'healthy' is our budget?
or undue credit?
have a strict monitoring side'
women, the Taliban-style
food markets and small farmers
Pakistan's best known newspaper columnists and analysts, especially those who
were politically active in the late 1960s, are calling the present times and
mood in Pakistan, 'revolutionary', and are making numerous references to the
1968-70 period. Of a later generation of writers, there are those who are
comparing Pakistan today to the 1986-88 period, and here too, one hears the
word 'revolution' repeated many times in columns, as well as on the
electronic media. Whatever one wants to call it, there is no doubt that the
political process underway in Pakistan today is probably the most significant
development that has taken place in many, many, years. Numerous events and
developments have taken place in the last ten weeks, which may have changed
Pakistan's future for some time to come, if not permanently.
looks at just the last few weeks, there are four main events -- or series of
events, or processes -- that have taken place which have changed Pakistan's
political map. A number of smaller happenings have also added additional
dimensions to these developments. The four main actors/events which have come
to the fore relate to the Chief Justice 'issue', the muhajir Muttahida Qaumi
Movement (MQM), Benazir Bhutto's Pakistan Peoples Party, and the
extraordinary new role and power of the electronic media.
March, the fully-uniformed Chief of the Army Staff, President General Pervez
Musharraf, summoned the Chief Justice of Pakistan Iftikhar Muhammad Chaudhry,
to his office, and is supposed to have kept him waiting for five-and-a-half
hours. In this period, it has been stated, that the Chief Justice was
pressurised by the president along with a number of uniformed Generals, to
resign his post. The president's team had created a charge-sheet against the
Chief Justice on a number of accounts related to the misuse of his office. He
was accused of many things, including his using a government helicopter to
attend a funeral and ensuring for his son, a public servant, privileged
postings. When he did not voluntarily resign, the Chief Justice was made
'dysfunctional' and sent home to await further charges, and an Acting Chief
Justice of the Supreme Court of Pakistan, appointed in his place.
no denying the fact that this has been President General Musharraf's worst
mistake and greatest miscalculation, and that he was ill-advised in taking
this decision. He himself, very soon after it became clear what the reaction
to this move was, said that a 'conspiracy' had been hatched against him
personally. For the government, there may have been reasons to take some
action against the Chief Justice since he had taken a stand in a major
privatisation case last year which embarrassed the government and revealed
its wrong-doings, and the Chief Justice was increasingly making some (albeit,
muted) sounds, about Pakistan's disappeared -- those people, many of whom
Baloch, who have been picked up by one of Pakistan's many 'agencies' and have
disappeared. It is important to state that the Chief Justice is no
trail-blazing revolutionary for, as a judge of the Supreme Court, he had
signed all the nefarious laws and constitutional changes which President
Musharraf had creatively made, without a whisper of protest. Chief Justice
Iftikhar Muhammad Chaudhry was as much part of the establishment as was the
Chief of the Army Staff, himself. With the Chief of the Army Staff seeking a
second term as President of Pakistan -- which many judges and politicians
feel is unconstitutional -- he was advised by someone close to him that the
Chief Justice would create a problem when it came to his re-election and,
hence, should be removed.
least of all President General Pervez Musharraf, could have expected the
response to this order, by no means novel in Pakistan's military-led history,
which has made these last ten weeks the weakest and most difficult of his
seven-and-a-half years. In the beginning, seeing that their Chief Justice was
not bowing down to military pressure, some lawyers were emboldened and
started a public campaign to have a fair trial of the deposed Chief Justice
and to have him reinstated. Slowly, this small campaign grew in nature and
size, and some judges resigned their posts in protests, and many judges
started supporting the ousted Chief Justice. In the first few weeks of the
campaign, the slogans were largely those related to the restoration of the
Chief Justice and regarding upholding the stature and sanctity of the
judiciary. The judiciary fought back to protect its own institutional
interests and so in the process, emerged united. There was little 'politicisation'
and political parties, as always the opportunists most have been in the past,
watched from the sidelines.
very soon it became clear that this was not just a protest against one
decision, but there were clear beginnings of a 'movement', for justice and
with political overtones. The lawyers were joined by some activists from some
political parties and by some members of the public. While there has been
considerable support from the public -- as seen by popular meetings and
response to the Chief Justice's various visits and trips to different parts
of Pakistan -- this has not been a 'public' movement, but very much a
lawyers' protest movement, with some and growing, help from political
the colour of the protest has changed, and from a collective action issue
concerning the lawyers and their self-interest, the slogans and the politics
of the movement, have become far more political. From being in favour of the
Chief Justice and his reinstatement, they soon became anti-government, anti-Musharraf,
and have now become audibly anti-military. There is growing support for the
lawyers' movement amongst different cross-sections of society, as can be
envisaged by the number and nature of people who are participating in the
movement, many as observers, rather than as activists and participants. Even
the more radical slogans are being repeated in many quarters and the 'Go
Musharraf, Go' chant heard at most of the jalsas of the lawyers, is no longer
uncommon. Yet, it must be remembered, that while the lawyers' movement may
have a lot of public support and sympathy and it has increasingly become 'politicised',
this is not, as yet, a 'political movement' in the sense that is usually
extraordinary May 5 road-trip from Islamabad to Lahore, which usually takes
four hours took 24, completely changed the mood and scale, of both the
lawyers and the government. The lawyers and their supporters realised that
they were on to something bigger than they had envisaged, while the
government/military felt that this was certainly not normality for them.
After all, this was the Punjab, which was following the journey of the Chief
Justice. In his address to different Bar Councils across Pakistan, the Chief
Justice was scheduled to address the Sindh Bar in Karachi on May 12.
has been ruled by the Mutahhida (previously Muhajir) Qaumi Movement, since
the early 1980s, when the MQM emerged as an urban militant political party,
speaking for the rights of the settled migrants (muhajirs) from India after
partition. Its politics was known to have been one which was overtly violent,
yet they were also popular. They have won all the elections that they have
participated in since the 1980s, from the larger towns of urban Sindh,
especially Karachi. Because of their urban Sindh vote bank, they have also
been part of the Sindh provincial Government, as they have been since the
General Musharraf Elections of 2002. The city of Karachi has faced much
violence, destruction and mayhem since the rise of the MQM, especially during
the second Benazir Bhutto government in the 1990s. However, since 1999, when
General Musharraf and the military took over power, Karachi has been at peace
and has prospered perhaps more than any other region/part of Pakistan. The
MQM-Military-Alliance, is the other MMA which is part of the Pakistan
period since 1999 has been the longest period of peace and prosperity that
Karachi has seen since probably the 1960s. The first MQM cadre, brought up in
an era of terror and violence in the 1980s and 1990s, is probably in its late
thirties and forties, or even older. The MQM youth have, since 1999, lived in
an era of peace, prosperity and stability as it has been part of government
and has not needed the violence or terror to achieve its political or
economic interests and goals. Most citizens of Karachi who support the MQM
have lived seven-and-a-half years in peace and prosperity. Clearly,
demography and economic well-being, have remade the MQM and its supporters,
and until May 12, overt violence was not part of the MQM's strategy.
12, the Chief Justice of Pakistan, Iftikhar Muhammad Chaudhry, was scheduled
to make a trip to Karachi. As a counter measure, the MQM decided to hold its
own rally in support of General Pervez Musharraf. However, the MQM (which is
the Government of Sindh and a major partner in the Federal Government) tried
everything possible to stop the Chief Justice from coming to the city. After
putting hundreds of road blocks across the main streets from the airport,
they attacked small groups of those lawyers and political activists who
wanted to come to the airport to receive the Chief Justice. Over 40 people
were gunned down in cold blood. This was not the first time so many people
were killed in Karachi in a matter of a few hours, but it was the first time
for almost a decade, and the peace of the city was destroyed by those who
were responsible for that peace.
consequence of the killings of the 40 people in Karachi this time around,
unlike the killings in the past, was unprecedented. Never before has there
been such condemnation of the Federal Government, the Provincial Government
and the MQM and its leaders, as now. The MQM has never had to make a tactical
retreat in the past and has weathered every political storm that has come its
way. This time, however, it has been shaken by the reaction of politicians
and from the media -- on which more below.
seems of interest is to try and understand why the MQM has been more loyal
than the king himself. Why did the MQM do what no other political party in
government has done, even when it could have disrupted the Chief Justice's
visits and addresses? One reason for this is, that there is a strong MQM
military alliance, when both need the other. It could be that the MQM
panicked over the growing support for the Chief Justice and against General
Pervez Musharraf. It could be that they wanted to show him that they were on
his side and would not allow 'their' city to be taken over by his opponents.
(In fact, President General Pervez Musharraf has come out in extensive
support of the MQM's way of handling things on May 12, and has said that they
are completely innocent of the killings). The MQM needs the military as much
as the military needs the MQM, and hence the enthusiastic support to each
other. Other reasons suggest that the MQM military alliance is based not
simply on any ideological/political basis, but that both have benefited from
the billions of dollars worth of land deals made in Karachi. While the
military may run Pakistan, MQM runs Karachi. The MQM military nexus is based
on each benefiting political and economically through each others' backing.
then reaction against the way the MQM took over Karachi on May 12, has
backfired and added to a renewed resentment against the MQM, and many of its
supporters too, have been shocked and find it difficult to defend their
party's actions. Importantly, the MQM, for the moment at least, stands
isolated from the political mainstream, and only the President and his Prime
Minister are left with making embarrassing statements in their defence. Even
many of Musharraf's Ministers are unable to support MQM's actions of May 12.
biggest and most embarrassed loser in the process which started from March 9,
has been Benazir Bhutto and her Pakistan Peoples Party, with more egg on her
face than she would like. Benazir Bhutto in April, when the Chief Justice
'issue' had neither become as politicised as it is or had grown in scale to
the size it is, had said that she was willing to make a deal with President
General Musharraf allowing her to come back to Pakistan to participate in the
2007 elections. She had even said that she had no objection to being his
Prime Minister to him as President. President Musharraf too, had said that
this was a possibility he could work with. However, after the lawyers'
movement became bigger than anyone anticipated, and especially after the May
12 killings in Karachi, the main route open to Benazir Bhutto, is a littered
minefield. With so much antagonism against the MQM for breaking with the
settled political, parliamentary, process since 2002, Benazir Bhutto would
face excessive protest if she were to go ahead with accepting a minor,
junior, partnership to General Musharraf.
winner as a consequence of the events of May 12, and with the deal for the
moment in hibernation, has been the King's Party, the party in power at the
moment, the PML-Q. What would have happened to the seventy or so Ministers in
government, or the Chaudhry brothers of Gujrat who rule the Punjab under the
banner of the PML-Q, if Benazir and Musharraf made a deal, has never been
discussed. Clearly, while Musharraf may have required an alliance with the
PPP, his current crop of ministers from the PML-Q, would not have. Also, with
the MQM and the PPP having a bitter past, it was never quite worked out how
both will work together in Sindh, a province from where they draw their
greatest support. For the moment at least, the Benazir-Musharraf deal has
been put on hold. Many in government hoping to be elected, hope this stays so
for some time to come.
of the show since early this year, has been what one can collectively call
'the media'. The 'revolution' or political movement with its consequences,
are all the making of the media. They certainly are real and have mass
support, but without constant live coverage, with history in the making as
one watches, the sort of reaction one sees would not have taken place. The 24
hour long car ride from Islamabad to Lahore of the Chief Justice, was shown
live on television, as was the murderous attacks on citizens and on TV
stations in Karachi May 12.
the visuals have been revolutionary in what they have depicted, what has been
even more extraordinary, has been the media content, which has been truly
revolutionary. Never before has one heard the slogans of 'Go Musharraf Go',
or 'No more military rule', on live television. Never before has the MQM been
called a fascist party on live television by dozens of analysts, nor Altaf
Hussain, the leader of the MQM equated with Hitler. Both in the electronic
media and in the press, these examples are made with great ease and with a
great deal of space, and repeatedly, daily. Just a few years ago, at least in
Karachi, it would have been impossible to survive calling the MQM fascist, in
private leave alone in public, or calling Altaf Hussain, Hitler. Or for that
matter, chanting slogans in the National Assembly which were reproduced in
all newspapers after May 12, of the type: 'qatil, qatil, MQM' or 'qatil,
qatil, Musharraf'. The press has been fairly free for some years now, but
never so free or so powerful.
power of the press has been recognised and used by both government and those
who oppose it. Every speech of the leaders of the lawyers' movement is
televised live, and they get away saying whatever they want, including
statements televised live, such as 'down with the Generals, down with the
military'. There have also been many attempts to gag the press, and to scare
it off, but all such attempts have failed and rebounded back into the face of
the government. The press is emerging as perhaps the most powerful unknown
force in Pakistan's politics.
all this has been going on, there has also been the dramatic developments in
Islamabad, around the Lal Masjid and the Jamia Hafsa, a madrassa for girls.
As all writers have been emphasising, just a few kilometres from the
Presidency, a group of ulema and their students, have raised the flag of the
sharia and of the call to a 'Talibanisation', all in Musharraf's enlightened,
moderate, Pakistan. It seems that this group of students and their leaders
have been given a free hand to instil the fear of God in the hearts of
Islamabad's Muslims. The comfort level of these instigators is so high, that
many believe that this freedom being given to them is deliberate and meant
for publicity reasons. The fear, the argument goes, is not to be instilled in
the hearts of the populace of Islamabad, but in the hearts of the Americans
in Washington. The hope is that these cries of the 'Talibanisation of
Pakistan' will be heard in Washington and will lead to continued and further
support to President General Musharraf's enlightened moderation (or is it
moderate enlightenment? one forgets), and the Americans -- so critical and
influential to the political economy and geo-politics of the region -- will
continue to back the man in uniform and in power in Islamabad today, rather
than bring about any change over which they may have little control or
Pakistan is in the throes of major developments, by no stretch of the
imagination is this a revolution. It is barely a political movement, although
it is in the process towards becoming one. Unlike 1968-70, 1977, or even
1983, 1986-88, all political movements were organised around political
parties and political leaders. Today, the only 'leader' is a Chief Justice,
while some of the political parties are waiting to see when they can join
President General Pervez Musharraf's camp and cut a deal with him, while most
have only shown symbolic support to the lawyers' movement, without at all
jumping in. The opposition to military rule is still as disorganised as it is
President General Pervez Musharraf is in a spot of bother, and needs to
extricate himself from this hole he has dug himself into. It is probable that
there will be some sort of change or transition in this year of two
elections, but at the moment it is difficult to predict the outcome of this
transition. President General Musharraf may emerge further weakened for the
moment and may need to rebuild his rule, more inclusive this time, along with
more partners. It does not look likely that he will leave voluntarily nor
give up power. He can always make a number of tactical retreats, and salvage
some room for himself. One does not know what his most important
constituency, the army, is thinking, but they may prefer to enjoy the
benefits of military rule by supporting someone who has ensured that they all
benefit. On the other hand, with the military being abused publicly, on
television, it may be the army which calls for a collective retreat, to
re-emerge after playing its ubiquitous 'behind the scenes' role, which it did
throughout the decade of democracy in the 1990s. The TINA factor -- there is
no alternative -- however, might just result in the General-President's
political longevity. Sixty years and still the serving Chief of the Army
Staff General, as President of Pakistan. Ignominy of the worst kind.
The article has been published in Economic and Political
the last budget of the present regime in the election year. The our
soft-spoken Prime Minister-cum-Finance having no first hand experience of
people's suffering and humiliation at the hands of tax collectors, could not
realise what kind of bashing the citizens of this country get every day from
the Central Board of Revenue (CBR). For the last three years, CBR has been
showing wonderful and all time record high tax collections by resorting to
indirect taxes even under the garb of income tax, making the life more and
more miserable for the poor of this country.
last many decades, the concerned citizens have argued that the tax laws and
procedures in Pakistan should be simple, stable, neutral, and favourable to
economic growth. There is a consensus on this point and the CBR's present
Chairman is also now motivated and committed to play his role in the
achievement of this goal [we are not sure about his team, especially the old
timers who are usually change-resistant]. At this critical juncture of our
history when economic revival is at the core of our survival, we must
strengthen the hands of State for the generation of revenue to come out of
neo-colonial influence imposed on us through 'debt prison' of foreign donors.
policymakers sitting in the Finance Ministry, instead of wasting huge amounts
in hiring foreign consultants for Tax Administration Reform Project Reform
(TARP), should concentrate on evolving a consensus strategy aimed at
simplifying tax laws/procedures and their smooth implementation. Its goal
should not be defending the shenanigans of CBR or reminding the people of
their tax obligations but to ensure environment conducive for both the tax
collectors and taxpayers. In today's tough circumstances, our emphasis should
be on reconciliation and not exchange of bitter accusations and mud slinging.
Our action plan [borrowing a popular phrase from General Musharraf] should be
'Tax Reforms: Moving From Study to Action' [till today we have plenty of
studies but hardly any result-oriented action].
the government took a small step by instructing its own handpicked tax
experts at the Special Task Force (STP) to conduct a study on the income tax
code's complexity. The STP delivered a massive study, a testament to the
code's complexity. The STP's Chairman, an ex-bureaucrat, concluded that there
is no single source of complexity in the tax code. Rather, tax complexity is
brought on by a combination of forces, including:
law's lack of clarity and readability, large number of exemptions with 'ifs'
use of the tax system by the government to realise ambitious collection
dictates of foreign donors.
independent tax experts, who have never been invited by the CBR to sit in
their meetings relating to tax reforms for their known hostility towards
them, believe that the list of income tax code provisions that deserve
elimination or reform is the presumptive taxes on individuals and corporate
sector. Created in response to charges that a handful of wealthy individuals
and corporations were able to avoid paying income tax by using various
deductions and credits and get enormous refunds with the connivance of tax
collectors, the Presumptive Tax Regime [PTR] no longer serves the purposes
for which it was intended.
within last 10 years, the number of individual taxpayers required to comply
with the PTR continued to grow, but tax incidence fell heavily on the poor
and negligible or zero, in some cases, on the rich. For example, a rich
person earning Rs 2 million per annum as profit from bank deposits pays Rs
200,000 as tax under presumptive regime, whereas his normal tax liability on
this income is 35 per cent. In contrast, a widow, who is earning just Rs
100,000 per annum from her deceased husband's gratuity kept in a bank to make
both ends meet, has to pay Rs 10,000 as tax although her income otherwise is
below taxable limits. In fact, the importers, suppliers and contractors have
managed to shift their tax burden on the consumers/clients and enjoyed
enormous saving in taxes due to this ill-conceived tax device that was the
brainchild of a perceptive taxman who just wanted to portray high figures of
tax collection under Income Tax in order to obtain rewards from his political
masters. Now this colossal benefit has been extended to even the wealthy
property owners, who are earning enormous rents. They will be just taxed at
the rate of 5 per cent of gross amount of rent from tax year 2007. This shows
the callousness of our governments, who have always been subservient to the
landed interest, civilian or military alike.
economists and tax experts [not part of the official bandwagon of
self-styled, foreign-sponsored tax reforms] are proposing a number of
suggestions to fundamentally overhaul the tax codes/procedures and withdrawal
of PTR. Any action on these proposals will bring more shortfalls for the CBR,
which it cannot afford as its main thrust of taxes is on withholding taxes on
imports, exports, contracts and collection of taxes on profits on deposits,
bank instruments etc. It is worthwhile to mention that there are nearly 20
withholding tax provisions under various sections of the Income Tax
Ordinance, 2001 alone. The CBR never tried to broaden the tax base by
bringing the mighty into the tax net and relied mainly on withholding taxes.
The percentage of taxes collected by own efforts by passing orders and
creating demands other than withholding and voluntary payments under the
direct taxes is just 10 per cent. Since the promulgation of new law no effort
has been made to conduct any effective or meaningful tax audit to unearth
massive tax evasion.
is passing through a reform process (only time will show how successful or
sustainable the changes were), all the tax associations/independent tax
experts/concerned citizens/journalists/NGOs should seriously consider to
launch a non-governmental, public purpose and non-partisan organisation
[Foundation for Tax Justice, or under any other suitable name] that can
inform and educate Pakistanis about tax matters and issues, through research
and analysis, using objective, reliable data on government finance. The
proposed Tax Foundation should promote a sense of 'tax consciousness' in the
public. Its dissemination of information and objective analyses will help
both the parties; it can provide guidelines to policy makers in the ongoing
debate over tax and budget policies, and at the same time will inculcate a
greater understanding of the official tax policies/issues/laws to the public
at large. At present, numerous groups conduct research on tax and budget
policy, but it should be institutionalised. The Tax Foundation can:
analyse data from all levels of government
explore the effect of tax policy on businesses and individuals alike and
channel this information to the general public.
way, the Tax Foundation, a non-partisan, non-profit research and advocacy
organisation dedicated to fair taxation at the federal, provincial, and local
levels, can serve as a national resource centre, providing Pakistanis with a
better understanding of their tax system and the effects of tax policy. The
Foundation's mission should be to educate the public about taxes, and to that
end, it should publish reports, books/leaflets and through Internet site,
make complex tax system comprehensible for the layman; and answer queries
from the public and the media on tax policy, rates and collections. As a
non-partisan educational organisation, the Tax Foundation shall not represent
any particular economic sector's point of view. It must have a charter for
independence, and credibility. It should commit itself to principles which
guide its research and public information programs and which should be the
touchstones for all tax policy such as:
Informed Citizenry. People must know who and what is being taxed and how tax
legislation is enacted.
Simplicity. Complexity makes accurate tax compliance needlessly expensive and
Stability. Frequent change lessens citizens' understanding of the tax code
and complicates long-range financial planning.
Retroactivity. Taxpayers must have confidence in the law as it exists
entering into a transaction.
Neutrality. The primary purpose of taxes is to raise revenue, not to
micromanage the economy with subsidies and penalties. The tax system should
favour neither consumption nor saving and investment.
Promote Economic Growth. The tax system should not impede the free flow of
goods, services and capital, domestically or internationally.
worthy Prime Minister-cum-Finance Minister is committed to improve tax system
of Pakistan and his efforts are well directed to make the country free from
debt shackles of the foreign donors, then the following steps are imperative:
taxes for middle and low-income families.
Requiring the wealthy to pay their fair share.
Plugging corporate tax loopholes.
Adequately funding important government services.
Reducing the foreign and domestic debt.
Taxation that minimises distortion of economic markets.
an independent Tax Foundation in Pakistan can be a key turning point in the
tax reform process that is needed to raise public revenue and minimise ire
against tax machinery and tax evaders. The Foundation can exert public
pressure on the wealthy to pay their due share of taxes, help propel the
tax-overhaul effort, and reduce the government tax deficits. Only such an
independent Foundation can study the impact of tax exemptions/concessions for
the wealthy and corporations and keep the issue alive in debate over the
federal and provincial budget deficit. In USA such a study, Inequality and
the Federal Budget Deficit (1991), conducted by an independent organisation
examined the linkage between tax cuts for the wealthy and the mounting
federal deficit. This attention helped set the stage for President Clinton's
1993 Budget Act, which took back some of the tax cuts previously granted to
the wealthiest Americans by the supply-side tax plan of 1981. We need similar
studies and actions in Pakistan.
Pakistan there is an urgent need for such an independent public-spirited
organisation so that fairness and justice in tax system is ensured and
watched by citizens themselves. Unfortunately, our official viewpoint is
totally different on the issue. They want to be in charge of everything
through State control. The CBR stalwarts want to supervise 'Tax Reform' under
their tight noose and the Prime Minister-cum-Finance Minister wants to be the
in-charge of Supervisory Council, controlling CBR. You cannot reform in this
way. The lawful but excessive use of power is also maladministration. In this
country nobody is willing to exercise his authority in moderate fashion. We
do not like criticism of any kind, even the most positive and constructive
one, and are found of flattery. However, if they want any meaningful tax
reforms, they will have to give up encouraging the sycophants and will have
to develop a tolerant and positive attitude towards
studies/articles/criticism surfacing in the media or at seminars/meetings.
public and policymakers both can benefit from the independent Tax Foundation,
the role of which will be that of a watchdog. In tax matters there is always
be a third party interference concept, as taxpayers and tax collectors are
always parties to dispute, whether it is tax codes, procedures, policies and
assessments. In civilised societies, they have, therefore, established fast
track independent dispute resolution commissions, outside the traditional
appellate system, as an alternate means to achieve harmony and reconciliation
between the payers and collectors. Such steps in Pakistan have been destroyed
by CBR by keeping everything under its control, whether it is Advance Ruling
Mechanisms for non-residents or option for Alternative Dispute Resolution.
writers (www.huzaimaikram.com), tax advisers, are authors of many books and
teach tax laws at the Lahore University of Management Sciences (LUMS).
to the federal budget 2007, a special parliamentary session is convened to
debate the budget. Given this context, this article focuses on budgetary
allocations for the health sector with a view to lend impetus to a dialogue
on the short and long term imperatives of allocations in the health sector,
on four areas in particular: aggregate level of allocations, quality of
expenditures, allocation distributions and the issue of leakages and
pilferage from the system.
outset, it must be recognized that a discussion on budgetary allocations for
health is important for one specific reason: health is fundamental to the
social sector and in countries where macro policy decisions are largely
shaped by geopolitical realities and market forces. In these countries,
allocations for the social sector are a true reflection of any government's
commitment to meet the equity objective.
with respect to total allocations, it is well-recognized that there have been
increases in budgetary allocations in recent years; the present allocation is
a positive development. However, even as it currently stands, public sector
spending on health amounts to roughly $4 per capita, after adjustment for
population growth and inflation. Therefore, there is a wide gap still to be
bridged between this and the internationally recommended public sector
spending of US $ 34 per capita - a level on which the delivery of a package
of essential health services to populations becomes possible. In other words,
it would then become possible to achieve goals such as the Millennium
Development Goals (MDGs) and others articulated in the Midterm Development
Framework (MTDF). Theoretically, this would necessitate a five-fold increase
in the existing budget or a 50 per cent increase every year for the next 10
years. Pakistan's Fiscal Responsibility Act does not stipulate such an
increase. As a first step, therefore, we must set a 5-10 year plan for
gradual but substantial increases in the health budget. Here, it is important
to address the next question: even if we achieve this impossible fiscal
target with the existing health system, would we have the ultimate cure for
our health woes? The answer is clearly 'No' because of the issues inherent in
the utilization capacity. An important indicator of this is the 'allocation
versus expenditure' lag.
lapses in the social sector are ascribed to lack of utilization capacity;
this masks systems challenges, which make the utilization of budgets
challenging - excessive centralization of operational decision-making,
onerous financial and administrative procedures and lack of accountability
for delays in decision making, which have implications for fund flows, are to
mention a few. Coupled with this is the limited capacity to plan and
implement, which further negatively impacts the limited ability to expend.
Therefore, alongside budgetary increases in aggregate and in program-specific
categories, it is critical to set aside dedicated funds for procedural
to this is the issue of quality of expenditure and expenditure targeting. A
careful tracking of fund flows in the health sector shows a predominance of
expenditures in the month of May and June before the financial year ends. In
addition, there are no mechanisms in place to evaluate the impact of given
allocations on outcomes vis-a-vis the equity objective and the poverty
reduction strategy focus, which should be the core objective of the state
health sector. Enhancing quality and appropriate targeting of expenditures is
closely linked with governance, which creates yet another imperative for
dedicated budgetary allocations to strengthen governance structures that
enable the delivery of programs. A core prerequisite for sound governance is
reliance on timely and appropriate information for decision-making. Again,
this flags the need to provide substantial budgetary support to bridge the
current gap in Pakistan's health information system. There are several
components of a health information system already in place, albeit with many
gaps; however, there are also clear opportunities where the right investments
in structures and technology in particular can enhance connectivity in the
existing health management information system; enable building infrastructure
for hospital information systems both in the public and private sectors;
improve death registration and enhance the potential within existing survey
instruments. It would be logical to make investments in these areas where
gains can be achievable in the short term. This would require enhanced
allocations over and above what has been currently budgeted for the National
Plan for Disease Surveillance and the National Health Information Resource
Center; reliable sources indicate that this amounts to Rs. 10 million and Rs.
28 million respectively. Additionally, it is important to earmark funds for
policy research, at least in areas where evidence is badly needed such as in
the case of the post WTO impact on prices of drugs and the impact of WHO'
International Health Regulations 2007 at a country level.
third area, which must form the substrate for the budget debate is the
distribution of allocations in the budget of 2007. With reference to
allocations within preventive health domains, a careful analysis reiterates
the need to enhance allocations in certain areas. According to reliable
sources, the health budget allocates 500 million each for blindness, maternal
and child health and hepatitis; 350 million for HIV/AIDS, 100 million for
malaria, and 205 million for tuberculosis. As opposed to this, only 5 million
have been allocated for the prevention and control of non-communicable
diseases (high blood pressure, diabetes, heart diseases and stroke).
be important to look at these distributions in the light of contemporary
evidence on mortality (deaths) and morbidity (disease). The Burden of Disease
Studies conducted to date by the World Bank and US-based academic
institutions show that both communicable and non-communicable diseases (NCDs)
share an equal burden in terms of morbidity. In terms of mortality, data from
the Pakistan Demographic Survey of the Federal Bureau of Statistics shows
that the percentage of deaths attributed to NCDs has increased from 34.1 per
cent in 1992 to 54.9 per cent in 2003. Critics argue about the validity of
the Pakistan Demographic Survey data and refer to issues inherent to the
validity and accuracy of these statistics. But does it make sense to
disregard local data completely, particularly when global trends and
independent international evaluations also validate the same trends? Critics
also argue that these diseases are not part of the MDGs; however, even if the
MDGs are taken as a yardstick, we must be reminded of the fact that Goal 6
refers to the 'other disease categories' on the premise that countries would
have the indigenous capacity to determine what constitutes a locally-suited
priority. Non-communicable diseases should clearly be a public health
priority, given that they kill more people than malaria, tuberculosis and
HIV/AIDS combined. The point is not to question the validity of investments
in these areas but to argue for increased investments for NCDs in addition.
NCDs are equally important and merit due attention.
the prevention and control of NCDs has been addressed through a very small
program at the Ministry of Health, which is supported technically through the
pro-bono contributions of an NGO and the partnership of professional
associations. However, it is hoped that the Ministry of Health will develop a
full program for NCD prevention and control.
to infrastructure in the distribution of allocations domain: there has been
news of allocations for 900 (803) proposed heath care centers in the urban
settings on the premise that these would decrease the workload burden on
existing tertiary care hospital sites. This warrants revisiting a fundamental
question in health which relates to the role of the state in health? The
state should clearly be a 'financier' and 'regulator' of services; however,
it need not be a 'provider' of services. Lessons learnt from the lack of
sustainability and failure of the BHU initiative launched in the 1980's
should be instructive in this regard. This experience indicates that it might
be best for the state to stay away from being a provider of services and
focus on creating structures, which enable it to leverage the outreach of the
private sector to deliver services. True that options for revitalizing
existing state-owned healthcare infrastructure must be explored as in the
case of the BHU restructuring arrangements given that something has to be
done with the 'existing' infrastructure; notwithstanding, 'future
investments' in infrastructure should weigh the benefits of 'government
provision of services' vis-a-vis 'government financed private provision'; the
latter appears more plausible in a country where the law of the land lets the
private sector operate. The same argument applies to another area in the
current budget. The federal government will be paying for a tertiary care
facility in NWFP, the annual recurring cost of which could enable the
government to purchase services from market to achieve the equity objective.
These options reiterate the need to revisit some fundamental policy
standpoints - continuing to make investments in infrastructure vis-a-vis
exploring alternative modes of service delivery, which can make service
delivery more equitable.
not the least is the issue of leakages from the system - an outcome of
various forms of financial and moral corruption. There is an anecdotal
evidence of various practices, which lead to leakages from the system -
kickbacks, over-invoicing, and outright graft in the contracting process,
collusion among bidders in the procurement process and theft from central
stores in hospitals are to mention a few. These occur as a result of poorly
managed expenditure systems and poor fiscal controls over flow of public
funds. Improving governance is critical to addressing these issues; from the
budgetary standpoint, however, allocations in certain areas can give quick
dividends. For example, electronic public expenditure tracking procedures and
electronic equipment and supply inventories can track leakages from the
system and a nationwide database for matching staff and wage payments can
maintain up-to-date personal records and as such can assist in eliminating
abuses such as paying ghost workers. Budgetary allocations should therefore
leverage technology to enhance efficiency and promote greater transparency in
health systems and to eliminate wastage of scarce resource, which lead to
poor quality of care, compromised safety and efficiency and de-motivation of
summarize, the budgetary increases this time around are commendable. However,
as a short-term measure it is also important to reanalyze priorities for
allocation and pay attention to systems strengthening with the understanding
that these investments will not be visible for a while - quite unlike
physical infrastructure. Over the long term, strategic planning exercises in
the Ministry of Health, the Planning Commission and civil society think-tanks
should focus on the following from a budgetary perspective:
an essential package of health services should be carefully costed; the
government should then make a five-year plan to enhance allocations to a
level where the delivery of these services becomes possible. Simultaneously,
they should also enhance their capacity to utilize funds, both through
procedural as well as personnel reforms. Secondly, they should look carefully
into policy and strategic directions both for the provision of essential
health services for all citizens as a public good as well as other services
for the under privileged who are not covered under any pre-payment scheme. In
this connection, they should clearly articulate a policy on infrastructure
vis-a-vis provision through the market and in the event of the latter, aim
for the creation of an enabling and transparent regulatory environment.
Thirdly, they should analyze alternative means of health financing by
leveraging the potential within existing arrangements - mainstreaming safety
net resources for health and insurance-based arrangements.
Parliament gets into session to debate the budget for 2007, they must
therefore, be mindful of the fact that it is not enough to put money in
programs; unless the systems to deliver them are reconfigured and
strengthened, programs will find it difficult to deliver on objectives.
The author is the Founder President of the NGO Heartfile.
of village Yaroo Rind, Khairpur struggled all through her early life. When
she got married to a drug addict, Shah Bux Rind, her life became even more
miserable. It was she who had to earn single-handedly for her family
including her husband. After doing embroidery work all day, all she could
earn at the day's end was not enough to cater to her family's most basic
It was a
lucky day for her when she came to know about a credit programme being
offered in her area. It was the micro-credit finance offered by Sindh
Agricultural Workers Coordinating Organisation (SAFWCO), a non-government
organisation working in backward areas of Sindh. She wasted no time in
approaching the organisation's team and borrowed Rs 5,000. She bought a calf
from that money and left it with her brother for rearing. "When it
becomes a buffalo, I will sell it and get enough money to spend on my
daughters' marriages," she tells TNS.
someone advised her to buy chaff with the micro-credit offered by SAFWCO. She
did and stored it. Later when the demand for chaff rose, she sold it for a
handsome amount and saved a good amount after paying back the loan.
is the provision of small loans and other financial services to poor
entrepreneurs who are otherwise excluded from conventional banking. This,
according to definition, is a development strategy with significant potential
for poverty alleviation and economic empowerment.
the difference between micro-finance and charity disbursement is that the
former has to be returned and the latter doesn't. Ideally, microfinance does
not only cater to one-time financial needs of the poor, it develops their
entrepreneurial skill and make them masters of their own destiny. This means
only a fraction of the poor are eligible to avail this facility. The rest
neither have the capacity to generate income from this money nor to return
system that was seen in place on a field visit to selected communities in
interior Sindh was that the financing organisations had involved local
communities in the whole process. At many places these communities were
called Village Development Organisations (VDOs). For example in Sanghar and
Khipro, SAFWCO is making such disbursements.
is a partner organisation (PO) of Pakistan Poverty Alleviation Fund (PPAF),
an independent body that provides 54 per cent of the total micro-credit
disbursed in the country. PPAF on February 28, 2007 had a resource base of
US$ 826.17 million. Its board of directors consists of 12 members of whom
nine are from the private sector. Seth Hussain Dawood of Dawood Hercules
Groups is the sitting chairman. PPAF disburses the funds given by the World
Bank to the poor through POs working in their respective areas.
loans aren't disbursed just like that. Immense weightage is given to the
rationale of the proposal submitted. The local needs of a community are also
kept in mind just to ensure that the money is given for viable
projects," says Tufail Rajpar, General Manager, Credit & Enterprise
example, in the backward and water-deficient areas of interior Sindh, the
most viable projects are agricultural development ie trade in seeds,
fertilisers and chemicals, livestock rearing, handicraft development and use
of donkey carts for transportation of goods.
tells TNS that the recovery rate in these areas is 100 per cent and people
are availing loans over and over again. He says that though there might be
organisations that do not keep a follow-up, all those partnering with PPAF
have to keep track of what is going on their areas of operation. In fact, it
is binding upon such organisations to do so.
a lot of stress is laid on forming innovative alliances and partnerships with
the corporate sector to reach out to the poor. In this regard, PPAF signed a
memorandum of understanding (MoU) with the Government of Pakistan, Engro
Foods Limited (EFL) -- the owners of Olper's brand -- and three of its POs in
2005. Under this initiative, people rearing livestock in water-deficient
areas will be selling milk to Engro Foods at market rate.
Ghafoor, a villager tells TNS that though they are getting vocational/skill
development training in the area, it is not easy to win orders. "We are
being taught how to make candles, soaps, detergents etc. But the fact is that
the factories producing these goods have flooded each and every corner of
their country. The packaging is better and so is the quality and price,"
he adds. "So what we do is that instead of using micro-credit for these
purposes, we simply go to the market and bring seeds, fertilisers etc at
wholesale rates. As middlemen are out we can sell these agricultural inputs
to the locals and are free to sell the produce to whoever we want to,"
the visit, it was observed that the micro-finance organisations working with
PPAF had issued a list of business activities for which money could not be
disbursed. These included property/real estate development, commercial
construction, hazardous toxic waste, plastic bags, radio-active material,
tanneries, timber, logging, deforestation, financial services, explosives,
armaments, ammunition, mining, breweries, poaching/hunting and informal
In a country like ours, microfinance can evolve into a means for the 'non profit' financial institutions to play on the desperation of the poorest of the poor
By Farheen Hussain
Ever since Dr Mohammad
Yunus, founder of Grameen Bank, was awarded the 2006 Nobel Peace Prize,
microfinance has received an unprecedented level of validation the world over
and is touted as the new tool for bailing millions out of abject poverty.
"Microfinance is the practice of providing financial services, such as
micro credit, micro savings or micro insurance to poor people." To get a
holistic idea of poverty we must accept that poverty is not just living on
less than a dollar a day but in countries like Pakistan, there is poverty of
opportunities; that is, those who are born poor are condemned to die poor.
Today there are more
than 50 microfinance providers (MFPs) offering financial services across
Pakistan with a current outreach of 750,000 borrowers. With an estimated 10
to 50 million potential clients, less than 10 per cent of the microfinance
market is being utilised. So it is hardly surprising that our young industry
is gripped with issues of financial sustainability and outreach. However, a
microfinance institution (MFIs) is not an end in itself but a means to an
end. MFIs have a dual objective: to attain financial sustainability so they
have a continued presence in their borrower's lives and to ensure that their
loans are resulting in an increase in the borrower's permanent income.
Unfortunately in Pakistan's microfinance industry, sustainability of the MFI
is the dominant discourse and it is assumed that simple access to financial
services will be enough to alleviate poverty.
Recently, one got a
chance to take part in an impact assessment being conducted by a prestigious
academic institution, in collaboration with two major MFIs operating in
Lahore. Our research hypothesis was to ascertain the impact of microfinance
on women empowerment. For this purpose we drew a sample from the female
client population of the two MFIs and devised a lengthy questionnaire that
was designed to gauge the nature and profitability of the business started
with the loan, the resultant change in income, asset base, decision-making
power of the borrower in household and community and also the opportunities
it opened up for the borrower and her family after her induction into the
Our field work took us
to the semi urban area of northeastern Lahore, and during the course of our
study we progressively got disillusioned with the services of these MFIs. I
am not generalising our observations to the entire industry nor am I
criticising the commendable contribution of Dr Mohammad Yunus and the concept
of microfinance. But no matter how noble and genius a concept, its
translation into action is a function of the prevailing conditions of the
country it is practiced in. Unlike Bangladesh or Latin America the
institutions, in Pakistan, have collapsed. There are no regulatory
authorities or law and order so when prominent NGOs and state owned
institutions engage in micro financial services and claim to emulate the
Grameen model, no regulatory body or authority bothers to verify the validity
of these claims.
Most MFIs that charge
exorbitant effective interest rates of up to 35 per cent, justify this by
declaring they are well within the global benchmarks of interest rates levied
by other MFIs. What they fail to add is what the Grameen Bank or other
successful MFIs in Latin America charge are not just interest rates but the
charges for an assortment of services. Before dispensing the actual loan most
successful MFIs carry out a host of preliminary steps (which we observed are
entirely missed by our MFIs); firstly the loans are not for consumption but
entrepreneurship, MFIs must ensure that the borrower utilises these loans to
start or invest in a business. Though a business idea is never imposed, the
Grameen Bank conducts an informal appraisal of the borrowers' business plans
and monitors its profitability over progressive loan cycles. So as to rule
out any possibility of borrowers investing one loan after another in failed
our research work we encountered numerous examples of borrowers who used the
loans to pay off debts, rents and other expenses, indicating that the MFIs
are not involved and do not ensure that the loans are utilised exclusively
for entrepreneurship. More disturbingly, many borrowers had undertaken
business ventures doomed to fail at the outset, yet the MFIs proceeded to
give larger loans in the subsequent loan cycles.
Rasheeda Bibi, resident
of Guldasht Colony, described how she reluctantly became a member of an MFI
in order to buy spare parts for the rickshaw her teenage son drove; their
main source of income. The rickshaw broke down again but she continued to
take two more loans to pay for its repair. The rickshaw broke down again, a
few months ago. However, Rasheeda Bibi has again applied for a loan. What is
problematic is that the MFIs will continue providing their financial services
given that Rasheeda Bibi or many like her can't afford to pay off the loan as
well as the interest. To the MFI, it is irrelevant that the borrowers are
effectively increasing their financial needs and sinking deeper into a
debt/loan quagmire by consuming these loans or investing them in failed
businesses. What does matter to them is that the principal plus interest is
preliminary step is to check if the borrower has relevant skill required for
the business they intend to undertake. If not, then with additional charges
the Grameen Bank provides the necessary vocational training to its borrowers.
During our research we discovered that this was not only entirely absent but
unheard of. Lastly and most crucially, successful MFI models provide the
borrowers with backward and forward linkages to the market. This I personally
felt was the most critical step, not only can the borrower buy the inventory
in bulk, at reasonable rates, but also sell their finished product totally
cutting out the role of the middle man.
Many of our respondents
used their loans to start embroidery 'businesses' which in reality meant that
they put in long hours to heavily embroider pieces of garments that were
whisked away by elite boutique 'aunties' who paid them a pittance for their
drudgery. Shahida Bibi resident of Baghbanpura proudly displayed an
intricately embroidered duppatta she had just finished. On my inquiring what
it would fetch her she replied the Baji would pay her around Rs 17 for the
I was dumbfounded by
her answer, I am sure these elaborately embroidered garments would be
exorbitantly priced at any chic designer outlet in a posh locality and if one
is to subtract the cost of sequin, thread and cloth it is entirely the labour
of these women that adds to the value of the finished product. So why is the
labour valued so cheaply? What an invaluable service would the MFI provide if
they could link the borrowers directly to the market, so that the role of the
middle man who extracts the entire profit is eliminated.
Microfinance, a global
phenomenon, is spreading like wildfire amongst the poorest classes. The idea
of 'social collateral' as conceived by Dr Muhammad Yunus is pure genius since
it allows a poor labourer, domestic servant or even sex worker become credit
worthy and access financial capital. However, in a country with no effective
regulatory authorities or institutions even a noble practice can evolve into
something ugly, a means for the 'non profit' financial institutions to
exploit the desperation of the poorest of the poor.
MFIs must institute
changes internally, and conduct impact assessments of their activities as
regularly as they review their financial performance and implement relevant
changes in order to do justice to their tall claims of poverty alleviation
and empowerment. The state regulatory bodies must be more involved and
monitor the social impact of MFIs.
should be taken internally and externally in order to curtail a massive
proliferation of credit addicts. Otherwise microfinance is just good business
for those who wish to capitalise from the wretched of the country while
maintaining a noble facade.
The writer is Research
Associate, NGO Pulse, LUMS-McGill Social Enterprise Development Center (SEDC)
'We have a strict monitoring side'
Kamal Hyat is the Chief Executive of Pakistan Poverty Alleviation Fund (PPAF)
-- an apex body that routes World Bank funds for micro-finance to the poor
through its partner organisations. PPAF is the leader organisation in the
sector as it provides 54 per cent of the total microcredit available in the
country. Incorporated under section 42 of the Companies Act 1984, PPAF claims
maximum autonomy with minimal interference from the government. In an
interview with The News on Sunday, he talks about the philosophy of the
organisation, its objectives, achievements and many other issues. Excerpts of
the interview follow:
on Sunday: PPAF is sponsored by the Government of Pakistan. How can it keep
the government out of it?
Kamal Hyat: We are quite fortunate that the government has practically
refrained from interfering in our affairs -- despite the fact that it's the
government that negotiates loan agreements with donor bodies. Our role starts
when it comes to disbursement of this amount. Involvement of private sector
people with excellent track records definitely brings credibility to the
whole thing. The fact that we are registered under Companies Act 1984 also
grants us structural autonomy.
are the people managing the affairs of PPAF? And how is the body different
from other organisations having the same mandate?
would simply say that the people who are on our board of directors have
impeccable careers in their respective fields. They are leading businessmen,
bankers, former bureaucrats etc. For example Hussain Dawood, Chairman Dawood
Group is our chairman and former Secretary General Finance Moeen Afzal is a
member of our board of directors. The rules are so strict that anybody who
assumes a public office has to quit the organisation. But this doesn't mean
there is no state representation. Two members of our board are from the
government sector. But they normally perform the task of negotiating matters
with the donors or the related government departments. Here I would to tell
you that we have a lean staff of only 65 to 70 people all over Pakistan. Our
administrative/operational expenditure is less than 1 per cent of our total
disbursements -- a fact that makes us one of the most cost-effective
organisations in the world.
do you ensure that the microfinance reaches the persons who deserve it the
do not intervene in any area directly. What we do is that we disburse the
funds through our partner organisations. These organisations have a
considerably long history of working in the respective areas. PPAF has a very
strict criteria in selecting partner organisations. There is a long list of
pre-requisites that a qualifying partner organisation must have. The partner
organisation identifies which areas have to be focused on and which sectors
to be financed there.
we have presence in 111 districts of the country where around 70 partner
organisations are working with us hand in hand. To name a few, they are Aga
Khan Rural Support Program (AKRSP), Baanhn Beli (BB), Bunyad Literacy
Community Council (BLCC), Balochistan Rural Support program (BRSP), Green
Circle Organization (GCO), Islamic Relief (IR), Omar Asghar Khan Development
Foundation (OAKDF), Sindh Agriculture Forestry Workers Coordinating
Organization (SAFWCO), Sungi Development Foundation (SUNGI) and Thardeep
Rural Development Program (TRDP).
it okay to leave it to the partner organisations to make major decisions?
this is not the case. Beneficiaries are not left at the mercy of anyone. The
partner organisations are engaged mainly for the reason that they have better
understanding of their local requirements. PPAF regularly interacts with them
and holds training programmes for them. They have to follow a standard
accounts and financial reporting system as the operational manuals devised by
PPAF. The monitoring side of the programme is very strict as well. Our teams
make regular visits to the areas where our projects are running. Besides, we
engage independent organisations like Gallup to conduct surveys in these
areas. We involved Gallup Pakistan in 2005 and asked it to conduct an impact
study for us. The body carried out its survey in 1760 villages and came out
with positive results. Now we are planning to ask a foreign body to conduct a
survey for us. Secondly, I would say the financial matters are as transparent
as possible. We have disbursed $272 million (Rs 15.53 billion) under the head
of micro-finance till March 31, 2007 since the launch of the programme in
2000. The total number of our micro-credit loans exceeds 1.3 million. We are
proud to say that not even a single finger has been raised against us. Sidat
Hyder and Associates are our auditors and every one of us has a clean bill.
What plans do you have for those who are not lucky enough to come under the
umbrella of PPAF? Don't you think it's a sort of discrimination?
always try to ensure that the funds are equally distributed in all parts of
the country. But sometimes there are constraints that cannot be overcome
easily. Presently, 60,000 communities in 27,000 villages of the country are
benefiting from PPAF programmes. Our model is that we make a community
self-sufficient and then exit. Once this happens, we look for newer areas
where we can intervene. Running our programmes in each and every part of the
country simultaneously is not possible because of resource constraints.
Secondly, I would like to tell you that we don't go to the area just like
that. Interventions are made where they are needed the most, many a time on
-- Shahzada Irfan Ahmed
Marx famously wrote that
the ideas that prevail in society are the ideas of the ruling class.
Unfortunately, this is more true than one would like to admit, perhaps more
so in Pakistan than in most other societies. Yet this is not because of some
deep and essential cultural defect, a conclusion that too many people are far
too eager to make. In fact, the internalisation amongst many Pakistanis of
the myths that the powers-that-be have widely propagated can only be
explained in historical context.
British rule in India --
not unlike the rule of other European colonial powers -- survived for as long
as it did because enough Indians accepted the logic of colonialism which
decreed that order and stability were the defining features of any
forward-looking society. In other words dissent was not to be tolerated and
was equated to backwardness and unruly traditions. In this context, Gandhi's
choice of civil disobedience as the method to challenge the British was far
from incidental. It reflected the need to debunk the myth that order and
stability in society were preferable to freedom and other basic rights.
Unfortunately aside from
the NWFP the Pakistan areas did not experience as much popular mobilisation
in the final decades of British rule as the rest of India. Thus the logic of
bureaucratic paternalism remained deeply rooted; it makes perfect sense
therefore that our post-colonial rulers would reinforce the tradition of
viceregal rule and continue to rely on the same principles of government
perfected by their colonial predecessors.
Thus even today, 60 years
after the creation of this country, there is a widely-held conviction amongst
many of our thinkers, politicians and ordinary citizens that 'benevolent
dictatorship' is preferable to the rule of the people. Of course the fact
that dictatorship can never be benevolent is ultimately exposed, particularly
at times of popular uprising. The current resort of the government to all
manner of repression in the face of widespread resentment is testament to the
essence of undemocratic rule. And much to the government's chagrin, the
draconian restrictions being imposed on the media and the arbitrary arrests
of political activists have produced more political action rather than
individuals and groups amongst us are finding it increasingly difficult to
defend their philosophy. This is because the post-colonial model of
bureaucratic paternalism has been characterised by serious contradictions
that did not exist under the British. The military has encroached into the
political and economic realms in a manner that has seriously undermined its
reputation as the guarantor of the state. A well-known advisor to General
Yahya Khan, Major Sher Ali, presciently warned almost 40 years ago that the
military's aura of infallibility was directly correlated with its
mysteriousness. In other words, the military did and should not come into
contact with ordinary Pakistanis except when it could project itself as the
national saviour. Major Sher Ali's advice was not heeded by subsequent
military rulers, and even though the institution still projects itself as
national saviour, it has expanded its own corporate interests so much that it
no longer stands aloof from society, and is accordingly suffering the
lobby is therefore hard pressed to come up with a response to the assertion
that a military that has such well developed political and economic stakes
cannot remain immune to censure. Arguably it would still be possible to
hoodwink the wider population if criticism of the military's overarching role
in Pakistan was limited to political workers as was the case during the Zia
dictatorship. But the broadsides are now emanating from all corners. Slogans
targeting 'fat and flabby generals' -- as Bhutto famously referred to them --
are commonplace. And it would appear that the societal consensus against the
military's dominance is growing.
Expectedly, the response
from the champion of bureaucratic paternalism has been reactionary. But the
fact of the matter is that it is at times like these that the most healthy
and vibrant features of Pakistani society come to the fore. In spite of what
all the pro-order/stability intellectuals insist, dissent and debate are the
markers of a progressive society. Indeed, there is a time and place for order
and obedience, but not of the kind that our ruling class has propagated for
the last 60 years. From our homes to the masjid to the classroom to the
workplace, most Pakistanis are taught to be docile and submissive to
authority, women obviously more so than men. As suggested above, to the
extent that this is a cultural trait, it has been used moulded by power to
project the omnipotence of the state and its allies.
It is precisely to prevent
the emergence of a popular challenge to oligarchic rule that the ideals of
order and stability have been propagated far and wide. It is important to
bear in mind that Ziaul Haq spearheaded a nationwide project to demobilise
society in the name of Islam. The populism of the Bhutto era was dangerous
enough to the powers-that-be that it was necessary to crush it entirely.
Debate and dissent had emerged in the late 1960s as popular values, and it
was only by reasserting the necessity of order and stability -- and that too
under the guise of Islamisation -- that the champions of bureaucratic
paternalism could reassert themselves.
Since end of the Zia
period, the vanguard of order and stability -- the military -- has been
counter-posed to the inept and corrupt vanguards of disorder, the
politicians. Through the 1990s this charade was successfully repeated, and at
the time of the Musharraf coup in 1999, the military was sitting pretty,
along with those traditionally complicit in the project of bureaucratic
But as events since March 9
have proven, things change, and quickly too. The arrogance of the
powers-that-be has been exposed beyond any doubt, and they are now
undoubtedly worried. But those of us that are committed to seeing this
society move towards ideals beyond order and stability should not be worried
in the least. Indeed we should be cautiously optimistic. We are making steps,
however small, to rid ourselves of a colonial legacy that has haunted us for
O general hum bhi zinda hain!
phenomenon of Talibanisation is increasingly posing a threat to the education
and employment of womenfolk across the length and breadth of the NWFP.
Extremists and radical groups of clerics have started threatening openly,
'advising' women, their parents and husbands, in writing, via telephones and
speeches through FM radio stations, mosques' public address systems, etc. The
threats from extremists aim at women's complete banishment from public
sphere, their prompt target being the education of women.
to the data available on Peshawar-based women and human rights organisations,
the trend of threatening girl students and forcing closure of educational
institutions initially emerged in Waziristan. In Dera Adam Khel, some
teachers were threatened and, later, a number of schools as well as an under
construction degree college for women were bombed at night time.
another incident, two Talibans, planting bombs in Sheraki Girls High School,
were killed when the device accidentally went off.
have also been given to the staff of girls' educational institutions in Bannu,
Tank, D I Khan, Swat, Charsadda, Mardan, Kohat, Dir Upper and Lower. Even in
Peshawar some private schools have been threatened with suicide attacks. It
may be mentioned here that a blast occurred near the gate of a girls college
in downtown Peshawar a few months ago.
recurrent and compelling threats have forced half of the girl students in
Dera Adam Khel to drop out. A significant number of girls have also left
schools in Bajaur and Swat, Tank, and Bannu. Whereas, in both Waziristan
agencies, there is a complete shutdown of female schools. Sources reveal that
hundreds of female teachers have also asked in writing that they are
incapable of serving in the said areas under the circumstances. Many,
according to them, have also taken long leaves.
women's educational institutions has since then become a routine, with
occasional bombings. In Bajaur, edicts were issued declaring a complete ban
on women education and scores of schools were bombed in Mardan. According to
a member of the HRCP NWFP chapter, "Threats come from various extremist
outfits, and it is very difficult to estimate their number."
to sources in the southern district of D I Khan, recently, the parents of
girl students of Gomal University have received letters from the 'commander'
of local Talibans, forcing them to stop their daughters from attending
radical, militant clerics are also antagonistic towards working women. A
woman from a Wazir tribe, who was recently appointed Educational District
Officer (EDO) in D I Khan, received threats from extremists telling her not
to join the service.
illegal FM radio stations are being used by the clerics continuously.
According to reports, in Swat and Dir, a large number of parents have pulled
their daughters back from schools and colleges. In this regard, the religious
sermons of a radical cleric, namely Fazlullah, in Imam Dheri village of Kabal,
Swat, has played an instrumental role. He has effectively convinced, by
labelling education for girls 'un-Islamic', a large number of people.
officials in Peshawar say, "Fazlullah literally felicitates those who
discourage and stop their daughters from going to educational institutions.
But, no clear cut action has been taken by the government against him."
are of the view that the more liberal parents are not quite convinced by the
mullah's anti-women education campaign. They end up risking their ties with
the society at large.
means that the clerics' influence is not the only variable in discouraging
people from sending their daughters to educational institutions.
sociologist at the University of Peshawar says, "In the face of growing
number of threats, the little improvement attained over the past few years in
the Gross Enrollment Ratio in schools for girl would come down
the spread of the phenomenon, he says, "When lawlessness becomes
prevalent, criminal behaviour is further encouraged. It does not remain
confined to a particular area, and ripples out. This is what is happening in
there have been reports that some radical groups have also made physical,
including suicide, attacks on girl schools and colleges in Peshawar and
Mardan, if the female students and teachers decline or fail to comply with
their 'command' of wearing veil (hijab). It is indeed alarming because
Peshawar is the provincial metropolis and has a large number of educational
institutions for women as well as a host of co-educational campuses, where
students from all over the country have enrolled. Mardan is also the second
largest city of the province. One can easily gauge that when woman education
in such places is in jeopardy (from the clerical militant onslaught), what
could be the condition in remote Dir and D I Khan.
growing number of instances of clerical radicalism targeting women in the
Frontier is reminiscent of the Taliban regime (1996-2001) in Afghanistan
under which all schools for girls were closed down and complete ban was
imposed upon women employment even in such professions as nursing and
strange that despite so many instances of threats to women in the region, the
provincial government (led by the MMA) and the federal government are
unmoved. The Human Rights Commission of Pakistan (HRCP) NWFP chapter is said
to have written letters to the governor and the interior ministry to take
appropriate steps against the perpetrators. But, there has been no response
observers consider the lack of action on the part of the NWFP government as
being due to the fact that it is also dominated by the clerics. This, despite
the fact that some ulemas, including those associated with the MMA, have
condemned the anti-women education propaganda of Maulvi Fazlullah and others.
writer is a Peshawar-based journalist/political research analyst who has also
worked in senior government positions.
generations, Pakistanis have shopped for food and groceries at open markets
and from roadside vendors. But the trend is now changing as some superstores
chains are catering to the country's growing middle-class. These emerging
food markets have changed the pattern of food consumption and consumer
Ali, a vegetable seller in Kasur pura and adjacent areas in Lahore, is slowly
wheels his cart back home. His day begins at four in the morning, when he
sets out for the wholesale vegetable market a 30-minute walk from his house.
From there, it's another two hours to the market where he tries to get best
products available and then in the next four or five hours, sells these
vegetables by visiting different streets in his area. But the past few months
have been disastrous for him. A new superstore was opened in his area of
business and he lost almost half of his customers, even the ones he
considered 'permanent'. "I am struggling to sell my vegetables. Whatever
is left at the end of the day is sold at half the price or simply discarded.
I cannot store them," he says. He is not the only who is facing this
situation in Lahore. According to him, many of the vendors and small shops
are facing a similar situation.
to the website, PlanetRetail.net, super and hyper markets are dominating the
markets all over the world, and 60 to 65 per cent of buying and selling is
done through them. At present, the retail sector, according to World Bank
statistics, is contributing 6-12 per cent to the world GDP and its share in
international trade is US$8 trillion. The processed food consumption is on
the rise in the lower-income countries by about 28 per cent per year. It
means that the target markets for the super-stores right now are the
low-income countries where the middle-class base is widening. The statistics
further reveal that highest growth-rate (48 percent) is observed in breakfast
cereals in low-income countries. According to the website, Pakistan, with a
population over 160 million, is the 9th largest consumer market for food.
to household survey, an average Pakistani spends 42 per cent of his income on
food items. Experts think that these days, preserved food is being preferred
to fresh food, both by superstores and consumers. "For superstores it
has more shelf life while for consumer it is more nutritious and ready to
eat," says Dr Abid Qayyum Sulahri, Research Fellow and Head of
Globalisation and Rural Livelihood Program at Sustainable Development Policy
Institute (SDPI). According to him, Pakistan, in 2005-06, imported processed
food worth $0.5 billion but in 2006-07 the import bill of processed food
commodities has increased to $2 billion. Most of this processed food is being
sold by superstores. The situation is similar in many other low-income
countries where the food processing industry is doing a business of over $3
trillion every year. Because of this, a multi-country and multi-donor
research initiative, led by International Institute for Environment and
Development (IIED), UK 'Re-governing Markets' has been launched.
to Dr Abid, the basic idea of this research is to study the success and
failure of small farmers or producers to integrate them in emerging food
markets. "The purpose of this study is to learn from those developing
countries where modern agro food markets have emerged fully, such as in Latin
America, South Africa, Thailand, Malaysia Turkey and to recommend policy
measures for more recent markets like India, Pakistan and China, because due
to the increase in per capita income and liberalisation of markets, food
patterns have changed in these countries." The other purpose of the
research is to know whether the countries, where modern agro based markets
have emerged, are able to integrate small farmers or not.
Asia, SDPI is conducting this research and is trying to intervene on
different policy levels regarding emerging food markets in South Asia.
"We are trying to influence policy matters on public and private
(industrial level) levels to make them aware of the most recent phenomenon in
food markets; while, at the same time, we are also trying to consult farmers
to see their practices. We will try to change their cropping pattern
according to the needs of the emerging food markets," he tells TNS.
"At present, in Pakistan, we are facing greatest resistance from public
farmers in Pakistan are facing a lot of problems in integration in the new
atmosphere and the real beneficiaries have been middlemen. Dr Ali Abbas
Qazilbash, National Expert - Laboratory Accreditation of United Nations
Industrial Development Organization (UNIDO), believes that one reason is that
in Pakistan agricultural research is based on pre-harvest statistics and
there is no guide for farmers after that. "If a farmer has information
about markets and the standards and gets his products accredited, he can
dictate the price and there is no harm in value-addition to products,"
he tells TNS. He urges the need for research-oriented interventions in the
sector. He also stresses the importance of cooperation among various
government departments and civil society organization with the similar
objectives and mandates. "Extension system should be in functional form,
and should be able to deliver at the grassroots. There should be a link
between research and farmers through efficient extension services to enable
them to exploit the situation to their favour," he says.
small farmers' representatives believe that it is hard for small farmers in
recent situation to exploit the situation. Shujaat Ali Khan, secretary
Sustainable Agriculture Action Group (SAAG), stresses the need for polishing
entrepreneurial skills of small producers. "Our small farmers should
have market information and should know how to make their products
market-oriented. But because most of small farmers in Pakistan are under huge
pressures and illiterate, they stand to be more marginalized in the emerging
food markets," he says. Shujaat thinks that as most of the policies in
Pakistan are made for landlords, who own more than 70 percent of total
agricultural land in Pakistan, while small farmers are neglected. ôI think
policy-makers should give importance to small farmers as well," he says.
to Shujaat most of the agro industry is in the urban areas and if farmers can
be provide with the food processing and storage technology, it can increase
their income and enhance their bargaining power. "Because most of the
agro products perish within one or two days, farmers are forced to sell them
on very low rates. Recently, in the Pakistani market both producers and
consumers are suffering. Producers are forced to sell their products at cheap
rates while consumer has to buy it on very high rates, while most of the
profits are going to middlemen and industrialists." Shujaat thinks that
the emerging food markets cannot do anything for small farmers, if they are
not trained. Shujaat stresses proper and objective-oriented harmonization
among departments, institutions and ministries to avoid horizontal
overlapping in agricultural sector.
Wajid Pirzada, Chief WTO Cell, Minsitry of Food, Agriculture and Livestock,
says that there may be some overlapping in public sector because there are
many departments working for agriculture and farmers in country. He thinks
that contract and cooperate forming is the best solution to increase
bargaining power of small producers in emerging food markets.