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relief support Discontentment in the air planning Much
more is at stake firstperson For a politics of the
young
relief Home-based solutions Local community acted in Badin while state remained indecisive for long By Shahzada Irfan Ahmed Groups of shabbily clothed and sun-tanned men, strolling along the roadside or sitting on the edge, welcome the commuters traveling to or through Badin district’s flood affected areas. These men lift their heads and their eyes fill with hope at the sight of a luxury jeep cruising towards them. The curiosity increases as the vehicle nears and intensifies when it comes to a halt next to them and disappears again as it accelerates and heads towards its destination. The exercise is repeated again and again throughout the day bearing different results on different occasions. Sometimes, there are relief workers who bring food, water and other necessary items for them and on other occasions they are travelers, government officials or lost commuters stopping for directional guidance. Hardly two hundred
meters away from the place, some two dozen temporary shelters house female
relatives and children of these men who have to spend their days like
these and look for a place to rest during the night. As displaced families
far outnumber the shelters available at the place, these are shared by two
or three families at a time. This means men are barred to observe the
privacy of the unrelated families however tough the outside weather
conditions may be. Deprived of their houses and other assets in the form of poultry or livestock, livelihood, crops and even access to food and drinking water, these people are embodiments of courage, resilience and hope. “There are those who have seen most of the 21 natural disasters hitting in the district in the last 16 years and had to rebuild their lives again and again,” says Dr Akash Ansari, who heads the Badin Rural Development Society (BRDS), a locally based civil society organisation working in the area since 1995. Muhammad Musa, 65, from Allah Dino Khaskheli village is one such example. Having lost his house and 10 goats to the floods, he does not seem to be in a trauma. Puffing a cigarette while standing in queue at a food supplies distribution center, he hopes God Almighty will compensate them for the losses. When asked about the weekly supplies they are getting, he says they are sufficient as his family has cut short on consumption. However, he is not comfortable with the quantities of tea and sugar they are getting. “The relief organisations term these entities a luxury but for me and most Sindhis they are nothing less than a lifeline,” he adds. Dr Akash tells TNS that
Badin people do vacate their houses after repeated warnings of looming
disasters and persuasion but this time nature was tough with them. The
Badin district which has an average rainfall figure of 200 millimeters
received above 600 millimeters rain in just 30 days. “In some other
districts, the figure was as high as 1200 millimeters over the same period
which is a record,” he says adding, “People waited for the torrential
rains to stop but they didn’t and the level of water kept on rising.” This was not all as rain water from other districts also headed to Badin, which is a gateway to the sea. Water from around 200 streams and drains falls in the 210 kilometers long Left Bank Outfall Drain (LBOD) which has structural flaws and breaches in it. In case of excess water the drain overflows and inundates Badin. This water takes a lot of time to drain into sea as the land here has a very mild slope and the situation is even when there is high tide. The sea refuses to accept this water and even throws back its saline water on this coastal land. Dr Akash adds the damage was so severe and abrupt that they did not have time to wait for government authorities to respond. Being a partner organisation of Pakistan Poverty Alleviation Fund (PPAF), they took up the case with it. The fund, he says, immediately allocated Rs258 million for relief operations to help 400,000 displaced individuals in 14 union councils Badin. He says it was a blessing for Badin affectees that development funds provided to PPAF by international donors, including World Bank, were diverted for disaster mitigation and rehabilitation in the area. The amount of Rs 258 million for one district is highly significant keeping in view that the federal government has announced Rs 100 million for relief in the whole of Sindh. One thing which was
evident during the relief activities was that the local community based
organisations worked beyond their capacity to help out the trapped masses.
They had to be extra-efficient as the federal government was late in
giving the SOS call and the Sindh government too over-confident and
unwilling to accept external help. Similarly, the National Disaster
Management Authority (NDMA) failed to respond well, a fact admitted by the
authority’s head before the elected representatives. Dr Suhail Abbas, a medical graduate in public health from UK, is a professional worth praise who, instead of availing some lucrative job in the sector, opted to serve his community. Associated with BRDS, he sits in a makeshift clinic in Matli Taluka of Badin district and inspects patients suffering from diseases like malaria, dermatitis, scabies and cholera. Having spent his childhood and youth in the same locality, he knows the language of the people very well and also has the idea of diseases rampant there. Scabies, he says, was the skin disease that affected a large number of people as they had to wade through stagnant and polluted areas to reach safe places. The distances traveled were long and whole families had to be treated even if only a member was found suffering from it. The situation right now is that 40 per cent of the 7,000 square kilometer area of Badin is under water and people are force to leave their houses and even move to other districts. Haseena, 35, is one such individual whose house and livestock were lost to floods. Chronically anemic, she is mother of five children born in a little less than five years. She has no idea where her husband is. All she remembers is that he was asked by the landlord to carry his cattle to the neighbouring Tharparkar district. The poor man had no
choice but to carry the cattle to a safer place and leave his wife and
children at the mercy of inclement weather and diseases rampant in the
area. The landlord did visit her in the camp but only to dole out Rs 500
in return for the service provided by her husband. One can see thousands of people sitting on sand dunes under the open sky in Badin’s neighbour Tharparkar district. Most of them were daily age workers, cotton pickers, farm workers etc from drought-prone Tharparkar district who had gone to Badin for livelihood and settled there. Rehabilitating them in their original hometown is not an easy task keeping in view that they have lost their belongings and livelihoods. PPAF Chief Executive Officer (CEO) Qazi Azmat Isa believes preparing for disasters is more important a function than to fight them. Taking the example of Badin, he says no doubt the area is prone to disasters like cyclones, tornadoes, floods, rains, back-tides, LBOD overflows and so on. It’s quite likely they keep on hitting the area in future, therefore, contingency and preparedness plans and public awareness on disasters are the need of the time. Bangladesh is still hit by floods but they have learnt to manage them. They are building stilted houses on elevated lands which can brave floods. The same remedy can also be tried in Badin, he concludes.
support After 9/11 and again following the killing of Osama bin Laden, questions have been raised about the purpose of aid from the United States to Pakistan. If aid was primarily meant for military and counter-terrorism support, the results from an American perspective have been inadequate at best. Washington has accused the Pakistani government and military of duplicity, and of protecting key militant leaders living within Pakistan. The United States continues to ask the government of Pakistan to “do more.” There are Pakistani voices, however, who argue that this is America’s war, not a global or Pakistani war. The fighting has cost Pakistan three times as much as the aid provided and 35,000 victims. Sympathisers of militant groups in Pakistan’s army have also been found to protect insurgents and have been involved in terrorist activities themselves. Clearly, trust is low. The lack of trust didn’t start following 9/11 — Pakistan’s aid relationship with the United States has a tortured history. In 1950s and 1960s, US aid stimulated growth for Pakistan and did not focus excessively on military assistance to the detriment of development programmes. Following the Soviet invasion of Afghanistan in 1979, problems emerged that haunt the aid relationship to this day. American efforts against the Soviets unintentionally strengthened Pakistan’s military and intelligence agencies, their supremacy over civilian institutions, and rising jihadism that would grow to engulf both the country and the region. Then after 9/11, the
spigot of aid nominally meant to help the fight against terrorism instead
supported the military acquisitions of the Pakistani army and only modest
progress in counter-terrorism operations. With military aid much higher
than economic aid, US assistance has strengthened the hand of Pakistan’s
military in the country’s political economy and failed to support the
civilian government and democratic institutions. But changes in the US and
Pakistani administrations in 2008 shifted aid toward development. Perhaps a longer-term engagement and commitment to civilian and development aid might result in strengthening democracy in Pakistan instead of reinforcing the military dominance that thwarts US counter-terrorism goals. This shift can illuminate how American aid to Pakistan can address both US and Pakistani objectives and concerns. It has become increasingly clear since the killing of Osama bin Laden that US government aid to Pakistan is plagued by a complexity that belies claims of a strategic partnership. Bilateral assistance ordinarily should be a win-win proposition for both countries, in this case with the United States helping Pakistan to address American security concerns, and Pakistan receiving much needed funding to serve its population, meet perennial and ever-increasing revenue shortfalls, and help modernise its military forces. In reality, the aid relationship between the United States and Pakistan has been muddled, deceptive, complicated, and even dangerous, especially since the events of September 11, 2001. The barrage of writing and analysis that has appeared since the killing of bin Laden in Pakistan has underscored this point, with such words as “duplicity” and “double game” being used extensively by US analysts and policymakers alike. It would be in the interest of the United States to ensure a stable Pakistan, with a liberal, democratic government focused on development. One could reasonably expect that the civilian government of Pakistan has similar objectives. However, the relationship has been so fraught with cross-purposes and doublespeak that the real purpose of US aid to Pakistan in the post-9/11 era is no longer clear — from either country’s perspective. Of course, the United States wants Pakistan to prosecute the war on terrorism and help defeat al-Qaeda and the Taliban insurgency in Afghanistan as well as in Pakistan. It also wants to help Pakistan develop into a stable, democratic state at peace with itself and its neighbors. But until recently the primary recipient of US aid in Pakistan was the military and its Inter-Services Intelligence Directorate (ISI). US cooperation, therefore, has strengthened the very actors — the Pakistani security establishment — that have served the interests of neither Pakistan nor the United States. It is time that policymakers in both countries rethink how this relationship should proceed. Five decades of aid to Pakistan, 1950-2001 From independence to the Soviet invasion of Afghanistan It is not much of an exaggeration to state that since independence in 1947, Pakistan has been an aid-dependent nation. Some estimates suggest that the gross disbursement of overseas development assistance to Pakistan from 1960 to 2002 (in 2001 prices) was $73.1 billion, from both bilateral and multilateral sources. Almost 30percent of this official development assistance came in the form of bilateral aid from the United States, the largest single bilateral donor by far. Assistance of this magnitude was made possible by the fact that Pakistan’s leadership, especially its military leadership, clearly aligned itself with the United States during the Cold War. By joining SEATO (the Southeast Asia Treaty Organisation) and CENTO (the Central Treaty Organisation) and signing military and other pacts of cooperation with the United States in the 1950s and 1960s, Pakistan hoped to benefit from US geopolitical support as well as financial and military assistance. The United States, in turn, viewed Pakistan as an ally and a hedge against perceived Soviet expansionism in the region. American aid to Pakistan was vital during the 1960s. It helped play a significant part in numerous development projects, food support, and humanitarian assistance through the United States Agency for International Development (USAID) and other mechanisms. Thanks to this assistance, the United States was well-received by the people of Pakistan. By 1964, overall aid and assistance to Pakistan was around 5percent of its GDP and was arguably critical in spurring Pakistani industrialisation and development, with GDP growth rates rising to as much as 7percent per annum. Though the United States decided to cut off most aid to Pakistan when Pakistan initiated the 1965 war with India over Kashmir, aid resumed after a few years, albeit at much lower levels. Not only was aid vital in the 1960s, but it also was focused on civilian economic assistance. After a brief spike in the late 1950s, American military assistance and reimbursements in the 1960s were consistently below the total aid provided by USAID’s predecessors and total economic assistance provided to Pakistan in those years. This balance may have contributed to the positive impact US aid had until its termination after the second Kashmir war. From the Soviet Invasion to 9/11 The Soviet invasion of Afghanistan in 1979 again precipitated increased US development and military assistance as Pakistan became a frontline state in the war against Soviet occupation. Large and undisclosed amounts of money and arms were channelled to the mujahideen fighting the Red Army in Afghanistan through Pakistan’s military and its clandestine agencies, particularly the ISI. While this “aid” was not meant directly for Pakistan’s military, there is ample evidence that significant funds meant for the Afghan mujahideen were pocketed by Pakistani officers.6 Pakistan also received money directly to provide for the rehabilitation of Afghan refugees and for the development of roads and communications infrastructure. Despite these funds, America’s image in Pakistan had begun to decay by the 1980s because of the distrust among Pakistanis following America’s failure to come to its assistance during the 1971 war with India, the perceived US emphasis on fighting the Soviets rather than helping Pakistan, the growing Islamisation of Pakistani society under Muhammad Zia ul-Haq, and the rise of political Islam after the 1979 Iranian Revolution. The unprecedented increase in aid during the Soviet invasion of Afghanistan was reversed when President George H. W. Bush could no longer certify that Pakistan did not possess nuclear weapons in 1989 as required by the Pressler Amendment. Consequently, US development assistance fell from $452 million in 1989 to 1percent of that in 1998 on account of the sanctions imposed by the United States. On balance, US assistance prior to 2001 neither put Pakistan on a path to self-sustaining growth nor recovered real value in terms of America’s own Cold War objectives. Certainly, the expulsion of the Soviet Union from Afghanistan with strategic help from Pakistan was a major gain for Washington, but the Afghan campaign also ended up strengthening the praetorian state in Pakistan while doing little to aid its people, even as the stage was set for developments that would lead to the terrorist attacks of September 2001. The events of September 11 would dramatically complete the change in the nature of US aid to Pakistan from developmental aid, which dominated during the 1950s and 1960s, to purchasing Pakistan’s cooperation in counter-terrorism. While aid in the earlier decades focused on helping the people of Pakistan and in supporting economic growth, aid in the 1980s in particular began to strengthen the military and its clandestine institutions. Aid, which was largely productive in the earliest phase, thus gave rise to more damaging consequences in later years. Moreover, developmental aid and “war aid” were very different categories of support, producing very different results. The war aid disbursed to Pakistan’s military, the ISI, and the Afghan mujahideen — although intended to serve America’s purposes more than Pakistan’s — ironically nurtured the very entities that were to cause serious problems three decades later. The complicated issues of US aid, 2001-2010 9/11 and military-centric aid Table 1 shows that in FY 2002–2010 (and not including commitments such as the Enhanced Partnership with Pakistan Act of 2009), the United States gave Pakistan almost $19 billion, or more than $2 billion on average each year, with twice as much allocated in 2010 ($3.6 billion) than in 2007. Over the period of 2002–2008, only 10percent of this money “was explicitly for Pakistani development,” and as much as “75percent of the money was explicitly for military purposes.” In more recent years the share of economic-related aid has risen, but it is still less than half. The United States has considered Pakistan an essential ally in the war on terrorism since 2001 and as part of its broader strategy has solicited Pakistani military operations in support of various counter-terrorism operations. To compensate Pakistan’s military, the United States created the Coalition Support Fund (CSF), “designed to support only the costs of fighting terrorism over and above regular military costs incurred by Pakistan. Nearly two-thirds — 60percent — of the money that the United States gave Pakistan was part of the CSF.” According to Robert Gates, the secretary of defence at the time, CSF funds have been used to support approximately 90 Pakistani army operations and keep around 100,000 Pakistani soldiers in the field in the northwest of the country close to the Afghan border. Since 2009, a new category of security-related aid, the Pakistan Counterinsurgency Fund/Counterinsurgency Capability Fund (PCF/PCCF), has also been developed. The PCF/PCCF objectives are similar to those of the CSF, though with perhaps more focus on fighting insurgency within Pakistan, such as the Pakistan military’s Swat campaigns in 2009. This clearly is in both countries’ interests, and opinion polls show public support in Pakistan for combating violent extremists. Unlike military aid, economic-related US aid to Pakistan had been a much lower share of total aid until 2009. The primary purpose of aid to Pakistan has been counter-terrorism, not economic support, the building of schools and hospitals, or development, broadly defined. 25percent of total aid between 2001 and 2008 was allocated for economic and development assistance, including food aid. Some $5.8 billion of US aid was spent in FATA (the Federally Administered Tribal Areas), the focus of most counter-terrorism and counterinsurgency activity in Pakistan. 96percent of those funds were directed toward military operations, and only 1percent toward development. (To be continued) The writer is a visiting scholar in the Carnegie Endowment’s South Asia Programme. Currently a visiting professor at Columbia University with a joint appointment in the School of International Public Affairs and MESAAS, the Department of Middle Eastern, South Asian, and African Studies, his research focuses on development, governance, and political economy in South Asia. Zaidi’s most recent book, Military, Civil Society and Democratisation in Pakistan, was published by Vanguard Press, Lahore, in October 2010
Discontentment
in the air
Violence in Balochistan continues after the death of Nawabzada Mir Balach Khan Marri. Another tragic dimension to the Balochistan imbroglio was witnessed in the bomb blast in Qila Saifullah late last year that killed six students. Whereas the establishment has succeeded in creating a smokescreen around the circumstances, the Baloch people in general and nationalists in particular are accusing the regime for allegedly masterminding this elimination. Investigations into this affair would never produce any conclusive and authenticated report to fix responsibility given the past track record. Suppression of veracity notwithstanding, the removal of the Baloch nationalist leader has driven a deep wedge between the Baloch and establishment. It is certainly dangerous and can cause irreparable damage to the state structure if positive actions are not taken. The Baloch have felt deprived within the state structure of Pakistan. Scores of skirmishes, military actions, guerrilla resistance, and executions have marred the history of this turbulent province. A sentiment that has recently developed amongst the political cadres is the sense of disenfranchisement. With the decision of BNM (M) opting out of polls, the sentiment of dissent is more than obvious. The governments that have assumed power during the past few years were seen largely as puppets with their strings controlled from the centre. The provincial governments proved useless in terms of basic governance matters. The sufferings of Baloch people during disasters and calamities could not be mitigated by the provincial governments. A sizable population has been forced to live under open sky. Law and order has worsened to the scale that even top governmental functionaries are not safe. The murder of former government spokesman, Abdul Raziq Bugti, is a case in point. The instances of sabotage, destruction and killings are on the rise despite claims of tranquil by the establishment. In the half-hearted
attempts to bring normalcy to the province, the peculiarities of social
and geo-physical structure of the province were largely ignored. Despite
being one of the most thinly populated regions, Balochistan possesses a
diverse range of communities inhabiting its territories in a most
traditional manner. Trouble began showing up soon after partition when the sociological and anthropological peculiarities were ignored. The limited participation of local interest groups in the political administration and organisation of their own context brewed a sense of deprivation ever since. This could have been addressed only through an effective and open ended political process which was sadly missing for most of the post independence history. The discovery and subsequent utilisation of natural resources further fueled this frustration. Sui remained a troubled area during the 1950s when attempts to bring order miserably failed. The exploitation of common folks at the hands of tribal chieftains was another problem. The sardars cobbled linkages with the establishment at the cost of their people. Ensuing political fragmentation hardly allowed any worthwhile political force to emerge. The federal government has claimed to have begun massive development work in Balochistan. However, a section of Baloch population is skeptical of this process and considers it as a partial reason for the ongoing unrest along side other factors. Ongoing expropriation of land and resources by other communities and state agencies and plans of construction of military garrisons in Sui, Kohlu, Awaran and Gawader are the key concerns. The Balochistan situation is now largely internationalised. Events such as the ban on Balochistan Liberation Army (BLA), abduction and killing of Chinese engineers and briefings by former Baloch legislators to the European Union officials have brought greater focus of the international community to the Balochistan scenario. The trust of the people and power-wielding stakeholders must be restored in the political process launched by the government. The government must display a magnanimous attitude by announcing amnesty to all. Top leaders of all factions, including Balochistan National Movement, Jamhoori Watan Party, Baloch Students Organisation and other groups should also be invited to dialogue sessions. All the tribal chiefs and representatives should also be invited. Dialogue should focus on striking a working relationship between the government, political parties and tribal chiefs and developing a road map to stop violence and sabotage through acts of confidence-building measures. This attempt may become ineffective if the establishment does not come forward with an open approach. Release of political detainees and help in locating the missing individuals can be the starting moves by the establishment. The best way is to provide political space to help evolve a feeling of participation amongst political forces. One can learn from marginalisation of Awami League in the former East Pakistan. One hopes the government learns from the past.
planning Pakistan’s Stand-by Arrangement with the International Monetary Fund (IMF) expires at the end of this month (September 2011) and is not being renewed. Originally, the SBA had provided for $7.6 billion assistance for a period of 25 months beginning in November 2008. The credit was enhanced to $11.3 billion for another nine months. Out of this sum, only $7.27 billion have been disbursed, as the government could not take the agreed reforms. When Pakistan went to the IMF in October 2008, the economy was preciously placed. Fiscal deficit had increased to Rs 777 billion (7.6 per cent of GDP), trade and current account deficits had reached $21 billion (8.47 per cent of GDP) and $14 billion respectively, foreign exchange reserves had depleted to $7.31 billion (as on October 17, 2008), inflation was around 25 per cent and the exchange rate had nose-dived to Rs 82.37 per American dollar. Accordingly, the IMF conditionality provided for reducing fiscal and current account deficits, discouraging government borrowing from the central bank as a source of deficit financing, maintaining high interest rates with a view to reducing inflation, exchange rate flexibility, increase in tax-GDP ratio, elimination of power subsidies and a drastic cut in the subsidies provided to public sector enterprises (PSEs). Fiscal deficit, which formed the main pillar of the edifice of the IMF programme, was to be reduced to 4.2 per cent of the GDP in FY09, and then to 3.4 per cent in FY10. The FY09 target was missed as the fiscal deficit was recoded at 5.3 per cent. The FY10 fiscal deficit target was subsequently increased to 4.6 and then 4.9 per cent. However, the budget deficit of 6.3 per cent was recorded during that year. The fiscal deficit target for FY11 was 4 per cent of GDP, which subsequently was enhanced to 4.7 per cent in the wake of the devastating floods in August-September 2010. However, the fiscal deficit exceeded 6 per cent. Though the targets were
not achieved, fiscal deficit has significantly been brought down from 7.6
per cent in FY08. However, the cuts in fiscal deficit have been made
possible in the main by slashing the development spending. On the other
hand, the current expenditure has gone up significantly. These changes in
the size of development and current spending reflect the political economy
of Pakistan, where any attempt to reduce fiscal deficit has to face three
constraints: (a) a major portion of the public finance is eaten up by
defence expenditure and debt servicing; (b) security related expenditure
has to be increased to ward off the growing menace of terrorism; and (c)
tax-GDP ratio of 9 per cent due to lack of a tax culture along with the
inability to widen the tax net. The current account balance presents a better picture. During FY09, the current account deficit was curtailed to 5.3 per cent of GDP ($8.8 billion) and further to 2.2 per cent ($3.9 billion) during FY10. In FY11, the current account surplus of $437 million was recorded. The principal cause of the improved current account performance is workers’ remittances, which rose to $11.20 billion in FY11. In the first two months of the current fiscal year (July-August FY12) current account deficit of $189 million has been recorded compared with $1 billion for the corresponding period of last year. The State Bank of Pakistan (SBP) has been maintaining high interest rates with a view to controlling inflation. At the end of FY11, the policy rate was 14 per cent and was subsequently slightly curtailed to 13.5 per cent. However, strong inflationary pressures persist. The average CPI inflation declined to 12 per cent in FY10 and rose again to 14 per cent in FY11. The inflation was recorded at 14 per cent in July FY12. The major cause of inflation is the fiscal deficit and the way it is being financed (bank borrowing). Another cause is the energy crisis driven aggregate demand-supply gap as there is both underutilization of the existing production capacity and lack of new investment. The rupee, which had fallen sharply against the dollar between July and November 2008, recovered some of its ground after the first tranche of the IMF assistance was received in November that year. Though subsequently the rupee has depreciated selling for about 88 per dollar at present, but for the capital inflows from the Fund the exchange rate would have been even worse. During FY09, economic growth rate fell to 1.2 per cent, which was one of the lowest in Pakistan’s history. Even that low growth rate was made possible by downward revision of GDP growth to 3.7 per cent from the original figure of 5.8 per cent. A modest economic recovery was made in FY10 as the growth rate increased to 4.1 per cent. For FY11, economic growth of 4.5 per cent was targeted. However, mainly due to devastation caused by the floods, the growth rate fell to 2.5 per cent. The IMF programme was extended in December 2010 on the request of the Pakistan government to enable it to undertake the measures earlier agreed with the Fund. At the top of these measures was introduction of the reformed general sales tax (RGST), which became a contentious matter between the government and the opposition. Accordingly, the government chose the easier way of imposing additional taxes of Rs 53 billion through a presidential ordinance. The measures included 15 per cent income tax surcharge, withdrawal of sales tax exemptions and increase in excise duty by 2.5 per cent. The fundamental objective of the SBA was to address Pakistan’s macro-economic imbalances through restrictive fiscal and monetary policies. The injection of capital inflows from the IMF has no doubt saved the country from having to default on debt re-payment, made it possible to pay for imports, helped improve balance of payments (BoP) position and foreign exchange reserves (reported to be $17.79 billion as on September 15 2011) and stemmed the exchange rate deterioration. However, the IMF conditionalties can hardly provide a durable basis for overcoming the BoP and related problems for which the economic fundamentals will have to be improved. The IMF conditionalties have slowed the pace of the economy by making for restrictive fiscal and monetary policies, which have negatively impacted growth and job creation. As the economist Joseph Stiglitz puts it, “Stabilisation policy cannot be separated from growth policy. Failure to stabilise may hurt growth, but stabilisation, in the traditional sense of the term (price stability and fiscal adjustment), does not necessarily lead to economic growth.” Does this mean the termination of the IMF programme is a step in the right direction? No doubt, debt, including that from the IMF, is not a credible solution to a country’s macro economic problems. Besides, the economy is not as much precariously placed as it was when the country went to the Fund. However, the IMF programme did provide the policy makers an opportunity to take some difficult but fruitful measures, such as increase in public revenue and restructuring of PSEs. But that opportunity has been sacrificed at the altar of political expediency, for which not only the government but also the opposition is responsible. Since 2012 is likely to be the election year — in any case elections are due in early 2013 — the government is not likely to annoy any powerful constituency either by increasing tax-GDP ratio or restructuring PSEs. Instead, the government will go for an expansionary fiscal policy to drive up the aggregate demand and create jobs. Both of these are goals worth pursuing. However, the fact that job creation and aggregate demand increase will be done not by enhancing the productivity and efficiency of the economy and shoring up public revenue but by deficit financing, which in the absence of considerable foreign assistance will rely on bank borrowing, makes pursuit of these goals counter productivity. The result again is likely to be high fiscal and current account deficits and inflation as was the case in October 2008. The new government then again will be forced to knock at the IMF door for assistance. Yet another case of déjà vu! hussainhzaidi@gmail.com
Much
more is at stake The US-Pakistan relations are once again on a bumpy path and show a massive trust deficit. No one seems to be ready to understand the real problem in the country and at the regional level. The US government and their officials are giving serious threats to Pakistan, forcing it to take immediate action against the Haqqani network in North Waziristan. The US Secretary of Defense, Leon Panetta, and American military chief Admiral Mike Mullen accused the Pakistan intelligence agency ISI of facilitating the Haqqani group to attacking the US Embassy in Kabul. Understandably, the US is strongly insisting on Pakistan to break any linkages with Haqqani group for maintaining peace in the region. Leon Panetta also warned Pakistan against not taking any action against Haqqani group. And if Pakistan does not take the right action, according to him, the US has the right to take action against Pakistan. The US ambassador to Pakistan, Cameron Munter, also believes in Pakistani military agency’s involvement in Afghanistan. The US claims groups like Haqqani network are a serious threat not only for US and Afghanistan but also the Pakistan’s stability. The government and the people of Pakistan should prove that their land is not going to be a safe-haven for militant forces in future. The meeting of Admiral Mike Mullen with General Kayani in Spain and director CIA David Petraeus’ meeting with Gen Shuja Pasha in Washington gave a clear message to Pakistan military leadership to take steps to take steps against the Haqqanis. If the US insists that
there is strong evidence against ISI engagement with Haqqani network then
why it didn’t share the information with Pakistani military and civilian
leadership? Pakistan’s political and military leadership is denying all allegations of the US. The Interior minister Rehman Malik said if US has any evidence it should share it with the Pakistan government and it will take action independently. Haqqani network leader Sirajuddin Haqqani is also denying operating from Pakistan, saying they are much secure in Afghanistan. The US government and the senate committee voted to make a security and economic development aid to Pakistan conditional on its taking determined steps to fight against the terrorist including Haqqani network. It simply means that the US administration is using political and financial tools against Pakistan for imposing its dictation. The message is very clear from both sides; America believes Pakistan is playing a double game with them and Pakistan believes the US is directly exploiting them in the name of peaceful relations in the region. The Pakistan military leadership also feels that what the US is doing is totally against the strategic interest of the region, especially with India and Afghanistan. History of US Pakistan relations shows that there has been mistrust and blame-game with each other. Pakistan is a strategic partner of the US war on terrorism, but the question of lack of trust and cooperation with each other is critical. This also reflects lack of political understanding between both partners and both are not adopting a democratic and political discourse. We also forget the case of Afghanistan where US faced serious failure and still has no proper alternative solution before leaving from Afghanistan. But the US is not ready to accept its failure in Afghanistan. Pakistan also does not seem to understand the internal situation of terrorism. The regional countries should declare in principal that their land will not be used against any other country and also that they would take all possible actions for the elimination of militant forces. I fully agree that we need to convey a very clear message to the Afghan groups like Taliban and Haqqani that Pakistan can no longer facilitate them and allow them to use it as land against any other country or force, including NATO forces. But the same question should also be asked from other countries like Afghanistan and India. The international forces are also addressing Pakistan’s concerns related to the regional perspective and build more understanding with each other through developing anti-terrorism mechanisms and regional cooperation. For example, if the US allegations about Pakistan’s involvement in destabilising Afghanistan and supporting the Haqqani group can be addressed then who takes the responsibility of the Afghan military, US military and NATO forces. The question is why the Afghan and US and NATO forces didn’t take action against Haqqani network? Why it’s just Pakistan’s failure and why don’t we accept that as we all are responsible for the big failure. The real situation is that the US has totally failed to prove as successor in Afghanistan. I am not saying that Pakistan has a clear cut strategy but that only Pakistan is not responsible for the whole crisis in the regional perspective. President Obama needs more success in Afghanistan and good relations with Pakistan before general elections in America. Even if the US eliminates Haqqani network from Afghanistan in coming years the question of Afghanistan’s stability will remain critical because the negotiation process with Taliban and US will again be critical, especially after Burhanuddin Rabbani’s assassination. The Afghan opposition leader, Dr Abdullah Abdullah, said the Taliban proved the peace process was not acceptable. The Americans should also realise the need to evaluate the anti Americanism wave in Pakistan. The US needs to evaluate the whole scene and re-define and re- structure their own policy with Afghanistan and Pakistan. Pakistan also needs to evaluate its own policies and failures and adopt acceptable policies. The
writer is a political analyst and can be reached at salmanabidpk@gmail.com
firstperson Dr Vali Reza Nasr is a leading authority on the Muslim world and author of several books. Born in Iran, Vali Nasr is a Professor of International Relations at the Fletcher School of Law and Diplomacy of Tufts University, an adjunct senior fellow at the Council on Foreign Relations, and a senior fellow of The Dubai Initiative at Harvard University’s John F. Kennedy School of Government. He served in the Obama administration as Senior Advisor to Richard Holbrooke, US special representative for Pakistan and Afghanistan during 2009-2011. Among other books, he is the author of The Islamic Leviathan: Islam and the Making of State Power (Oxford University Press, 2001); Mawdudi and the Making of Islamic Revivalism (Oxford University Press, 1996); The Vanguard of the Islamic Revolution: The Jama`at-i Islami of Pakistan (University of California Press, 1994); The Shia Revival: How Conflicts within Islam Will Shape the Future (W. W. Norton & Company, August 2006); The Rise of Islamic Capaitalsim: Why the New Muslim Middle Class is the Key to Defeating Extremism (Free Press, June 2010) and Forces of Fortune: The Rise of the New Muslim Middle Class and What it Will Mean for Our World (Free Press, September 2009). In the wake of rising tensions between the US and Pakistan, The News on Sunday interviewed Dr Nasr to discuss the developments and what should be expected as an outcome. The News on Sunday: The US authorities have held the Inter-Services Intelligence responsible for assisting one or the other Taliban or pro-al-Qaeda networks in the past. How different is the current level of accusations for supporting the Haqqani network in attacking the US Embassy in Kabul? Vali Reza Nasr: Previously, the United States had dealt with these matters through private channels, and had attempted to avoid public discussion of this issue, which could adversely impact public opinion in both US and Pakistan. This time the highest ranking military official in the United States formally accused Pakistan of supporting terrorism targeting American troops, and did so publicly and in front the US Senate. This changes the tenor of US-Pakistan relations. It will no longer be possible to mask deep disagreements over Pakistan’s relations with extremist groups behind the veil of civilian ties, economic relations and talk of partnership and alliance. Bilateral relations are now poised not for partnership, but potential conflict. TNS: How strong is the level of commitment within the US administration to take Pakistani authorities to task this time? VRN: The level of
commitment has always been high, and the US officials have consistently
pressed Pakistan on these issues. Since the Obama administration took
over, US dispensed with talk of “rogue elements” of ISI being
responsible for transgressions and instead focused on changing
Pakistan’s strategic calculus. What is different now is rather how US is
going about this task. Frustrated that engagement and private pressure has
failed, it has decided to lift the veil of what really ails relations
between the two countries. TNS: The US authorities are warning unilateral action against Haqqani network inside Pakistan, to which Pakistan has reacted sharply. Is this harsh response by Pakistan a surprise or was this expected given the growing level of mistrust with US over the past two or three years? VRN: I am sure that regardless of what Pakistan’s leader may think privately, in public their words and deeds will be governed by political considerations. Given the anti-American mood in the country and nationalist fervour, it is expected that Pakistani leaders would act defiant. However, there is danger that politicians and generals could become hostages of their own rhetoric and end up contributing to the very developments that they allegedly are warning against. TNS: There is a clear understanding at the international level that without support from Pakistan no operation, military or civil, can succeed in Afghanistan. So how will this war of words help the US and Nato? VRN: That is true, and it was the guiding principle in the Obama administration’s high-level engagement with Pakistan early on. However, increasingly the belief that there is no solution to Afghanistan without Pakistan is matched with the belief that there will be no solution in Afghanistan “with” current Pakistani posture. The current war of words reflects American frustration with being unable to dent Pakistan’s position, but in itself it does not show a way forward. Its value may be in capturing Pakistan’s attention and laying the ground work for serious new engagement. TNS: Do you see the present conflict between US and Pakistan a success for the al-Qaeda strategy to prevent the resolution of conflict in Afghanistan and spread the war canvas beyond Afghanistan and Pakistan? VRN: No. I think this is a convenient narrative for avoiding the realities facing both the countries. The current threat comes not from an al-Qaeda or Taliban takeover of Pakistan — nor is that scenario likely even if US and Pakistan came to blows — but rather from Pakistan deliberately avoiding cracking down on extremists, or worse using them to pursue regional interests. TNS: With an estranged Pakistan, will the US forces be able to leave Afghanistan as planned? VRN: That is difficult to say at this juncture. US has acknowledged all along that its success in Afghanistan requires Pakistan’s cooperation, and the emphasis here is the word “cooperation”. The current feeling in the US is that such cooperation is not happening. Of course things could get worse, but they are doing so not because there is adequate cooperation, but because there isn’t enough cooperation. TNS: Would you be able to identify five core issues each on which the Pakistan government (civil, military, ISI) and the US (CIA, Nato) are on the same platform and five core issues of conflict? VRN: I think there is agreement that the war must finish, and Afghanistan must not return to civil war and chaos, but there is no consensus on how to get there. US sees the path to stability in a strong Afghan state. Pakistan has never warmed to that idea, especially under Karzai and wants a larger role for the Taliban in Afghanistan’s future. TNS: What could be the best model for Pak-US relations, civil and military? VRN: A working relationship cannot be built on pretence of common interests when one partner undermines the other surreptitiously. That is how it worked during the Musharraf period. Now the relationship is maturing, there is greater understanding that US and Pakistan’s respective interests diverge in important ways. Rather than pretend otherwise Washington is now acknowledging the issue. When the two countries can agree on common interests — future of Afghanistan and ending extremism in South Asia — then you will have a model relationship.
For
a politics of the young Being an unapologetic leftist I am as inclined as anyone else to join in the refrain: the rich are getting richer and the poor are getting poorer. One comes across enough anecdotal examples on a daily basis to confirm that this age-old adage is indeed still worthy of being called an adage. It is now a more or less accepted fact that the onset of neo-liberalism in the late 1970s gave rise to a noticeable decline in bargaining power for the toiling classes and the withdrawal of the state from the provision of welfare services. These profound political changes have greatly contributed to an increase in inequality, in virtually all countries. Having said this, it is worth bearing in mind that inequality is almost always a relative measure. In other words, an increase in inequality means that the poor strata of society are relatively worse off than they were in the previous period under consideration. This is not the same as a situation in which poor populations’ incomes decline absolutely or their access to basic services diminishes. Economists do talk up the difference between real and nominal incomes to account for the fact that the value of money decreases over time. So even when nominal incomes are increasing, individuals and families are not necessarily able to purchase more ‘stuff’ than when their nominal incomes were lower. In fact, in many cases, they are able to purchase much less. Technicalities aside, just as I am inclined to exclaim that the rich are getting richer and the poor are getting poorer, I need only to look around me to observe that a significant strata of society previously in the bracket of the ‘poor’ is enjoying considerable social mobility. Perhaps it is by design that the rather amorphous term ‘middle class’ is used to refer to this increasingly large and influential segment. In any case, the point that needs to be emphasized is that major changes are taking place in this society and it is high time that the nature and scale of these changes are recognised. It is in India and China that the ‘new’ middle classes have truly arrived. These two countries are much bigger versions of Pakistan insofar as their large agrarian social bases have also undergone — and continue to undergo — massive transformation. In both of these countries, one is able to clearly observe the apparently contradictory trends of greater income inequality and the dramatic extrication of millions from the category of ‘poor’. I view this dialectic of
increased exclusion and increased opportunity for social mobility as quite
perverse. It is coeval with greater atomization within society and a
tendency to engage with the political sphere individualistically rather
than to articulate and secure collective goals. I think in years to come
this dialectic will produce potentially explosive outcomes, particularly
in the case of educated youth. Pakistan’s population is extreme young. There are now 100 million Pakistanis below the age of 25. If we work with the assumption that a quarter of this population has or will soon acquire a higher degree of some kind — an assumption that is not wildly improbable given the mushroom growth of private universities over the past decade or so — the Pakistani economy will need to absorb 20-25 million twenty-somethings who believe that they are entitled to permanent, white-collar employment. The public sector is the preferred choice for those who hail from small towns and villages, given the power and prestige associated with employment in the civil service. The private sector is not a bad second option given the fact that salary packages are typically much more lucrative. The problem is that neither the public nor private sectors have anything like the required absorptive capacity to accommodate these tens of millions. Then there is the much bigger segment of this below-25 population which does not possess a university education. Needless to say, these 75-80 million young people also need to secure livelihoods. There are even fewer formal job opportunities to meet the demand of this army of the unemployed than in the case of the aforementioned educated segment. A couple million of this teeming mass will go abroad, by hook or by crook. Many more will become involved in informal occupations. But this still leaves tens of millions of young people without gainful employment. Many of them already espouse ‘middle-class’ values insofar as they believe that they are entitled to a particular lifestyle replete with ‘necessities’ such as designer clothing, touchscreen phones and personal vehicles. In short, the rich are getting richer and the poor are getting poorer, but many of those who were formerly — or even contemporarily — poor perceive themselves very differently to the poor of three decades ago. Then it was much more common for young people from amongst the poor (and some from amongst the rich, even) to not crave a change of personal status but a change of the system that produces the divide between rich and poor. In the event, the deep craving for upward mobility will not produce the desired result, at least not for the majority of the 100 million that will shape the future of this country in decades to come. What will those left out of the mix do? It is impossible to say, but one must continue to hope and strive towards a new politics of the young, by the young, for the young. It is a terribly overused cliché that the future is charted by young people. But in our case this is truer than we perhaps wish to acknowledge. If this future is not one in which the structural contradictions of the system give rise to a struggle for alternatives, then we face a bleak societal meltdown. Arguably, this meltdown has already started and the task we are confronted with is to stop things from getting completely out of hand. The problem is that too many young people today believe that they have no role in charting our political future. For this cross-section of society, ‘us’ is at the mercy of ‘them’. Sooner or later a critical mass of young people will have to break down this binary conception and recognise that what happens to ‘us’ is very much in our own hands.
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