Economy suffers over $35 billion loss due to Afghan turmoil

[Neo]

Economy suffers over $35 billion loss due to Afghan turmoil ​

LAHORE (February 12 2009): Business community on Wednesday urged Obama's special representative, Richard Holbrooke who is currently visiting Pakistan, to help provide direct access to Pak products in US markets as Pak economy has so far suffered irreparable huge loss of $35 billion direct and indirect due to turmoil in Afghanistan.

Founder chairman Pak-US Business Council and VP Saarc Chamber of Commerce and Industry, Iftikhar Ali Malik while talking to APP here, said that "we entire business community welcome Richard on exploratory visit to Pakistan". He said it is on record that Pakistan is the only country in the world which has not only suffered tremendous economic loss but also huge human loss in war against terror.

Iftikhar said that more than three million Afghan refugees in Pakistan were also posing security risk. He said that entire Pakistani nation including business community, all political parties under the dynamic leadership of President Asif Ali Zardari and guidance of Prime Minister Syed Yousuf Raza Gilani, people from all strata of the society stand united against the menace of terror and fully committed to defeat it as Pakistan has always been an active US associate against the menace of terror.

He said due to war on terror, Pakistan's national economy is exclusively suffering a net loss of $6 billion annually as a fallout of the war against terror, which has displaced thousands of people and endangered security in the country.

In the prevailing scenario, United States must provide direct market access to Pak products on zero rate duty to help stabilise the country's bleak economy in the wake of the war against terror.

Iftikhar who is also co-chairman businessman panel, the largest alliance of chambers in the country and ruling group in FPCCI on behalf of entire business community again urged for US assistance to Pakistan to help overcome the economic crisis, by restoring the quota for Pakistan at par with all other under developed countries.

"The US should buy back products from industrial zones in Pakistan and help strengthen the existing industrial zones with the provision of modern infrastructure", he said, adding that proper and timely American assistance will help ensure durable peace and stamp out terrorism, besides strengthening the democratic government in Pakistan.

Observing that due to the unrest and turmoil in a neighbouring country, he said a major chunk of Pak food stock is smuggled to Afghanistan, which ultimately leads to acute foodgrain scarcity within Pakistan. The current economic crisis looming world-wide has especially impacted the poor countries, he added.

He said there is vast scope for US private sector investors in every sphere of life, particularly in the agro power and IT sectors, adding that the US Chamber of Commerce (USCC) can play a pivotal role in promoting bilateral trade relations.

"Pakistan is an emerging market rich in opportunities for American investment, while the US is already an important trading partner" he said. Malik urged the need to restore relations to the pre-9/11 level, adding that good relations between the US and Pakistan, and the Muslim ummah will help restore confidence and attain world peace. "With South Asia becoming the hub of international economic activity, restoration of peace in the region is all the more necessary," he observed.

 

[metalfalcon]

Pakistan runs short of Wheat, Sugar and Rice because these Basic Commodities are Smuggled to Afghanistan.

 

[Omar1984]

Pakistan runs short of Wheat, Sugar and Rice because these Basic Commodities are Smuggled to Afghanistan.

You're absolutely right brother. Check the news I posted in pages 44 and 45 http://www.defence.pk/forums/economy-development/17339-pakistan-economy-news-updates-44.html
Punjab and Sindh produced more wheat than their target and more rice has been produced than is even consumed by Pakistanis. With these kind of production, no Pakistani should be going hungry.

 

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Children on frontline of Pakistan economic crisis

Abdus Sattar Edhi remembers a tearful mother who agonised over whether or not to abandon her three-year-old son to charity after her husband lost his job.

"A year ago, we used to receive a couple of kids across the country a day, but the number is rising mainly because our people's economic situation is weakening," said Edhi, who heads the charitable Edhi Foundation.

"Now we receive one or two kids every day just in Karachi, and across the country five or six," he said.

On the porch outside the charity's head office in Pakistan's depressed economic capital of Karachi, metal cradles hang from chains beneath a sign that reads: "Do not kill, lay them here."

Parents lay up to 40 children a month in the cradles - a heartbreaking indication of just how tough it has become to feed and clothe families in a country where the economic situation is worsening almost daily.

The global credit crunch has hammered Pakistan's economy - already reeling from years of constant bomb attacks, regional insurgencies, and battles between government troops and Islamist extremists in the northwest.

Food prices have soared and overall inflation is rising while export orders from crisis-hit Western economies have slumped.

Last November, the International Monetary Fund approved a US$7.6 billion ($11.5 billion) bail-out package to stabilise Pakistan's economy and avoid a balance of payments crisis and defaults on foreign loans.

Industries are in crisis: textile merchants report orders from Britain and the US are drying up. Brokerage houses have collapsed along with the Karachi stock market; heavy industries such as automobiles are sacking workers.

White-collar jobs are also disappearing as managers struggle to keep businesses afloat.

According to Edhi, this was the undoing of Jehan Ara, who in floods of tears lay her toddler in a crib as she could no longer to afford to care for him.

"She said 'I'm leaving him until we have the means to raise him. His father is a labourer who has lost his job in a mill and my earnings are not enough to feed him and my two older kids'," Edhi remembered.

The foundation runs 18 centres across the country, housing more than 2,000 children at any one time. In Karachi, there are about 200.

The children live in dormitories, attend school classes, share a communal play area and go on monthly outings.

Sometimes, Edhi said, the children ask where their parents are.

"Someone threw me in the cradle and I've been here ever since. It is now my family," says Mohsin, who is nicknamed Kaka, meaning little boy.

Anwer Kazmi, an official at Edhi's foundation, said there are 320 cradles outside Edhi offices nationwide, including 40 in Karachi. As times getting tougher, more children are left

Pakistan has suffered from crushing poverty since it was created almost 62 years ago when a century of British rule ended.

Today it is number 139 on the UN's human development index of 179 countries.

Pakistan's gross domestic product (GDP) has plunged to 3.5 percent in the current fiscal year, from six percent last year.

"If people stop leaving their children at my doorstep it would show Pakistan is on the path of prosperity," said Edhi.

"But since cradles are continuously filling at my centres, I don't see it happening in near future."

On the pavement outside a nearby restaurant, kitchen staff set down lentil soup and bread - charity for the children.

Kaiser Bengali, an economist and former member of the government's economic council, said 40 percent of Pakistan's population of 160 million live on one dollar a day or less.

The government puts the figure at 33 percent.

Food prices that have doubled since 2005 have only made the poor poorer, Bengali said.

Imran Ali, 32, worked in a knitwear factory in Karachi's slum neighbourhood of Korangi, where he earned 200-300 rupees (6.2 to 9.3 dollars) a day depending on how many shirts he stitched, until his services were terminated.

"I am a father of four and can't afford to live without working. It's impossible to find a job anywhere now and people like me don't have the savings to start working independently," he said.

With little hope of finding another job, he says his family depends on what his 14-year-old son earns selling flowers at traffic lights to supplement his wife's salary as a maid.

"Their earnings are too little to buy bread for all and keep the other kids in school," he said.

Pakistan, which has watched arch rival India embark on the path to prosperity and regional superpower status, was slapped with heavy sanctions after going nuclear in 1998, further suffocating economic development.

Former president Pervez Musharraf's decision within hours of the September 11, 2001 attacks to back the US-led "war on terror" saw Washington pump in 10 billion dollars of aid money and cancel billions more in foreign debt.

But suicide bombings, religious extremists winning the upperhand in parts of northwest Pakistan, political instability, inflation and a sharp decline in foreign reserves - all coupled with the global crisis - have squeezed growth.

Economists warn against a vicious cycle, saying mounting economic problems boost civil disturbances and fan the flames of militancy.

The government has blamed the economic woes on the fight against terrorism, but many ordinary people accuse the authorities of squandering aid money.

The finance ministry said in a poverty-reduction draft strategy that the annual cost of Pakistan's anti-terrorism military efforts rose 40 percent to 678 billion rupees in 2008 from 484 billion rupees the year earlier. -AFP