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ARTICLE (March 14 2009): I have now seen most of the happenings in agriculture and I found that with the passage of time, we have deteriorated in our concepts and its application in the country. How is this explained? Very simply, the inflationary aspect did not keep in touch with the salary structure. The other aspect that came to the front was the connectivity required for the job.

Cronyism and caste system and other forms of ethnic considerations came to the fore. This had an adverse affect on the organisational force and at the moment no less than 79% of the foreign-trained personnel have left the research organisations for one reason or the other. Agricultural inflation, or agflation, as it is now called, has played havoc to the social system in the country.

The original sin is on the increase and the concept of social justice just does not appear to be corrected. Policies devised for a few as against the many have been put in place. How can exorbitant input costs in agricultural be reduced?

With nitrogen not available except in the black-market, there is no substitute for phosphate fertiliser and the effort not to find any is going on to apathy. What we then to do and say, as the West wants us to and take our comparative advantage to the pits of the world?

Pakistan will never be able to compete with the world, as we know it for the simple reason that the West will go on telling us how to raise tariffs on utilities till such time as our industries are unable to compete the globalised world that is becoming more and more poachers of what they had earlier preached.

The Bank of England is going to print money and increase its money supply and that is the answer to their highly paid CEOs in the corporate sector that take millions of dollars/or pounds as their salary. Well, that is the mean and rapacious end of the market and the mighty hidden hand of Adam Smith should come down heavily on them and these individuals taken to the logical place where they belong.

The western model of development and management has broken down because the governance there is not of the order that is required to have the kind of responsible social and corporate behaviour that is and was expected of them. A decadent society is indicated where the norms of decency are openly flouted and breakdown of taboos accepted as a way of life and one of normal behaviour.

On the social side, the indicator comes from the advertisements in the leading papers suggesting that temporary common law husband and wife relationship for these elites that have all the money and now want it to be used for destroying all those values and attitudes that their leaders speak off but never practice. What values do you allow when taboo behaviour becomes acceptable and when nuclear families breakdown due to heavy considerations of money? Money availability is for means to a decent end and that is all.

USAs in God we Trust has come to an end. Can social values be resurrected? It is not possible under the normal circumstances as the whip hand is no longer with the governments but with those who have enjoyed the benefit of these lapses of values and judgements at will in both time and space. Under conditions of uncertainty and that caused by the lack of decent management skills and the fetish about technological superiority there has to be some kind of give.

One never thought that it would be this kind of give in which the determinism of the globalised world would give way to the kind of economic debacle of the west? Is that the only model of development of a country and its society? Agricultural inputs can be reduced without jeopardising the food security of the country.

For Pakistan, the answer lies in the use of phosphate from the waste material of coal deposits in Pakistan, use of waste sugarcane sludge, use of leaf material from banana plants that have been discarded during pruning and that are lying waste by the road side. The advantages can be further driven home if all the manure from the animals including poultry is bagged and sold in granulated form. It is possible to do so and at a pittance of the original cost.

It has been done in the case of sugarcane waste and it can be done where the bulk of such material is available and let me take Landhi Cattle Colony as an example. You want sustainable agriculture that is what you have to do. Try something new our forefathers used and are not new technology but old ones packaged differently.

The cost of organic fertiliser that has been used in the research trials comes to about Rs 400 per bag and contains both nitrogen and phosphate and besides potash and the micro-nutrients. The game is an exciting one for in agriculture and life style nothing is wasted. The problem is with the collection process but that may be due to our inability to manage waste. Now we have CDA and the lot of commissioned people, who will go for obsolete waste managed technology just because they do not apply their mind.

That kind of cost will be never helpful for they are given to a living of ease and comfort. The waste recycling projects demand where it is done by a soil scientist of some repute is only 1,2 million rupees whereas if CDA is taken into consideration and some others then the cost would be in dollars and millions of it. These are innocent wonders of this world. For agriculture one can take the coal, refine it and get two acids that are used for such good affect that one wonders at the lack of our ability to cash in on it.

Humic acid costs Rs 50 per liter and is sued as a plant hormone and one has to use two kilograms of it per acre and the other is fulvic acid that is used for the clearing of sludge and metal impurities in city and town. Time to change the input strategy? You bet. At what cost? None? Instead of paying the MNCS the kind of money that one is paying and instead of touts of the WB and ADB [former employees] sending obscene signals in favour of more of the earlier systems why not trust our very own.

All kinds of fears are thrown at you and all kinds of harassment are carried out while posing as friends of Pakistan. Once the input strategy is worked out the output strategy would have to be taken into consideration. The sustainability of agriculture would not be in question. The cost would be reduced and it would mean that everyone is a gainer. Is that bad for the system?

The other input cost that has never been under consideration is the transaction cost developed as a result of fossil fuels. It is obvious that there is no control over the system and that the petrol and oil policy is dictated by other nations. So what is wrong with having your own bio-fuel policy? Want to try Salicornia and other bio-fuels grown on lands that are marginal and not being used for any other agriculture or for any purpose.

But what you do at the ignorance of the people that are to give a decision and that are located in places where a planning permission has to be taken. Life is like that in Pakistan where policemen on the beat are taking decisions for the rest of the country through their limited visions of what is required.

Having had a comfortable life of their own they have done what they have to mess up this country for lack of thinking and acting. I wish I could unleash the thought process of Paulo Fararie on their limited minds and shake them up to be and to be in the process of conscientisation. There is more to life than a 9 am to 3 pm office life and more to it than to sit before the TV and call it relaxing.

Try something different for your country for it has given you a lot and taken you from your bootstraps and developed you as a worthy member of this country and now it is up to us to take it to a nationhood situation. Try it for at the end of it all of us will be satisfied that we have played the game well and maybe, just maybe, build that bridge that gives us hope and resilience. Take care for the powerful in the world of economics do not want to lose and will try and win at all costs.
 

SUKKUR (March 14 2009): OMV AG has started natural gas production from the extended Latif-1 well in Nara taluka of the Khairpur district. The fast-tracked project will produce 1,000 boe/d during the first three quarters of this year. Production will then rise to 4,000 boe/d when the Latif-2 well is drilled in the fourth quarter.

"The new Latif gas reserves is the result of continuous successful exploration efforts of OMV together with its [joint venture] partners in Pakistan to enhance domestic gas production in Pakistan," OMV Gas field officials told APP here on Friday.

Gas is transported through a 23-km pipeline to the OMV-operated Kadanwari gas plant. The company sells the gas to Karachi utility, Sui Southern Gas Co Ltd, which will distribute it in Sindh province. OMV and its partners, Eni SPA and Pakistan Petroleum Ltd (PPL), will submit a field development plan to Pakistans government with the intention of boosting Latif gas production beyond 2011.
 

Pak industries yet to seize on the opportunity​

Sunday, March 15, 2009

LAHORE: Pakistan’s industrial sector has not benefitted from the carbon initiative under which developed nations having high pollution levels trade cleaner environment-friendly industrial technologies by providing cash credit.

Developed nations under the Kyoto Protocol are bound to bring their emission of gases, which has caused global warming, to 1992 level by 2012. They can do so either by replacing heavy gas-emitting technology in their industries with cleaner technology or by buying carbon credit (carbon dioxide being the main pollutant) from industries in developing economies which use cleaner technologies against cash payment.

The rate of one carbon unit is 15 euros. The entire process from registration of an industrial unit to disbursement of payment is overseen by a special United Nation’s cell established in all developing countries. A three-megawatt electricity generation plant installed by thousands of textile and other industrial units in Pakistan could net Rs5 million per year, according to Asim Mehmood, a carbon initiative consultant.

The News has found that barring Pak-Arab Fertilizer no other industry in the country has benefited from this facility. About a dozen have applied and some are in final stages of registration. Most of the industries using cleaner technologies, however, are unaware of this facility while those which have some idea do not know how to apply.

The carbon initiative provides a chance to environment-friendly industries in developing countries to earn billions of dollars by registering and claiming carbon credit. Currently, India is the leading beneficiary of carbon credit which according to UN statistics accounts for 31 per cent of all carbon credit that is currently disbursed. It is followed by China which has a 24 per cent share. Even Bangladesh is much ahead of Pakistan as four of its industries are availing of this facility.

Consultants point out that delayed government response to start the registration process is one reason for Pakistan’s poor performance. They say first the provincial environment protection departments examine the application for registration with the UN cell and then the federal department for cleaner development approves the application for submission to the UN agency. This process, according to the consultants, takes several months.

Another consultant apprehends that the presence of a strong Indian lobby in the UN agency is a drawback as it put hurdles in the way of registration. He says the objections are baseless as several Indian industries have been registered having similar minor flaws. However, on objections Pakistani consultants now cite the example of registered Indian industries to strengthen their case. Asim says the reluctance of industries to hire consultants is another reason which has deprived the industrial sector of benefits of this facility. The Kyoto Protocol was adopted in Kyoto, Japan, on December 11, 1997 and came into force on February 16, 2005. Some 183 parties have ratified the protocol to date. Detailed rules for implementation of the protocol were adopted in Marrakesh in 2001 and are called ‘Marrakesh Accords’.

Under the treaty, countries must meet their targets primarily through national measures. However, the Kyoto Protocol offers them additional means of meeting their targets by way of three market-based mechanisms which include emissions trading known as ‘carbon market’, clean development mechanism in their country and joint implementation under which a developed country provides credit for a clean project in a developing country and recover the debt through carbon credit.
 

KARACHI (March 15 2009): The State Bank of Pakistan (SBP) Governor, Salim Raza, has said that around Rs 40 billion in the account of is not being utilised by the commercial banks. Speaking at a luncheon meeting with members of Rice Exporters Association of Pakistan (Reap) here on Saturday, he said that some commercial banks had provided less financing than their ceiling under export refinance.

He assured the rice exporters that the central bank would look into the matter and would take steps for this amount to be utilised, mainly for the sectors which are in dire need of financing. He invited Reap members to hold a special meeting with him next week to discuss the issues regarding export refinance, banks financing, and others in detail.

He asked the rice exporters to pay attention on quality and value-addition of the commodity. The rice exporters should establish their brands in the international markets, he remarked. He emphasised on better warehousing facilities and good packaging of the commodity to minimise damage ratio and to earn more foreign exchange.

He said that the SBP had issued the United Nations guidelines to commercial banks regarding trade and banking with Iran. "The commercial banks can provide banking services to Pakistans exporters for their trade with Iran in the light of UN guidelines," he added.

He said that the SBP was ready to help in establishing a branch of any Iranian bank in the country. Earlier, Reap Chairman Abdul Rahim Janoo briefed the SBP Governor about the association and the rice trade.

He said that private sector had played a historic role in promoting the countrys rice exports since its privatisation in 1989. "We had achieved $2.2 billion rice export target last fiscal year from previous only $300 million, before its privatisation", he said, and added that Reap had set a target $2.4 billion for the current fiscal year.

He said that rice trade activities were going on smoothly by the private sector. However, some hurdles were created by the intervention of government institutions, like TCP and Passco, in rice trade. He said that the countrys rice exports would hit $4 billion mark under Reaps Vision 2010. However, he said, the government should provide level playing field to the private sector.

He said that Reap members had explored many markets in the world for Pakistans rice with their own efforts. They had established their own brands in the international markets and had made rice the second biggest foreign exchange earning commodity for the country.

He pointed out that Reap has planned to send its delegations to many countries to explore and establish new markets for Pakistans rice. The first delegation would be sent to Saudi Arabia in the last week of the current month, he added. He said that Reap has planned to set up a most modern rice laboratory in the country.

Reap vice chairman Haroon Rashid said that rice exporters to Iran were facing many difficulties as no Pakistani bank has presence in that country. He requested the SBP Governor to consider opening of at least one branch of any Pakistani bank in Iran. Some leading rice exporters also spoke on this occasion to discuss various issues and gave many suggestions.
 

ISLAMABAD (March 15 2009): The government has asked the World Bank to increase the amount of Technical Assistance (TA) being provided for Benazir Income Support Programme (BISP) from $50 million to $60 million, said Farzana Raja, Chairperson of BISP in a press conference here on Saturday.

"It is true that no contract has been signed so far in this regard but the government is hopeful that the total amount of TA would be increased by the World Bank," she said. She said that Rs 34 billion were allocated for BISP in budget 2008-09 and this amount has now been increased to Rs 70 billion.

She said that the survey on poverty would soon be started and the President and the Prime Minister will announce the programmes package. She said: "Nawaz Sharif, PML-N chief is supporting provincialism and is looking for his own interests instead of national interest."

"Shahbaz-led provincial government initiated Rs 2 Roti (bread) scheme and it revealed that PML-N is not interested in the welfare of other provinces." She regretted that subsidised Roti was not available even in Lahore. She said that Nawaz Sharif was engaged in fanning provincialism and claimed that PPP was the only political force, which talked for unification of the federation.

Farzana Raja claimed that Pakistan Peoples Party was the largest political force in Punjab and the PPP government took the responsibility of development of the country. In protest rallies Nawaz Sharif always talked about vision of Benazir Bhutto, which shows that he doesnt have his own vision. She advised Nawaz Sharif to join Pakistan Peoples Party if he is inspired too much with the party.

She said those who had asked for mercy and had been meeting in the dark hours of night were still looking for another deal. They seemed willing to trade the lawyers protest. The government wanted to resolve the issues in the light of Charter of Democracy whereas Sharif brothers consent was to decide it on roads.

She said that Nawaz Sharif, Shahbaz Sharif, Aitzaz Ahsan and Iftikhar Chaudhry have no match. Nawaz Sharif and Shahbaz Sharif have only focused on Prime Ministership.

To lead their own agenda, they were having separate meetings with Prime Minister Yousuf Raza Gilani. She said the way PML (N) was behaving clearly shows that they want their favourite judiciary under their own rule. She said that why should they claim fighting for judiciary if they already had dishonoured it in the past. Slogans like "Jaag Punjabi Jaag, Teri Pagg Noo Lagg Gaya Daagh" would only fan provincialism.

She said that Nawaz Sharif and his party have not done anything historical. That was why they always quote Shaheed Mohtarma Benazir Bhutto. If they had got such an inspiration from Shaheed Bibi, they should join PPP. She said that PML (N) announced leading the lawyers protest on receiving the Supreme Court verdict regarding their disqualification, which highlighted their personal agenda.

She said that protest was a democratic right of all but no one could be allowed to challenge the writ of the government. Those who do not believe in the supremacy of law should not advocate it. Peoples Party is an ideological political party and it has a long profile of sacrifices. No matter whether it was restoration of judiciary or freedom of expression, Peoples Party has always been in forefront.

About her UK visit, she said that the British government had admired Benazir Income Support Programme for its well-managed and systematic aspect and assured manifold assistance for this programme. She said that the process of disbursement of money at the doorsteps of more than 1.5 million deserving families has been started whereas more than 2.7 million applications have been submitted to Nadra for verification.

Farzana Raja, during her UK visit, addressed important think tanks and British Pakistani Forum. She also met high profile British officials and representatives of various political organisations.
 

KARACHI (March 15 2009): Sindh Chief Minister Syed Qaim Ali Shah Saturday held a meeting with a 8-member delegation of UAEs Bin Din Group and PEDCO of South Korea, working on development blocks of Thar Coal Project and considered the details of Letter of Intent.

According to details, the Korean Firm would work for three years in Blocks 4 and 8, and start drilling and boring for coal mining, where-after power generation will start. The Korean group will set-up Mine-mouth Thermal Power Plant of 1000 MW, by using Thar coal reserves.

The meeting was informed that Mines and mineral development dept, Law dept, Thar Coal and Energy Board and Chief Ministers Secretariat would examine the details of the agreement, being prepared for the proposed project. The Thar Coal Energy Board is going to have an important meeting on Tuesday and signing of the agreement is expected on Thursday.

The Chief Minister assured of all possible assistance and co-operation of Sindh Government to the delegation. The PEDCOs representative informed that theres is a major power company of the world and will soon start coal mining. He said the Mine-Mound power plant would cast a positive and soothing impact in Pakistans economy.

He said the plant, after completion, would be Pakistans first and biggest thermal plant which would make energy available to two million households and six lac industrial units. It will generate job opportunities for 90,000 skilled and non-skilled workforce.
 

Says IFIs to release loans soon​

Friday, March 13, 2009

ISLAMABAD: State Bank of Pakistan Governor Saleem Raza said on Thursday Pakistan was not facing any balance of payments (BoP) difficulties during the current fiscal year as the IMF, World Bank and Asian Development Bank would soon release their loans for the country.

He also said the central bank would review discount rates in the next couple of months as Karachi Interbank Offered Rates (KIBOR) witnessed 3 per cent decline and it was hoped that the interest rates would be reviewed downward if the core inflation decreased. “There is no question of any rescheduling on paying foreign debt and liabilities as the country made payments on maturity of Eurobond well on time,” the SBP governor said while talking to reporters after the day long roundtable conference on Microfinance Intuitions (MFI) arranged by the Planning Commission (PC), here on Thursday.

To a question regarding the foreign currency reserves target for June 30 envisaged by the IMF, he said the country’s foreign currency reserves were $1.5 billion on higher side compared to the envisaged target till March 2009.

“We have almost half a billion dollar less than the envisaged target of foreign currency reserves till June 30,” he added. According to the latest data of the SBP on Thursday, the foreign currency reserves stood at $10.052 billion on March 7.

Without sharing the exact target for June 30, the SBP governor said the foreign currency reserves would be increased to over $10 billion.

Raza said in the same breath that the country would soon receive $840 million in the second tranche from the IMF after its board approval. The other multilateral agencies such as the WB and ADB would also extend their loans soon so there is no financing gap on external front for the ongoing fiscal year.

When he was asked about any possibility for decreasing discount rates by the end of the current month, the SBP governor was non-committal on this issue and he stated that although the inflationary trend witnessed some declining trends in recent months but the CPI-based inflation pushed up because of escalation in prices of food items. The core inflation is not coming down but the SBP will review discount rates in next couple of months, he said.

Referring to KIBOR, he said it witnessed 3 per cent decline and it was hoped that overall interest rates for borrowers would also be reduced. To another query about existing spread between lending and deposits rates, he said the banks used to charge more on those products where there was a risk of default such as credit card and consumer financing.

He also said the banking sector was not facing any liquidity crunch as bad loans of consumer financing as well as the textile sector put some pressures but their overall situation was quite satisfactory.

Regarding the finance ministry’s intervention into the monetary stance and about autonomy of the central bank, the SBP governor said both the finance ministry and the central bank moved hand in hand and the finance ministry could express its viewpoint on monetary stance which could not be termed contrary to the SBP.
 

KARACHI: China and the Middle East countries will invest in horticulture sector of Pakistan to the tune of $5 billion during the current year 2009, an official of Agribusiness Support Fund (ASF) said Wednesday.

“Saudi Arabia and China are interested to acquire land on lease besides to join hands with the private sector stakeholders in order to grow soft crops and vegetables,” Chairman Sindh ASF, Mateen Siddiqui said. China and Middle East will be the key players of investment in horticulture sector as they are interested in rice, wheat and vegetable crops of the country, he added.

He said it was expected that after investment the country could save most of exports of agricultural produce as it was hampered by lack of modern storage facilities. High post harvest losses, insufficient packing and grading and cold storage facilities along with absence of refrigerated transport and containers can be eliminated through foreign investment.

He said due to the most liberal investment policy in the region, Pakistan is most suitable for investors. He said the exporters need a full-fledged packaging house, ripening chambers and blast chillers. He said the government was providing a number of incentives and facilitating measures were being taken for promoting business activities in Pakistan. Most of our economic sectors are open to FDI where the foreign investors can hold 100 percent equity. Safety of investment is assured and Pakistan has signed Bilateral Investment Treaties (BIT) with many countries worldwide.

A high percentage of horticulture produce is wasted due to ineffective post-harvest practices and around 25-30 percent of total production of fruits and vegetables is wasted due to lack of proper post-harvest handling.

These include the network of industrial estates and export processing zones, economic zones with tax holidays, concessional customs duty on import of plant and machinery and the unrestricted outward remittances of capital, profits, royalty, technical and franchise fees etc. Special Economic Zones have been proposed for set up in different parts of the country. Chief Executive Officer PHDEB, Shamoon Sadiq said Pakistan horticulture sector possesses a great potential for development. However, the growth of the sector is inhibited by a multitude of constraints.

Per hectare yields are very low as compared with international benchmarks. The product is perishable by nature and therefore requires proper handling after harvesting to keep it in good condition till it reaches the consumer and export destinations. He said Ministry of Commerce in consultation with PHDEB, prepared proposals under National Trade Corridor Improvement Programme (NTCIP) for enhancing annual export of fruit and vegetables, and floriculture from existing $160 million to $500 million in the next 5 years. He said Pakistan is successfully involved in biotechnology, tissue culture, cutting of floriculture, and as a result we are now in a position to export flowers to the developed world.
 

ISLAMABAD (March 15 2009): Minister for Water and Power, Raja Pervaiz Ashraf told the National Assembly on Saturday that Alternative Energy Development Board (AEDB) has initiated many projects for introduction of alternative energy in the country.

Replying to a question from Abdul Qadir Patel, MNA during Question Hour session, he said that next month first commercial scale wind power plant in the countrys history will be ready for inauguration.

He also said that first public sector wind project of 50 MW has been signed with Karachi Port Trust. He added that 40 micro wind turbines have been installed in Karachi, while 125 KW wind turbine are already operational in Landhi, Karachi. He said that in solar energy sector, 3000 off grid, rural homes were electrified through solar energy in district Tharparkar, Sindh.

Raja Pervaiz Ashraf said that a solar energy project for 300 villages in Balochistan was waiting for funds. Pilot projects for PV water pumping and solar water heaters have been approved for World Bank financing, he added. He said that ECC has approved policy recommendations for use of bio-diesel as alternative fuel.
 

ISLAMABAD (March 02 2009): Pakistan's global IT revenue, with an average growth of around 50 percent per annum, is expected to realise the targets by the end of financial year 2009-10. The country's IT sector, over the last few years, has been growing at a remarkable rate and, to meet the future objectives, Pakistan Software Export Board (PSEB) is focusing on the growth of skilled human resource.

Keeping in view its prime objective--development of future workforce--the Board has devised an open door policy for the provision of financial subsidies, technical support and partnerships not only for the IT companies but also for the educational institutions.

In this respect, the PSEB is working with the Higher Education Commission (HEC) to augment the influx of quality graduates into the industry, said an official at the Board. It had launched an Internship Programme to undertake match making between fresh IT graduates and IT companies and to provide grooming to graduates where necessary.

This programme is also aimed towards the development of confidence among Pakistan's IT business managers regarding output of IT-oriented educational institutions. So far, more than 3300 graduates from 220 universities and institutes across the country have been placed in 250 IT companies and IT departments of public and private sector organisations for a period of three months.

The retention rate by the IT companies has been more than 80 percent, and another 10-50 percent received job offers from other organisations because of their internship experience. This permanent retention rate is the highest of any Internship Program in the country. In Internships Phase-III, interns are being paid a revised stipend of Rs 6,000 per month for a period of 3 months.

Over 1,600 students will benefit from this revised programme in the next one year. A web portal will also be established to further streamline the process. According to officials, PSEB is also facilitating the graduates as well as the IT companies by acting as a liaison point for provision of quality graduates that match the companies' requirements.

It also provides ongoing training and industry-standard certifications to professionals, and undertakes research to benchmark IT professionals and graduates in the country. Officials said that to sustain and improve growth, IT companies in Pakistan need around 235,000 working professionals by the end of 2009-10. Currently, that number is a little above 100,000, and approximately 135,000 more professionals are needed in the next two years.
 
Saturday, 14 Mar, 2009

ISLAMABAD: The Asian Development Bank (ADB) would continue to restructure its portfolio in Pakistan during the implementation of its $4.4billion Country Partnership Strategy (CPS) 2009-2013 and will take its focus away from education sector and fund only selective projects on the governance side.

The 165-page CPS, which the bank unveiled few days ago, says that the bank’s restructuring exercise would continue over the next four years. ADB’s ongoing active portfolio totaling to $5.2billion is being extensively restructured and the number of active projects reduced.

There were 80 ongoing ADB-assisted loans in Pakistan at the end of 2006. By August 31, last year, this had been reduced to 58 which also included the new approved assistance. The cleansing process would continue, the CPS shows.

On the recommendation of the bank’s country assistance programme evulation (CAPE), the CPS focuses on smaller number of sectors and sub-sectors. For instance, ‘education will not be a focal area of ADB given the substantial amounts of external financing for the sector from other multilateral and bilateral donors’.

The CPS has, however, not alluded to the fact that this year the social sector (education and health particularly) has been the main victim of the government’s over Rs100billion cut in spending under the Public Sector Development Programme (PSDP) and squeezed funding for the higher education and science and technology.

ADB’s support for the governance will remain limited with focus on only three sub-sectors: public resource management; economic transformation and private sector development.

In the agriculture sector, now the main focus of ADB will only be on irrigation and water management. Support for traditional rural development projects and stand-alone agriculture reform programmes is being phased out.

The paper says overall progress of its multi-million dollars Access to Justice Programme (AJP) which sought reforms in the judicial sector and police services at the federal level in Pakistan ‘remained uneven’. The CSP says the project had achieved some goals, but there had been a serious dearth of timely investment for capacity building.

Citing the reasons for taking its focus away from education, the CPS says the implementation of a number of stand-alone education and health sector projects financed by the bank continued with mix results in the past. A Decentralised Elementary Education Projects in Sindh approved in 2002 ran into start-up delays and implementation snags and never left the ground.

About the multisector Devolved Social Services Programmes (DSSP) in Sindh, Punjab and Balochistan in 2003, 2004 and 2005 respectively, the bank says the progress had been slow due to start-up delays despite the fact that the DSSP achieved many of their goals.

According to CPS, in order to get of the existing energy crisis, Pakistan needs over $60billion investment in the power generation sector over the next five years. On the energy side, the bank say Pakistan has severe policy bottlenecks and unmet capital investment in this sector.
 
Sunday, 15 Mar, 2009



As the IMF programme will be implemented in the next 18 months. we must prepare the ground for transition from the current stabilisation phase to the next growth-resumption phase.

In November 2008, Pakistan entered into a standby arrangement with the International Monetary Fund to support the country’s stabilisation programme and fill in the external financing gap.

Pakistan has successfully drawn down the first two tranches of this loan. Most of the stabilisation indicators are showing an improvement.

If present efforts to maintain fiscal discipline, curtail borrowings from the State Bank and build up foreign exchange reserves continue, it is likely that the IMF will be able to complete the forthcoming reviews successfully and the agreement reach an orderly termination point by June 2010.

While the implementation of the IMF programme proceeds over the next 18 months we must prepare the ground for transition from the current stabilisation phase to the next growth-resumption phase. This will not take place automatically. It will require public policy measures of a different kind. Macroeconomic stability attained through the IMF programme will, of course, lubricate this transition by allowing the government some degree of freedom that it does not enjoy at present. But the biggest challenge is the restoration of confidence in the economy.

The current year will be difficult for Pakistan. The international economic environment is far worse than anticipated. Global recession will certainly affect exports, workers’ remittances and external capital flows. The present confrontation between the PPP and the PML-N will further add to unease among investors. Pakistan’s growing negative image, reinforced by the terrorist attacks on Sri Lankan cricketers in Lahore, will scare away even the most favourably inclined foreigners.

This environment makes it extremely difficult to steer the course towards higher production, growth and employment. However, several measures initiated and sustained over the coming years can mitigate the adversity.

First, the incentives provided to wheat farmers by paying them above world prices should indeed be translated into benefits for the widest segment of the rural population. Assuming that 6.5 million tonnes of wheat are procured by public agencies, the rural areas will witness a cash injection of Rs156bn this year. This boost in the purchasing power of rural households will have a multiplier effect on consumer-oriented manufactured goods produced domestically and arrest the declining trend in manufacturing sector.

The demand from rural households is not leaked into imports; domestic labour-intensive goods and services create a positive impact on GDP and employment. The danger is that food department officials may misuse their huge discretionary powers in this state of glut to enrich themselves, buy from politically influential and well-to-do farmers and shortchange the small and poor farmers. It must be ensured that such corrupt practices do not occur.

Second, export industries have been hit hard by energy shortages. As Pakistani exports have become relatively competitive due to 25 per cent depreciation in currency, production has been constrained because of the non-availability of power and gas supplies. There is an immediate need to reconsider the allocation of the shortages’ policy. Political expediency dictates that household consumers be given preference but economic pru

dence demands that the manufacturing sector in general and export industries in particular be accorded priority.

After all, they earn the foreign exchange for the country. Instead of approaching the donors for financial aid, the same amount can be raised by taking care of genuine problems faced by the exporters.

Third, higher education and scientific research sectors were given some serious attention in the past six to seven years. These sectors take a much longer time to produce perceptible results. If there are weaknesses or shortcomings in their management these should be addressed. If there’s lack of trust in managers they can be replaced by competent and dedicated persons of the present government’s choice. But to interrupt the process of human capital formation midstream would enhance the costs and push back the benefits.

In a globalised economy driven by knowledge, innovation and human ingenuity, deviating from the path of investment in higher education and scientific education cannot be accommodated.

Fourth, as fiscal deficit targets are achieved, the cutback on development expenditures, while totally justified and understandable in the present stabilisation phase, has to be reversed with the 2010 budget. A modest increase in the energy, education and health sectors in the coming year followed by sizable allocations for the next three years is warranted so that the ministries can plan their investments ahead of time.

Along with these allocations in the public sector, public-private partnerships should be intensified. There are many private investors who, scared of complex bureaucratic entanglements, would draw comfort from a partnership with the government. This is a win-win situation in which private capital and management are combined with public-sector facilitation and support.

Fifth, social protection to the poor claims only a tiny fraction of the national income. The Benazir Income Support Programme, the Baitul Maal, the Zakat fund, etc are the right types of interventions. Poverty surveys will identify the poor, but there are two areas of concern that need to be addressed. The quantum of allocations for social protection programmes must be raised to reach out to the majority of households below the poverty line. The production capacity of the target groups must be raised to enable them to move away from the poverty line.

Technical and vocational training, public works programmes, small rural infrastructure projects, guaranteed employment programmes and conditional cash transfer schemes are some instruments that have been successfully tested and tried elsewhere.

Lastly, there is an urgent need to devolve financial and administrative powers to the provinces and the districts. Provincial autonomy, decentralisation and delegation of powers to local governments, transfer of law and order and revenue functions to civil servants from nazims form the agenda of governance reforms. These reforms will take a much longer span of time but initiating the process of their implementation will build confidence among provinces, reduce polarisation, improve law and order, and empower communities and people.

These reforms have to be accompanied by early decisions on the allocation of financial resources between the federal and provincial governments by the National Finance Commission. Better enforcement and management of the 1991 Water Accord will also remove mistrust among the provinces.

The above agenda may appear formidable but what needs to be done is clear. All that is required is political will and the implementation capacity to plan, manage and execute it in a steadfast manner.
 
Nothing going to work for Pakistan as long as we have corrupt leaders sitting on our head. Nothing going towards Pakistan economy. All goes to corrupt leaders pocket. Simple !
 
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