Challenges and opportunities

Pakistan today stands at a crossroad. We are faced with the most severe challenges in our 61 year history. But this is not the first time we have been confronted with challenges. We have faced numerous challenges before, and we have come out of these challenges if we stood united as a nation. The 1947 partition, the 1965 war, the 1971 war and break-up of Pakistan, the 2005 earthquake, and the Dec 27, 2007 tragedy. Foremost of all, we are confronted with the security, law and order, militancy, extremism and terrorism situation. In FATA, there is a war going on between militants and locals, between foreign fighters and locals, and between militants and our armed forces. Then there is intrusion by foreign forces, both by land and air, coupled with cross border terrorism. Who knows who is fighting who? The International Red Cross Committee (IRCC) has declared Pakistan a war zone. Then from Khyber to Karachi, there are suicide bombers, striking hotels, airports, cinemas, shopping centres, embassies - you name it. There are kidnappings of diplomats and foreign engineers. It appears a beehive of terrorists that has been let loose, and there is smell of fear and death everywhere. There is insurgency in Balochistan, which has its roots from the days of the Kalat insurgency, the guerrilla war of the 70's, and the assassination of Nawab Akbar Bugti. Some are fighting for their rights within Pakistan, yet there are other groups asking for independence. Today even most national parties feel Balochistan has been deprived of its resources. Then there is a complete collapse of the social fabric: crime in cities and rural areas, kidnappings, dacoities, robberies, mobile and car snatching, murders, rapes, siyah kari, karo kari, burying of women alive, elderly captivated in chains, you name it and the list is endless. Then there is the financial crisis. The KSE 100 has fallen by over 36 percent since last year, from 14,500 to 9,300. Only in the last three months $540 million have been ejected from the stock market. Forex reserves have deflated from $16 billion to $9 billion, equivalent of two months of imports. The rupee has devalued by over 30 percent against the US dollar, from Rs 60 to Rs 78. The trade deficit has swelled to $22 billion, from $13 billion last year, mostly due to heavy import bill from oil and food, Oil imports are now $12 billion, about 30 percent of the total imports of $40 billion. The food inflation is running at 34 percent, which is pinching the poorest the most, while the consumer price index is over 25 percent hurting businesses. Fiscal deficit is 7.7 percent of the GDP, or Rs 777 billion, against a budgeted target of 4.2 percent. Current account deficit is $14 billion, or 8.6 percent of the GDP, which is what we need to avert a financial collapse. Pakistan's external debt stands at over $43 billion. Interest rates are in double digits, the lending late almost 14 percent. Moody bond outlook has been downgraded to negative from stable because of depleting foreign reserves. More people are living below the poverty belt, the gap has further widened between the rich and the poor, and the poorest of the poor are even poorer. There are hunger suicides, the hungry asking for fatwa to make suicide for hunger allowable. Never has the moral of this nation fallen so low. And on top of that, Transparency International has ranked Pakistan among the 46th most corrupt nation in the world. Then there is the Power crisis. We are running 4500MW short of peak power requirement, or about 25 percent of total capacity, and demand is increasing by about 2000 MW every year. The distribution systems are poorly maintained, and as a result of both, there is load shedding and failures for up to 8 to 12 hours every day. Some areas of Balochistan and Frontier do not even get electricity for days. Agriculture productivity has fallen to its lowest, due to the shortage of water, land lost to water logging, salinity and desertification, and due to low crop prices offered to farmers. Polio has resurfaced despite tens of millions of dollars spent in this sector, so have Dengue, HIV AIDS, Tuberculosis, and other water borne diseases. Then there is sugar, atta and diesel crisis which may hit us next. The quality of education has continued to deteriorate, despite billions spent in this sector. Not a single Pakistani university can be counted among the best, and there is continuous brain drain of intellectual capital. Over 100 billion rupees have been unwisely spent on higher education irrespective of what HEC tells us. But there is a silver lining on the cloud. Like mentioned earlier, we can overcome all these problems if we stay united as a nation. What we need foremost is good governance. We have had a good start, with the February elections. The government has vowed to make the Parliament and its committees supreme, and is answerable to the Parliament. The PPP is committed to repealing the 17th amendment and the notorious 58(2)(b). Everyone is committed to a free judiciary and the process of the reappointment of the deposed judges has started. The remaining judges will be appointed soon. The two major parties are both committed and signatories to the Charter of Democracy, to which Shaheed Mohtarma Benazir Bhutto and Nawaz Sharif had penned their signatures. The appointment of the leader of opposition as chairman of the Public Accounts Committee is a good start. All the parties are committed to abolishing the concurrent list, which will take away the heartburn of the smaller provinces and lead to greater autonomy. The NFC award is being revised. The Cabinet is being expanded with representatives of coalition partners, and Nawaz League has again been invited to join. There are coalition governments in all provinces. With good governance, the confidence of the people, the investors, and the world community will be restored. The law and order problem will automatically be handled once we have good governance. The government is already reaching out to the people of FATA and Balochistan. The cases against Baloch leaders have been withdrawn. We have a three-prong approach: to talk with those who will lay down their arms, to initiate major development, and to go for limited strike against those who continue to terrorise. We will not allow cross border terrorism, nor will we allow violations of our land and air space. Inviting President Karzai to the oath taking ceremony, and holding of the joint press conference was a good move to show the world community that we are reaching out to our neighbours. This will take care of our western borders. Rapport has already been developed with Prime Minister Manmohan Singh at the United Nations, and we are hopeful for a peaceful resolution to the Kashmir problem without compromising on principles. Already there is an agreement on trade and the opening up of land routes at Wagah - Attari and Khokrapar-Munabao borders. Free trade and less restriction on people movement will do wonders between the two countries and will lead to a peaceful and prosperous South Asia. With peaceful neighbours, 90 percent of our problems will be solved, where we can now divert more of our defence expenditures into development. Good governance will revive the confidence of the investor. Privatisation (but not of strategic assets) will write off debts and increase reserves. The Friends of Pakistan that just met in NY has agreed to bail Pakistan out of its financial crisis, and will meet in Abu Dhabi next month. The World Bank has assured support of $1.3 billion. The PPP is offering investment opportunities in coal mining and setting up of power plants. Coal needs an investment of $8-10 billion, and one investment conference has already taken place in DC, and the next one is planned for Hong Kong. There is huge potential to set up wind energy power plants as well, where currently we are producing zero despite it being the fast growing sector for power generation. Germany produces over 20,000 MW using wind, which is more than all of Pakistan's need, and the southern terrain is the most feasible for wind energy as per USAID reports. There is potential for bio-fuels, and expansion in the nuclear energy arena for peaceful purpose, much like what India got from the US. This has to be aggressively pursued. There are untapped reserves of copper and gold in Balochistan, as well as of oil and gas in the country. All in all, we see major potential for development and growth in Pakistan under good governance. The wheat support price has just been increased, which will encourage farmers, discourage wheat smuggling, and ensure food security in the country. In education, we are focusing on lower education, and strengthening the existing universities first. Pakistan needs to develop intellectual capital, much like India has done over the last 20 years, as we have a vast resource of young energetic people. Over 35 percent of our population is below 25 years of age, which is an asset, unlike the western world where the elderly is the majority. Finally we need to bring in good laws, and implement them. We need to ensure the protection of our citizens, and provide justice to them. We need laws to protect the minority, the children and the women, we need to ensure consumer protection, and we need laws for intellectual property and for environmental protection. In every challenge there is an opportunity and we as a united nation should capitalise on these challenges and grow. With good laws, good governance, and a good team, Pakistan may well be on its way to joining the ranks of the developing world. The writer is a PPP senator E-mail:

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