there was no government of the people in the country. For the revival of true democracy in Pakistan, the ruling coalition was indispensable. Politics is the art of the possible, and accommodating each other for the sake of national prosperity, progress and development was the main motive behind this settlement.

TNS: Now that coalition government has been formed, are you optimistic about the future?

GAB: Yes, currently it is crucial not only for democracy but for the country too. In the current circumstances, if anyone tried to establish a single party rule, then it will not be a government of the people but of the agencies -- which will neither be in the interest of the people nor the country. Pakistan is passing through a critical juncture and it requires unity among the political parties to garner stability in the country. The current coalition government is working on exactly these lines.

TNS: Provincial autonomy has remained one of your party's major demands for years. Now being a part of the federal government, do you plan to do anything substantial in this regard?

GAB: Yes, we still demand provincial autonomy for the provinces as enshrined in the 1973 Constitution. Delegating powers to the federating units is essential, because it will further strengthen the federation. We are committed to the goal of provincial autonomy and will surely take concrete steps in this regard in the near future.

TNS: Besides the renaming of the NWFP, what other issues of provincial autonomy do you intend to take up with the federal government?

GAB: There are a number of them. For instance, the federal government should pay to the province outstanding hydel profit dues, proper share of gas revenues and tax on tobacco produced here.

TNS: Do you agree that the NWFP should be renamed as Pakhtoonkhwa?

GAB: Naming the province is a very important issue for us. The other three provinces in the country have their identity, while our people have none; therefore, we want a name -- an identity for our people. The NWFP Assembly has already passed a resolution in this connection also. We are very clear on this and in due course will surely rename the NWFP as Pakhtoonkhwa.

TNS: Considering the ongoing energy crisis, has there been any change in your party's stance on the Kalabagh Dam?

GAB: Our stance on the Kalabagh Dam is very clear: we will never allow its construction at the cost of our province and that of Sindh too. This issue is been discussed for decades and we have got tired of trying to tell the federal government to go for the numerous other choices. It was also our suggestion to build the Basha-Diamer Dam instead of wasting time on something that is not in the interest of the people of two provinces. If anyone ever tried to build the Kalabagh Dam, the first person to oppose it would be Ghulam Ahmad Bilour.

TNS: There is a perception that the ANP does not support the restoration of the judges. What is the reality?

GAB: No, the ANP is not against the independence of the judiciary and restoration of the deposed judges. Two things are very important for Pakistan in the current scenario: restoration of the judges and continuation of the coalition government. These two will decide the future of the country.

TNS: What is the ANP's policy about the Taliban?

GAB: Our policy is that of reconciliation and we are trying to solve the differences through jirgas, which are a peaceful channel among Pakhtoons to create peace and shun violence. We want an end to further bloodshed of Pakhtoons, who have suffered the most in the so-called 'war on terrorism', and to bring peace back to the areas that used to be hospitable and secure places for everyone but have turned into battlefields. The ANP believes in non-violence, which is the ideal set for us by our leader Bacha Khan.

TNS: Bashir Ahmad Bilour was one of the strong contenders for the office of chief minister in the province. Why was his name dropped?

GAB: Keeping in view the decades-long services of the Bilour family for the ANP, the sacrifices we have made for the party and the number of times we have won elections from its platform, we deserved the office of chief minister in the province -- in fact, it was our right. Besides, Bashir Ahmad Bilour is himself a senior member of the party and has the distinction of never losing any election. But we did not challenge the decision of the party and accepted it with an open heart. Though many people thought that we will quit the ANP in retaliation, but our commitment to the party has not been shaken.

TNS: There is a perception that some coalition partners had objections to Bashir Ahmad Bilour's nomination as the chief minister of the province?

GAB: Perhaps some people do not want the ANP to thrive in Peshawar. It is because of our family that the ANP secured the highest number of votes in the city. It is something like creating obstacles in our drive to serve the people more effectively.

TNS: It is said that senior political ideologues of the ANP, such as Ajmal Khattak, have been sidelined in the party. Is it true?

GAB: The party does not sideline anyone unless he sidelines himself. There is a great respect for seniors and other affiliates in the ANP.

TNS: Some people allege that you use your political clout to advance your business interests. Any comment?

GAB: Politicians are often blamed for no rhyme or reason, especially in our part of the world. Our family's politics has nothing to with our business interests, because we had an established business in Peshawar long before I joined politics. These are only baseless allegations to tarnish my image.

World food prices continue to soar. The World Bank has identified more than three dozen third world countries as being at risk of severe food shortage, possible famine and attendant eruption of conflict. The most elementary economics textbook suggests that price hikes are a function of scarcity; in other words, a good or service becomes more valuable in the marketplace when demand exceeds supply.

For the most part, in such a situation mainstream economists posit a solution that emphasises an increase in food production, or in related vein, an increase in agricultural productivity so as to be able to make up the shortfall in supply. The Asian Development Bank's (ADB's) recently released report on the world food crisis offers exactly this solution.

Not surprisingly the report suggests tired remedies, including the need to build mega water storage projects to bring more land under cultivation and better supply water-starved regions. There is no acknowledgment that such projects have been propagated as the panacea to the problems facing agrarian economies since colonial times, and in recycled idiom during and after the Green Revolution of the 1960s. One wonders how it is that the ADB (and other institutions like it) can vest so much faith in a development paradigm that clearly has not succeeded in addressing the basic issue.

More generally, the ADB report points out that the major structural cause of the current escalation in prices is the sharp hike in oil prices. Intriguingly on this account there is no 'solution' offered or even conjecture as to the reason for the increases in recent years. One would think that it would be relatively easy to draw a correlation, however weak, between the price of oil and the war in Iraq, for example. The ADB think-tank obviously only ventures supply / demand analysis that is considered politically correct.

Given just how serious the food crisis is, it is stunning that mainstream analyses and prescriptions are so intellectually bankrupt. In the first instance, there has been almost no mention in expert reports or the world press for that matter about the role that American and European agribusiness companies are playing in determining world food prices, whether directly or indirectly. The indictment is even more damning considering the not insignificant coverage given to agriculture-related negotiations at the World Trade Organisation (WTO) over the past couple of years. Specifically a clear divide has emerged over agricultural pricing, marketing and distribution pitting Europe and North American on the one side and the Group of 77 countries -- effectively the agrarian economies of the third world -- on the other.

The one issue over which there is the most conflict is that of agricultural subsidies: the Europeans and North Americans want to maintain enormous subsidies to agribusiness and at the same time demand elimination of subsidies to producers in the third world. Needless to say, the G-77 has rejected this outrageously unjust demand and, thus, the so-called Agreement on Agriculture is yet to be finalised and the so-called Doha Round of the WTO has stalled.

It is a well-known fact that European and North American agribusiness companies have a tremendous bearing on global food markets. On the one hand, their dumping practices have pushed food prices down so that third world producers have found it difficult to compete. On the other, however, agribusiness artificially limits supply so as to push prices up to inflate or at the very least maintain profit margins. By continuing to provide enormous subsidies to agribusiness, European and North American states are complicit in this quite criminal game.

Multinational food retailers with franchises all over the world are also well versed in the creation of deprivation. For example, McDonald's has an explicit policy to waste all leftover food at the end of each working day rather than allowing hand-outs because this ensures that prices are not pushed downwards. More generally, in recent months, Pakistanis have become well acquainted with the hoarding practices of both wholesalers and retailers, which have been major endogenous factors behind the price hike.

There are of course many other aspects to the global political economy of food, all of which illuminate the fact that food production is far from an apolitical exercise and is not dictated by 'free' market principles but by the ability of big producers to manipulate supply and demand to their own benefit. But admitting this fact would fly in the face of the development orthodoxy of the ADB and other international organisations.

On the one hand, the argument can be made that the ADB and others suffer from a distinct lack of imagination in the sense that they are so wedded to their age-old conception of development that they find it difficult to break with it. This inertia argument may be applied to the individual technocrat who has become convinced through multiple years of education and exposure to the corporate media that the world does actually function in the way that is described in Microeconomics 101. But it becomes very tenuous when one historicises the role of institutions such as the ADB in creating the current structure of global capitalism.

The same ADB demonstrates great innovative ability when it comes to dealing with the constraints on capital accumulation presented by the deepening crisis of global capitalism. Following the global stagflation in the early 1970s, the ADB and other multilaterals have come up with all sorts of new measures to deal with the crises of overproduction and decreasing profit rates. In the main innovations, such as debt-swaps, unregulated equity markets and the like have-not succeeded in resolving the underlying crises of the capitalist world economy, but they have ensured that a small minority of the world's people continue to live in the lap of luxury, unmoved by almighty predicaments, such as the one the world's poor are currently confronting.

The problem then is not that the top brass sitting in ADB headquarters in Tokyo has a problem with the imagination. Instead it is one of priorities: despite all the claims, the priority is not to meet the needs of the world's people, to protect its ecology or to ensure a balanced moral order but rather to ensure that the omnipotent profit-making machine is facilitated to continuing its loot and plunder. And this paradigm will not change from within, of that we can be sure.

Education is a necessary prerequisite for any nation's economic, social, political and cultural development. The lack of a significant literate population has resulted in innumerable negative consequences for the Pakistani society, including unawareness about one's own and other people's rights and responsibilities as a citizen, and apathy towards political and social affairs. This has created an environment that is conducive to social ills, such as corruption.

Considering the importance of education, it is heartening to see that the new government is taking this sector seriously. On April 23, the federal minister for education announced that the current National Education Policy would be revised and also changed some educational targets. The most ambitious of the objectives of the proposed policy is the achievement of 100 per cent literacy rate. Before the policy is finalised, it is necessary for the policy-makers to look into previous national educational polices, to formulate achievable objectives and compatible strategies for enhancing the literacy rate.

According to the United Nations Development Programme (UNDP) Human Development Index, in 2005 Pakistan's adult literacy rate stood at 49.9 per cent and gross enrolment ratio (the number of students enrolled in a level of education regardless of age as a percentage of the official school going population for that level) for primary, secondary and tertiary education collectively stood at 40 per cent. This means that Pakistan has one of the lowest literacy rates in the world. What is even more shameful is the fact that the gap between male and female literacy rates has increased in recent years. In 1990, according to the UN, 42.2 per cent of adult males and 20.2 per cent of adult females fell into the literate category. By 2004, the gap had widened with 59.8 per cent of adult males and only 30.6 per cent of adult females falling in the literate category.

The policy review process should ideally start with an assessment of whether the objectives that are being forwarded in the latest education policy are rational, so as not to waste valuable financial and human resources. After all, one of the major flaws in past educational policies has been the setting of impractical targets. For instance, in 1947, when infrastructure for educational institutions had either been destroyed or was being used as refugee camps, the government set universal primary education and adult literacy in its policy objectives.

Between 1947 and 1992, every government or regime attempted to achieve universal primary education, but remained unsuccessful and the unrealised goals were added as objectives in the subsequent policy plans. Thus, the first step in rational policy objective formulation for the government is to take into account existing infrastructure and resources and past performances of policies, as well as the political, economic and social setup of target regions, before attempting to once again attain objectives that none of the previous governments and regimes have been able to.

It is equally important to assess whether it is necessary to revise the current education policy in the first place. After all, it seems that successive governments have passed and implemented modified or completely new policies more on the basis of a tradition that began with the First Plan and First Conference of 1947 than on the basis of need-assessment. Between 1947 and 2006, eight different education policies were implemented and numerous education committees were formed.

All these education policies forwarded two common goals among others: enhancement of the literacy rate and the provision of universal primary education for both boys and girls. These objectives have manifested themselves once again in the latest education policy. However, as the literacy rate in the country has remained more or less the same since its inception despite consistent policy commitments by both democratic governments and military regimes, it is important to determine whether frequent policy revisions or renewals are of any worth.

The major explanation offered for the continuous failure of policy formulation process is the volatile nature of Pakistani politics, which is characterised by frequent democratic government and military regime changes. This is harmful because with each government or regime change, local and national literacy projects are terminated midway. This practice affects the enrolled students as well as the teachers. Moreover, it is financially unviable, because any organisational setup constructed for the implementation of policy is dismantled and attained assets are subsequently disposed of. Hence, it is important for the current government not to abandon literacy projects that were initiated under the previous education policy. It must also seriously consider doing away with the tradition of compulsively formulating new policies or revising policies of preceding governments upon assuming power.

Another major flaw of past national education policies is that active efforts on behalf of the government, that are necessary for successful policy implementation, were missing. Educational policies are formulated and complementary strategies for policy implementation, and systematic monitoring and evaluation, exist at least on paper, but are not always used to track the progress. Not only does this adversely effect the educational development of the country, but the lack of persistent supervision has also provided opportunities for corruption, which by negating the merit-based system discourages participation in education by those at the lower rung of the socio-economic ladder.

In this regard, the government must ensure that politicians make an honest effort to motivate illiterate people to enroll themselves and their children in schools that are set up for the achievement of policy objectives, as they are being commonly used as a facade for nepotism by local power-holders. When teachers are hired because of their connections with these power-holders, rather than because of their motivation or competence to understand and meet the individual needs of their students, policy implementation is further weakened.

Moreover, it is important for the government to realise that gender gap in the literacy rate exists not only because of insufficient infrastructure for boy and girls, but because of traditional boundaries set by communities and/or rational economic decisions made by parents of the children. Parents belonging to the poverty-stricken classes prefer their children to work instead of study, as upward mobility is heavily restricted because of reasons explained earlier. Also, the need to survive takes precedence over education. Even if there is enough economic scope for the children to go to school, boys are usually given preference as they are culturally defined as the 'breadwinners' of the family; whereas girls are to be married off.

In addition to this, in tribal and rural areas, the population explosion has further reinforced the role of females as housekeepers, and necessitated their need to stay at home and cater to the family's needs. Also, the larger number of boys' school in a given district has seemingly substantiated the notion that male children must be given preference in education. Hence, it must be ensured that the illiterate and poverty-stricken masses, especially in the rural and tribal regions, first understand the value of education for both boys and girls, and the consequences of illiteracy on the quality of their lives.

To achieve this, a national awareness campaign must be undertaken before one girls' school is set up in each union council -- as has been proposed in the latest educational policy. Further, it is high time that the government acknowledges and deals with the feudal lords who obstruct the goal of national literacy, especially female literacy, through various legal and illegal means in order to maintain the status quo. Finally, the government must recognise that the existing dependence on international aid flows for the sustenance of national educational development must be decreased and, ideally, done away with.

Though the increasing amount of international aid, which has been flowing into the country for the education sector since the 1960s, has played an important role, it has also resulted in dependence on foreign donors for the sustenance of the educational system. The problem has been further compounded by the politicisation of international aid flows (most of them depend on the donor country's terms) that render them prone to abrupt termination if Pakistan does not meet the donor country's demands in the political sphere. Hence, it is necessary to depoliticise international aid for educational development, to ensure that sanctions due to a country's political stance do not adversely affect its education sector.

Containing the growing fiscal deficit is one of the major challenges facing the government on the economic front. Meeting this challenge entails making some hard and manifestly unpopular choices. Before taking up Pakistan's case, it seems adequate to explain in general terms what fiscal deficit is and how it increases. Fiscal deficit increases when public spending or expenditure exceeds public revenue for a given period. Contrary to popular view, fiscal or budget deficit is not inherently a vice; nor is fiscal or budget surplus inherently a virtue.

In short, whether the government should have fiscal deficit or surplus depends on the state of the economy. As famous economist Lord Keynes remarked, the government should seek to balance the economy rather than the budget. If case of widespread unemployment and deficiency of aggregate demand, fiscal deficit is in order to stimulate the economy; whereas in case of inflationary boom, fiscal surplus should be preferred. However, at any rate, fiscal deficit needs to be kept within manageable limits; otherwise, it can destabilise the economy.

Though both developed and developing economies face fiscal deficit, the problem is more serious and frequent in case of the latter. This is for more than one reason: Whereas for developed countries, the major economic problem is to maintain a steady growth rate, for developing countries the major economic challenge is both to accelerate the growth rate and maintain economic stability. Hence, developing countries need a higher investment-gross domestic product (GDP) ratio to add to the capital stock and accelerate the rate of capital formation.

The source of investment is either the public sector or the private sector. Developing countries are by and large acutely short on dynamic entrepreneurs; therefore, the public sector has to take the lead in investment. The government also has to spend an enormous amount on creating the social capital -- education, health, public utilities, etc -- and physical infrastructure, which makes an expansionary fiscal policy necessary. On the other hand, due to low level of business activity and income, public revenue cannot match public spending. The result is fiscal deficit, which can be financed either from external or domestic sources.

The domestic sources may take the form of public borrowing or borrowing from the central bank. Public borrowing may be borrowing from the capital market through the sale of government bonds or treasury bills; or non-market borrowing through national savings schemes or prize bonds. Borrowing from the central bank takes the form of printing money. All these forms of public borrowing have some undesirable consequences. Public borrowing adds to public debt, which has to be repaid in the form of both principal and interest, thus further limiting the fiscal space available to the government. Besides, market borrowing puts upward pressure on interest rate, which increases the cost of doing business. On the other hand, borrowing from the central bank is inflationary as it results in expansion of money supply in the economy.

Coming to Pakistan, fiscal deficit rose to 4.3 per cent of the GDP in FY07 from 4.2 per cent in FY06, 3.3 per cent in FY05 and 2.4 per cent in FY04. In the first half of FY08, (July-December 2007), fiscal deficit constituted 3.6 per cent of the GDP, which is almost double the fiscal deficit in the same period of the preceding fiscal year. In value terms, fiscal deficit increased to Rs 377.5 billion in FY07 from Rs 325.2 billion in FY06, Rs 217 billion in FY05 and Rs 129.4 billion in FY04. In the first half of FY 08, fiscal deficit was Rs 356 billion, more than double the FY07 figure for the corresponding period. For FY08, fiscal deficit target was Rs 398.7 billion; however, the actual figure may go beyond Rs 555 billion. This will make it difficult to meet the four per cent fiscal deficit-GDP ratio target for the current fiscal year.

The increase in fiscal deficit is due to growing excess of public spending over public revenue. Total revenue increased to Rs 1,298 billion in FY07 from Rs 1,076.6 billion in FY06, Rs 900 billion in FY05 and Rs 794 billion in FY04. Thus total revenue increased by 63 per cent between FY04 and FY07. However, as a percentage of the GDP, public revenue has marginally increased to 13.9 from 13.5 between FY04 and FY06.

Total expenditure increased to Rs 1,675.5 billion in FY 07 from Rs 1,401.8 billion in FY 06, Rs 1,117 billion in FY05 and Rs 923.6 billion in FY04. Thus total expenditure increased by 81 per cent between FY04 and FY07. As a percentage of the GDP, total expenditure rose to 14.2 per cent in FY07 from 14.1 per cent in FY06, 13.3 per cent in FY05 and 13.7 per cent in FY04. Budgetary target for expenditure-GDP ratio and revenue-GDP ratio in FY 08 was 15.5 per cent and 15.7 per cent, respectively.

It may be mentioned that in the 1990s, average fiscal deficit-GDP ratio was seven per cent, well above the current level of around four per cent. However, decline in fiscal deficit has more to do with fall in expenditure than increase in revenue. For instance, in the 1990s, expenditure-GDP ratio was 23.6 per cent, while revenue GDP ratio was 16.8 per cent -- well above the current levels of expenditure (14.2 per cent) and revenue (13.9 per cent).

In theory, the simple way to contain the fiscal deficit is to reduce expenditure or increase revenue. However, in practice, this simplicity turns into complexity. To understand this, let us look into the composition of public expenditure and revenue! Because of space constraints, we will look at FY07 figures only. Of the total expenditure of Rs 1,675.5 billion, the current expenditure was Rs 1,375.3 billion (82 per cent of total expenditure), while development expenditure was Rs 300.2 billion (18 per cent of total expenditure). The two major components of the current expenditure were debt servicing of Rs 368.8 billion (27 per cent of current expenditure) and defence spending of Rs 250 billion (18 per cent of current expenditure).

Debt servicing is an obligation that the government has to fulfil. Public debt makes up 53.4 per cent of the GDP, down from 67.7 per cent of the GDP in FY04. But the public debt-GDP ratio still remains high, forcing the government to allocate a substantial portion of its expenditure to debt retirement. The huge military expenditure, on the other hand, is rooted in the country's political system which is dominated by the armed forces no matter which party is in power. It is easier for a party in opposition to criticise massive military allocation. But the very first lesson the same party learns when it enters the corridors of power is don't mess with the defence spending. Hence, any cut in defence spending in the forthcoming budget is virtually out of the question. The government's discretion regarding allocation of resources starts only after meeting expenditure on these two heads.

As for revenue increase, in the wake of robust GDP growth, public revenue should also register fast growth to reflect stepped up economic activity. However, Pakistan's case presents an altogether different story, as revenue-GDP ratio has declined from 16.8 per cent in the 1990s to around 14 per cent currently. Out of the total of Rs 846.4 billion tax revenue in FY07, the share of direct and indirect taxes was Rs 334.4 billion and Rs 513.1 billion, respectively. Thus the share of indirect taxes (62.75 per cent) is much higher than that of indirect taxes (37.25). In order to increase tax revenue, either direct or indirect receipts will have to be increased. Any increase in indirect taxes shifts the burden to the consumer or the final customer and results in price increase. Moreover, indirect taxes are essentially regressive as the burden is shifted equally regardless of the income.

Another problem with indirect taxes is the elasticity of demand. Since demand for essential goods is inelastic and that for luxuries elastic, increase in taxes on luxuries may reduce revenue while that on essential goods increase revenue. Though economically it may be a better choice to increase taxes on essential goods, socially and politically such a move will be unpalatable, as it will further reduce disposable real income of low-income groups who spend a major portion of their budget on such goods. Thus any increase in taxes has to be in direct taxes. However, the problem with direct taxes is that these are easier to evade and require an efficient tax collection machinery and tax culture, which we are deficient in. Moreover, increase in direct taxes has to be moderate; otherwise, it will stifle business activity and reduce rather than increase revenue receipts.

It is in this context that the recent hike in petroleum prices -- the fourth in three months -- needs to be seen. In the budget for FY08, out of a total subsidy of Rs 114 billion, Rs 15 billion were allocated for oil subsidy. However, due to hyper increase in world oil prices, actual oil subsidy may eat up about Rs 155 billion by the end of the fiscal year. Faced with enormous fiscal deficit, the government had to take the unpopular decision of passing on the price increase to the consumer. Increase in oil prices is likely to be followed by that in electricity tariffs, thus driving up inflationary pressures to the detriment of both consumers and businesses. That said, one must be mindful of the fact that though subsidies result in reduced prices, they are a transfer from the public revenue and it is the taxpayer who ultimately bears their burden.

(Email: hussainhzaidi@gmail.com)

Islamabad has been the venue of a lot of controversial development schemes and projects in recent past. Let us analyse the five most 'important' projects initiated in the city one by one by placing together the version of the Capital Development Authority (CDA) / builders with the reality:

1. The Centaurus

The builder's version: "Immerse yourself in 6.59 acres of architectural brilliance. Fascinate your senses with facilities beyond imagination. A spectacular urban structure that draws its inspiration from the Margalla Hills. The five-storey shopping mall, the two residential complexes, the corporate complex and the luxurious seven-star hotel will be intrinsic to the stunning development. It's the magic of a wonderful lifestyle. It's The Centaurus!"

The reality: The Centaurus will adversely affect the whole city. Some of the serious demerits are:

• The project is in violation of the Pakistan Environmental Protection Act and is being illegally constructed without a proper environmental impact assessment (EIA).

• The Environment Protection Authority (EPA), the CDA and the Islamabad Electric Supply Company (IESCO) ignored violations.

• A huge amount of more than Rs 1.6 billion for supplying water, managing sewage disposal and providing electricity will be provided from the taxpayers' money.

• Traffic concerns have been ignored.

• Residents of F-8 and adjoining sectors will be severely affected, as the huge structure will block light. Other problems will include waste disposal, loss of green areas and noisy traffic.

Road Projects: 9th Avenue and 7th Avenue

The CDA's version: The increasing traffic situation can only be mitigated if there are more roads. The city is growing and with the increase in population, it is only natural that roads are 'expanded'. These are 'environment friendly' projects aimed at decreasing the traffic rush and resulting jams, which in turn are a cause of air pollution.

The reality:

• The city needs a proper mass transit system rather than more and expanded roads.

• There are 'tram lines' planned next to the roads to have the whole city covered with a modern mass transit system, which is allegedly part of the real master plan.

• There was a massive drive to cut down on the most well-developed green belts in the city. All trees were supplanted and allegedly sold. No effort was made to conserve the area in any way.

• These huge structures run in the middle of the city, especially residential areas, causing much noise and air pollution. Light is also compromised in these areas.

2. Projects within the

Margalla Hills National Park

Daman-e-Koh Viewpoint

The CDA's version: The Daman-e-Koh Viewpoint has been entirely renovated, landscaped and newly paved, with the addition of three terraces, a new restaurant, improved and increased car parking, new lights, and golf carts for visitors, making it even more attractive and beautiful.

Restaurant at Pir Sohawa

CDA's version: A brand new facility is currently being developed to cater to families, with a view to provide them with a quality restaurant, along with comprehensive hospitality facilities, such as conference rooms, terraces and sight-seeing decks.

Widening and electrification of Pir Sohawa Road

The CDA's version: To provide unlimited access to the spectacular Pir Sohawa, with new lights being installed, quality signage and markings adorning the roadside, and the overall road being widened from 12 to 18 feet.

The reality:

• The projects happen to be inside a national park -- an area designated for not being disturbed by human activity.

• The area should be used for eco-tourism -- a concept that enables people to enjoy the natural landscape, but at the same time not pollute or damage the area.

• The CDA being the custodian forgot its responsibility and has had several commercial projects.

• Widening and electrification of the area is a serious concern as animals are disturbed at night. The animal population will decrease and their natural cycle will be severely disturbed.

• No solid waste disposal plan is being implemented, with restaurants dumping waste openly, thereby increasing the populations of scavenger, such as cats, dogs and crows in the area. These, in turn, attack and decimate other wildlife, such as other small animals and birds.

3. Development of F-9 Park

The CDA's version: The first phase of the Fatima Jinnah Park in Sector F-9 is being developed, with its master plan and PC-I approved, with an initial development across 100 acres. Landscaped gardens and an extensive horticulture face-lift will be executed in the coming months.

The reality:

• Islamabad boasted of its first park with open lawns, trees and space to breathe like nowhere else. What we see instead is concrete all around, as commercialism abounds.

• The F9 park is no more a place for interacting with nature. It is just a compendium of restaurants, a shopping mall and a junk food outlet.

• Recently a club was also opened in the park, which will serve another blow to the whole concept.

4. Development of promenade at Rawal Lake

The CDA's version: In order to capture the scenic beauty of Rawal Lake, a lakefront recreational spot is under development, replete with a walking promenade, landscaped gardens, a floating deck, a family restaurant, adequate car parking and kids play areas, and recreational games and activities.

The reality:

• Rawal lake is the main source of water supply to the residents of Rawalpindi.

• The lake is already contaminated with sewage from the illegally built Bani Gala residential area.

• The lake forms one of the protected wetlands in Pakistan, according to which no development of any kind should be allowed at least one km around it.

• The promenade will further increase pollution and damage the lake, which is already under severe stress, thereby endangering the precious water supply.

5. Islamabad Zoo

CDA's version: The Marghazar Zoo, long overdue for a facelift, is in the process of receiving one, with the whole facility being completely redesigned and the area being increased from 25 to 60 acres.

The reality:

• Not a single biodiversity expert with the relevant experience of managing, implementing and running a zoological garden is involved in the project, its commissioning or its EIA.

• The zoo falls within the Margalla Hills National Park area, which is already under stress of other commercial initiatives.

• The national park area will be further 'polluted' by not only from the visitors to the zoo, but also by the different species of plants and animals that it will house. This is aptly termed 'biopollution', which can result in 'bioinvasion' that can wipe out indigenous fauna and flora.

Development of Saidpur Tourist Village

CDA's version: The Saidpur Model Village will provide an opportunity to tourists to walk through cobble stone streets and observe old houses. The development under way to make the village a tourist-friendly place includes establishing home cafes and handicraft bazaars, the restoration of a 150-year old temple, and the upgrading of services and the environment.

The reality:

• The upgrading is not in line with our cultural heritage.

• Structures built are in sharp contrast to the indigneous culture.

• The CDA did not pay attention to conserving historical structures or designs, and implemented its own form of culture for people to 'enjoy'.

Most countries are re-evaluating their traditional geo-political position in this changing global environment. Greater importance is now being attached to economic and trade relations, irrespective of the past animosities. One of the spheres in which opportunities of collaboration exist between Central, West and South Asian countries is energy. The Central Asian Republics (CARs) and Iran are rich in energy resources, such as oil and gas; whereas South Asian countries are deficient in them because of smaller reserves and the ongoing large-scale development.

Iran and Turkmenistan have abundant proven natural gas reserves and they are keen to exploit this resource as a source of revenue. On the other hand, India and Pakistan have become their potential customers. According to a research report, in near future, India and Pakistan will need approximately 200 million standard cubic metres of gas daily. Though the two countries are also looking for other choices to cater to their energy needs, gas from Turkmenistan and Iran perhaps offer the best solution. Besides, Turk and Iranian experts have given technical assurance about availability of gas for more than 30 and 40 years, respectively.

The growing energy demand is going to change the strategic equation in South Asia, as economic interdependence would bring peace to the region by improving relations between the countries. Many positive developments have already taken place in this regard. The plans for the construction of Iran-Pakistan-India (IPI) and Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipelines received an impetus last month, after all the stakeholders held deliberations on the expeditious initiation of work on these projects. The estimated cost of IPI and TAPI gas pipelines is about $ 15 billion, and they will provide more than six billion cubic feet of gas to Pakistan and India on daily basis. The two projects will be completed between the years 2012 and 2015, and the Asian Development Bank (ADB) has already shown its willingness to finance them.

Pakistan was initially more interested in TAPI gas pipeline. The current cost of this 1,680 km-long pipeline is estimated to be $ 7.6 billion, whereas in 2002 its cost was projected to be $ 3.3 billion. This pipeline will run from the Dualtabad gas deposit in Turkmenistan to the Indian town of Fazilka. It will initially provide 30 million cubic metres gas to Pakistan and India each and five million cubic metres gas to Afghanistan on daily basis. This can later be increased to 90 million cubic meters gas on daily basis. Last month, Pakistan, Afghanistan and India signed a framework agreement to buy natural gas from Turkmenistan. This revised the original agreement singed by Pakistan, Afghanistan and Turkmenistan in December 2002, to allow India to join this United States-backed gas pipeline project.

As far as IPI gas pipeline project is concerned, it is supposed to carry 1.1-3.4 billion cubic feet gas per day through a 2,670 km-long pipeline. It will start from Iran's Pars gas field and enter into Pakistan. Travelling through Khuzdar, one section of it will go onto Karachi on the Arabian seacoast, while the main section would travel onto Multan, from where it would travel to New Delhi in India. The projected cost of this project is $ 7.4 billion. Iran and Pakistan reportedly have removed all the hurdles during the recent visit of the Iranian president to Pakistan, and an agreement on this gas pipeline project will be signed in Tehran soon.

Interestingly, China has also shown interest in IPI gas pipeline project, as Beijing too needs energy to cope with its expanding industrial development and socio-economic progress of its people. Both Pakistani as well as Iranian leadership has welcomed China's participation in the project, which will certainly contribute to economic development of the whole region. The gas imported from Iran will be exported to China in liquefied natural gas (LNG) form. According to a feasibility report, the LNG terminal will be set up at Gwadar, where natural gas will be converted into LNG for export to China through existing or proposed communication link from Gwadar to western part of China.

Both IPI and TAPI gas pipeline projects are of vital importance to Pakistan, China and India, which desperately need energy to sustain their industrial and economic growth in the coming years. As far as the significance of these gas pipelines for Pakistan is concerned, the country will not only earn revenue in the form of transit fees but will also enhance its strategic importance in the region by allowing its territory to be used for the transit of gas from the proposed pipelines.

Though no one can deny the geo-political as well as geo-economic importance of these proposed gas pipeline projects, some analysts have doubts about their success because of the instability in Afghanistan and Balochistan, through which they have to travel. Peace in Afghanistan and Balochistan, in fact, is an essential pre-requisite for the smooth supply of the gas to the region. Perhaps, some kind of security can be guaranteed by offering incentives to the locals in the areas from where these pipelines have to pass.

Another issue of concern is the strategic interests of big powers in the region -- for instance, the US and Russia are opposed to IPI and TAPI gas pipelines, respectively. The major concern of the US is to contain the Iranian influence in the region, thus it is pressurising Pakistan and India to opt for TAPI to cater to their energy requirements. Russia, on the other hand, is opposing TAPI gas pipeline project, as it wants Turkmenistan's gas to be exported to Europe via its territory. It is for this reason that it is supporting IPI gas pipeline project. Besides, the US administration is also working hard to stop Pakistan and India from cooperating with Iran, China and Russia, to safeguard its own interests in the region.

Pakistan's relations with its western neighbours are important because of religious, cultural and strategic ties. In order to maintain its influence in the region, the US has been discouraging efforts aimed at enhancing regional cooperation. Notwithstanding this, Pakistan should go for both gas pipeline projects as they will enhance its geo-strategic importance. There is no blinking the fact that energy is vital tool of development as well as a pre-requisite for the socio-economic well-being of the people. The energy needs of Pakistan, China and India are bound to grow with the passage of time, in view of their booming economies.

Further, the proposed gas pipeline projects have the potential to alter the geo-strategic equation in the region, as the economic and development gains from these projects will compel India, Pakistan and other regional stakeholders to re-evaluate their traditional roles. Their cooperation and coordination in gas pipeline projects would further enhance political harmony and economic stability in the region. Nonetheless, it is important to start these projects at the earliest, as their cost as well as the energy demand of both India and Pakistan is only increasing with the passage of time.

Most of the PIA's current problems are an outcome of the wrong policies of those who were put in charge of running the show, as they knew nothing about the aviation business, with the exception perhaps of Air Marshal (r) Nur Khan and Air Marshal (r) Asghar Khan. The list of others who followed and how 'successful' they were is known to everyone. The fact that political parties used the national airline to provide jobs to their favourites also contributed to its deteriorating standards and loss of revenue.

Now the management has announced a programme aimed at making the national carrier a profitable enterprise once again, one to which its catch phrase 'Great People to Fly With' can be justifiably applied. It is surprising, however, that while many measures have been adopted, one of the easiest solutions to the problem -- which, if adopted, could have made a world of difference and helped to do away with unnecessary expenditure -- has been ignored altogether: not serving food to the passengers.

Many airlines around the world stopped their operations after 9/11, merged with other airlines or are still struggling to keep in the air, but the remarkable turnaround that United Airlines of the US has made after taking corrective measures is an example that should be analysed and followed. All measures adopted by the management of United Airlines were also applied to Ted, an affiliated airline with smaller planes going to the same destinations as well as other domestic routes in the US, and United Express, planes using the expertise of United Airlines but owned by smaller companies. Importantly, both Ted and United Express cater only to economy class passengers.

Travelling around the US and talking to people at various levels in the hierarchy of United Airlines reveals some interesting facts. United Airlines was bailed out by the Bush administration to prevent it from bankruptcy, but the airlines' management also adopted stringent measures to streamline administrative glitches, as well as off load unnecessary frills and furbelows. The first step was to get rid of half the non-essential work force and use the other half to its full potential, which led to a more streamlined working environment besides saving a considerable amount in salaries.

The most significant decision by the management was to stop serving food to economy class passengers on all domestic flights. Since there are hundreds of such flights operating on a daily basis throughout the United States, it can be imagined that a great amount of money has been saved because of this step. Since there is no meal service, cabin staff is also reduced to the minimum requirement for a safe and comfortable flight. On any United Airlines, Ted or United Express flight, economy class passengers are served a soft drink and a small snack of peanuts or crisps and that is it.

You can ask for a refill if you want one or buy an alcoholic drink if you so desire. Similarly, if you are hungry, you can buy a lunch box for $ 5. Since passengers usually eat while waiting for a flight, the demand for these is not so much that it cannot be met. Another measure that saves money as well as the hassle of preparing these boxed meals is giving the contract to another company. The logic behind this was that even if the meals do not sell, United Airlines does not suffer a loss.

Pakistanis love to eat. Eating is not only a need or a pastime in the country, but also a form of entertainment. But we surely can do without food on a 90-minute flight, which is how long it takes to get from Lahore to Karachi or vice-versa. If passengers need to eat, they must do so at the airport like in other parts of the world, where restaurants are packed with people who are enjoying cuisine of their choice, as a variety of eating places exist for the purpose.

While such places do exist at airports in Pakistan, they are not frequented much, possibly because they are not up to the mark or because passengers know they are going to get a free meal on the flight. Many restaurants would love to open a branch at the airport if an offer was made to them and there was a guarantee that no meals would be served during the flight. Besides, the PIA also serves snacks that are as good as meals.

Most passengers waste the meal and/or snacks served to them after opening the wrapping. This 'waste' is thrown away and heaven knows where it goes, but many items served on flights find their way to the market. You can buy the small packs of butter, jam, yogurt and even food (in winter) marked with the letters 'PIA' at small shops in crowded localities. They are either stolen or retrieved from the trash bin.

If these measures were adopted, the large catering setup that now takes care of all meals would not be needed to operate at its current scale, and could be reduced to cater only to international flights on which meals are must. This step would also cut expenses. If these measures were adopted, the passengers might grumble for a while, but would soon get used to travelling without a meal service. It would not only be good for the economic health of the airline, but also for the physical health of the passengers.