affair with illusions
The more we, the citizens of Pakistan, know, the less we understand. The last week has confirmed this notion
It is a sad reflection on just how regular an occurrence the suicide bombing has become that few people were surprised by the brutal attacks on a hospital in Dera Ismail Khan and the Pakistan Ordinance Factory (POF), Wah Cantt, in the days immediately following Pervez Musharraf's resignation. In some ways the violence was almost expected, given that it had been a while since the last blast and the fact that a major political upheaval had just taken place. It is now common knowledge that the masterminds of this endless violence choreograph their feats very meticulously.
What was different about these blasts was the swift manner in which the so-called Tehrik-e-Taliban Pakistan (TTP) claimed responsibility for the carnage. Only in a few instances in the past has the mysterious organisation and its even more mysterious leader, Beitullah Mehsud, openly admitted its atrocities in this way. For those of us already suspicious about the dramatic emergence of the so-called 'Pakistani Taliban' and the musical chairs-like 'military operations' that are taking place across the NWFP and FATA against it, the last week has only confirmed that the more we know, the less we understand.
In the midst of all the devastation, and the sensationalist media coverage of it, one tends to forget that the Pakistani society, and in particular the Pakhtun society, has come to be ravaged by the trauma of suicide bombings only since the Americans invaded and occupied Afghanistan. Before November 2001, there was nothing resembling the kind of violence in both the tribal and settled areas of the NWFP that there is today, notwithstanding the fact that the use of measured force by the common people is enshrined in the Pakhtunwali code.
It is necessary, therefore, to recount how we have gotten to the current state of affairs, even at the risk of repeating what has been elaborated on many times before by numerous writers, including myself. After all, given that the 'frontline' of the so-called 'war on terror' is now virtually within the Pakistani territory, it is more important than ever to flesh out exactly why this has happened and identify those who are responsible.
Official and media accounts emphasise that Waziristan is the home base of the 'terrorists', and that it is from here that attacks in Afghanistan and the settled districts of the NWFP are being planned and executed. According to this narrative, Taliban and al-Qaeda operatives based in Afghanistan retreated to Waziristan and regrouped after the Americans took control of Kabul. Presumably the 'terrorists' lay low for a period of time, securing themselves amid the tribal population, before launching fresh attacks on the Americans to the west and their Pakistani collaborators to the east.
This seems to tally with the numerous military incursions made into both the North and South Waziristan by regular Pakistani troops and paramilitaries in the early phases of the 'war on terror'. The focus then was on isolating the foreign fighters, mostly through the use of force and to a limited extent by enlisting the support of local tribes. Ostensibly these efforts were successful, because, quite suddenly, Waziristan was out of the news and the rest of the tribal agencies became the epicenter of 'terrorism'.
It is true that Bajaur and other agencies were bombed sporadically even when Waziristan was the primary battleground, implying that some 'terrorists' were there to begin with. However, their numbers seem to have increased quite dramatically in recent months, and given that Mehsuds are said to be spearheading the insurgency in FATA and the settled areas, that there must have been a very deliberate migration of 'terrorists' from Waziristan to the rest of the province. But how is this sequence of events to be reconciled with the fact that the Taliban (or al-Qaeda) was initially confined to Waziristan and then had to defend itself against a major military offensive? Could the Mehsuds have spread out (almost overnight) all over FATA and later into the settled districts too despite these huge obstacles?
The only logical answer would be that an already-available supply of 'terrorists' existed in all parts of FATA and the settled districts, and all that was needed was a Mehsud-like commander or two to smuggle his way out of Waziristan and take control of the readymade militia. But the residents of Swat and other areas swear that there was no readily-available supply of militants. Indeed, most people in the NWFP (as well as the rest of the country) are now asking: where in the world did this supply-line of militants come from?
In a similar vein, how do the 'terrorists' sustain a never-ending supply of weapons and other sophisticated equipment? No one is doubting there are many parts of FATA that are difficult to monitor, but surely it must be almost impossible to import the huge quantities of weapons into the 'terrorist' strongholds, given that either American or Pakistani troops are lurking on all sides. And to come back full circle, what happened to Waziristan? Is it now free of ëterroristsí?
The Awami National Party (ANP) has more or less admitted that it is powerless to stop the rot in the settled districts of the NWFP unless FATA is opened up and some semblance of a political process established there. In other words, FATA is a playground of the military and the 'terrorists', and it is anyone's guess what the relationship between the two really is and what kind of games are actually being played out.
It should also be reiterated repeatedly that the Americans' presence in Afghanistan and their increasingly threatening posture vis-a-vis FATA serves only to make matters worse, both in terms of uncovering the truth about what is really going on in the region and in the sense that anti-American sentiment fuels the supply line of suicide bombers, regardless of who is manipulating these young minds behind the scenes.
For its part, the elected government needs to pay more attention to the so-called 'war on terror' rather than accepting the dictates of generals, whether American or Pakistani. It will be the first to suffer the blame if the indiscriminate violence is not controlled. If there is a silver lining for the government, it is that ordinary Pakistanis are now far less enamoured of the Osama bin Ladens of the world than they were when the Americans first arrived. In other words, there is growing recognition that the military, America and those that speak the language of 'jihad' form a nexus about which nothing good can be said and from which nothing positive can be expected. The government needs to take advantage of this popular sentiment and take on all the three, rather than issue meaningless statements expressing a commitment to fighting 'terror'.
If the government can distinguish itself from all these protagonists, it will be because it renounces violence, wants to abolish the 'no man's land' status of FATA, and insists that strategic and foreign policy be decided in the full view of the public. It has been proven repeatedly in recent months -- most recently in the case of Musharraf's demise -- that political forces can take on America and the Pakistan Army on the basis of public support without fear of reprisal. As for the third member of the nexus, it will surely wither away if and when the shenanigans of the other two are exposed. In any case, this is the only way forward.
Beware the Ides of August
By Kaleem Omar
The number '8' is considered propitious in Chinese folklore. That's why the Beijing Olympics' opening was scheduled for 8.08 pm on the 8th of August (the 8th month of the year) in the year 2008.
In Pakistan, however, we now have a new mantra for military dictators: 'Beware the Ides of August.' President Ziaul Haq (a serving army chief) died in a plane crash on 18-8-1988 after riding roughshod over the country for eleven long years. President Pervez Musharraf (who took off his army chief's uniform only a few months ago) resigned from his job as president on 18-8-2008.
Journalist-turned novelist-cum-playwright Mohammed Hanif, who worked as a journalist at Karachi's Newsline magazine for many years, then did a brief stint at the Karachi office of The News before moving on to the BBC's Urdu radio service in London, called Zia's death 'A Case of Exploding Mangoes' in his novel of that name published in England a few months ago.
Hanif's book derived its title from the widespread popular notion that Zia's plane crashed due to explosive substances hidden in a crate of mangoes that had been loaded on to the plane before its departure from Bahawalpur airport.
Another theory has it that the crash was caused by the release of a nerve gas into the cockpit after the plane took off and incapacitated the pilot and co-pilot. Yet another theory claims the crash was caused by mechanical failure. Like so many other things in Pakistan, the truth of the matter will probably never be known.
Zia's death triggered a chain of events that eventually led, in October 1999, to the ouster of the Nawaz Sharif elected government by the then-army chief, General Pervez Musharraf, whom Sharif himself had selected as army chief the previous year, following the resignation of Musharraf's predecessor, General Jehangir Karamat.
Karamat had invoked Sharif's ire when he gave a speech at the Naval War College in Lahore suggesting the creation of a National Security Council to oversee relations between various organs of the government, and resolve any differences that might arise between the civilian government and the chiefs of the armed forces.
Sharif saw this as an attempt by Karamat to impose an extra-constitutional body over the elected civilian government. The idea was not new. Back in 1979, General Ziaul Haq's martial law regime had asked a London-based British legal scholar to prepare a plan for the creation of a National Security Council. The document was published as a position paper by Altaf Gauhar's South magazine, a London-based monthly funded by Agha Hassan Abedi's Bank of Credit and Commerce International (BCCI).
That position paper traced the history of the infamous 'Doctrine of Necessity' that had been used by Pakistan's superior courts to justify the promulgation of martial law in the country by several army chiefs: General Ayub Khan in October 1958, General Yahya Khan in March 1969 and General Ziaul Haq in July 1977.
After reviewing those actions, the author of the position paper had used a convoluted argument to suggest that the best way of avoiding the imposition of martial law in the future would be to create a National Security Council, comprising members of the civilian government and the chiefs of the armed forces, to resolve any differences between the two groups that might arise.
For reasons that are still not clear, however, that 1979 plan was not put into practice and the proposed National Security Council remained an idea. The idea did not become a reality until 2004, when President Musharraf set up a National Security Council, with his former FC College-classmate Tariq Aziz as its secretary.
When Musharraf decided to set up the council, he once famously remarked: "The only way to keep the army out is by bringing it in." Many critics strongly disagreed with this view, arguing that the real purpose of the council was to impose an extra-constitutional body over the elected civilian government.
But the use of the 'Doctrine of Necessity' by Pakistan's superior courts to justify extra-constitutional actions goes back even further. The 'Doctrine of Necessity' was first used in this country in 1955 by the Federal Court (the predecessor to the Supreme Court), headed by Chief Justice Munir, to overturn a Sindh High Court decision that had ruled as illegal then-Governor-General Ghulam Mohammed's dissolution of the Constituent Assembly in 1954.
Maulvi Tamizuddin Khan, the speaker of the Constituent Assembly, challenged the dissolution in the Sindh High Court, which ruled in his favour and ordered the restoration of the Constituent Assembly. But the federal government appealed against the ruling in the Federal Court, which overturned the Sindh High Court's ruling.
The only Federal Court judge who upheld the Sindh Court's ruling was Justice AR Cornelius. He wrote a dissenting judgment stating that Ghulam Mohammed's action was illegal and that the Constituent Assembly should be restored. All the other Federal Court judges, including Chief Justice Munir, ruled in the government's favour.
That episode set the stage for all the political rot and unconstitutional actions that followed over the next forty-four years, culminating, eventually, in Musharraf's ouster of the Nawaz Sharif government and dissolution of the National Assembly in October 1999.
President Musharraf's resignation on August 18 led to a spate of comments in the international media. The Times of India said: "Pervez Musharraf was history the day he handed over charge to Ashfaque Kayani and donned civvies. It was clear from that day the army would not walk the extra mile to save his skin when the day of reckoning dawned. And that day wasn't long coming. After the verdict of the February 18 elections, the question of Musharraf's departure was no longer if, but when."
The Indian newspaper added: "Musharraf overstayed his welcome, partly because he believed the political coalition was fragile and would crack soon, partly because the US, particularly Vice-President Dick Cheney, was loath to let him go and Musharraf thought that would keep him there, and partly because he believed he could play out a final tactical victory in the fluid situation between the army, politicians and the Taliban. None of that happened." The famous Scottish poet Robert Burns once wrote: "The best laid plans of mice and men gang aft aglay." He was right.
Exposing media fanatics
Self-criticism is a kind of luxury in which most journalists may not indulge in
By Abdullah Khoso
Robert Ferguson has been working as a senior lecturer in Education at the School of Culture, Language and Communication, Institute of Education, University of London, since 1994. He has also been the course leader of the master's programme in Media, Culture and Communication during this period. Ferguson has been in the education sector for the last 24 years. From 1984 to 1994, he worked as the head of Media Studies, Joint Department of English and Media Studies, and the academic head of the Department of Educational Media, Institute of Education, University of London.
Of Robert Ferguson's many books, two are particularly important: Representing Race: Ideology, Identity and the Media and The Media in Question. The former is an analysis of the intellectual and historical base without which understanding the media is impossible. Ferguson tires to situate media discourse in the context of ethnocentrism, orientalism, ideology and representation, and draws on examples from newspapers, films, radio and television. His overview demonstrates a close association between representations of 'normality' and 'ethnocentrism'.
In the latter book, Robert Ferguson examines the contemporary research on media and cultural studies, and its impact in the context of rapid development in media technologies. He points at changing definitions and contexts of media studies through critical investigation. Moreover, Ferguson has been working as a broadcaster for more than two decades. His is currently researching on the representation of history on television. The News on Sunday interviewed him recently. Excerpts follow:
The News on Sunday: How does the European media portray Islam and Muslims?
Robert Ferguson: This, of course, is a difficult question, because there was a time even before 9/11 when there were plenty of people who were aware that it was problematic the way the non-Muslim world saw the Muslim world. Though it has been a problem always, it was treated in a light-hearted way before 9/11. I think that the media, especially newspapers, is much more likely to be ethnocentric or Islamophobist. If you ask most people on the street they will get confused about who is Muslim and who is not, as many people in the United States are confused if anyone asks them where is Iraq. In fact, this becomes a much more virulent kind of ethnocentrism against people seen as the Muslims.
TNS: What kind of debate was initiated in Europe after the publication of caricatures of the Holy Prophet (PBUH) in a Danish newspaper?
RF: What was done in the Danish case has brought to the fore an old debate: if you have the right to speak, how much are you allowed to say, if it offends others? And if you are allowed to say what you like and you will offend others, to what extent should you mind your manners? I think that people need to be responsible; they should be able to say what they want to say, but in a responsible manner. What you should not be able to say, however, is anything that acts against the forces of democracy. For example, no one should be allowed to say all the Jews should be killed, because it is not a democratic thing to say. Democratically, you are not allowed to kill someone. So I do not approve of that; it should not be allowed and it should be illegal.
TNS: Was the publication of the caricatures a responsible and harmless thing to do?
RF: The publication of the caricatures was harmful, as well as irresponsible. In fact, religion was used as a tool to promote ethnocentrism.
TNS: Were there any hidden motives behind the publication of the caricatures?
RF: Denmark has strict immigration policies, which essentially means that it is careful about dark-skinned people. So there is a dimension to this, at least in one respect. Of course, there currently is Islamophobia in the air in Europe. The people are terrified and they have become anti-immigrant and anti-Muslim. A lot of this is based on fear and ignorance. In one sense, this fear is real too, because they have seen so many things happening in the world, such as 9/11. However, equating all the Muslims with terrorism is wrong.
TNS: Can you give us an example of a terrorist act by a Christian fundamentalist?
RF: There are people who are doing it, but they may not be doing it for the sake of Christianity. Their main motivation may not be religious; it may be social. There are fundamentalists who are shooting doctors and surgeons who carry out abortions. They think that they have a religious justification for doing this. Christian fundamentalist groups, such as the Ku Klux Klan, do exist and their ethnocentrism is awful. Fundamentalists are everywhere, in every religion.
TNS: What kind of fear is attached with black people irrespective of their beliefs?
RF: The idea of anti-Muslim is because of an image of a specific person in mind. It is a certain kind of person, by definition a dark-skinned, bearded man wearing a certain kind of gear. We have not constructed such images ourselves; very often we have learned them through the media. People in big cities have not met anybody, but have just seen images on the screen. What they are frightened of is kind of a fanatic that is being projected in newspapers.
TNS: How does the European media deal with an event?
RF: Television news channels will always say, with some justification though, their responsibility is to inform people about what is happening in the world, but details and explanation of that will be in current affair programmes or documentaries. Moreover, there is no time in the news to give details and explanation. The debate, however, is how much explanation one can give in the news and what kind of explanation. There can be many sides, but usually we have to listen to both sides of the argument. There, however, are certain issues in the world about which you necessarily do not listen to both sides or you do listen to both sides but one side seems to be much louder than the other. What we have as news, which is predominantly reporting, is what is going on in the world, but there can always be reporting from another point of view.
TNS: Is the approach of the European media to Muslims getting better or worse?
RF: This question is nearly unanswerable, but we can say it has got worse in recent years, because of a mixture of fear and the fact that this fear is entirely faceless. The European media on the whole has demonised the Muslims, though the Muslims have done fantastic things too.
TNS: How much self-criticism is being exercised in journalism in Europe?
RF: Usually self-criticism and journalism do not go together. If journalists will be self-critical, they will be out of job pretty quickly. Journalists work for different newspapers and different newspapers do things differently. However, we cannot say this about all journalists. Some of them are very reflective and do think. A tiny minority of journalists may even be self-critical but mostly they are critical of society, of how things are going on. Self-criticism is a kind of luxury in which most journalists may not indulge in; it makes them weak or not up to the job. This does not necessarily mean that journalists are responsible for all the bad things in the world or whatever wrongs are being committed against the Muslims, but I am sure that some of them do help.
TNS: How do you see the relationship between the real world and the media?
RF: I do not think that there is any difference between the two; they essentially are the same thing. You can walk into a television studio, with media people watching, recording and cooperating with you. Now representation is becoming part of the real world, part of our existence. It is a fact that the media represents the real world in such a way that it has become part of the real world itself.
TNS: How do you see the future of the media?
RF: Technology is likely to develop so much that we may not be able to conceive yet how sophisticated the media may become, but this will only be a technological development and not necessarily a conceptual development. This may also have an impact on jobs, which, in turn, will influence the way the world operates -- the realities of the world become very harsh when people start to lose their ability to live as they once lived. When the media will become more sophisticated technologically, how it will interact with the people is still very much an unchartered territory. The media will not lead the world neither the world will ever operate now without the media, so the two are stuck.
The ongoing violence in the NWFP and FATA has forced thousands of families to migrate from their native areas to safer places
By Delawar Jan
Mass migration from different tribal and settled areas of the NWFP, caused by the ongoing military operations, is affecting the weak economy of the province as well as overburdening the existing infrastructure. Operations to quell the insurgents in the Hangu district, Khyber Agency, South Waziristan Agency, Bajaur Agency and the Swat valley, as well as the sectarian clashes in Kurram Agency, have forced thousands of people of these areas to migrate to other districts of the NWFP to save their lives.
The continuing exodus from several areas in the province has made it extremely difficult for the NWFP government to cope with the situation, given its fragile economy and the scarce resources available with it. On the other hand, the federal government and donor agencies have turned a blind-eye to the problem, which is now turning into a major crisis. The displacement has not only deprived the people of their livelihood, but has also affected the education of their children.
The latest internal displacement, believed to be the biggest in the history of Pakistan, was seen in Bajaur Agency, where the security forces heavily blitzed suspected positions of the local Taliban. Utmankhel, Jar, Hajilawang, Skandaro, Mulla Kalay, Hayatay, Manodherai, Loisam, Sewai, Damadola, Inayat Kalay, Nawagai and other towns were shelled, which resulted in the death of many civilians while scores of others sustained injuries. The killing of civilians and continued bombardment from jets and gunship choppers forced the locals to leave their native areas for safer places.
"More than 250,000 people of 39,100 families have been displaced. About 70,000 of them are registered in the relief camps in Lower Dir, Malakand and Peshawar. In all, the government has set up 17 camps for them across the province," NWFP Relief Commissioner Jamil Amjad told a press conference recently. According to him, 220,000 people have migrated to Lower Dir alone and most of them are living with their relatives. However, locals and volunteers working in relief camps said so far more than 300,000 people have left Bajaur Agency alone, and are currently living with their relatives in different districts or in relief camps in Lower Dir, Malakand, Mardan, Nowshera, Peshawar and other towns of the province.
"All of a sudden, jets and helicopters started shelling that not only killed several people and cattle in our village, but also seriously wounded my daughter. The thundering sounds of the hovering jets and choppers as well as intensified shelling terrorised the children, who started screaming due to fear. After this, we fled in a hurry leaving all our belongings behind," a fez-veiled woman of Loisam, Bajaur Agency, sitting in a tent at the Pirpai camp, tells The News on Sunday. She informs that they do not have even the basic facilities -- such as safe drinking water, electricity and sanitation -- at the camp. "We will rush back to our village the moment the operation stops, because we cannot live in these conditions," the woman remarks.
Cooped up in tents in scorching heat, the displaced families are in a pathetic condition, because they lack adequate facilities. One can constantly hear the cries of children who could not bear the heat in the absence of electricity. The mothers of the uncomfortable children are seen flapping hand-fans to provide them with some relief from the heat, but this hardly works. Hundreds of people, thus, have fallen prey to diarrhoea and malaria, as well as skin diseases, in different camps located in the districts of Lower Dir, Nowshera and Mardan.
The federal government, in particular, is responsible for the woes of the innocent Bajauris, because it did not make arrangements for a possible exodus before the full-scale military operation in which hundreds of people, including civilians, have been killed so far. Reportedly, many people also died of trauma during the migration. "This ambulance is taking back to Bajaur a minor girl who died of trauma. A vast majority of the patients examined here were traumatised by the conflict," says a volunteer of the Jamaat-e-Islami-supported Al-Khidmat Foundation, which has established relief and medical camps at Munda, a town in Lower Dir bordering Bajaur Agency.
Thousands of migrants, majority of them children and women, are sitting in fields, under-construction buildings and roadside in Munda, as more and more families were coming in. School and hospital buildings have been turned into relief camps in most towns of Lower Dir to deal with the crisis, affecting the education of thousands of students and disturbing health services. Dozens of families have spent sleepless nights in the open before finding a shelter. "I left Bajaur with my family five days ago and spent three nights under the open sky. Now I have shifted to this (Pirpai) camp," said a third-year student who discontinued his studies due to the ongoing military operation.
Muhammad Nabi, who was forced by fresh aerial shelling to leave his village Nawagai along with his family, says they have been sandwiched between the militants and the security forces, and are in no position to resist them. "We covered miles on foot before finding a vehicle to reach here, because any further delay could have caused us an irreparable loss," the white-bearded man says. A woman at the gate, cuddling her crying child, says she reached the camp that morning with her family and are still waiting to find a place. This suggests that the migration has still not stopped.
The federal government has pledged to provide Rs100 million to the province to properly look after the displaced families, but the NWFP government has demanded Rs1.5 billion because it does not have the wherewithal to take care of such a large of internally displaced people for an unknown period. Realising the problems of Pakistan after the Bajaur exodus, the United States has also offered assistance to the government. However, local and international non-governmental organisations (NGOs), as well as United Nations agencies, have been least bothered.
Some analysts believe that the growing woes and sufferings of the innocent people in troubled tribal and settled areas of the NWFP, and the subsequent lethargy and indifference of the government to look after them, have been turning these people into militants. They are of the view that due to ill-planning on the part of the government, military operations have been producing militants, instead of crushing them.
The recent sharp depreciation of the Pakistani rupee against the American dollar is a matter of serious concern, because of its likely adverse effects on the messes
By Hussain H Zaidi
For six years, the Pakistani rupee remained relatively stable against the American dollar. On average, the rupee-dollar parity was 61.0 during fiscal year 2002-03 (FY03), 57.7 during FY04, 57.9 during FY05, 59.6 during FY06, 60.1 during FY07 and 60.5 during FY08. In the first four months of FY08 (July-October 2007), the rupee remained more or less stable. However, the steep slide started in November 2007 after the proclamation of emergency. By the end of April 2008, the rupee-dollar parity had exceeded 64.0.
In mid-May, the rupee declined to Rs69.40 per dollar and to Rs72.55 per dollar in the first week of July. On August 15, the rupee-dollar parity sunk to 77.10 -- meaning that the domestic currency had depreciated by 13.10 percentage points against the greenback in only the last three-and-a-half months -- mainly due to heightened political uncertainty created by the ruling coalition's decision to impeach the president. The rupee recovered some ground after the resignation of Pervez Musharraf on August 18 and at the close of business hours on August 20, one dollar was traded for Rs74.90.
What is the reason for such a sharp erosion of the exchange value of the rupee and what are its implications for Pakistan's economy? Before we look into these questions, a few paragraphs about the exchange rate seem in order. Put simply, the exchange rate is the price of one currency in terms of another. In other words, it is the relative price of a domestic currency. Like other relative prices, the exchange rate may be determined by the market -- by the forces of demand and supply -- or alternatively fixed by the government. The former is called the floating or flexible exchange rate, while the latter is known as the fixed exchange rate.
In a market economy, prices are not left completely to the whims of the forces of demand and supply and the authorities intervene to ensure price stability. In case of a flexible exchange rate, the government (or the central bank) intervenes to check volatility in the market. For instance, if the domestic currency is appreciating or likely to appreciate sharply against a foreign currency, the central bank will pump in domestic currency into the foreign exchange market or pump out the foreign currency. Conversely, in case of a major depreciation (actual or likely) of the domestic currency, the authorities will inject foreign currencies into the market. The important thing to note is that sharp movements of the domestic currency, both upward and downward, do not bode well for the economy and, therefore, need to be avoided.
The exchange rate is determined, just like prices of two or more commodities, by the relative demand and supply of domestic and foreign currencies. If the demand for a foreign currency exceeds its supply, it will appreciate, which means that the domestic currency will depreciate. The greater the difference between the demand and supply, the sharper will be the upward or downward movement of the exchange rate. A country's demand for and supply of foreign currency is reflected by its balance of payments (BoP) account, which consists of two types of entries: debit items and credit items. The former covers payments made to foreigners, such as import of goods and services, debt servicing and investment abroad; while the latter covers payments received from foreigners, such as export of goods and services, foreign direct investment (FDI) inflows, and external grant or credit.
The demand for a foreign currency arises from debit items in the BoP, while the supply of foreign currency comes from credit items in the BoP. Thus, if a country imports more than it exports, its demand for a foreign currency will exceed the supply thereof and, thus, the domestic currency will depreciate. The result will be similar if capital outflows exceed capital inflows. Hence, when an economy is facing an adverse BoP position, it is likely to have a weak exchange rate position -- its currency will depreciate. The relative value of the two currencies -- the exchange rate -- is also in part determined by the domestic prices in the two countries. A country facing higher inflation than its trading partner is likely to have a weak exchange rate position.
Value of the domestic currency also reflects businesses' confidence in the country's economic health. This confidence is eroded amid political uncertainty or instability. Hence, political factors also play an important role in exchange rate stability or volatility, as the case may be. With this brief account of exchange rate movements, let us return to the depreciation of the rupee against the dollar! We begin by looking at the BoP account for FY08. The current account deficit reached $14.01 billion compared with $6.87 billion during FY07. The surge in the current account deficit was due to the trade deficit, which shot to $20.74 billion compared with $13.53 billion during FY07. But for the $6.45 billion worker remittances, the current account deficit would have been even higher. The large trade deficit meant that the demand for dollars far exceeded their supply, thus resulting in appreciation of the greenback against the rupee.
A country's current account deficit is financed by inflow of foreign capital -- the credit items of the capital account. However, Pakistan is also facing problems as far as capital account is concerned. Take the example of foreign investment! During FY08, the country received total foreign investment (FDI plus portfolio investment) of $5.19 billion, which was $3.22 billion less than that of $8.41 billion during the previous year. Though FDI slightly increased from $5.14 billion in FY07 to $5.15 billion during FY08, foreign portfolio investment sharply declined from $3.28 billion to only $41 million. Portfolio investment -- the investment in stock market -- is inherently volatile, because it does not entail a long-term commitment and is seriously affected by political uncertainty. In this context, we can say that it is the increased political uncertainty that has mainly accounted for capital flight from Pakistan in recent months.
As a result of problems regarding both current and capital accounts, foreign exchange reserves declined from $15.61 billion at the end of FY07 to $11.28 billion at the end of FY08. As of August 1, 2008, the reserves had fallen further to $10.15 billion. The falling foreign exchange reserves have constrained the State Bank of Pakistan's (SBP's) ability to directly intervene in the market by injecting dollars into it. Not only that, the weakening forex position conveys a negative signal to the market. Speculations abound that the dollar will go up further. As a result, the demand for dollars goes up, which actually drives up their price in terms of the rupee -- an obvious case of a self-fulfilling prophesy.
In addition to the BoP problems, the increasing inflation is also partly responsible for the slide of the rupee. During FY08, consumer price index (CPI) inflation increased to 12 percent from 7.8 percent during the preceding year. In July 2008, the CPI inflation shot up to 24.3 percent. Food inflation increased to 17.6 percent during FY08 from 10.3 percent during FY07. In July 2008, food inflation increased to 33.8 percent. The rising inflation has forced the SBP to tighten the monetary policy, albeit without considerable success, because of the government's growing dependence on the central bank to finance its yawning fiscal deficit.
During FY08, 80 percent of the fiscal deficit amounting to Rs689 billion was financed by the SBP. The monetisation of the fiscal deficit is a principal cause of the increasing inflation and consequent erosion of the value of the domestic currency. Regarding the political factor, one reason for exchange rate stability from 2002 to 2007 was relative political stability in the country. However, since November 2007, the country has remained subject to political uncertainty reflected in the depreciation of the rupee. The exit of Musharraf does not mean an end to political uncertainty, because the issue of reinstatement of the deposed judges is still on the table.
Exchange rate stability, primarily, is the responsibility of the central bank. Though on its part, the SBP has adopted some measures, such as placing ban on the export of foreign currencies, curtailing trading time of currency dealers, slashing advance payment against imports to 25 percent from 50 percent and tightening the monetary policy. However, these measures have not proved effective in stopping the slide of the rupee. The central bank's most useful tool in maintaining exchange rate stability is sale and purchase of currencies in the foreign exchange market.
However, as mentioned above, in the SBP's case, the use of this tool is constrained by falling foreign exchange reserves. What is needed to prevent further depreciation of the rupee is foreign capital inflows, which will increase supply of the dollar and convey a positive signal to the market, thus reducing speculations. In the absence of an alternative, the government will be forced to go to the International Monetary Fund (IMF), though its assistance is not without conditionalties.
Finally, we come to the effects of the depreciation. In theory, depreciation of the domestic currency tends to make exports cheaper and imports expensive, and, thus, may drive up exports and drive down imports. This enables the economy to narrow its trade deficit. However, in practice, the change in export or import volume is contingent upon many factors. For a country such as Pakistan, which depends on import of capital equipment and raw materials for its exports, the increase in import prices increases the cost of production of exportable goods, which adversely affects their competitiveness in the international market.
Hence, the effect of the depreciation on exports can go either way. As for effects on imports, nearly two-thirds of our imports consist of petroleum products, capital equipment, raw materials and food products for which the demand tends to be largely inelastic. This means that the rupee depreciation is not likely to significantly attenuate the import demand. Hence, instead of narrowing the current account deficit, the depreciation may actually widen it, thus aggravating an already precarious BoP position.
Secondly, the depreciation will negatively affect the terms of trade (ToT) -- the difference between export and import prices -- because exports will be cheaper and imports expensive. Favourable or improved ToT enables a country to buy a larger quantity of goods (imports) in exchange for a smaller quantity of exports. A country's overall welfare is positively related with its favourable ToT. A developing country such as Pakistan needs to import machinery, equipment and raw materials to maintain the growth momentum. Deterioration in ToT will constrain the power to import industrial goods in sufficient quantities and, thus, may slow the growth momentum. Another impact will be on foreign debt payment. At the end of FY08, external debt and liabilities stood at $46.28 billion. During FY08, debt servicing -- including payment on both the principal and the interest -- amounted to $2.80 billion. The depreciation will increase the cost of debt servicing and put additional pressure on the country's fiscal position.
Sustainable urban transport is a must for Pakistan's big cities
By Dr Noman Ahmed
At last, the government seems to have woken up to the implications of fuel price-hike and its impacts on the common people. On July 16, the federal cabinet announced to introduce a CNG buses project for 10 large cities in the country, with Karachi designated to receive the first consignment. Later in the month, the National Trade Policy allowed the import of CNG buses from India. While the decision of resorting to a comprehensive bus project is useful, it is not a new approach. The previous regime had also announced a large bus scheme for Karachi on several occasions. The issues faced in the urban transport sector need a holistic approach, based on objective analysis and feasible solutions.
Unfortunately, this sector has been overwhelmed by inappropriately devised projects without any direct relation to the scale and magnitude of problems. For example, more than Rs30 billion have been spent on the 16.5-kilometre-long Lyari Expressway, which is a duplication of Karachi Northern Bypass. The project has dislocated more than 200,000 people, affected education of more than 18,000 children and increased the cost of living of affectees due to locational disadvantages. As predicted in various research studies, the project faces serious hindrances to its completion due to the resistance offered by politically strong groups that have refused to vacate their properties near the project site. Many other developmental projects have faced the same fate in Karachi and other big cities of Pakistan.
Our cities have a very underdeveloped urban transport system. It usually evolves as a byproduct of land sub-division, speculative real estate development and undesirable urban sprawl. As a consequence, the feasibility of the system becomes questionable from the very onset. Inner city areas experience a petty contractor-driven process of urban redevelopment on piece meal basis, which gives rise to over-densification. In both the extremes, provision of transport and other components of infrastructure become economically unviable. The other extreme is the acres of sold out, but unoccupied, housing societies that continue to be sparingly populated.
The extension of public transport system is an economically unviable option for such localities that are abundant in Karachi, Lahore, Hyderabad, Faisalabad, Rawalpindi, Quetta, Peshawar, as well as many medium-sized cities in Punjab and Sindh. Passenger density along the movement corridors does not reach even the bare minimum requirement due to spread out distances and uneven housing development. Despite continuous feedback provided by research institutions, independent experts and representatives of interest groups, the policymakers have not paid any heed to coming up with a feasible solution. Now that the oil price surge has hit us hard, some cosmetic attempts, such as import of CNG buses, are being contemplated, which are unlikely to have a positive impact.
The issue of subsidy is very crucial in urban transport. Across the globe, including the developed countries, the urban transport is treated as an essential service. It does not stand as a profit-making enterprise. Whereas the private sector is invited to participate in the sector, it is given adequate cushion in a targeted manner to facilitate the running of economically-viable services to benefit citizens. The provision of subsidies is strictly monitored to ensure the rightful benefit at the end of the equation.
This subsidy is justified from the standpoint of minimising locational disadvantages of the workforce living in far flung areas, reducing the operational deficit of transport operators and ensuring a decent service for the passengers. The availability of desirable public transport reduces private car trips to work locations, thereby causing a decrease in road usage. In turn, this step increases the efficacy of public buses using the same space. From the social standpoint, the greater use of public transport by multiple classes also reduces the societal divide. It is worthwhile to note that top executives in London, New York or Sydney can be found routinely travelling on public transport for work trips.
From the technical perspective, mode of transport is dependent upon the geographical and population size of the city. The cities with population range of more than five million essentially qualify for some form of mass transit solution. The efficiency of ordinary buses does not correspond to the passenger requirements. Karachi, the largest city of Pakistan, has not been able to develop a mass transit system since the 1970s when it was first planned by the city authorities. Despite certain efforts by various government departments, the cumulative effort of the government has fallen short on this account.
Promotion of a technically-inappropriate option of elevated rapid rail transit, inability to revitalise and upgrade existing circular railways, rapid encroachment on crucial right-of-way corridors, and sale of public transport assets have been the shortcomings. In Lahore, the same issue persists with a lesser intensity. International research has proved that rapid rail transit is an unsuccessful and expensive option with very high operating costs. The solution is to resort to bus rapid transit, which requires lesser investment, results in lesser displacement and lower gestation period, and is also user-friendly. It is running in many cities in South Asia and elsewhere in the developing world. The private sector will also show interest, if given the corresponding risk coverage and operational support.
The use of non-motorised transport -- especially bicycles -- is a very useful option for short and medium trips. This can be promoted by creating a bicycle-friendly environment and infrastructure. Dedicated lanes / tracks for bicycles are an essential issue. In our land use planning and adjustment, it can be effectively incorporated, should the government intends to launch it as a campaign.
In the wake of rising fuel prices, this can surely become an effective choice for the masses. By introducing glamour for young people, bicycling can be extrapolated as a popular fun-cum-transport option for schools and colleges. Finally, the government must realise the fact that geographical disadvantages between various urban, semi-urban and rural locations can only be minimised through a cheap and efficient transport system. The government of the time shall be doing itself a great service by addressing this need at the earliest instance!
Pakistanis working abroad are faced with many challenges, ranging from low salaries to poor living conditions
Syed Nadir El-Edroos
Prime Minister Yousuf Raza Gilani, in his speech marking the August 14 celebrations, highlighted the important role overseas Pakistanis play in the country's development (read survival). This statement came at the back of reports that remittances for July 2008 touched $627 million, in line with the government's efforts to realise the target of $7.5 billion for fiscal year 2008-09. Ever since the 1970s, remittances by Pakistanis working abroad have underwritten the nation's economic survival. In short, the country's balance of payments (BoP) deficits have been plugged by their remittances.
The much-denounced policies of elite consumers and consumption-based growth; fuelled by the demand of foreign imports, have been effectively paid by the remittances received from Pakistanis working abroad. The tragedy is that most workers who leave Pakistan for, say, the Middle East do so in the hope of improved earnings, and a better life for themselves and their families. That, however, is far from the case and the inequalities that fuel their hopelessness in Pakistan are perpetuated in the 'labour camps' of sprawling cities abroad.
Since the 1970s, successive governments have encouraged the supply of labour abroad, primarily to the Middle East. These unskilled and semi-skilled workers built the housing schemes, shopping malls and skyscrapers that make up Dubai, Abu Dhabi or any of the major cities in the Gulf. However, as in any desert, this is but a mirage. While the rich and wealthy marvel at the transformation of small seaside villages into cities today, little or no thought is spared for the hundred of thousands of labourers who have toiled to build these cities.
An average labourer works six days a week, up to 12 or more hours a day, spending a further two hours commuting from his work site to the labour camp where he is housed beyond the city limits. Journalists are discouraged from visiting these areas, while a quick Internet search reveals the pictures of these camps that resemble a prison more than a residence ñ up to 10 people share a small room in far from ideal conditions.
Moreover, upon arriving in the country, he has to give his passport to the local authorities, limiting his freedom to enter and leave the country, a measure which would hardly be tolerated in most countries. Surprisingly, most people who end up in such conditions have actually had to pay for the 'privilege' of working and living in such conditions. They spend up to two years paying for the debt owed to their agents; only after which are they able to actually remit any meaningful sums of money back to their loved ones at home.
In the last two years, several cities in the Gulf have seen labour strikes (unions are illegal here) over work and pay conditions. Interestingly, the United Arab Emirates (UAE) government offered to fly back any unhappy labourers, no questioned asked. Surprisingly, an overwhelming number of people chose to leave. While labour issues are ignored, child camel jockeys are perhaps more known. Though the latter are now illegal in the Gulf, there seems to be no let up in the demand for small children to ride camels across the region. Parents or relatives sell young children to be quickly whizzed of to the Middle East, often under false pretences. Similarly, there is no shortage of cases of maids who have had to face abuse from those whom they worked for, with little or no recourse to justice.
Whatever I have stated above is no secret. It is an open secret, which is also well-documented, published in the media and even acknowledged by various governments in the Gulf. However, the fact remains that these workers have no rights, even that of unionising or protesting against injustices. Human smuggling in Pakistan is a major industry and it is surely patronised officially. The extortion of rural immigrants promised a better life abroad in exchange for vast sums of money has led many to incur huge debts while working abroad. As mentioned earlier, most emigrants from Pakistan are forced to relinquish their passports on arrival, which places them at the mercy of their superiors.
What is extremely disturbing is how successive governments in Pakistan have turned a blind-eye to such a sorry state of affairs. At least I find it amazing that our Muslim 'brethren' are not only feted officially, but then allowed by the Government of Pakistan to treat Pakistani nationals in such a fashion. The government cannot claim ignorance, as I have mentioned earlier that such situations are well-documented.
Critics of this position would be quick to argue that the money they remit home is of national interest and they are many success stories of Pakistanis working oversees who have done very well for themselves. But here I am talking about the labourers, who are much larger in terms of number and have to suffer the most. Their plight remains problematic in many respects, because they are beyond the jurisdiction of the Government of Pakistan; however, their position as labourers in their host country does not provide them with the rights that can help to dignify their experience of staying abroad.
The sorry pictures of Pakistani nationals being deported and then questioned on arrival at airports or, perhaps even more disturbing, the overfilled small motor launchers that often bring back deported Pakistanis from time to time find some media space among the many issues that face our country. For all of the importance that is attached to the foreign currency that these workers generate, their position in our and foreign societies is at its nadir. Pakistan has successfully exported its inequalities abroad. As in their home country, those who toil to make the malls, hotels, work at the restaurants and provide most of the services that those who can afford take for granted, the same scenario is repeated in foreign lands.
However, in cities such as Dubai, their existence is momentary. They are shipped into the cities to work for long hours in the building cities or in the kitchens, and then shipped back beyond the city limits, beyond the eyes of those who come to enjoy the splendour of the products that they produce. Further, the remittances they do send back have mostly been used to fuel consumption rather than sustain growth, thus foreign workers can expect their children to take their place in the years to come Perhaps this is what we in Pakistan are looking for! Enjoy the spoils of the land and just ship out all the poverty, the unattractive underbelly of society.
Necessity breads compulsion and, therefore, the demand to leave the country regardless of the conditions abroad are unlikely to change in the coming years. More cases of dead Pakistanis found in ships or containers are likely. The government is likely to remain silent in all such cases, fearful of antagonising our 'brothers' in the Middle East. The prime minister stated that his government would try to make arrangements for foreign workers to be granted voting rights while being abroad. The question here is not the merits of whether one should work abroad; rather, this has to do with the impotency of our government to act in its citizens' interests. However, whether our government is even able to table the issue of the rights of its citizens abroad is debatable.
Managing garbage disposal in an efficient manner is the need of the hour
By Sibtain Raza Khan
Modernisation has changed our lifestyle. Use of disposable material has increased many times in our daily life. Though this has created a lot of ease in our lives, yet inadequate and improper disposal of waste is posing serious threats to human health as well as environment. 'Waste' is generally defined as unwanted material. Within this category, there are many types, such as municipal solid waste, industrial waste, agricultural waste, construction and demolition waste, medical waste, oil and gas waste, nuclear waste, etc. All these types of waste have properties that may make them hazardous or capable of having a detrimental effect on human health and environment.
Municipal Solid Waste (MSW), commonly known as trash or garbage, is the most common type of waste in Pakistan. It includes mainly household waste (domestic waste) and commercial waste that is colleted by a municipality within a given area. There are five broad categories of MSW: 1) biodegradable waste (food and kitchen waste); recyclable waste (papers, bottle and plastic); inert waste (construction and demolition waste); composite waste (clothing, tetra packs, etc); and hazardous or toxic waste (chemicals, spray cons, etc).
It is estimated that currently 60,000 tonnes of solid and semisolid waste is generated in Pakistan per day. Though every city has its waste management system right from collection of garbage up to its disposal, improper disposal of garbage is posing a serious threat to public health. For example, disposal of waste into nullahs, canals and rivers is polluting the water supply along the whole length of these courses. Infections and diseases are spreading from dump sites to the general population. According to Dr AK Shahid, a renowned physician, improper disposal of garbage has negative consequences for human health because flies breed on uncovered piles of rotting garbage and spread diseases like diarrhea, dysentery, typhoid, hepatitis and cholera; while mosquitoes transmit many types of diseases like malaria, dengue and yellow fever.
Now, improper collection and disposal of solid waste has become a major problem in the major cities and at least 40 percent waste generated in these cities remains either at collection points or on the streets. The public have a view that proper methods to dump the waste are not being employed by civic bodies. Landfill sites to dump the municipal solid waste are not designed properly and are causing problems, including various diseases, due to incomplete decomposition of solid waste. These un-segregated sites have turned into a breeding ground for rodents, flies and insects. The population living near these un-segregated sites suffers from respiratory diseases, because of the foul smell and smoke of burning trash in the area.
Environmentalists have also stressed that improper disposal of solid waste is a serious environmental as well as health hazard. They emphasise that open dump sites are producing diseases and contaminating the groundwater. Environmental Protection Agency (EPA) officials agree that the biological decomposition of garbage produces nitrogen and ammonia gases, which are dangerous for human health. In fact, the burning of solid waste, including plastic bags, is not only polluting the air but also generating another kind of garbage.
On the other hand, officials of civic bodies view that sanitary workers collect and dispose of solid waste properly at the landfill site through dumpers. Moreover, after dumping the garbage, it is covered with clay and pressed with bulldozers. Besides this, they add, main roads and streets are cleaned regularly by road sweeping machines after the business hours. It is also the duty of citizens to cooperate with civic bodies and keep their cities clean. Therefore, awareness should also be created among the people to dispose house waste in a proper manner.
For proper disposal of MSW, new and productive methods should be adopted. Though a number of techniques are being used in the developed and developing world for waste management ñ such as disposal methods (landfill and incineration); recycling methods (physical reprocessing, biological reprocessing and energy recovery); and avoidance and reduction methods -- only ages-old disposal methods are being used by civic bodies in Pakistan.
Nonetheless, there are new trends in the country. For instance, according to media reports, the Fauji Cement has installed the first-ever refuse-derived fuel (RDF) plant at Rawalpindi to recycle garbage into fuel. This newly-installed recycle plant would make use of garbage as a source to produce fuel, which would then be used in the cement plant that has a capacity of 12 tonnes per hour, enough to produce energy equivalent to 170 tonnes of coal fuel.
In the developed world, MSW power plants are even being used to produce electricity by burning the waste as a fuel. These waste-to-energy (WTE) plants are designed in a way to dispose of MSW and to produce electricity as a byproduct of the incinerator operation. According to the US Environmental Protection Agency, 17 percent of the country's MSW was burned and used for generating electricity in 1998.
The Mass burn (MB) and RDF methods are commonly used by the developed world in WTE technologies. In the MB method, burning MSW converts water to steam for driving a turbine connected with an electricity generator. On the other hand, in the RDF method, first MSW is processed and then the shredded MSW is used as a fuel in the same manner as at MB plants. The Fauji Cement is using the later method to produce energy for cement production.
Though burning MSW can generate energy and reduce the volume of waste, yet ash disposal and the air polluting emissions from plant combustion operations have some primary environmental concerns that demands due attention. For sound management of MSW, the EPA recommends that first avoidance and reduction methods should be applied, and then recycling and composting methods, while disposal in landfills or waste combustors methods should be used as a last option. There is a serious need for adopting avoidance and reduction methods, as recommended by the EPA.
In this regard, people should avoid using polythene bags and try to use paper bags or hand-made cloth bags while shopping. Besides this, WTE plants should be installed in the big cities. This exercise would not only provide an opportunity to produce electricity, but would also lead to sizeable reduction in waste. Besides this, municipal bodies should incorporate wider waste disposal means to effectively tackle the nuisance of garbage at the roadsides and within the residential areas.
These civic bodies should seek public help by increasing consciousness among the masses, especially through media and awareness campaigns in schools and colleges. To counter garbage problem at public places and in residential areas, more waste bins should be installed, which should be regularly cleaned by the municipal authority. Also fine should be imposed on littering public places. However, it is only with public support that civic bodies can improve the garbage disposal system and can help in providing cleaner surroundings.
Women have a major role to play in achieving sustainable economic progress
By Sidra Tufail
In today's dynamic world, it is imperative that women be equipped with economic equality to further the country towards the path of development. The world has experienced a fundamental change in its economic affairs and women have played a major role in this regard. Now, economic development is being closely related to the advancement of women. Countries where women have advanced, economic growth has been steady, whereas where women have been restrained, there has been stagnation.
The role of women in development is most intimately related to the goal of comprehensive socioeconomic development, and is a strategic question for the development of a society. The full and complete development of Pakistan, as well as the overall welfare of the nation, requires the maximum participation of women on equal terms with men in all fields. It is, thus, imperative that we recognise the role of women as a dynamic factor and a valuable asset in the overall process of development and not to view them as an economic burden or cost that they are currently considered by many.
Equality between women and men is a matter of human rights and a condition for social justice. It is also a prerequisite for development and peace. Empowerment and equality are important human rights aims in themselves, and promoting gender equality also promotes the stable growth and development of economic systems, with social as well as strictly economic and monetary benefits.
Unfortunately, for Pakistan, gender disparities are rampant in the country. Large gender disparities in basic human rights, resources and economic opportunity, and political voice are still pervasive in Pakistan. The assumption that the responsibility for child rearing and for family needs lies with women limits their capacity to participate efficiently in the production process. Gender inequalities hinder development and ignoring them comes at a great cost to people's well being, and the country's abilities to grow substantially and govern effectively and, thus, reduce poverty.
Any development strategy initiated in our economy that neglects the need for enhancing the role of women cannot lead to widespread socioeconomic development. A change in the traditional role of men as well as the role of women in our society and the family unit is needed to achieve full equality between men and women. Women's second-class status carries a financial and social cost, and not just for women. Men and society in general, also pay a price. For this reason, empowering women should be the central aim of sustainable development for Pakistan.
The issue of women's status, autonomy and equality has frequently been raised internationally on the principle that a nation cannot progress when a vast segment of society is deprived of its due share and not allowed to play its role properly. Inequality between women and men limits productivity and, ultimately, slows economic growth. In addition, women's human capital generates benefits for society in the form of lower child mortality, higher educational attainment, improved nutrition and reduced population growth.
Limited education and training, poor health and nutrition, and denied access to resources not only affect the women's quality of life, but also hinder economic efficiency and growth. In Pakistan, however, gender discrimination is almost codified in the law, and women still lack the right to own land, manage property or conduct business, which severely limits their ability to participate as independent agents in the private sector's activities. This is alarming because women are agents of change, shaping the welfare of current as well as future generations. These human and development costs to Pakistan's economy make a strong case for public action to reduce gender disparities and, in doing so, reap the social as well as economic benefits associated with gender equality.