Rampant corruption is believed to be a major factor impeding economic development in Pakistan and many other developing nations.
Is this corruption and lawlessness rooted in the absence of adequate law enforcement, or the lack of independent judges? Or is it a national culture of corruption that ranks such nations among the most corrupt in the world on Transparency International surveys? 
A paper titled "Cultures of Corruption: Evidence from Diplomatic Parking Tickets" by Ray Fisman of Columbia University and Edward Miguel of University of California, Berkeley attempts to answer the above question by using parking violations data on international diplomats living in New York City during 1997-2005.
Since all foreign diplomats have immunity from prosecution in the host country, they do not have to pay fines for any parking violations in New York City. The authors argue that the way the diplomats from different nations behave in such a situation is entirely based on the cultural norms of the nations they represent.
The data presented by the authors shows that Pakistani diplomats with 69.4 tickets per diplomat are the tenth worst offenders, behind those from Kuwait (246.2), Egypt (139.6), Chad (124.3), Sudan (119.1), Bulgaria (117.5), Mozambique (110.7), Albania (84.5), Angola (81.7) and Senegal (79.2). The authors also report that diplomats from low corruption countries (e.g., Norway and Sweden with zero parking citations) behave remarkably well even in situations where they can get away with violations, suggesting that they bring the social norms or corruption “culture” of their home country with them to New York City. Others with no parking violations include diplomats from Oman, Turkey and UAE.
In addition to a strong correlation between number of parking tickets and TI's corruption index, Fisman and Miguel also find that officials from countries that have less favorable popular views of the United States commit significantly more parking violations, providing nonlaboratory evidence on the role that sentiment and affinity play in economic decision-making.
With 69.4 tickets for each official ranking them at number 10, Pakistani diplomats in New York are also the worst among fellow South Asian diplomats. Bangladeshi diplomats rank 28 (33 tickets), Sri Lanka ranked 40 (17.2 tickets), Nepal ranked 43 (16.5 tickets) and India ranks 79 (6.1 violations per diplomat).
Going by the highly persuasive data and arguments by Fisman and Miguel, it is hard to see how better law-enforcement and independent judiciary can solve the highly corrosive problem of widespread corruption in Pakistani society, unless it is also accompanied by a national campaign to promote a culture of honesty in the country. Such an effort must begin with open acknowledgment of the seriousness of the corruption crisis and an earnest desire to change, followed by wide-ranging ethics reforms in all spheres of life which are actively role-modeled and led by civil, social, political, business, military and religious leaders of the country.
Related Links:
Haq's Musings
Pakistani Judges' Jihad Against Corruption
Incompetence and Corruption in Pakistan
Zardari Corruption Probe
NRO Amnesty Order Overturned
Transparency International Rankings 2009
Transparency International Corruption Index 2010
Threre are more reasons to migrate to Canada
1 year ago
22 comments:
I think there is a bias against Pakistan in Western Media. Pakistan is better than India in reality.
"My feeling is that it was all a hoax, a drama which has been crafted, and badly scripted I would say. "But they shouldn't make a scapegoat of Pakistan in this way. This is very wrong." - Hamid Gul. He said this on TV. OBL was killed in Afghanistan and brought to Abbotabad to make the very good Military and Pakistan look bad.
I was in Pakistan recently and people are worried that foreign forces like RAW of India and CIA in America are working together to destroy our nuclear weapons by supporting Pakistan Taliban.
This corruption business is all their agenda because there is corruption even in America. Corruption in India is worst just like their poverty as you can see in your video.
Pakistani people still keep working hard inshallah.
Irfan and Liaquat:
Denial is not the right answer.
Unless Pakistanis acknowledge the existence of serious problems of corruption, incompetence and terrorism in their midst, there can be no progress toward solutions.
The sooner it is done, the better it is for average Pakistanis who are suffering the most from the current multiple crises.
Corruption is also rampant in the US, both within the military and the politicians. It will be good if you shoot them down as well. Best if you tabulate PK v. US along those lines.
@ Irfan :
"I think there is a bias against Pakistan in Western Media. Pakistan is better than India in reality."
Really!
If Pakistan focuses on itself or had focused on itself it would not be in this predicament today. If I can paraphrase Golda Meier 'Pakistan loves itself but hates India even more'.
The only genuine cohesive force in Pakistan that keeps it going is the universal dislike and hatred of India.
All other problems including CORRUPTION is secondary!
http://nation.com.pk/pakistan-news-newspaper-daily-english-online/Politics/31-May-2011/Govt-misses-all-major-economic-targets
corruption is one reason that lead us to this situation that we are bing declared as a failed state. people who have authority are buty in collecting more and more wealth with the net of corruption and those who are still clean are either waiting for the opportunity or been dumb enough to utilize it. thats the reality, bitter tough.
Here's a BBC report on corruption in India that parallels the experience of many ordinary Pakistanis in their daily lives:
Imagine if you had to pay a bribe to see your newborn baby, get your water supply connected or obtain your driving licence. It's an everyday fact of life in India - but campaigners are now fighting back, using people power and the internet.
"Uncover the market price of corruption," proclaims the banner on the homepage of ipaidabribe.com.
It invites people to share their experiences of bribery, what a bribe was for, where it took place and how much was involved.
Launched in August, the site gives Indians a chance to vent their frustrations anonymously and shine a spotlight on the impact of corruption on everyday life.
"I did the driving test correctly but still the official said I was driving too slow, I realised his intention so gave him 200 Rupees and got the thing done," is a typical example of a posting.
The website was the brainwave of Ramesh and Swati Ramanathan, founders of a not-for-profit organisation in Bangalore called Janaagraha which literally means "people power".
"Bribery is routinely expected in interactions with government officials", Swati Ramanathan told me, "to register your house, to get your driving licence, domestic water connection, even a death certificate."
Having lived in the US and the UK for several years, they were dismayed on their return to see how widespread corruption had become and decided to do something about it.
"We are all also responsible because we end up paying the darn bribes because otherwise you can never get anything done in India.
"We said, 'It's not enough to moralise, we need to find out what exactly is this corruption? What's the size of it?'"
'High reward'
The website has evolved into a consumer comparison site where people can also get information and advice in different languages on how to avoid paying bribes.
One woman told me how she got round paying a bribe to register her mother's house.
"I went with all the paperwork and at first they looked through it and said, 'Oh, I think one of the documents is not up to date.'
"What I had been told at the website is that this is one of the excuses they make to take a bribe, and what we need to do is tell them, 'OK, give it to me in writing with your stamp and seal, and I will make sure I get these documents the next time so that I can get it registered.'"
"The moment I said that, they backed off and said, 'No, no, it's OK, we will pass it through.'"
So far, nearly 10,000 bribe experiences have been reported across 347 cities and 19 government departments.
As the numbers mount, Swati Ramanathan hopes the website will become a powerful tool for shaming government departments into tackling corruption.
"There is so little risk to being corrupt in our country and so high a reward," she explained.
"The moment you change the equation and you make it riskier, the reward becomes less. You make it riskier by making it public."...
http://www.bbc.co.uk/news/world-south-asia-13616123
Can civil society fight corruption? asks Soutik Biswas of BBC:
Are sections of India's civil society subverting democracy to pressure the government to push through tough anti-corruption laws?
The beleaguered Congress-party led government appears to think so. The senior-most minister Pranab Mukherjee has fired an uncharacteristic broadside at activist Anna Hazare's anti-graft agitation for resorting to hunger strikes, making unreasonable demands like video graphing meetings of a joint panel to discuss an ombudsman law and imposing deadlines on the parliament.
Mr Hazare is a well meaning Gandhian, who has a record of fighting corruption in his home state of Maharashtra. But he also has a predilection for making clumsy statements - he endorses capital punishment for the corrupt, for example. But few Indians deny that Mr Hazare has touched a chord, mostly among the country's fretful, politician-loathing middle classes, by pressuring the government to take a tough stand against corruption. Graft has become a way of Indian life, kept alive by the rulers and ruled alike.
Mr Mukherjee's barb is clearly not aimed at Mr Hazare alone. Last fortnight, Baba Ramdev, a thriving yoga guru with political ambitions, also began a hunger strike in Delhi demanding that the illicit money stashed away in foreign banks by rich Indians be brought back home. After futile negotiations with the guru, the government cracked down on his fast in the middle of the night, baton charged sleeping supporters and evicted him from Delhi. The police action earned the opprobrium of many Indians, and further battered the government's fast-eroding credibility.
Now the government appears to be trying to bottle the genie of Mr Hazare and Baba Ramdev's "movements", both of which it legitimised in the first place through recognition and negotiation. It seems to be also unable to handle the vicissitudes of these agitations, with its leaders blowing hot and cold against the government. Such a civil society movement, Pranab Mukherjee said, amounts to a "sinister move of destroying the fine balance between the three organs of government enshrined in our constitution".
"If someone dictates terms from outside to the government, does it not weaken or subvert democracy? It is a big question... We are all civil society, no one is uncivil."
Clearly, Mr Mukherjee's definition of civil society in the haste of a press conference is literal. The World Bank defines civil society to "refer to a wide array of non-governmental and not-for-profit organisations that have a presence in public life, expressing the interests and values of their members or others, based on ethical, cultural, political, scientific, religious or philanthropic considerations".
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India has seen deeper, meaningful civil society movements which have been blithely ignored by most of middle class in the past. Only when a protest comes to Delhi in the full glare of 24/7 news television does it get attention. And more so, when it rallies against corruption - which actually hurts the poor more than the rich and the middle class.
By all means, many believe, an enlarged and more representative civil society - ideally a larger, wider group of people from all over the country, not just a bunch of well meaning lawyers and activists from Delhi - should be putting pressure on a stubborn government to act against corruption. Also, as development expert Rajesh Tandon reminds us, civil society is not intrinsically virtuous. And good graft-free governance does not come from reforming the state alone - it demands the reformation of society and its people. There are no short cuts to a more virtuous India.
Data from Pew research and Transparency International shows that the nations, such as India and Pakistan, where the huge majorities of people claim religion is important in daily lives are also among the most corrupt.
Please read more at http://www.riazhaq.com/2011/06/per-capita-income-corruption-and.html
Here's Prof Anatol Lieven, the author of Pakistan-A Hard Country, explaining P2K in an interview with Harpers magazine:
This represents a shocking surrender on my part to SMS-speak, which comes of associating with students!
What it stands for is “Patronage to Kinship,” which is central to the nature and workings of the Pakistani state and political systems. In my book, I argue that this system—especially in the countryside but to some extent also in the cities—revolves around local elites using their own wealth to gain leadership positions in their kinship groups, using these positions to advance in politics and get elected to the provincial or national assembly (whether under civilian or military rule), and then in turn using their influence on government to extract corruption.
However, by contrast with some systems, like Nigeria’s, the benefits of this corruption cannot simply or even mainly be kept for the immediate beneficiaries. In order to retain support, they have to distribute a reasonable proportion of it to their kinfolk and other supporters—otherwise they won’t go on supporting the leaders for very long. Even within quite tight-knit kinship groups, there is usually a rival relative who will step forward to claim the leadership if the existing leader is seen as mean, greedy, and unresponsive to his followers’ needs. There are two good U.S. quotes which illustrate the morality behind this. The first was said about Mayor Richard M. Daley of Chicago by his supporters: “He dunks, but he splashes.” The second comes from Bruce Springsteen’s song “Highway Patrolman”: “A man turns his back on his family, he ain’t no friend of mine.”
In my book, I describe this system as “Janus-faced.” On the one hand, because of the way in which it maintains kinship links and spreads a certain amount of patronage through society, it helps maintain the existing system’s resilience in the face of the threat of Islamist revolution. On the other hand, it cripples the state’s ability to generate and spend resources effectively on infrastructure, education, and every other form of state service, and it is therefore disastrous for Pakistan’s economic development and social progress.
I argue that the power and prestige of the Pakistani military within the Pakistani system has been due chiefly to its ability to separate itself from the normal workings of the patronage and kinship system, and to operate as a relatively efficient and honest meritocracy. However—and I do wish more of my critics would notice this—I also say repeatedly that the reason the military has been able to do this is that it has in effect functioned as a giant patronage network, extracting a massive share of state resources and spending them on itself, albeit in an orderly way and with some benefits reaching the ordinary soldiers as well as the officers.
http://harpers.org/archive/2011/05/hbc-90008092
Here are some interesting excerpts from an Outlook India interview with Prof Aswath Damodaran of NYU Stern School of Business:
What risks do the present crisis hold for developing economies like India, grappling for well over a year to curb inflation?
If you are a developing economy you are like a growth company, which is far more dependent on the economy because everything gets magnified. Developing countries are far more exposed to global real economic growth because so much of the value comes from future growth. It is like a mature company is less affected by a recession than a growth company; mature economies are less affected than developing economies by a slowing global economy. Everybody gets hurt, but developing economies in a strange way can get hurt more because everything gets magnified at their level.
So, is India’s current pace of economic growth sustainable?
A scaling effect is going to kick in. It is one thing to grow at 9 per cent a year when you are a smaller economy, but as you get larger people have to get realistic. Policymakers have to realise that planning for 6 per cent real growth for the next 10 years is absurd. As the country scales up, you have got to get more realistic about real growth and have policies in place for what to do as real growth slows down, because it will. It will in India and it will in China. It has got nothing to do with the quality of the policies, it is a fact that as the economy becomes larger maintaining those growth rates is going to be unrealistic.
As we speak, corruption has become a major cause for protests in India....
The way I think about corruption is that it is like paying an unofficial tax. What corruption has done is it has raised the effective tax rate for businesses operating in India from 33.99 per cent to 41, 42, 43 per cent and that lowers investment. It lowers real growth. It has always been a deterrent and it will continue to be so. I think it is important that corruption be dealt with, but you can’t deal with it with an ombudsman, or a group that gets together and says let’s catch corrupt politicians, because it is entrenched in the system. It is built into the system because the salaries of many public servants are set with the implicit assumption that they can supplement that salary by getting paid on the side. It’s almost like waiters in the US get paid a low minimum wage because the assumption is that people will tip them 15 per cent so they can make up that money. It is not going to be easy to take out of the system because you have to revisit the way in which public servants get salaries.
http://www.outlookindia.com/article.aspx?278286
Today I had a conversation with someone who told me he was in Karachi for 6 years.
He was born and raised in Canada and went there for a job with Barclays. He does seem to have parents who were from Pakistan, however. He worked there and was involved in other banking industry orgs and also helped an NGO out.
I asked him for his impressions about the local system and the present state of the country. He has just returned home to Canada a few weeks ago.
He told me the system worked well and the mayor was a good mayor. He said he thought he did a very good job.
He also said right now country is in a deep mess. People in power seem to just want to take what money they can out of the system. he said this happening at all levels!
I would like you to be cognizant of the fact that now in Pakistan, corruption is at a scale that boggles the mind - at least it should boggle the mind. We are talking no longer millions but BILLIONS. We are talking about Pakistan's external debt shooting up by ten billion dollars in a short span of 3 years with nothing to show for it. I suspect the borrowed dollars have been purchased with corruption billions and transferred abroad. In the next 2 years huge repayments are maturing to the IMF and other lenders. The oil price may shoot up. Our exports reduce and our water supplies may stunt our agriculture. I don't see how we will be able to cope.
Billions are 'spent' by the government and as much as 40-50% if not more is diverted for pay-offs. There is hardly any development or relief going on anywhere. debt service has gone through the roof, being the biggest item in the budget. Poverty is rising, employment growth is nonexistent. Spending on social services had collapsed as there is no fiscal space.
Corruption is a HUGE component in both out fiscal and current account deficits. It has made a huge increase in both our domestic and international debt. it can corrupted the moral fiber of the country, especially the bureaucracy. Now the younger generation is actually embracing corruption as a perfectly acceptable way of life, looking at the leadership, the tycoons and the senior government officers as role models. They are actually openly defending the corruption of their families and expressing their intention to indulge in the same.
Transparency International, in its 2011 world corruption report, has shown Islamabad sliding down from last year’s 34th to 42nd in ranking amongst the most corrupt nations in the world, according to The News:
However, this improvement is not due to the fact that the government or the rulers are less corrupt than they were before but because of some good results shown by institutions like the judiciary, Public Accounts Committee (PAC), federal tax ombudsman and the defence departments.
Although last year’s 34th position of Pakistan was out of a total of 178 countries assessed by Transparency International as against 2011’s 42nd rank out of 183 countries, still the country did not deteriorate further as has been the case during the previous three years of the present regime.
To be released here on Thursday, the Transparency International’s 2011 Corruption Perceptions Index evaluated Pakistan getting 2.5 score out of 10, and ranked as 42nd most corrupt country out of 183 countries.
In 2010, TI report Pakistan’s score was 2.3, and it ranked 34th most corrupt country out 178 countries. In 2011, the rank of Pakistan has improved because of increase in the number of countries assessed this year.
Pakistan gained new heights in corruption during the last three years under the present rulers. Pakistan ranked as the 47th most corrupt country in 2008, but in 2009 the country became more corrupt and ranked 42nd in 2009.
In 2010, it was 34th most corrupt nation in the world. However, it is interesting to note that the Transparency International acknowledged that the arrest in the further decline of Pakistan in terms of corruption is not due to the present government’s efforts to curb the menace but owing to commendable role of the judiciary, the Public Accounts Committee, the defence establishment and the federal tax ombudsman.
It underscored that PAC, which has done remarkable work under Leader of the Opposition Chaudhry Nisar Ali Khan, recovered Rs115 billion from 2008 to 2011. The TIP also applauded judiciary’s zero-tolerance for corruption, the Ministry of Defence efforts to apply long-standing Public Procurement Rules 2004 in the armed forces departments; and the working of the federal tax ombudsman as one of the cleanest institutions in the government.
The TIP, however, said that this progress has been overshadowed by the ongoing corruption cases like the NICL, RPPs and 2010 Haj scandal in which the Supreme Court has affected recoveries of billions of rupees.
The TI report says that corruption continues to plague too many countries around the world. According to the Transparency International’s 2011 Corruption Perceptions Index, some governments failing to protect citizens from corruption be it abuse of public resources, bribery or secretive decision-making.
Transparency International warned that protests around the world, often fuelled by corruption and economic instability, clearly show citizens feel their leaders and public institutions are neither transparent nor accountable enough.
The 2011 index scores 183 countries and territories from 0 (highly corrupt) to 10 (very clean) based on perceived levels of public sector corruption. It uses data from 17 surveys that look at factors such as enforcement of anti-corruption laws, access to information and conflicts of interest. Two-thirds of ranked countries score less than five. New Zealand ranks first, followed by Finland and Denmark. Somalia and North Korea (included in the index for the first time) are last. Pakistan with 2.4 score ranked 42nd most corrupt country.
http://www.thenews.com.pk/TodaysPrintDetail.aspx?ID=10666&Cat=13
http://cpi.transparency.org/cpi2011/results/
Here are parts of a report in the News on corruption at all levels in Pakistan:
KARACHI: Speakers at a symposium on Friday said that corruption has thrived in every institution of the country, while institutions established to curb this menace have failed to identify the magnitude of the burgeoning problem, a statement said.
The National Reconciliation Ordinance (NRO) introduced corruption to the top levels of the national politics and government, it said.
These views were expressed in a seminar organised by the National Accountability Bureau (NAB) on “good governance and curbing corruption”.
The event was organised to mark world Anti-corruption Day that fell on December 9 every year.
Dean Faculty of Law, Federal Urdu University, former justice Dr Muhammad Ghous said corruption invariably hampered the good governance, while institutions formed for keeping surveillance on such a practice have not yielded good results.
In his view, honest, sincere and competent officers should be elevated at the helm of affairs of institutions to do away with corruption completely.
He regretted that corruption had become a part of life of every individual in the country. Be it a bank, educational institution, research institution or any other public service organisation, all departments have become morally sick, he added.
Dr Ghous said the most corrupt people are, unfortunately, irremovable from their services mainly due to the political influence. There is no global prescription for eliminating corruption, however, encouraging public participation and strengthening of institutions by giving authority to honest officers could significantly contribute in curbing this problem, he said.
Transparency International Pakistan Adviser Adil Gillani said the UN Convention against anti-corruption was ratified by Pakistan in 2007, while just passing the 37 days of its ratification, the then president General Pervaiz Musharraf introduced NRO, hence, paving the way for corruption at every level of the government.
Good governance could significantly play a vital role in eliminating corruption, he said.
Sindh NAB Director General Major Shabbir Ahmed (Retd) said the cooperation of people is direly needed to do away with the burgeoning menace of corruption.
The department is endeavoring to cope with this problem, he said.
Ahmed said that imposition of strict rules and regulations in every organisation could play a vital role in anti-corruption mission.
Former Inspector General Police Sindh, Niaz A Siddiqui regretted the non-existence of any mechanism to protect rights of citizens.
He questioned why there is no surveillance of police officials in their offices, contrary to thousands of close-circuit cameras installed in the city monitoring citizens.
He saw absence of strict accountability mechanism behind increasing corruption in the country.
http://www.thenews.com.pk/TodaysPrintDetail.aspx?ID=81473&Cat=3
Transparency International Pakistan says military least corrupt, according to The Nation newspaper:
Judiciary has stepped up into the 4th position from 6th in the previous year in terms of corruption, while land administration department has got the first position on the list of country’s most corrupt institutions, according to the National Corruption Perception Survey 2011, released by the Transparency International Pakistan (TIP) on Wednesday.
According to the report the police department has taken the second spot while the Power sector has dropped to the 5th rank from 2nd. Taxation slipped to the 3rd rank from its previous 8th position, while Customs and Tendering and Contracting departments have shown alarming increase in the corruption trend.
It is pertinent to mention here that for the first time military has been included in the survey and it was the least corrupt department after education in the year 2011. Police had topped all the previous years’ surveys but the Land Administration has crossed them and the factor of the ‘Land Mafia’ was one of the big reasons for this increase.
The annual survey report was released at Karachi Press Club in a press conference by TIP Chairman Sohail Muzaffar, along with TIP Advisory Committee chairman Syed Adil Gilani. This year’s survey has been conducted by Gallup Pakistan. Sohail Muzaffar cited the delay in punitive action by the state organs against the corrupt elements in corruption cases like Pakistan Steel, NICL, Punjab Bank, Rental Power Plants, KESC, PIA, Railway and Wapda as the main reason for the rise in corruption levels.
Sohail informed that judiciary is confronted by deliberate defiance in implementing Supreme Court orders and delay in punishing corrupt persons by the judiciary is one of the causes of lower ranking of judiciary. He said that they have released the reports to tell the government and the people that which is the most corrupt department and it should not be taken into personal context or any political intention. “We are trying to help out the government by showing them the corrupt sections in them, now it’s up to the government how it cleans them”.
On the inclusion of military in the survey, the TIP chairman said, “We have not included it in the survey, Gallup itself has added military and they have not put railways in the survey”. He said the military should not be placed before the education in the rank because according to him military is less corrupt than the education.
He added that Gallup agreed late to conduct the survey, “No one was ready to conduct the survey, the Institute of Business Administration (IBA) which conducted the previous year’s survey refused to conduct it this year. We had short time and Gallup agreed in the last”, said Muzaffar.
http://www.nation.com.pk/pakistan-news-newspaper-daily-english-online/national/29-Dec-2011/military-least-corrupt-institution-tip
Here's an Express Tribune report on TI findings in Pakistan:
The latest perception report from Transparency International Pakistan (TIP) shows a limited number of respondents see centres of corruption in Pakistan in the following descending order, of being perceived as the most corrupt to the least: 1) land administration; 2) police; 3) income tax; 4) judiciary; 5) tendering & contracting; 6) customs, plus state corporations and the last is the army. Once again TIP has expressed its shock at the mounting lack of honesty in public affairs and has listed some of the reasons why the graph of evil is creeping upwards every year.
It is not surprising that land administration is the first among the perceived culprits. It is vastly the domain of the provinces where the politician has yet to begin to take responsibility for sorting-out maintenance and collection. Land record is still in primitive shape and the low bureaucracy that handles the sector is not upgraded and made competitive. Most of the trouble takes place away from the big cities because the writ of the state languishes in smaller districts and abdicates to three power centres: the feudal landlord (often a politician), the police and the judiciary. It will take a long time to sort-out this mess and it will not happen at the same speed in all the provinces. The police has endemic ills that most states in the Third World have failed to tackle. The recruitment of policemen has been pegged to good education only recently, but the provinces — whose domain this is — have been remiss in making the kind of allocations needed to upgrade the institution’s performance. The ratio of policemen to population is abysmal, training standards — though imitative of the army — are nowhere near being practically useful and low status has kept the average policeman tied to slavish behaviour towards the seniors and a brutish one towards the common man.
But the police may not be intrinsically as bad as the circumstances of its functioning make it. State policies favouring non-state actors involved in terrorism on the side have hamstrung the police. Unwillingness to prosecute has instilled in the department a habit of not trying too hard to convict, say, terrorists from a shady jihadi organisation simply because it is being clandestinely supported by the state. Because of this ambience of state-backed criminality, many policemen themselves indulge in crime and get away with it. Many senior policemen live beyond their means and own properties they could not have bought with honest money. As for the tax administration, if one were to look at the statistics, things may be getting better — and that is why it is no longer number one in corruption. Pakistan’s revenue collection is one of the lowest in the world (with the tax-collection machinery believed to be riddled with corruption and inefficiency) and that impacts directly the capacity of the state to spend on development. The reigning theory is to erect a system in which the income tax officer comes into least contact with the taxpayer.
http://tribune.com.pk/story/314181/pakistans-perceived-corruption/
Here are some excerpts from an interesting Friday Times Op Ed on Pakistan's undocumented (informal & illegal) economy:
The economy is in the doldrums, but that is not news any more. What is more interesting, and more difficult to investigate, is what is happening in the world beyond the survey operator and tax collector's ambit. Papers published by the Social Policy Development Center (SPDC) in Karachi and the State Bank place the informal economy in a range of 20 to 30 percent of GDP. But most of this undocumented economy does not include strictly illegal, or shall we say criminal, practice.
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that militant groups are running their own businesses (during the TNSM's movement in Swat, emerald mines were reputed to be in the hands of Maulana Fazlullah's men); that militants and terrorists are even coming up with new ways to generate funds (kidnapping for ransom being a case in point).
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According to data from the UN, Afghanistan produced about 90% of the global output of opium in 2007. This fell to just over 62% by 2010 (with Myanmar accounting for most of the rest). Three quarters of the poppy production was in the provinces of Helmand and Kandahar, which border Pakistan. Domestic consumption of opium in Afghanistan is next to nil. Also, the country does not legally import the chemicals needed to process opium into heroin, although these are imported in Pakistan for legitimate uses. Almost 7,000 metric tons of opium, both raw and processed, in the form of morphine and heroin, leaves Afghanistan and finds its way to the lucrative markets of Western Europe.
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Given that the global trade in opiates is estimated to have a value of some $70 billion, even a small proportion of the proceeds can make life comfortable for a lot of people in Pakistan.
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With close to 80 suicide attacks in 2010, about 400 rocket attacks, and about 350 bomb blasts in addition to target killings, use of improvised explosive devices etc, its not hard to deduce that there is a significant trade in arms and ammunition in Pakistan. The ISAF container scam case led to some interesting findings. There were the obvious conclusions - including that the abuse of the Afghan Transit Trade facility is massive. More tellingly, the Supreme Court's suo moto case found that 7,922 ISAF containers simply went missing. In addition to the packed meals, the alcohol and the camp supplies stamped with ISAF logos that appear in border markets, the possibility of pilferage of more dangerous items cannot be ruled out.
The smuggling masked by the Afghan Transit Trade is another story altogether, and according to some stakeholders extends to the illegal trade in timber, antiquities and gemstones stemming from that unfortunate nation. Being a neighbor to a land-locked, war-ravaged country with no semblance of law and order was never going to be easy. But Pakistan's governance failures have made a bad situation worse.
There's much more to Pakistan's economy than meets the eye, and many of the more interesting activities are practically impossible to investigate unless someone is prepared to take considerable personal risks. The few pieces of the jigsaw puzzle that are available from public data and information paint a tantalizing picture. If the downslide of the formal economy continues, things could get even more interesting.
http://www.thefridaytimes.com/beta2/tft/article.php?issue=20120113&page=7
Here's an Op Ed by Prof Anatol Lieven published in the Guardian:
If Pakistan's chief justice, Iftikhar Chaudhry, manages to press his charges of corruption against the president, Asif Ali Zardari, he will bring down the existing Pakistani government. If he extends his anti-corruption campaign to the political elites as a whole, he will bring down the entire existing political system – and replace it, his critics say, with a dictatorship made up of an unelected (and equally corrupt) judiciary.
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The truth is that Pakistani politics revolves in large part around politicians' extraction of resources from the state by means of corruption, and their distribution to those politicians' followers through patronage. Radically changing this would mean gutting the existing Pakistani political system like a fish. Nor is it at all certain how popular the process would really be with most Pakistanis.
For while the greater part of this process of extraction and redistribution is illegal according to Pakistani law, how much of it is immoral in Pakistani culture is a much more complicated question. Every Pakistani politician accuses his rivals of corruption but, equally, the perception that he himself is "generous" and "honourable" to his own supporters is likely to be central to his own local prestige. If a public monument is ever erected to the Ideal Pakistani Politician, the motto "He dunks but he splashes", originally coined by Mayor Richard Daley of Chicago, should be inscribed on its pedestal.
And this is not just a matter of cynical politics. It also obeys a fundamental moral imperative of local culture to be loyal to one's followers and, above all, one's kinfolk. The politician who is really despised is the kleptocrat who both steals immoderately and does not share the proceeds. As a result, a good deal of the proceeds of corruption does get distributed through parts of society, thereby helping to maintain what until recently has been the surprising underlying stability of the Pakistani political system.
The military is widely seen as relatively immune to corruption, and when it comes to its own internal workings, this is largely true – though it usually ceases to be true when generals go into politics. However, it is vitally important to note that this is in large part because for many decades the military as a whole has acted as a kind of giant patronage network, extracting a huge share of Pakistan's state resources via the defence budget and other concessions, and spending them on itself. Because – to its credit – it has distributed the resulting benefits in an orderly if hierarchical way among its generals, officers, non-commissioned officers and even to a degree privates, it has managed to keep a lid on corruption within the military itself. However, a belief is growing among ordinary soldiers, not just that the generals' perks are immoderate but that in some cases their families are using their connections to make huge corrupt fortunes outside the military.
As for Zardari, it seems highly doubtful that he can hang on much longer. The chief justice is pursuing him with bulldog determination and the letter of the law is on his side. The military has been infuriated by what it believes are his attempts to ally with Washington against it. It does not want another military government, but it does want a civilian regime that is much more responsive to its wishes. And the opposition want him out before, not after, senate elections that might just enable him to cling to the presidency even if as expected his Pakistan People's party is defeated in general elections due by early 2013. Whether getting rid of Zardari will fundamentally change Pakistani politics, however, is a very different matter.
http://www.guardian.co.uk/commentisfree/2012/jan/19/pakistan-culture-honourable-corruption?newsfeed=true
Here's a Global Post story on NATO using smugglers to supply its troops in Afghanistan through Pakistan:
With few other options available to it since Pakistan closed its border crossings almost two months ago, NATO has at times resorted to paying local smugglers to get much-needed supplies to its troops fighting in Afghanistan, Pakistani officials say.
The Pakistani and Afghan smugglers, who must pay bribes to militants to travel safely through some areas, navigate treacherous routes over the 1,800-mile mountainous divide that separates the two countries to bring containers of oil, food and other essential items — all at a price — to soldiers on the other side.
“Borders mean nothing to us. We have been crossing in and out for centuries,” Sahib Khan, a smuggler who said NATO had hired him, told GlobalPost.
The hiring of illegal smugglers came after a failed attempt by NATO to pay private companies, which truck goods across the border under the Pakistan-Afghanistan Free Trade Agreement (PATA). These private companies, Pakistani officials said, were secretly swapping out their normal cargo for NATO supplies until Pakistani security forces caught wind of the scam.
A senior officer for the Frontier Corps, an elite military unit that is responsible for security along the border, told GlobalPost that a total ban on the movement of containers under PATA, which was signed in 2010 to promote bilateral trade, eventually foiled the strategy.
“We had concrete evidence that some of the containers being imported by private companies, under PATA, were being used to smuggle supplies for NATO troops under cover of commercial imports,” the official said.
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Smuggling between Pakistan and Afghanistan has long been a profitable and vibrant business. Various trade agreements have been signed between the two neighbors in a bid to contain the practice, but high import and export taxes coupled with little government oversight, thwarted those attempts.
Mostly items like flour, edible oil, lentils, dried vegetables, contraband cigarettes, and animals for meat are smuggled into Afghanistan, while spare auto parts, electronics and unregistered vehicles are smuggled the other direction.
Smuggling is so widespread that it has become the backbone of the economy in towns and villages along the border, where locally it is treated simply as normal trade. The mountainous terrain provides an edge over security to smugglers who regularly trickle across the border without any trouble.
Sahib said that most of the food and oil supplies he has carried across the border for NATO originate from the southern port city of Karachi, and are moved through Peshawar and Quetta, and finally through Pakistan’s tribal areas, which are largely under the authority of various militant groups.
For those militants, the smugglers have been an important source of income. Smugglers are required to pay “rahdari,” or “passage,” an unofficial tax that allows them safe passage.
“Once we are onto the route, it’s the responsibility of those who receive rahdari to ensure we are able to safely enter into Afghanistan,” Sahib said.
Any smuggling that is done on behalf of NATO can in no way make up for the closed borders, however. Smugglers say they carry between 20 and 25 small containers a day while, when the border crossings were open, NATO shipped an average of 250 large containers a day — making the reopening of the borders essential to the war effort.
http://www.globalpost.com/dispatch/news/regions/asia-pacific/pakistan/120123/pakistan-border-nato-us-troops-afghanistan
Here are some excerpts of BBC's Soutik Biswas's review of Pulitzer-winning New Yorker reporter Katherine Boo's "Beautiful Forevers":
"We try so many things," a girl in Annawadi, a slum in Mumbai tells Katherine Boo, "but the world doesn't move in our favour".
Annawadi is a "sumpy plug of slum" in the biggest city - "a place of festering grievance and ambient envy" - of a country which holds a third of the world's poor. It is where the Pulitzer prize winning New Yorker journalist Boo's first book Behind the Beautiful Forevers is located.
Annawadi is where more than 3,000 people have squatted on land belonging to the local airport and live "packed into, or on top of" 335 huts. It is a place "magnificently positioned for a trafficker in rich's people's garbage", where the New India collides with the Old.
Nobody in Annawadi is considered poor by India's official benchmarks. The residents are among the 100 million Indians freed from poverty since 1991, when India embarked on liberalising its economy.
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She used more than 3,000 public records, many obtained using India's right to information law, to validate her narrative, written in assured reported speech. The account of the hours leading to the self-immolation of Fatima Sheikh derives from repeated interviews of 168 people as well as police, hospital, morgue and court records. Mindful of the risk of over interpretation, the books wears its enormous research lightly.
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The local councillor runs fake schools, doctors at free government hospitals and policemen extort the poor with faint promise of life and justice, and self-help groups operate as loan sharks for the poorest. The young in Annawadi drop dead like flies - run over by traffic, knifed by rival gangs, laid low by disease; while the elders - not much older - die anyway. Girls prefer a certain brand of rat poison to end their lives.
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Boo has an interesting take on corruption, rife in societies like India's. Corruption is seen as blocking India's global ambitions. But, she writes, for the "poor of a country where corruption thieved a great deal of opportunity, corruption was one of the genuine opportunities that remained".
On the other hand, Boo believes, corruption stymies our moral universe more than economic possibility. Suffering, she writes, "can sabotage innate capacities for moral action". In a capricious world of corrupt governments and ruthless markets the idea of a mutually supportive community is a myth: it is "blisteringly hard", she writes, to be good in such conditions. "If the house is crooked and crumbling", Boo writes, "and the land on which it sits uneven, is it possible to make anything lie straight?
http://www.bbc.co.uk/news/world-asia-india-17038326
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