Pakistan Economy: Sinking Like A Rock, says Asian Development Bank.

Sinking like a rock: Slim chances of recovery for Pakistan’s directionless economy, says ADB

By Shahbaz Rana / Creative: Anam Haleem

ISLAMABAD: Amid deep-rooted concerns over a “directionless” economy due to failure of the previous government and inability of the caretaker setup to take immediate meaningful steps, the Asian Development Bank has warned that Pakistan’s current growth model is unsustainable that also undermines future prospects.

In its Asian Development Outlook, the Manila-based lending agency has painted an extremely bleak picture of Pakistan’s economy that is “directionless” and immediate recovery chances are almost nil amid a worsening balance of payments position.

“A difficult political situation stalled effective policy response to macroeconomic and structural problems, especially regarding energy, and the end of the government’s 5-year term in mid-March limited political scope for major policy or structural reforms,” it said.

The economic developments in this fiscal year are unfolding along broadly similar lines as previous year, but with “deepening concerns about sustainability and the adequacy of forex reserves”.

A missing link in the ADB’s analysis of political failures is the role of bureaucrats in running the affairs of the government who often do not disclose actual extent of problems to the leadership.

The season of revolts – By:Arif Ansar

Excerpt;

But the winter of discontent is still far off

The Arab Spring is now well underway and appears to have spread to other continents as well. Early signs of a European Spring are visible in UK and Greece, and there is an American version in the form of the Occupy Wall Street movement. Meanwhile, Anna Hazare provided a glimpse of how an Indian Spring may look like. The underpinnings of these protests may be different but at a broader level they signify the widening gulf between governments and their citizenry. In other words, hidden in these protests is a modern crisis of the nation-state system.

What triggered these public uprisings is hotly debated. However, in the context of the Arab world and Pakistan, the WikiLeaks disclosures may have played a major role. These secrets revealed how governments are playing a duplicitous role, especially about their dealings with the US. ….

…. Like many other outcomes of the linked and globalised world, these public revolts are also transnational in nature. There appears to be two contradictory forces at work: on the one hand the technological advancements and social media are making the borders increasingly irrelevant, and on the other, worsening economics is causing nationalism to resurge. The future of nation-sate structure is dependent on how it reconciles the pulls and tugs that emanate from within, with those that act upon it from outside.

To read complete article » Pakistan Today

If USA attacks Pakistan…

– by Harris Bin Munawar

When America’s top military official hinted at direct US action in the tribal region where it believes Pakistan shelters and works with the anti-American Haqqani Network, among the first to respond was the network’s top leader. “The US would suffer more losses in the North Waziristan Agency than they did in Afghanistan,” Sirajuddin Haqqani said, daring the US to send its troops into the tribal region that the Pakistani army itself has refused to enter.

This means: 1. His network is entrenched in North Waziristan 2. It is their responsibility to defend the agency 3. They would prefer to do so over several years in Afghanistan-style guerrilla warfare

Pakistan Army says it is not ready to take on the influential pro-Taliban leader, effectively giving up a claim on the territory he controls.

Prime Minister Yousaf Raza Gilani says a raid on the Haqqani Network would be an attack on Pakistan’s sovereignty, as if the defence of North Waziristan has been outsourced to the Haqqanis.

Prone to the drone:

If Pakistan Army indeed lacks capacity, or will, to reclaim North Waziristan where Afghan insurgents are believed to hide, regroup and plan new attacks, that means it has no effective control over the region.

Pakistan says that: 1. Its army does not have the means or resources to control that territory 2. The government will lose political credibility if it orders an operation in the North Waziristan 3. Taliban reaction to such an operation will destabilize the entire country

If that is correct, Pakistan has lost de facto control over the area and it cannot claim sovereignty. That gives the US a justification to go after its enemies itself. And that is what the US does with missile attacks by unmanned aircraft.

A government that has been holding tribes collectively responsible for violations committed by their individual members has no moral authority to suddenly invoke modern notions of justice or mourn the death of innocent civilians who shelter the Taliban.

So little leverage:

If Pakistan is collaborating with, or supporting, or merely avoiding confrontation with a group it has long-standing ties with, a group it believes or hopes will have a significant role in the post-US Afghanistan, there is no reason it will stop doing that for an ally that is about to leave the battlefield.

Washington wants to put its foot down. It wants Pakistan to stop supporting its enemies. But “the problem is”, security analyst Caroline told Reuters, “we have so little leverage”. Because:

1. America cannot engage in a long-term battle inside Pakistan with its economy worsening, troops thinning, and a complete withdrawal from the region already announced

2. It has no identifiable target in Pakistan. The Haqqani Network does not have too much of a stationary central command that it could attack

3. Now that they are expecting an attack, members of the group will disperse

4. If the IsI is supporting the Haqqani Network, killing one or two of its leaders will not significantly hurt the group’s capability to attack US interests

What can America do?

1. The US can make a May 2 style incursion into Pakistan and go after the top leader of the Haqqani Network. After his father Jalaluddin Haqqani’s retirement, Sirajuddin the most influential insurgent figure in that region. But the impact of his killing might not be more than that of the killing of Osama bin Laden

2. It can make a number of simultaneous raids under air cover on several key targets in North Waziristan – people or buildings that might include Pakistan Army’s check-posts. Like the May 2 raid, the legitimacy of the operation will depend on how successful it is

3. The US can carry out a series of individual strikes followed by periods of calm. That way it will continue to meet its goals and embarrass the Pakistan Army, while making sure the tipping point is never reached

4. Washington can impose an economic embargo on Pakistan, stop all aid, freeze its accounts and declare the ISI a terrorist organisation. It can also use its influence on international agencies to end all aid and loan programs to Pakistan. That will be deathblow to Pakistan’s ailing economy

5. It can increase drone strikes in the Tribal Areas and take out targets with virtual impunity

Neither of these steps is new or extraordinary, and neither of these steps will dramatically reverse the US predicament in Afghanistan.

What can Pakistan do?

Any US move against Pakistan does not have to be new or extraordinary to hurt Pakistan. Pakistan Army has influenced public opinion in the past to create an anti-America feeling that it can then cite to seek concessions from the US. In doing that, it has entrenched itself into a position where it will have no choice but to respond to a US strike.

As an immediate response, Pakistan can:

1. Retaliate and fire at intruding US aircraft or men. Claims have been made that Pakistan can shoot down predator drones, but it is less likely Pakistan can detect and attack US fighter aircraft. The Osama bin Laden raid has also raised doubts about Pakistan’s ability to detect and attack intruding helicopters

2. Carry out a delayed but full-fledged counter-attack on US bases in Afghanistan that it believes were used in attacks on its soil. That may lead to a US counter-counter-attack and an all out war. How long can Pakistan sustain that war is an important question

3. Increase attacks on US interests through any Taliban factions or other insurgent groups that are ready to support Pakistan. If Sirajuddin Haqqani has made an offer to defend North Waziristan, the Pakistani military might take them up on that. Sooner or later, the US will withdraw anyway. But is there a guarantee these groups will not go rogue like many in the past? Can a modern Pakistani republic reconcile with their version of the Muslim faith?

4. Step back and start an operation in North Waziristan. But with the US leaving, will Pakistan want to alienate its supporters in Afghanistan? One way to deal with the problem is to continue the policy Pakistan is accused of. The army can hide key figures of the network and then conduct a fake operation for several months until the US is pressured by its politics or economics to leave the region. But then, how will Pakistan deal with the network and reclaim its territory after the US leaves?

5. Not retaliate with a military move, and just end diplomatic ties with the US, losing a key source of aid. Closing down NATO supply routes will hurt the US immediately. But if the supplies are stopped for too long, the US will find new, although more expensive, ways to get supplies to Kabul. If that happens, Pakistan would have burned up a very important advantage.

6. Go to China for help. China’s key security officials came to Pakistan last week. Pakistani analysts saw that as a sign of support. But the Chinese delegation is on a scheduled visit to discuss terrorists hiding in Pakistan’s Tribal Areas that fight against China in its Xinjiang province. It is not likely China support Pakistan on some of the possible plans we have discussed. Nor is it in China’s interest to jump into a US-Pakistan conflict.

Can Pakistan sustain a war?

Opinion leaders in Pakistan believe the resource-rich republic can sustain confrontation with a defeated US empire. Such self-deception has cost Pakistan dearly in the past. Let us look at the key resources needed in a war:

Troops: Pakistan does not have enough troops to guard both the Indian and Afghan border. We have grouped India with the US as a matter of policy, and will have to pay for that by being sandwiched between two hostile neighbours

Weapons: The weapons and equipment used by Pakistan Army come from the US and its allies. That means we will soon run out of ammunition and cannot repair or service the equipment

Money: Pakistan’s economy cannot pay for a war, especially after an embargo by the US. Hit by floods two years in a row, suffering from an energy crisis, cash-strapped because of huge government spending, and dependent on foreign aid, how long will its money last?

Communications network: Pakistan’s communication system can not bear the burden of war with a dysfunctional railways. With engine shortages and trains stopped half way for up to 20 hours because there is no diesel, how will Pakistan fight a war?

Intelligence: If Pakistan’s intelligence agencies are to be believed, they had no clue about the presence of Osama bin Laden in Pakistan in Pakistan, a planned US raid to kill him, or even about the activities of Raymond Davis and CIA contractors like him. On the contrary, it is accused of targeting journalists who there is a general consensus are not American agents. Pakistan’s intelligence network does not look like it is ready to fight a war

Diplomatic support: Every single country in this region was hurt when Pakistan had influence in Afghanistan the last time. Insurgents from China and Central Asia were sheltered and trained in Afghanistan, Iran was unhappy because tens of thousands of Shias were massacred, and India was among the victims of guerrilla warriors too. The International Tribunal for Former Yugoslavia is asking for former ISI chief Gen Javed Nasir. Who in the region will support Pakistan in its battle to control Afghanistan?

Domestic politics: Hundreds of people have been killed in ethnic and political battles in the crime-infested economic hub Karachi, Punjab is suffering from a new epidemic, Sindh is submerged in floods, Balochistan is fighting an insurgency and Khyber Pakhtunkhwa is dysfunctional because of terrorism. Pakistan’s domestic situation is less than ideal for a war.

Pakistan’s military and legislators plan peace talks with Taliban

– In the midst of bad and worsening relations with Washington, Pakistan considers new round of peace talks with Pakistan-based Taliban, arguing that ‘military solutions’ are making things worse.

By Owais Tohid

Excerpt;

……. But analysts believe that striking negotiations with Islamic militants will pose serious challenges. “We struck peace accords with militant commanders during the past and those blew up on our face,” says Peshawar-based defense analyst, retired Brig. Mohammad Saad. “Once you enter into negotiations, they [the militants] grow bigger than their size and start believing themselves as equal. The more the state talks to them, they will become a bigger problem in Pakistan.”

“Their agenda is different,” Brigadier Saad adds. “Their ideology is in clash with the norms and values of any modern civilized society.” …..

To read complete article → csmonitor

Army Gives Clear Deadline to Settle Karachi Issue

– By Aijaz Ahmed

IH Exclusive Report

The cat seems to have finally come out of the bag after dilly-dallying and procrastination of about three months as military top brass has issued a clear cut deadline to the struggling and fragile political government both in the center and the province to settle Karachi issue by 30th October, sources in the power corridors have revealed with complete confidence and authority.

Zardari-Kayani meeting, a file photo

This scribe saw fear on the faces of many in the ruling structure, and heard certain whispers in the parliament lobbies and pathways of other buildings on the power map of Islamabad ever since the military spokesperson issued a statement on Karachi issue in very awkward manner that put already weak government under further pressure. The fear appeared to have increased manifold the day Army Chief had a detailed meeting with president Asif Ali Zardari at the Capital Hill of Islamabad.

The follow up event, which was none other than the corps commanders’ meeting, was an additional factor due to its unusual end as no formal statement was issued against the normal practice for the last so many years. The footage issued by ISPR was also evident of the fact that the military top commanders were looking grim and worried over the situation of Karachi. The military hierarchy seemed to be under pressure more so as a large number of the common Pakistanis and almost all analysts of high stature consider army leadership responsible for the situation due to its clear-cut support for MQM, a creation of General Zia ul Haq.

The latest deterioration in the situation in Karachi appeared to be due to the multiple factors with the political interests of MQM remaining at the top. The worsening situation has alarmed every one as the situation strengthened fears about the very survival of Pakistan. Many among the political forces, traders, and even liberal intellectuals who have been posturing neutrality are very much disappointed in the present political dispensation and have demanded the deployment of Army under Article 245 of the Constitution.

Only two rival political parties, PPP and PML-N were still resisting army action due to certain reasons. However army was looking reluctant to accept the responsibility, but at the later stage the thinking appeared to have changed and an indication of will was given by Army Chief himself few days back. In this scenario the army chief had a one to one meeting with the president. The insiders having close relations with both presidency and the GHQ are of the view that the army chief has conveyed sentiments of his colleagues in the army to the civilian government. Sources from both sides confided that the October 30th has been given as deadline with a clear-cut message that ‘if the situation does not improve and issues are not addressed then we will address Karachi issue in our own way’. The message, according to the sources, has spread fear among the top party leadership as this is not only a message for an action in Karachi, but also an indication of distrust over the competence and abilities of the civilian government to deal with the situations, sources maintained. The action will not remain confined to Karachi only, the government at center and the provinces will be sent back home was the actual message between the lines, sources added. ….

Read more → Indus Herald

WSC participated in The 16th Session of UNHRC to inform about the worsening human rights situation in Sindh

London, UK, 19 march 2011: Press Release – A delegation of World Sindhi Congress (WSC) comprising of Dr Hidayat Bhutto and Dr Lakhu Luhano participated in the 16th session of UN Human Rights Council in Geneva. WSC delegation made statements at events organised by Interfaith International and RADDHO (Rencontre Africcaine Pour La Defense des Droits de L’Homme).

The delegation also met with numerous ECOSOC NGOs, human rights defenders from South Asia region and from nations oppressed by Pakistan and with the office of UN’s Special Group on Enforced and Involuntary Disappearances. In these meetings, the delegation had detailed discussions about the worsening situation of human rights for people of Sindh.

In his statement, Dr Hidayat Bhutto presented detailed views about the worsening human rights situation in Sindh. He mentioned the recent killings of Sindhi political leaders Zulfiqar Kolachi, Yonus Khaskheley and Haji Khan Noonari. He said that the disappearances of political activists continue to occur in Sindh where currently 39 Sindhi people are missing believed to be kidnapped by the agencies. He informed the international community about the second-time disappearance of one of the most prominent Sindhi leader, Muzaffar Bhutto, in daylight by the agencies. He requested the UN and the international community to press upon the agencies for the release of all kidnapped Sindhi and Baloch people. Dr Bhutto mentioned that the agencies are illegally settling people from Punjab and Pakhtunkhwa to colonise Sindh and enhance religious extremism. He detailed how Sindhi people are being systematically denied their social, cultural, political, educational and lingual rights by the Pakistani establishment. He said that the international community to be aware of these issues and requested to support people of Sindh in their struggle for their genuine historical and human rights including right to self-determination.

Dr Lakhu Luhano in his statement said that the Pakistani state is practicing a systematic policy of fanning, patronising, training and funding the violent religious extremism not only for their regional strategic extension but also to suppers, subjugate and colonise Sindhi and Baloch people. This policy has huge and serious implications for regional and global security and peace and for viability and continuance of tolerant Sindhi nation and society. He requested the international community for an immediate, effective and urgent action before it becomes too late. He warned the price for the entire humankind of the spread of this disaster would be unimaginable.

The other delegates at the events extended their support to Sindhi people in their struggle for their human rights including right to self-determination.