curbs
Union politics

Spate of European Union's restrictive measures against Pakistani businesses gives critics reason to doubt the motives
By Shahzada Irfan Ahmed
Trade relations between Pakistan and many of the countries, that are now part of the 27-member European Union (EU), have remained ideal for many decades. Apart from other factors, the Pakistani diaspora settled there has been instrumental in winning export business for their countrymen back home. The products exported from Pakistan had always found a ready market in this geographical bloc for their competitive prices and high quality.

Newswatch
A legal crisis brewing in the US

By Kaleem Omar
Pakistan is not the only country that is currently enmeshed in an imbroglio relating to its legal system. A legal crisis albeit of a somewhat different kind is also brewing in the United States where the White House and Congress clashed on Tuesday over Republican President George W. Bush's power to keep close advisers like Karl Rove from testifying under oath about Bush's sacking of eight US federal prosecutors last year.

rights
State of permanent emergency

Section 144 cannot be read and exercised in isolation of the fundamental rights guaranteed in the constitution and recognised the world over
By Asad Jamal

"Every citizen shall have the right to assemble peacefully and without arms, subject to any reasonable restrictions imposed by law in the interest of public order." Article 16 of the Constitution of Pakistan

'Section 144 can be imposed by
the district or provincial government to maintain law & order'

-- Muhammad Basharat Raja, Punjab minister for Law, Parliamentary Affairs and Local Governments

The News on Sunday: How do you justify the violence of police against the protesting lawyers on March 12, 16 and 17, in view of Article 16 of the Constitution of Pakistan?

Police on rampage
Police's role in exacerbating the public agitation triggered by the suspension of the Chief Justice has
been conspicuous and intriguing

By Adnan Adil
The lawyers' protest against the presidential action against the chief justice would have passed rather quietly had the police shown some restraint in dealing with protesting lawyers. The police roughed up none other than the top judge of the country, beat the protesters with batons wounding many people, fired massive teargas to disperse peaceful assemblies and ravaged the offices of lawyers and the media in Lahore and Islamabad.

welfare
Far from perfect

What provoked the Public Accounts Committee to express concerns on the prevailing zakat distribution system and direct the ministry to stop political interference in its disbursement?
By Aoun Sahi
On paper, the system seems geared to distribution of zakat on merit. On ground the situation is totally different. Different groups of society criticise the whole system for being unfair. The total collection of zakat made through banks is around Rs4.5 billion every year while according to department officials every year at least Rs20 billion is given to the poor in form of zakat.

The resistance is not futile
With the spawning of computer networks that now comprise the internet, the World Wide Web materialised to offer unfettered flow of ideas and viewpoints
By Aziz Omar
As various military junta and conservative regimes gear up in choking the means of accessing the internet, defenders of the free exchange of information are combining efforts. Valiant efforts have been made by journalists, writers, bloggers and free thinkers who in many cases openly defied bans of disseminating views critical of rulers and mainstream social norms and practices. Yet, the most effective resistance is offered by technologies that bypass or tunnel through the barriers put in place by the officially backed, self-appointed guardians of morality and knowledge.

pilferage
Multinational Corruption

Not only are the rich countries and their agencies impotent, they commonly have been and are accomplices in corruption abroad
By Mazhar Farid Chishti
Corruption has become a major international concern. The topic of international conferences, policy forums and ministerial speeches, it is also the subject of a recent OECD Convention and the focus of an international non-governmental organisation, Transparency International. Corruption is increasingly cited as a reason for withholding foreign aid or debt relief. If a country's inability to pay interest on its loans is due to its leaders siphoning off national earnings into their own bank accounts, the reasoning goes, surely extending aid or cancelling the debt will merely sanction further graft.

Land for industry
The recent announcement by the Sindh government to allocate land for cottage industry along KNBP is posing new challenges for manufacturing sector
By Dr Noman Ahmed
On March 14 2007, the Governor of Sindh directed the concerned departments to allocate land for cottage industry zones along the Karachi Northern Bypass (KNBP). The reason cited for this decision was to promote small scale industries and similar enterprises in the area.

 



curbs
Union politics

Spate of European Union's restrictive measures against Pakistani businesses gives critics reason to doubt the motives

By Shahzada Irfan Ahmed

Trade relations between Pakistan and many of the countries, that are now part of the 27-member European Union (EU), have remained ideal for many decades. Apart from other factors, the Pakistani diaspora settled there has been instrumental in winning export business for their countrymen back home. The products exported from Pakistan had always found a ready market in this geographical bloc for their competitive prices and high quality.

However, the last couple of years have seen the trend reverse drastically. There is a common perception that after 9/11, Pakistani products are not being welcomed to EU countries and the US and their way blocked on various pretexts. There are many who smell rat in the repeated EU decisions to impose such bans. To them the imposition of anti-dumping duty on Pakistani bed-linen by EU, preference given to Indian rice over Pakistani Basmati, banning of all aircraft except seven in PIA's fleet from flying to EU countries and the decision to stop importing Pakistan's fishery products after April 12, 2007 hint at a well chalked-out strategy. This strategy, according to them, aims mainly at pressurising the country and forcing it to cooperate with the global powers at various fronts, mostly against the will of its inhabitants.

The other type who reject the thesis and term it nothing more than a 'conspiracy theory' are, however, unable to satisfy the questioners when asked as to why the other backward countries in the region are not facing the axe. It's an established fact that many of these countries are known for extremely unsatisfactory quality of production and services but their trade with the EU has seen a double digit growth over the same period.

In this backdrop, it seems pertinent to discuss the different decisions taken by the EU against Pakistani businesses and leave it to the readers to draw their inferences.

To start with, one can look at the circumstances in which Pakistani authorities received a notification from the European Union (EU) mentioning the impending ban on fishery exports from April 12, 27. Under the notification, all the 11 EU certified seafood processing units based in Karachi have been delisted. This was nothing less than a shock for the industry as the EU imports fishery products worth US$80 million from Pakistan. This makes EU the largest buyer of Pakistan's fishery products in the international market.

The decision has come in the wake of a visit made by the officials of EU's Food and Veterinary Office (FVO) to Karachi Fish Harbour in January 2007. While this decision of EU has sent shockwave down the spine of fishery exporters, our federal commerce minister Humayun Akhtar Khan is suspiciously calm. In a press conference, he hoped that the ban was temporary and would be lifted soon. He also made the ceremonial statement of forming a committee to review the standard of processing and packaging fishery products and ensure its compliance with EU's high quality standards. The minister needs to be checked here and asked as to what was the benefit of earlier committees formed to look into matters related to export of bed-linen and Super Basmati from Pakistan. Secondly, one can ask him as to what makes him say that the ban is temporary. Is there any demand on a part of EU or its global partners which if accepted could make Pakistan a favoured business partner again, and that too overnight?

Sardar Hanif Khan, Chairman Pakistan Seafood Industry Association says the ban would adversely affect Pakistan's fisheries exports and send a negative image among other international buyers of our products. He said the fisheries' exporters hold the federal government for neither being able to lobby with the EU authorities nor ensure the quality standards set by the EU.

The decision on fisheries export comes in quick succession to the one that barred most of the planes of PIA from flying to the EU because of safety concerns. The ban affects 35 aircraft of the airline's fleet of 42 aircraft, with just seven Boeing 777s exempted. The EU had said last year it that would ban flights unless the airline revamped its ageing fleet.

PIA has strongly opposed the ban and does not consider it justified. The airline is considering leasing passenger planes and crew to continue with its operations on this highly profitable route. The ban has badly affected airline's flights to London, Paris, Rome and Amsterdam and other European destinations.

Though hardly any Pakistani who has had the 'privilege' of flying with the national flagcarrier will disagree with EU, there is an official excuse (though off the record) as well. PIA bigwigs say the EU wants to penalise PIA for buying aircraft for its fleet in the past from non-European companies and pressurise it to contract deals with Europeans in the future.

Another front on which Pakistan is fighting its battle is the registration of Super Basmati rice patent. Pakistan alleges India of securing fake registration of this quality of rice which it (Pakistan) claims is produced only in its Punjab province. The EU authorities are not weighing arguments coming from the Pakistani side and there have been talks for joint registration of the patent. But Pakistani growers of Super Basmati want exclusive rights and are raising voice at every available forum.

Last but not the least comes the textile sector. No doubt, Pakistani textile exporters have paid heavily due to the 'discriminatory' treatment at the hands of world powers. The exporters of bed-linen from Pakistan have suffered the most. Except for short periods, Pakistan's bed-linen exports have been subjected to anti-dumping investigations or duties for the last 14 years. The EU first imposed anti-dumping duty on Pakistan's bed-linen in 1997 but it was withdrawn in 2002 when investigations established non-existence of dumping element in bed-linen exports from Pakistan.

In December 2002, the EU again started investigations but even before their completion slapped anti-dumping duty at the rate of 13.1 per cent in March 2004. This makes Pakistani products in-competitive as compared to those imported by EU duty free or at much lesser duty rates.

It is not mere suspicion but a fact that Pakistan has lost on trade front after 9/11, despite being a frontline state in US-led war on terror. Figures show that the US used to receive more than 85 per cent of Pakistani textile exports in the past, but those levels have dropped by 68 per cent since the terrorist attack on twin towers.

The question that arises here is that how can a keen buyer turn indifferent overnight, especially when Pakistan's textile sector has spent billions of rupees on modernisation and up-gradation of their industrial units. But a more pertinent question that comes to one's mind is that of what use the highly paid state advisors, lawyers and officials posted in commerce ministry's WTO cell are if they cannot take up the above-mentioned issues at relevant forums.

 


Newswatch
A legal crisis brewing in the US

By Kaleem Omar

Pakistan is not the only country that is currently enmeshed in an imbroglio relating to its legal system. A legal crisis albeit of a somewhat different kind is also brewing in the United States where the White House and Congress clashed on Tuesday over Republican President George W. Bush's power to keep close advisers like Karl Rove from testifying under oath about Bush's sacking of eight US federal prosecutors last year.

Recent disclosures about the firings of the eight US Attorneys have ignited a firestorm over whether the prosecutors were sacked for political reasons and prompted calls for the resignation of US Attorney General Alberto Gonzales, who heads the Justice Department.

Democrats say the prosecutors' dismissals were politically motivated. Gonzales initially had asserted the firings were performance-related, not based on political considerations.

But e-mails released earlier this month between the Justice Department and the White House contradicted that assertion and led to a public apology from Gonzales over the handling of the matter.

Press reports said the e-mails showed that Rove, Bush's adviser and former chief of staff, as early as January 6, 2005, questioned whether the US Attorneys should all be replaced at the start of Bush's second term. It also showed that he, to some degree, worked with former White House Counsel Harriet Miers and former Gonzales chief of staff Kyle Sampson to get some prosecutors dismissed.

Democrats contend the Justice Department and the White House purged the eight federal prosecutors, some of whom were leading political corruption investigations, after a change in the USA Patriot Act of 2001 gave Gonzales the new authority.

In a remarkable show of bi-partisanship, the Senate on Tuesday voted 94-2 to strip Gonzales of his authority to fill US Attorney vacancies without Senate confirmation.

Bush and Congress (controlled by the Democratic Party since the mid-term congressional elections of November, 2006) now appear headed towards a constitutional showdown over demands from Capitol Hill for more information about internal White House deliberations', according to the New York Times.

The paper said that under growing pressure, the White House offered to allow members of congressional committees to hold private interviews with Rove and Miers who is the former White House counsel, and two other administration officials.

The Bush administration also offered to provide access to some e-mail messages and other communications about the dismissals, but not those between White House officials, according to the NY Times.

The paper said that Democrats promptly rejected the offer, which specified that the officials would not testify under oath, there would be no transcript of what they said and Congress would not subsequently subpoena them,

"I don't accept the offer," said Senator Patrick Leahy, Democrat-Vermont, chairman of the Senate Judiciary Committee. "It is not constructive, and it is not helpful to be telling the Senate how to do our investigation or to prejudge the outcome".

Leahy said, "Testimony should be on the record and under oath. That is the formula for true accountability".

House of Representatives Judiciary Committee Chairman John Conyers, Democrat-Michigan, said his committee would proceed with votes on whether to approve subpoenas for the information and the Senate has a vote on additional subpoenas that was set for Thursday.

Bush said he would fight any attempt to subpoena White House aides, creating the potential for a major constitutional standoff.

"If the Democrats truly want to move forward and find the right information, they ought to accept what I proposed", Bush said. "If scoring political points is the desire, then the rejection of this reasonable proposal will really be evident for the American people to see."

Bush also reiterated his support for besieged Attorney General Alberto Gonzales, whose resignation has been called for by members from both parties.

"He's got support with me. I support the attorney general," Bush said in a nationally televised news conference on Tuesday.

White House spokesman Tony Snow (a former Fox News anchor) also denounced reports that Bush is seeking a replacement for Gonzales as 'just flat false.'

White House Counsel Fred Fielding delivered the administration's offer to the members of Congress during a brief meeting in Conyers' committee office on Tuesday. He said Deputy Chief of Staff Rove, former counsel Miers, deputy White House Counsel William Kelley and J. Scott Jennings, a deputy to political director Sara Taylor, who, in turn, works for Rove, could be interviewed, but not under oath, and there would be no transcript.

Fielding also offered to produce correspondence between the White House and Justice Department, Congress and other third parties.

Representative Chris Cannon, Republican-Utah, the ranking Republican on the House sub-committee investigating Bush's sacking of the eight US Attorneys (federal prosecutors) last year, said the White House offer struck a balance between informing Congress and protecting the president's ability to receive candid and confidential advice from his staff.

"We get what we want, but we don't get it in a form that is public", Cannon said. "If the Democrats are interested in the truth, they will accept this offer and allow the Congress to get to the bottom of the issue as soon as possible."

It is ironic, in the extreme, that Cannon, a member of Bush's Republican Party, should doubt the Democrats' interest in 'the truth' considering that the Bush administration has, over the last six years, repeatedly lied to the American people and to the world at large about a host of issues, including its reasons for invading Iraq.

The Iraq war has already cost the United States over $ 650 billion and thousands of American live, to say nothing of what it has cost the Iraqi people.

According to the respected British medical journal The Lancet, more than 600,000 Iraqi civilians have been killed by the US military since the war began in March 2003. The country's infrastructure is in ruins as a result of US bombing and missile strikes, and its educational system, once the best in the Middle East, is in shambles. Iraq's economy, too, is in ruins, and the once oil-rich country is in danger of becoming an economic basket case.

If the Bush administration can lie about something like Iraq, members of his Republican Party, such as Cannon, are hardly in a position to cast aspersions on the Democratic Party's interest in the truth.

Cannon said that if Democrats were to accept the White House's offer, documents relating to Bush's sacking of the eight US Attorneys could be delivered and interviews of administration officials take place as early as next week.

While the officials would not be under oath, Cannon said, they could still face criminal charges if they lied to Congress. The alternative, he said, would be to issue subpoenas, which is likely to lead to a lengthy court fight.

The Senate Judiciary Committee has already authorised subpoenas at Leahy's discretion for several Justice Department officials, including Sampson, a Utah native and Attorney General Gonzales' former chief of staff who orchestrated the firing of the US Attorneys.

Setting up a possible legal showdown, a testy Bush vowed on Tuesday that he would go to court to rebuff congressional orders 'dragging' White House members up there to score political points' during what he described as 'show trials', said a Reuters report.

 


rights
State of permanent emergency

Section 144 cannot be read and exercised in isolation of the fundamental rights guaranteed in the constitution and recognised the world over

By Asad Jamal

"Every citizen shall have the right to assemble peacefully and without arms, subject to any reasonable restrictions imposed by law in the interest of public order." Article 16 of the Constitution of Pakistan

"Everyone has the right to freedom of peaceful assembly and association." Article 20(1) of the Universal Declaration of Human Rights

 

In Pakistan the laws frequently used to curb fundamental rights and freedoms guaranteed in the constitution and recognised in the international declarations and covenants, include Maintenance of Public Order, 1961, Security of Pakistan Act, 1952, Anti-Terrorism Act, 1997 as well as the much abused Section 144 of the Code of Criminal Procedure.

On March 10, when lawyers' associations all over the country decided to observe a strike and boycott the court proceedings on March 12 against the suspension of the CJP, the provincial and federal governments were quick to impose Section 144 that bars assembly of people at public places. This was clearly intended to prevent any apprehended protest demonstration by lawyers.

On Monday March 12, the Lahore administration came down hard upon the lawyers who had decided to express their anger outside the Punjab Assembly Hall and were marching close to the building. And without any provocation. It appears the administration wanted to give lawyers a treat of the baton in order to suppress dissent in coming days. Dozens of lawyers were severely beaten and given a bath in blood and several others were taken into custody by the police.

Again on March 17 in Lahore, when the organisations had called an All Pakistan Lawyers' Convention at the Karachi Shuhada Hall, the administration made it clear that even an indoor and absolutely innocuous assembly was not acceptable. The police started firing tear gas shells inside the High Court premises close to hall where the convention was taking place forcing the assembled lawyers to move away from the venue. As a result the police succeeded in disrupting and sabotaging the convention, a peaceful assembly of lawyers expressing free dissent.

A similar kind of treatment has been meted out to protesters, more notably in Islamabad and Quetta on March 21. It is clear that the government is using brute force to curb even the peaceful dissent and can go to any extent to abuse the law. It may be mentioned that the Acting Chief Justice of the Supreme Court has formed various tribunals to conduct enquiries, which is in a way a recognition of at least some sense of wrong-doing on part of the government.

Section 144 in its present form seem to confer powers to issue an order absolute at once in urgent cases of nuisance or apprehended danger and it seems as if the power provided therein may be exercised on the assessment of the concerned authority i.e. Zila Nazim [it used to be district magistrate] and/or the provincial government, apparently implying the authority's subjective satisfaction. However, this may not be the case. Section 144 cannot be read and exercised in isolation of the fundamental rights guaranteed in the constitution and recognised the world over and also several judgments by the superior courts laying down certain stringent conditions.

Even otherwise a plain reading of Section 144 reveals that the authority exercising the powers under this provision must be satisfied that there is sufficient ground to proceed under this law and an immediate prevention and speedy remedy is desirable. Then the authority must also consider that the direction intended to be issued is likely to prevent obstructions, annoyance or injury to any person lawfully employed, or danger to human life, health or safety or disturbance of public tranquility or a riot or an affray.

An order under Section 144 must be passed in circumstances of emergency only and must be of temporary nature as is clear from the wording of the subsection 6 of the provision, which says that no such order can be passed to stay in effect for more than two days at a stretch or seven days in a month from the making thereof. Only in special circumstances the provincial government may extend the period to two months. Those special circumstances as enumerated in the subsection 6 are danger to human life, health or safety, or likelihood of a riot or an affray.

These special circumstances have apparently crept into our law from the International Covenant on Civil and Political Rights, 1961 (ICCPR). Article 21 of the covenant says:

"The right of peaceful assembly shall be recognized. No restrictions may be placed on the exercise of this right other than those imposed in conformity with the law and which are necessary in a democratic society in the interests of national security or public safety, public order, the protection of public health or morals or the protection of the rights and freedoms of others."

However, in our case the provincial and federal governments seem to enjoy absolutely free hand in using the special legal provision at their whims in order to quell the voice of the people. It has become a habit with our governments and the district administrations (who usually act on the instructions from the provincial governments who in turn act on instructions from the federal government) to impose section 144 on short intervals which has been held to be violative of the provisions of the subsection 6 by the superior courts.

Lahore and several other cities of Pakistan are under section 144 and this has been going for some time now. Section 144 has been imposed indiscriminately and invariably to stop political parties from holding public rallies and protest marches by the human rights activists and members of general public against the government's highhandedness in cases of missing persons. For past several months, section 144 has been imposed in Lahore city again and again in order to quell political dissent of all sorts in complete disregard of the spirit of this special provision of law.

The policy towards the right to assembly has never been transparent; it depends on the whims of the government, provincial or the federal. Last year, we saw that the religious groups protesting against the Danish cartoons were allowed to cause havoc with public and private property in Lahore on February 14, 2006. That was a time when the administration should have taken preventive measures in view of the sensitivity of the issue involved.

One justification for the imposition of section 144 in order to bar assembly of people on the ground that freedoms to one or more groups can not be allowed to infringe upon others' rights and freedoms implying that by allowing assemblies on the roads causes hindrance in free movement and trade and business activity. However, the very fact that such abuse of law invariably accompanies indiscriminate use of police force which is always unreasonable and disproportionate to the perceived danger to human life, health or safety, or likelihood of a riot or an affray. Can any one explain what urgency the administrations of Lahore, Quetta and Islamabad saw in not just clamping section 144, but also in baton-charging the peaceful lawyers on March 12, 17 and 21?

Lahore and several other cities are in a state which can only be described a state under martial law, especially after the open attacks by the Lahore police on fundamental right to peaceful assembly. Every morning one enters the Lahore High Court building amidst hundreds of policemen deployed to quell any prospective demonstration taken out by the protesting lawyers, only to exit at the end of the day to find a greater number of policemen. A scene many senior lawyers say is reminiscent of Gen. Zia's martial law.

The acting chief justice has since then taken notice of the police action against the lawyers in Lahore and the matter being sub judice better be left to the Lordships' good judgment. However, our experience has been that rarely do our superior courts take to task the government of the day, the real decision-maker and the policy-implementer. The superior courts being the ultimate protectors of fundamental rights must ensure that the government does not repeat its performance like a habitual violator of civil rights and liberties if not a hardened criminal.

Meanwhile, the Punjab government has on 17 March directed the Lahore City District Government to extend imposition of Section 144 for another month.

Asad Jamal is a Lahore based lawyer and may be reached at asadjamal2006@yahoo.com

-- Muhammad Basharat Raja, Punjab minister for Law, Parliamentary Affairs and Local Governments

The News on Sunday: How do you justify the violence of police against the protesting lawyers on March 12, 16 and 17, in view of Article 16 of the Constitution of Pakistan?

Muhammad Basharat Raja: We are not disallowing anybody for exerting his/her rights. But the same article also states that this right is subject to any reasonable restrictions imposed by law in the interest of public order. Second it is duty of every government to maintain law and order and we are not allowing anybody to take law in his/her hand. Lawyers or any other person or party are free to protest but not at the cost of others.

TNS: But how can people protest when the government is quick to impose Section 144 in Lahore, especially on The Mall, that bars more than four people to assemble?

MBR: Imposing Section 144 on The Mall is not a new thing. In fact every government in the past also used to do so. We have not imposed it to stop lawyers or any other party from protesting but its purpose is to save the business on the road. Political parties and lawyers take it as a joke to give call for protest. See they started it from March 12, then March 16 and 17 and now a call has been given for March 26. They should keep in mind that by doing so they are threatening the law and order as well as the business.

The traders' bodies on The Mall are making requests that their business be protected. But the lawyers are insistent that they would continue to protest until they achieve their targets. Would they like to tell people what are the targets and why they want to achieve these on costs of others.

TNS: On March 17, lawyers had just gathered inside Lahore High Court building and not violating section 144 but the police fired shells of tear gas and pelted bricks on them?

MBR: On March 17 the lawyers first gathered in Aiwan-e-Adl and from there they came to the Lahore High Court building as a procession. During all this exercise police remained at a safe distance from them. But when they were targeted by bricks, they retaliated.

One should keep in mind that lawyers alone were not protesting and there were many other political elements with different agendas were involved. The government tried but the lawyers were not ready to cooperate with government.

After those incidents, lawyers have come to know that they are being used so they assured government for peaceful protest on March 19 and nothing happened on that day.

A judicial inquiry on the whole issue is under process and its findings will clearly tell the truth.

TNS: But Section 144 is meant to be imposed as an emergency measure and its article 6 clearly states that "no order under this section shall remain in force for more than two consecutive days and not more than seven days in a month"?

MBR: This is half-truth. If you read full text of the same article it will be clear that it allows provincial government to impose it for a period of time it feels necessary to maintain law and order situation in some specific area. This section is not just meant for emergency, but it can be imposed by the district or provincial government under any circumstances to maintain law and order.

-- Aoun Sahi

 


Police on rampage

Police's role in exacerbating the public agitation triggered by the suspension of the Chief Justice has been conspicuous and intriguing

By Adnan Adil

The lawyers' protest against the presidential action against the chief justice would have passed rather quietly had the police shown some restraint in dealing with protesting lawyers. The police roughed up none other than the top judge of the country, beat the protesters with batons wounding many people, fired massive teargas to disperse peaceful assemblies and ravaged the offices of lawyers and the media in Lahore and Islamabad.

On the first hearing of the reference against Justice Iftikhar Chaudhry in the Supreme Judicial Council in Islamabad, the way the police manhandled the suspended chief justice was so blatant that it led the acting chief justice to take notice of this situation and issue statements to defend the sanctity of the apex court. The scenes of Islamabad police blocking the way of Chief Justice preventing him from going towards the Supreme Court building were aired on TV screens. Eye-witnesses told the media that the police tore apart the judge's jacket and forced him to sit in a car and forcibly took him Balochistan House.

The same day, the police in Lahore ruthlessly beat protesting lawyers in its bid to stop them from taking out a procession from the Lahore High Court on to The Mall causing injuries to more than a dozen lawyers including some senior lawyers such as senator Latif Khosa (advocate). When the lawyers made a second attempt to move forward the police beat them again and both parties hurled stones at each other. Several lawyers were arrested but soon freed on the intervention of the chief justice of the Lahore High Court.

After the March 12 violence, it was expected that the administration would soften its posture and avoid ruthless use of force on the occasion of Justice Iftikhar Chaudhry's second appearance before the Supreme Judicial Council on March 16. However, the police again came down heavily on the crowd that turned up to express solidarity with the suspended judge. It fired teargas and rubber bullets on the crowds and arrested several political leaders in Islamabad who wanted to assemble outside the Supreme Court building including Jamaat Islami chief Qazi Hussain Ahmed. The police raided the offices of the Geo television in Islamabad followed by firing teargas and ransacking the building.

In Lahore, the same day, a small group of people mainly belonging to the PML(N) and the Jamaat-i-Islami gathered in and around the mosque at Nila Gumbad, Anarakali. They had planned to take out a procession to the nearby Lahore High Court building. The police cordoned off the area stopping people from freely going to the mosque for Friday prayers. A few dozen people came to Nila Gumbad chanting slogans against Gen. Musharraf and remaining peaceful for some time.

At Nila Gumbad, the Lahore Police Chief, Operations Aftab Cheema, wearing chest guard and helmet, was himself leading the police deputed. Only when Cheema ordered his men to disperse the slogan-chanting protesters, without any provocation, that the protesters rushed backwards in panic and started pelting stones at the police. The police fired tear gas and beat them with batons. The peaceful leaders who were standing at the gate of the mosque making speeches or were sitting inside were also arrested.

At Nila Gumbad, the police kept former President Rafique Tarar in custody and forced him to go home in a police-escorted car. Mustaf Safavi, a civil judge of Karachi, while resigning in protest rightly remarked that when the fundamental rights of the chief justice are not secure what to speak of the ordinary people.

On March 17, after the government had apologised for the police raid on the previous day's events in Islamabad, it did not stop the Lahore Police from brutally cracking down on the protesting lawyers in the city. The police armoured personnel carrier entered the High Court's premises after which the police men ransacked the lawyers' chambers. Half a dozen journalists and photographers were kept from covering events and taking photographs of the police firing tear gas. The police men threw stones on the protesters which made it look like their personal battle.

Contrarily, on March 21, when the police was withdrawn from the scene thousands of lawyers in Lahore brought out a peaceful procession in support of the suspended chief justice and no violence was reported.This clearly depicts that the earlier violent clashes in Islamabad and Lahore were the result of police's aggression.

The police's fierceness in handling the protests against the judicial crisis could be explained in terms of the police establishment's grudge against the legal arm of the state. In recent times, the higher judiciary has been critical of the police high-handedness and its poor performance in keeping law and order.

Only a few months back, the former IG Police Ziaul Hasan was summoned by the Supreme Court and had exchanged some not-so-polite words with the Chief Justice Iftikhar Chaudhry. Of late, the Chief Justice had been harshly criticising the Punjab police. Insiders say that the police establishment was also unhappy about the kind of protocol the CJP expected from senior police officers which they latter were not used to.

Following his footsteps the Lahore High Court took notice of of the situation after the murder of Punjab's advocate-general Arif Bhinder. The lawyers' protest on the occasion against the police and the high court's summoning of the IG Police Punjab in the court further angered the police establishment. The IGP Punjab was made to appear before the judges and made to stand before them in several hearings. The high court also warned the police that its failure to keep law and order may deprive it of its powers.

Perhaps, this was the defining moment for the police establishment to react the way they did. By taking an armoured personnel carrier into the high court's premises and roughing up the top judge it showed the bar and the bench as to where does the real power rests.

The police thinks it protects judges and gives them respect and protocol. When the same police came under attack by the higher judiciary, it took it as an insult. The role of the police establishment in shaping the government's decisions cannot be ruled out, specially in Justice Iftikhar Chaudhry's case. After all, at least two intelligence agencies -- the Special Branch and the Intelligence Bureau which provide feedback to the government and influence the decision-making -- are manned by police officers. Both these departments advise governments on key issues and possible danger to its existence.

After all, these are the police officials who bring the defiant politicians in line and make them join the ruling party. It also plays a crucial role in rigging the elections and making the life of political opponents miserable. How can the sitting government ignore the police advice when it is too much dependent on it for its own survival, in particular when the general elections are round the corner?

We are a society where dialogue and compromise do not define decision-making and public policy, but the use of force is the final arbiter, be it military intervention in national politics or police meddling in private dealings of the citizens. In these circumstances, no wonder the junior police officials can rough up the top judge of the country or destroy the lawyers' offices and enter the media buildings. The police has taken its revenge.

What provoked the Public Accounts Committee to express concerns on the prevailing zakat distribution system and direct the ministry to stop political interference in its disbursement?

By Aoun Sahi

On paper, the system seems geared to distribution of zakat on merit. On ground the situation is totally different. Different groups of society criticise the whole system for being unfair. The total collection of zakat made through banks is around Rs4.5 billion every year while according to department officials every year at least Rs20 billion is given to the poor in form of zakat.

Officials also admit that people at large do not trust the official distribution system. In 1999 Supreme Court of Pakistan gave a judgment which allowed all sects to file a declaration seeking exemption from payment of zakat on their financial assets.

More recently, the Public Accounts Committee of National Assembly has also raised strong concerns on the prevailing zakat distribution system and has directed the ministry to stop political interference in zakat's disbursement. Vakil Ahmed Khan, secretary Religious Affairs and Zakat and Ushr Ministry, told the committee that the distribution of zakat was the provinces' responsibility, and the Central Zakat Council only provided funds to the provinces on the basis of population. He conceded there were complaints against the current zakat system, but said the government was amending laws.

The declared objective of the zakat fund was to reduce poverty, provide sustenance to the destitute and assist them in becoming productive members of society. The performance of the system, however, has been far from perfect over the past 26 years.

First, zakat collection and disbursement have not been made transparent. In many cases the mustahqeen have to wait for months and get to know at the end that they cannot be accommodated because of insufficient funds. Second, the administrative expenses incurred annually on the maintenance of the zakat distribution machinery including expenditure on district chairmen of Zakat committees are not known.

Third, no record is provided for the actual entry and deletion of mustahqeen from the lists maintained each year under the zakat fund; there is also no system to verify the mustahqeen data being provided by LZCs. Finally, despite all claims to the contrary, the chairman of district and local zakat committees are always those who have some connection with the people in power.

Chaudhry Abdul Hameed Advocate, Chairman District Zakat Committee Lodhran admits that one needs to have some connection with ruling party to become a chairman. "In many cases LZC only nominates the people belonging to their family, locality or party and refer people who do not qualify as mustahqeen. But we approve their nominations because we do not have the resources and time to inquire the case," he tells TNS.

The main problem, he thinks, is the funds. "As per rules my district can only get Rs1.3 million annually in the shape of marriage grant which means that I can only accommodate around 1300 cases but believe me at present I have more than 4000 applications in this regard and all are mustahqeen."

According to him there are many allegations which are not genuine. Such allegations are usually made when people are unable to get zakat because of insufficient documentation or more eligible people get it.

Muhammad Ilyas Dar, Joint Secretary Zakat and Ushr Ministry of Religious Affairs, refers to some amendments they have proposed in the prevailing distribution system to make it more transparent. "We have proposed that CZC should be given the power to audit accounts of district and local committees directly; currently it is dependent on the information provided to them by Provincial Zakat Councils."

"It is right that Provincial Zakat Councils have their own internal audit system, but their auditors are based in districts and we think that chairman district committee can influence them," he says.

Dar admits that there is political involvement in disbursement as every MNA, MPA and influentials of the area wants to accommodate people who would vote for him. The elections of LZC members are also designed by the influential people of the area. He says that it is not right that Zakat system is doing nothing. "In a country where more than 33 per cent people live below the poverty line how can we accommodate all those eligible with only Rs4.5 billion collected in the name of zakat. But there are some sectors in which we are bringing amazing results. In Punjab 137 vocational institutes are being run with the help of Zakat fund and according to our surveys around 70 per cent of students in these institutes have got jobs in open market.

 

System in place

As a traditional religious institution, zakat involves both the payment and the distribution of religious tax by Muslims who enjoy some surplus to deserving Muslims. zakat is to be paid once a year on wealth possessed for more than a year by a Saheb-e-Nisab at a rate of 2.5 per cent. Traditionally it was the people who themselves distributed the zakat money to the mustahqeen (eligible) they knew very well.

After 1980, as a part of his Islamisation programme, Zia introduced the Zakat and Ushr Ordinance. Based on the Islamic notion of zakat, this ordinance made it obligatory upon the government to collect and distribute zakat. In this way a new system of zakat distribution began in Pakistan.

There are four main components of this distribution system. An autonomous Central Zakat Council comprising 12 members from different groups of society including four federal secretaries, three religious scholars and two female members is formed, headed by a serving or retired judge of Supreme Court of Pakistan. The chairman is nominated by the president of Pakistan with consultation of Chief Justice. This body makes the rules of business for the Zakat money and other bodies involved in distribution system. It also administers the Central Zakat Fund, maintained by the State Bank of Pakistan (SBP), which does not form part of the federal consolidated fund. The council is supported by the Zakat and Ushr wing of the Ministry of Religious Affairs. The council also decides the basis on which the zakat money will be distributed among different provinces of the country. Currently, the distribution is being made on the basis of population.

Disbursement in the provinces is regulated by the Provincial Zakat Councils through District Zakat Committees and Local Zakat Committees (LZC). The most important tier in this whole distribution system is the LZC which identifies the mustahqeen (the needy and the indigent).

According to Mian Abdullah, Administrator Zakat and Ushr Punjab 80 per cent of total zakat in province is distributed through these LZCs. In Punjab there are 25267 LZCs. The LZC comprises the chairman and eight members elected by the people of a community for three years. It is their responsibility to trace and register mustahqeen of their areas. "LZC decides as to who is eligible for zakat and who is not. A person denied by them as a mustahiq cannot get zakat money even through presidential orders," says Abdullah.

According to Abdullah Zakat is allotted under six different heads. The maximum, 60 per cent, is given to the Guzara allowance. The next five in order of priority are education 18 per cent, Deeni madaris 8 per cent, health 6 per cent, social welfare rehabilitation and NGOs 4 per cent and marriage grant 6 per cent. Rs500 per month is given to a mustahiq person or family (priority is given to people who cannot rehabilitate through any other way like widows, elderly and handicapped etc.) under the Guzara allowance. Rs10,000 is given under marriage grant to mustahqeen for marriage of their daughters. Mustahiq students are given from Rs75 to Rs875 in different categories according to educational level. They are also verified by the local Zakat committee.

"The decision of LZC is given importance because they are the people who have direct link with the poor of their area and as there is a pre-condition that they will not be affiliated with any party or group, we think they are in the best position to pinpoint the most eligible people of his locality," adds the Zakat administrator.

-- A. Sahi


The resistance is not futile

With the spawning of computer networks that now comprise the internet, the World Wide Web materialised to offer unfettered flow of ideas and viewpoints

By Aziz Omar

As various military junta and conservative regimes gear up in choking the means of accessing the internet, defenders of the free exchange of information are combining efforts. Valiant efforts have been made by journalists, writers, bloggers and free thinkers who in many cases openly defied bans of disseminating views critical of rulers and mainstream social norms and practices. Yet, the most effective resistance is offered by technologies that bypass or tunnel through the barriers put in place by the officially backed, self-appointed guardians of morality and knowledge.

Anonymisers or proxy websites enable surfers to access material from a blocked website. The proxy portals usually function in two modes: One type consists of the networked kind, which entail two or more internet computers redirecting the traffic from the site in question. The data is as usual encrypted and passes from the originating website to say computer A, then B or C and then finally arrives at the recipients' machine. This method offers increased protection against any attempts by a regulating entity in analysing the flow of internet traffic. However, it is possible to match the timestamp, size and number of data packets that come from the blocked website to the proxy one to those that pass from the latter to your browser. Some advanced anonymisers tackle this by adding a delay of few milliseconds after the data has arrived from the source website, before passing it to the requesting party.

Straightforward anonymisers work by simply having just one proxy site in the loop that encrypts the data from the host site. Such single-point forms of proxy surfing are sufficient to fool most internet filters and firewalls while protecting the identity of the end-user. Private information such as IP address, browser details such as history of previous visited sites and even operating system files are openly vulnerable for exploitation by hackers and snooping agencies. Proxy websites mask such details and only pass on their own respective ones.

Various government security agencies regularly screen all the emails that are sent and received by the internet subscribers within their jurisdiction. They are analysed and checked against similar lists as those used by filtering software. Even keeping the mails in the 'drafts' folder instead of sending them does not protect the data from prying eyes. Anonymous re-mailers are programmes that initially forward the mail to other addresses on the network and strip 'header' part before executing the final mailing procedure. The header information in all outgoing messages carries information that directly identifies the source of the sender's machine as a location on the computer network.

A united front against the aggressive filtering and surveillance activities of controlling governments is the OpenNet Initiative (ONI). This is a collaborative partnership of research centres in four leading academic institutions. Organisations within University of Toronto, Harvard Law School and the Universities of Cambridge and Oxford have made it their mission to expose and deconstruct filtering and surveillance methods employed worldwide. The ONI project has conducted various case studies of individual countries in this regard and the findings have been published on its site, opennetinitiative.net.

Various private foundations give grants in millions of dollars to the participant agencies of the ONI. A number of NGOs and social advocacy projects such as Reporters without Borders and Privacy International are part of the growing community of the crusaders of free speech. This global partnership benefits from the shared knowledge resources and training skills in advancing communication rights.

Citizen Lab, the University of Toronto leg of ONI has released an internet censorship navigation solution called 'psiphon'. Computer users in countries free from filtering install the software on the computers, thereby converting them into internet servers. Consequently, permitted web surfers in countries experiencing censorship can access the internet unfiltered by establishing a connection with psiphon enabled computers.

The logical justification of web traffic filtering arises in situations where it is important to protect businesses from malicious virus attacks, Trojans, worms and spy ware. Such vile lines of code are created with the sole purpose of disrupting internet activity or stealing sensitive information such as passwords, identity information and credit card details. Companies such as Symantec, Grisoft and McAfee have been marketing tools optimised for screening and deleting potential threats to computer security. Other kinds of content have been deemed to affect not the machines but their underage users, which may include gory, violent, offensive and pornographic material. Products such as Net Nanny and CYBERsitter are capable of not just restricting access to listed web addresses but are also capable of monitoring chat rooms visited, filtering email and blocking ports used by peer-to-peer software such as msn messenger and Kazaa.

During the development of the internet in the 1990s, the governments of developed countries such as US, Canada and UK agreed to uphold the freedom of expression and later information. Human rights watchdogs have played a key role in ensuring that the public has free access to information. It was tacitly agreed that internet usage regulation was largely the responsibility of parents and guardians. However, as the global community has emerged to increasingly incorporate the internet in their private and corporate lives, countries such as China, Saudi Arabia and Iran have attempted to curb intercommunication. The respective governments have self-appointed themselves in the role of a Big Brother and have begun to decree what is right and what's to be banned.

Iran restricts access to the most number of websites other than China. The Telecommunication Company of Iran and participatory Internet Service Providers (ISPs) use the filtering software SmartFilter developed by the American firm, Secure Computing. Until recently, the Iranian authorities had configured SmartFilter to block access to the most prominent informative and social networking sites such as Wikipedia, YouTube, Blogger, New York Times and even the homepage of Amnesty International. Surprisingly, Secure Computing claims that the Iranian authorities have deployed their filtering products illegally across the country's computer servers.

The Iranian government has not just stopped at clamping down on access to information on the web. It has gone a step further and has tied and prosecuted individuals on charges such as 'participation' in formation of groups to disturb national security and propaganda against the state. In 2004, Tehran's judiciary arrested around 21 bloggers and staff members of various internet news sites who had been critical of government policies, and allegedly used torture methods in extracting confessions. The Middle East division of the Human Rights Watch claims that detainees were blind folded and beaten for disturbing public opinion by writing articles for newspapers and illegal internet sites. The very next year, prominent blogger Arash Cigarchi was sentenced to 14 years in prison. And as recently as December of last year, Iranian lawmakers conducted a trial against four men on giving interviews online to foreign radio broadcasts, among other allegations.

In the 15,000 or so sites blocked by Iranian ISPs, most are in the local language Farsi. However, among the definite 'no-no' sites of pornographic nature as well as gay and lesbian themed ones, are ones such as those advocating women's rights and political reform. A large number of sites are also inadvertently blocked due to over-blocking, as the filtering software uses lists of keywords to block associated content. This outcome is typical of all commercial internet filtering products, which are often customized by their companies for hard-line regimes which intend to use the technology at a national level. This is apart from the flaws and errors that might arise in routine operation as the products lack transparency due to their being copyrighted as opposed to being open-source.

The Saudi monarchy is notorious for grossly violating the most basic human rights, such as equal ones for women and the freedom of expression and access to information. Even though internet accessing technology was available in the region since 1994, it was only by 1999 that the regime granted public access to the web. This delay was solely due to the authorities' objective to systematically block all objectionable content as outlined by them. The same proprietary software SmartFilter is utilised to block the usual erotica as well as many sites related to gambling, religious conversion and those of human and women's rights organisations. Many proxy websites, that can be used to indirectly access blocked content have also been blocked themselves.

Saudi authorities claim that their filtering policies are relatively transparent and not as secretive as those in Iran or China. Yet, their methodologies are prone to over-blocking and an estimated half a million or so websites cannot be accessed from within the kingdom. Even attempts of internet users trying to access blocked material are logged. This information is potentially used to track the violators, especially if they are related to anti-Wahabi or Shia groups.

In the Middle-East, apart from the morally policing governments of Iran, Yemen and Saudi Arabia, relatively liberal ones of UAE, Jordan, Bahrain and Turkey have also attempted internet content filtering at some level.

Turkish authorities recently temporarily blocked access to the video blogging site YouTube.com as they discovered some clips that allegedly insulted the founder, Mustafa Kemal Ataturk. The internet service in Bahrain and UAE, though high-speed, is routed through the respective countries' sole ISPs. Batelco in Bahrain and Etisalat in UAE constitute a centralised communication structure, thus enabling authorities to swiftly block access. Online dating services that act as meeting points between Muslims and non-Muslims are typical targets of blockage.

Though recent product releases are being touted to be more specific in their filtering out material up to an accuracy of individual sentences and paragraphs rather than entire websites containing multiple web-pages. Even though more focused filtering is achieved through higher computing power, it is the list of 'hot words' that determine the eventual blocking. Hence most states that employ the filters inject their own blocking lists that sit on top of the default ones.

Though some Middle-Eastern states such as have eased restrictions on internet access in the wake of the liberalisation of their economies, others remain closed. Moreover, they are strengthening their resolve in stamping out dissenting religious and political views as well as those of social commentators. The progressive citizens of such nations may quite possibly feel that they have the right to not knowing. They are hanging onto the hope that one day, the truth might set them free.



pilferage
Multinational Corruption

Not only are the rich countries and their agencies impotent, they commonly have been and are accomplices in corruption abroad

By Mazhar Farid Chishti

Corruption has become a major international concern. The topic of international conferences, policy forums and ministerial speeches, it is also the subject of a recent OECD Convention and the focus of an international non-governmental organisation, Transparency International. Corruption is increasingly cited as a reason for withholding foreign aid or debt relief. If a country's inability to pay interest on its loans is due to its leaders siphoning off national earnings into their own bank accounts, the reasoning goes, surely extending aid or cancelling the debt will merely sanction further graft.

Most commentators on corruption and on the 'good governance' initiatives instigated to combat it dwell on developing countries, not industrialised ones. Most scrutinise politically-lax cultures in the South, not the North. Most call attention to the petty corruption of low-paid civil servants, not to the grand corruption of wealthy multinationals. Most focus on symptoms such as missing resources, not causes such as deregulation of state enterprises. Most talk about bribe-takers, not bribe-givers.

Growing corruption throughout the world is largely the result of the rapid privatisation of public enterprises. Multinationals, supported by Western governments and their agencies, are engaging in corruption on a vast scale in North and South alike. Donor governments and multilateral agencies such as the World Bank and International Monetary Fund frequently put forward 'good governance' agendas to combat corruption, but their other actions send different signals about where their priorities lie.

In many instances, privatisation has been accompanied by widespread corruption. Joseph Stiglitz, ex-Chief Economist at the World Bank, admits that "it has proved difficult to prevent corruption and other problems in privatizing monopolies. Advocates of privatization may have overestimated the benefits of privatization and underestimated the costs, particularly the political costs of the process itself and the impediments it has posed to further reform."

The head of the World Bank's Asia-Pacific branch, Jean-Michel Severino, confessed that infrastructure privatisations in the region became a 'horror story' in which 'there was a high level of corruption'.The 'horrors' come about partly because of the inflexible and hasty deadlines set by the IMF and World Bank. Public services are privatised without enough time being allowed to set up workable frameworks for regulation. As the recent External Evaluation of the Enhanced Structural Adjustment Facility (ESAF) noted with some puzzlement

Corruption is a major cause and result of poverty around the world, at all levels of society, from governments, civil society, judiciary functions, military and other services and so on. The impact of corruption in poor countries on the poorer members of those societies is even more tragic.

At a global level, as globalisation continues at rapid pace, with promises of prosperity, the 'international' (Washington Consensus-influenced) economic system that has shaped this globalisation in the past decades requires further scrutiny for it has also created conditions whereby corruption can flourish and exacerbate the conditions of people around the world who already have little say about their own destiny.

A hard thing to measure or compare though is the impact of corruption on poverty issues, versus those inequalities that are structured into law, such as unequal trade agreements, structural adjustment policies, and so-called 'free' trade agreements and so on. It is easier to see corruption. It is harder to see these other more formal, even legal forms of 'corruption'. It is easy to assume that these are not even issues because they are part of the laws and institutions that govern national and international societies and many of us will be accustomed to it.

When asking why poor countries are poor, it is quite common to hear, especially in wealthier countries that are perceived to have minimal corruption (at least domestically) that other countries are poor because of corruption. Yet, corruption is not something limited to third world despots. Rich countries and their multinationals too have been involved in corrupt practices around the world.

Professor Robert Neild from Trinity College, Cambridge University writes in Public Corruption; The Dark Side of Social Evolution, 'Rich countries and their agencies... commonly have been and are accomplices in corruption abroad, encouraging it by their actions rather than impeding it...." (p.209). Specific problems he highlights include:

The impact of Cold War corruption (supporting dictatorships, destabilising democracies, funding opposition, etc);

Firms from rich countries bribing rulers and officials from developing countries to gain export contracts, particularly in the arms trade and in construction (even justifying it by suggesting bribery is 'customary' in those countries, so they need to do it to, in order to compete);

The 'corruption-inducing effects of the purchase, by the rich countries and their international corporations, of concessions in Third World countries to exploit natural deposits of oil, copper, gold, diamonds and the like.' Payments made to rulers often violate local (and Western) rules, keeping corrupt rulers in power, who also embezzle a lot of money away.

The drug trade.

Neild suggests that international law and national laws in rich countries that prohibit drugs may serve to "produce a scarcity value irresistible to producers, smugglers and dealers." Governments and civil society in the third world are often 'undermined, sometimes destroyed' by the violence and corruption that goes with the drug trade. "This is probably the most important way in which the policies of rich countries foster corruption and violence. Yet the effect on the Third World seems scarcely to enter discussion of alternative drug policies in the rich countries." Legalising drugs, a system of taxation and regulation, comparable to that applied to tobacco and alcohol might do more to reduce corruption in the world than any other measure rich countries could take, he suggests.

Dr Susan Hawley, writes in Exporting Corruption; Privatisation, Multinationals and Bribery, that bribery may be pervasive, but it is difficult to detect. Many Western companies do not dirty their own hands, but instead pay local agents, who get a 10 per cent or so 'success fee' if a contract goes through and who have access to the necessary 'slush funds' to ensure that it does. Bribery is also increasingly subtle.... Until recently, bribery was seen as a normal business practice. Many countries including France, Germany and the UK treated bribes as legitimate business expenses which could be claimed for tax deduction purposes.

Multinational Corporations and Corruption

 

Corruption scandals that sometimes make headline news in Western media can often be worse in developing countries. This is especially the case when it is multinational companies going into poorer countries to do business. The international business environment, encouraged by a form of globalisation that is heavily influenced by the wealthier and more powerful countries in the world makes it easier for multinationals to make profit and even for a few countries to benefit. However, some policies behind globalisation appear to encourage and exacerbate corruption. As accountability of governments and companies have been reduced along the way.

For multinationals, bribery enables companies to gain contracts (particularly for public works and military equipment) or concessions which they would not otherwise have won, or to do so on more favourable terms. Every year, Western businesses pay huge amounts of money in bribes to win friends, influence and contracts. These bribes are conservatively estimated to run to US$80 billion a year -- roughly the amount that the UN believes is needed to eradicate global poverty.

Such bribery may be pervasive, but it is difficult to detect. Many Western companies do not dirty their own hands, but instead pay local agents, who get a 10 per cent or so 'success fee' if a contract goes through and who have access to the necessary 'slush funds' to ensure that it does. Bribery is also increasingly subtle. It often takes the form of semi-legal fees or 'commissions', and inflated or marked-up prices. In contracts guaranteed by export credit agencies, such 'commissions' are included in the costs and thus in the total contract value covered by the guarantee. "It is obvious," comments Transparency International, "that this practice constitutes an indirect encouragement to bribe which, in future, brings it close to complicity with a criminal offence". Until recently, bribery was seen as a normal business practice. Many countries including France, Germany and the UK treated bribes as legitimate business expenses which could be claimed for tax deduction purposes.

Dr Hawley investigates for multinationals, bribery enables companies to gain contracts (particularly for public works and military equipment) or concessions which they would not otherwise have won, or to do so on more favourable terms. Every year, Western businesses pay huge amounts of money in bribes to win friends, influence and contracts. These bribes are conservatively estimated to run to US$80 billion a year -- roughly the amount that the UN believes is needed to eradicate global poverty.

Dr Hawley also lists a number of impacts that multinationals' corrupt practices have on the 'South' (another term for Third World, or developing countries), including:

They undermine development and exacerbate inequality and poverty.

They disadvantage smaller domestic firms.

They transfer money that could be put towards poverty eradication into the hands of the rich.

They distort decision-making in favour of projects that benefit the few rather than the many.

They also

Increase debt;

Benefit the company, not the country;

Bypass local democratic processes;

Damage the environment;

Circumvent legislation; and

Promote weapons sales.

 

Tackling corruption

 

What can be done to tackle this problem? Campaigners from around the world, but particularly the South, have called for a more just, independent, accountable and transparent process for managing relations between sovereign debtors and their public and private creditors.

An independent process would have five goals:

To restore some justice to a system in which international creditors play the role of plaintiff, judge and jury, in their own court of international finance.

To introduce discipline into sovereign lending and borrowing arrangements... and thereby prevent future crises.

To counter corruption in borrowing and lending, by introducing accountability through a free press and greater transparency to civil society in both the creditor and debtor nations.

To strengthen local democratic institutions, by empowering them to challenge and influence elites.

To encourage greater understanding and economic literacy among citizens, and thereby empower them to question, challenge and hold their elites to account.

The Bretton Woods Project organisation notes that the World Bank, under pressure of late, has suspended a number of loans due to concerns of corruption. These include loans to Chad, Kenya, Congo, India, Bangladesh, Uzbekistan, Yemen, and Argentina. The Bank has also started internal investigations of Bank corruption. However, "despite high-profile moves by President Paul Wolfowitz, the root causes of corruption -- underpaid civil servants, an acceptance of bribery by big business, and dirty money -- remain largely unaddressed."

The Bretton Woods Project adds that the "normalisation of petty corruption in developing countries has in part been driven by"

IFI conditions

The aid industry for 'overpaying consultants' and turning a blind eye to corruption in some regimes

The "World Bank's 'pressure to lend' culture where staff are rewarded for the volume of the portfolio they manage"

The World Bank's slow pace in investigating and disbarring companies found guilty of corrupt practices such as bribery, fraud or malpractice

Failing to increase transparency of some of its own procedures

The IFI's "central part of an international financial system which has both actively and tacitly supported the global proliferation of dirty money flows" including, for example, the financing of various despotic rulers that have siphoned off a lot of money to personal offshore accounts.

To help address these problems, the Bretton Woods Project suggests a few steps:

Greater transparency of World Bank processes, allowing greater visibility for elected officials and civil society in recipient countries;

Strengthening internal mechanisms within the Bank itself, to monitor integrity of Bank functions, and allow truly independent audits of Bank operations;

Minimum standards in governance, transparency and human rights that must be fulfilled before approving oil, gas and mining projects in institutionally weak countries.

Not always tying loans with economic policy conditions in such a way that some governments surrender their policy-making space.

But it is hard to see how the international economic agencies and their member governments can introduce incentives that would cause corrupt rulers to attack corruption... Not only are the rich countries and their agencies in this respect impotent, they commonly have been and are accomplices in corruption abroad, encouraging it by their action rather than impeding it. E-mail al-farid@hotmail.com

 


Land for industry

The recent announcement by the Sindh government to allocate land for cottage industry along KNBP is posing new challenges for manufacturing sector

By Dr Noman Ahmed

On March 14 2007, the Governor of Sindh directed the concerned departments to allocate land for cottage industry zones along the Karachi Northern Bypass (KNBP). The reason cited for this decision was to promote small scale industries and similar enterprises in the area.

A review of the actual situation around the scenario reveals many important facts. The corridor of KNBP, which stretches up till 56 km in length, has become a hot bed for land speculation of various kinds. Many private sector developers have announced land development schemes of dubious nature. Where the actual number of applicants to the Master Plan Group of offices for seeking proper approvals is very few, most of the schemes are unapproved and unauthorised.

Apparently ordinary people are not aware about the procedures and legalities of tenure. They are taking keen interest in all such schemes with a view to purchase land for long term benefits. It is disappointing to note that by announcing new ventures in the form of industrial or commercial projects, the government is indirectly fuelling speculation and inappropriate determination of land-use along a vital corridor of the city. Since KNBP and the overall scenario of land allocation and development shall have far reaching consequences on the management of the city, such attempts need to be critically examined for their validity.

The existing locations where cottage industries are functioning include North Karachi, New Karachi, Lyari, Korangi, Landhi Colony, Malir Colony, Liaquatabad, Nazimabad, Gharibabad, Benaras Colony, Orangi Town, F.B. Area, Saeedabad and many similar neighbourhoods. There are many reasons for the existence of these units in such predominantly residential or mixed land-use places. Economy of built space utilisation, easy possibilities of labour movement/commuting (especially womenfolk), availability of basic services, cost sharing at various levels amongst and stakeholders, existence of clientele and buyers of the products, availability of different supply chain components to be used as raw materials as well as financial linkages with the surrounding enterprises are the examples.

Much of this activity is informal in nature which makes the sustainability of the enterprises possible. Whenever the attempts were made to formalise these operations, the exponential rise in the cost of production prevented the implementation.

About four decades ago, the satellite towns of Landhi/Korangi and North Karachi were proposed. The objective of this attempt was to promote multi-level industrial development in the city. It was also envisaged that these location would become self contained townships and help in de-concentrating population from Karachi. Land subdivision, allotments and sale of industrial land followed. While medium and large scale industries were able to emerge out after a considerable time gap, the cottage industry essentially spread in the residential quarters due to the reasons outlined above. The sale and purchase of industrial land became a lucrative business in the recent past. Due to incessant speculation, the purchasing prices of land was inflated to such an extent that genuine industrialist found it beyond the feasible limits. The outcome was that the industrial operations started retarding and the interested industrialists and entrepreneurs were discouraged from undertaking respective ventures.

Manufacturing sector is already grappling with many challenges from various fronts. A significant constraint is the rising value of land and infrastructure in the established industrial locations such as SITE, Landhi/Korangi, West Wharf, Federal B Industrial Area and the newly initiated Bin Qasim belt. A plot of one acre may cost any where between Rs. 10 to 25 million. Additional charges for service connections for infrastructure further compound the scenario. It may also be noticed that the manufacturing sector is facing a fierce competition from China, India and other countries. It is vital for the economic growth to have a robust and progressive manufacturing sector as it extends multifarious employment opportunities. The competitiveness of industrialists can be only assured if the government extends befitting subsidies and incentives. A focused and action-oriented land supply could be a major factor. If supply of subsidised land can be linked up to immediate industrial investment/setting up enterprises, the schemes can become greatly beneficial. A sizable liquidity exists in the banking sector. Instead of directing it towards consumer finance, a portion of it can be used to facilitate the industrial sector through smartly devised schemes.

Forms and formats of industries is changing fast. New categories are now being continuously added to the domain of industry. Media, publications, information technology, fashion, beauty, music and the like are few important mentions. For their proper functioning, growth and development, they require appropriate allocation of space/land as a prime pre-requisite. Much of the activities in these domains is taking place in unsuitable locations either on a make shift basis or through over utilisation of available spaces.

For instance, many private TV channels are operating from the already congested office spaces of their parent organisation or in a residential building which has many handicaps. It also poses environmental nuisance for neighbours due to increased levels of noise. Until an affordable option is worked out for them, the expected excellence in output will be very difficult to achieve. Designers and drapers face the same dilemma. A comprehensive exercise in need assessment is required to be conducted to finalise land use choices. Nascent doling of raw land will be counter-productive for most of the industrial operation.

With the passage of time, the industrial operations shall be subjected to stringent international regulatory controls. The managements of enterprises shall be compelled to abide by the international rules and conventions in order to maintain market worthiness. Accommodation and operation of enterprises would make an important category. The industries that are shabbily housed and posses drawbacks in proper performance shall face the threat of losing business. It will be in the interest of the industrialists and the nation to enhance the performance standards by appropriate measures.

For instance, if the government takes upon itself to create scientifically planned industrial estates in correspondence to the need of the industrialists, it shall be catalytical to raise productivity. Provision of necessary infrastructure on priority, technical support in basic issues such as environmental and human resource regulations as well as assistance in financial, marketing and automation can be valuable. These are not new approaches. Pakistan has a history of viable industrial promotion ventures during 1960s when government did much more than merely selling land in the name of industrialisation!

If the regime is genuinely interested to promote industrial development, then several measures have to be undertaken on a scientific basis. An inventory of industrial land allotments must be made as the starting point. This land repository should be analysed for its utilisation and status. The assessment of infrastructural needs and potentials of provision must be carried out. New options and prospects of providing, consolidating and upgrading infrastructure must be worked out in order to build up the trust of prospective investors. Policy instrument must be devised to support the prospective entrepreneurs. Re-definition of tariffs, tax subsidies and assistance in design and development of units can prove attractive for industrialists. And above all, a policy must be prepared where speculation on industrial (and other categories of) land must be ensured. It must be remembered that rise in land prices is inversely proportional to industrial progress. We cannot afford to wait very long as the economic competition is increasing fast. It is time to act scientifically without any further delay!

 

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