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The Federal Minister for Water and Power Khawaja Asif in a meeting with a delegation from the Commonwealth Scientific and Industrial and Research Organisation revealed that the government was in the process of preparing a water management policy - the first in the history of the country. Pakistan was warned well over a decade ago by relevant experts, both international as well as local, that until and unless the government took appropriate policy decisions Pakistan would emerge as a water-deficient country. Sadly no government, civilian or military, deemed it appropriate to focus on resolving this looming crisis and the Pakistani public today is experiencing major issues as reflected by the decline in those with access to clean drinking water, annual flooding during the monsoon season and failure to harness the floodwaters for hydel generation.

Uncharacteristic of Asif Ali Zardari, his broadside against Prime Minister Nawaz Sharif fired this past Monday couldn't be more lethal. Not only has he accused Nawaz Sharif of being ungrateful to the PPP for the help it rendered to the PML (N) to form the government following the otherwise questionable 2013 election, he has also accused him dividing the nation "to save their allies Taliban and the terrorists". He also alleged that the actions being taken by the federal agencies in Sindh are in "clear violation of the Constitution". Demanding an end to the 'politics of revenge', Zardari has warned of "disastrous consequences" if it continued. As to what those consequences can be, he did not identify, but it is clear to all and sundry why the PPP co-chairman is so worked up against Nawaz Sharif. Following the arrest of PPP leader of its Punjab chapter Qasim Zia, his very close friend and aide Dr Asim Hussain was arrested on the charge of terrorism, and then there were arrest warrants for Yousuf Raza Gilani and Makhdoom Amin Fahim for alleged corruption. A score of provincial bureaucrats of Sindh government have been arrested on charges of corruption, too. According to Army Chief General Raheel Sharif, there is an 'evil nexus' between corruption and terrorism; and that has to be broken. But to Zardari's great annoyance, Nawaz Sharif remains passive to these developments. And is it that Zardari too is feeling the heat? One would only venture that only the wearer knows where the shoe pinches. But unlike the recent past, the PPP co-chairman would not blame the army for these arrests - "we salute our jawans who gave ultimate sacrifice in this war against terrorism" and that it is Nawaz Sharif "who is targeting PPP and other political opponents when innocent citizens are being killed by enemy bombing on border villages". Zardari also wants to know if hauling up the tainted politicians was such a sacred mission why then the PML (N) leaders guilty of similar crimes have been left untouched. That is, of course, a legitimate question that rankles not only the PPP but also others, given the fact that the present finance minister, Ishaq Dar, has reportedly confessed involvement in a money-laundering case and there is a video film purportedly showing Mashood Rana accepting bribe money.
The minister for Petroleum and Natural Resources, Shahid Khaqan Abbasi, announced an increase of up to 38.5 percent in domestic gas prices and a cut of 3 rupee per litre in petrol/diesel prices. Economists would, no doubt, support the trend though there would be arguments on the actual rate rise/decline announced by the minister and notified by Oil and Gas Regulatory Authority (Ogra). While the general public may well lament the rise in gas prices, with special reference to the price of CNG, and base their argument on the low cost of domestic gas extraction/supply relative to imported fuels yet this viewpoint ignores two economic factors. First and foremost, economists are agreed that all types of fuel in an economy must be priced equally and according to their calorific value (British thermal unit) or any other approved measure of unit of energy per unit of each fuel. Any discrepancy in price between domestic gas and other fuels raises the demand of the cheaper fuel thereby generating shortages which other more expensive fuels would have to meet. Gas shortages in Pakistan are now a permanent feature throughout the year and the government has been struggling to price it at par with the prices of the more expensive imported fuels.
The war in Afghanistan that the US-led Nato, the most formidable war machine in the history of the world, could not win in 12 years Washington wants the beleaguered Ghani-Abdullah regime to win in months. As of present, that appears quite difficult if not impossible given that Afghan Taliban are far better organised and more spirited today, under their new leadership, as against the Kabul forces. Also, because the international community, including the United States has now realised that without Taliban being its part endurable Afghan national reconciliation would remain an unrealised dream. And of the Taliban movement, the Haqqanis are an inseparable part, as their forefathers, led by Jalaluddin Haqqani, were part of the Afghan Jihad which defeated the armed-to-teeth forces of a superpower - and America's lingering nemesis - the Soviet Union. The Haqqanis are Afghans - racially, residentially, politically and culturally - and if they are now part of the Afghan Taliban fighters and take on the Kabul forces it is a matter of no surprise. Perhaps, had the Ghani-Abdullah set-up been more cohesive and independent and less infiltrated and managed by pro-India Karzai relics the Afghan-government there would have been some progress on political front and Pakistan-brokered peace negotiations beyond their first round. Accepted, during her interlocutions with host officials and leaders in Pakistan Dr Susan Rice was concerned over the attacks on Kabul, but how come she 'looked forward to Pakistan to reduce this [Haqqani] threat', and suggested "specific measures" Pakistan must take to stop these attacks. The Haqqanis as a fighting force are product of the Afghan jihad; earlier they fought the American war against the Soviet Union but now they are part of the Taliban movement fighting pro-America Afghan government forces. Pakistan's military operation Zarb-e-Azb is going apace against all Pakistani Taliban, both good Taliban and bad Taliban, and it is throughout the tribal areas including North Waziristan, which to many in the West was left untouched because they wrongly claimed the Haqqani network was quartered there. Islamabad should accept this myth and fight the phantom of Haqqani network on its soil otherwise it will not get $300 million of the Coalition Support Fund - let's not stoop to this blackmail. Let there be no bargain on the lives of thousands of jawans and officers martyred in battles against Taliban and other militants, and let us convey to our so-called friends and allies in the West that those who died in the line of their patriotic duty were no mercenaries. Restoring peace in Afghanistan is a shared responsibility of all and not of Pakistan alone.
Why do the investors shy away from investing in Pakistan? There can be a host of reasons. Multinationals do not want this country to be a source of output for products they market world-wide because of political and regional instability as their global supply chain has to be least affected since they constantly endeavour to retain and increase their market share and cannot afford any disruption. We are very conscious of our location being in close proximity of the world's two most populous countries - China and India. However, the infrastructure needed to move goods is not only missing but also our relationship with our eastern neighbour is not conducive to business either. Investors base their decisions on various factors such as availability of the raw material that they need for their products or close proximity of the market for their products, or both; and above all else they gauge the ability to quickly get in and out of a country they invest in. They also look at cheap land availability, taxation system, infrastructure, as well as availability of skilled labour prior to investment. Therefore, the laws relating to tax liability need to be transparent and a judiciary system which ensures speedy justice.
Indian provocations along the Line of Control (LoC) and the Working Boundary (WB) continue to claim innocent lives. In the latest round of shelling by the Indian Border Security Force (BSF) across the WB on Friday at least eight people were killed and another 47 injured, among them 24 women and 11 children. Ten of the injured are in a critical condition. CoAS General Raheel Sharif who rushed to the place to inquire after the injured expressed a common sentiment when said the Indians had "crossed all limits to terrorize Pakistan's civilian population disregarding international conventions and norms." For those close to the LoC and the WB, it has been like living in a war zone. During the past three months alone, Indians have violated the cease-fire as many as 143 times, killing 24 people. Yet there is no sign of tensions easing up.
The State Bank of Pakistan (SBP) says despite the global turmoil it sees no threat to Pakistan's economy as its macroeconomic fundamentals remain strong and SBP is closely monitoring the movement of currencies in international and domestic markets. In case of need it would take a stern action against speculators who are contributing towards weakening PKR against the US dollar which is the currency of intervention. We have, in these columns, argued all along for minor adjustment of PKR for Pakistani exporters to remain competitive. However, successive governments have tried and failed to keep the parity unchanged for long periods of time resulting in the country's forex reserves coming under pressure. Only when the Fund has forced a downward change, SBP has hurriedly complied with because the country needed the dollars since the alternate was default with all its painful consequences.

 



 
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Banking Review 2014


Annual2013/14
Foreign Debt $62.649bn
Per Cap Income $1,512
GDP Growth 4.24%
Average CPI 8.6%
MonthlyJune
Trade Balance $-2.378 bln
Exports $2.016 bln
Imports $4.394 bln
WeeklyAugust 27, 2015
Reserves $18.509 bln