Tuesday, July 29, 2014

SEC Fines US Gunmaker For Bribing Pakistani Officials

US gun manufacturer Smith and Wessen has agreed to pay the U.S. government $2 million fine for bribing officials in Pakistan, Indonesia and other countries as it tried to sell firearms to military and law enforcement agencies, according to US media reports.

The company has also implemented new procedures for its overseas business practices. It will report back to the US SEC (Securities Exchange Commission) on its FCPA (Foreign Corrupt Practices Act) compliance efforts for the next two years.

Here are some excerpts from SEC's press release on this settlement:

According to the SEC’s order instituting a settled administrative proceeding, the Springfield, Mass.-based firearms manufacturer sought to break into new markets overseas starting in 2007 and continuing into early 2010. During that period, Smith & Wesson’s international sales staff engaged in a pervasive effort to attract new business by offering, authorizing, or making illegal payments or providing gifts meant for government officials in Pakistan, Indonesia, and other foreign countries. 

 “This is a wake-up call for small and medium-size businesses that want to enter into high-risk markets and expand their international sales,” said Kara Brockmeyer, chief of the SEC Enforcement Division’s FCPA Unit. “When a company makes the strategic decision to sell its products overseas, it must ensure that the right internal controls are in place and operating.” 

 According to the SEC’s order, Smith & Wesson retained a third-party agent in Pakistan in 2008 to help the company obtain a deal to sell firearms to a Pakistani police department. Smith & Wesson officials authorized the agent to provide more than $11,000 worth of guns to Pakistani police officials as gifts, and then make additional cash payments. Smith & Wesson ultimately won a contract to sell 548 pistols to the Pakistani police for a profit of $107,852. The SEC’s order finds that Smith & Wesson employees made or authorized improper payments related to multiple other pending or contemplated international sales contracts.
The SEC’s order finds that Smith & Wesson also authorized improper payments to third-party agents who indicated that portions would be provided to foreign officials in Turkey, Nepal, and Bangladesh. The attempts to secure sales contracts in those countries were ultimately unsuccessful. 

The SEC’s order finds that Smith & Wesson violated the anti-bribery, internal controls and books and records provisions of the Securities Exchange Act of 1934. The company agreed to pay $107,852 in disgorgement, $21,040 in prejudgment interest, and a $1.906 million penalty. Smith & Wesson consented to the order without admitting or denying the findings. The SEC considered Smith & Wesson’s cooperation with the investigation as well as the remedial acts taken after the conduct came to light. Smith & Wesson halted the impending international sales transactions before they went through, and implemented a series of significant measures to improve its internal controls and compliance process. The company also terminated its entire international sales staff.

Similar allegations have in the past surfaced in FCPA cases relating to MicrosoftSiemensPaxar and other foreign entities in Pakistan. Last year, US media reported that an unnamed provincial minister in Punjab government and his wife traveled to the United States in December 2009 to close a $9 million deal for Microsoft Office software. The trip was booked by a travel agent working for Microsoft. Microsoft paid the costs of business class fare and stay at a luxury hotel in the United States, according to the Wall Street Journal.  In another case, Paxar Corporation, a New York listed company acquired  by Avery, acknowledged paying $30,000 to bribe Pakistani customs officials in 2008 through its local customs broker. Avery, a California-based company, manufactures and markets various office products in several dozen countries around the world.

Raymond Baker, author of "Capitalism's Achilles Heel", has detailed billions of dollars worth of bribes received by government leaders in several developing countries including Pakistan.  Here's a brief except from Baker's book on Sharif family:

"At least $160 million pocketed from a contract to build a highway from Lahore, his home town, to Islamabad, the nation’s capital. At least $140 million in unsecured loans from Pakistan’s state banks. More than $60 million generated from government rebates on sugar exported by mills controlled by Mr. Sharif and his business associates. At least $58 million skimmed from inflated prices paid for imported wheat from the United States and Canada. In the wheat deal, Mr. Sharif ’s government paid prices far above market value to a private company owned by a close associate of his in Washington, the records show. Falsely inflated invoices for the wheat generated tens of millions of dollars in cash."

Baker mentions the use of several offshore entities in British Virgin Islands and Channel Islands controlled by the family of Prime Minister Nawaz Sharif to launder billions of dollars received in bribes.

Similar details are offered in the book that explain how Bhutto-Zardari family have siphoned off money from deals made by Pakistan government. Here's a more extensive excerpt from Baker's book:

Upon taking office in 1988, Bhutto reportedly appointed 26,000 party hacks to state jobs, including positions in state-owned banks. An orgy of lending without proper collateral followed. Allegedly, Bhutto and Zardari “gave instructions for billions of rupees of unsecured government loans to be given to 50 large projects. The loans were sanctioned in the names of ‘front men’ but went to the ‘Bhutto-Zardari combine.’ ” Zardari suggested that such loans are “normal in the Third World to encourage industrialisation.” He used 421 million rupees (about £10 million) to acquire a major interest in three new sugar mills, all done through nominees acting on his behalf. In another deal he allegedly received a 40 million rupee kickback on a contract involving the Pakistan Steel Mill, handled by two of his cronies. Along the way Zardari acquired a succession of nicknames: Mr. 5 Percent, Mr. 10 Percent, Mr. 20 Percent, Mr. 30 Percent, and finally, in Bhutto’s second term when he was appointed “minister of investments,” Mr. 100 Percent. The Pakistan government’s largest source of revenues is customs duties, and therefore evasion of duties is a national pastime. Isn’t there some way to tap into this major income stream, pretending to fight customs corruption and getting rich at the same time? Of course; we can hire a reputable (or disreputable, as the case may be) inspection company, have the government pay the company about a one percent fee to do price checking on imports, and get multimillion-dollar bribes paid to us upon award of the contracts. Société Générale de Surveillance (SGS), headquartered in Switzerland, and its then subsidiary Cotecna, the biggest group in the inspection business, readily agreed to this subterfuge. Letters in 1994 promised “consultancy fees,” meaning kickbacks, of 6 percent and 3 percent to two British Virgin Island (BVI) companies, Bomer Finances Inc. and Nassam Overseas Inc., controlled by Bhutto and Zardari. Payments of $12 million were made to Swiss bank accountsof the BVI companies. SGS allegedly has paid kickbacks on other inspection contracts around the world. Upon being accused in the inspection kickback scheme, Bhutto sniffed, “I ran the government to the best of my honest ability. And I did it for nothing but acknowledgment and love.” Then there was the 1994 deal to import $83 million worth of tractors from Poland. Ursus Tractors allegedly paid a 7 percent commission to another of Zardari’s Caribbean companies, Dargal Associated. Bhutto waived import duties on the tractors, costing the Pakistani government some 1.7 billion rupees in lost revenues. Upon discovery of this scheme the Poles hastened to turn over 500 pages of documentation confirming the kickback. The Polish tractor deal was just a warm-up for the French fighter jet deal. After the U.S. government cancelled a sale of two squadrons of F-16s, Bhutto dangled a $4 billion contract for Mirages in front of the French—Dassault Aviation; Snecma, the engine manufacturer; and Thomson-CSF, producer of aviation electronics. Without missing a beat they allegedly agreed to pay a “remuneration” of 5 percent to Marleton Business S.A., yet another of Zardari’s British Virgin Island companies. This would have generated a tidy $200 million for the Bhutto-Zardari couple, but unfortunately for them she was driven from office before they could collect. Ah, but the gold deal gave some comfort to these aspiring kleptocrats. Gold is culturally important in the Asian subcontinent, in particular as a way for women to accumulate wealth. Upwards of $100 billion is invested in this unproductive asset in Pakistan, India, and surrounding countries. Smuggling is big business. Ostensibly to regulate the trade, a Pakistani bullion dealer in Dubai, Abdul Razzak Yaqub, asked Bhutto for an exclusive import license. In 1994, yet another Zardari offshore company, M.S. Capricorn Trading, was created in the British Virgin Islands. Later in the year, Jens Schlegelmilch, “a Swiss lawyer who was the Bhutto family’s attorney in Europe and close personal friend for more than 20 years,” opened an account for Capricorn Trading at the Dubai branch of Citibank. According to a 1999 U.S. Senate report: “Mr. Schlegelmilch did not reveal to the Dubai banker that Mr. Zardari was the beneficial owner of the PIC [private investment company], and the account manager never asked him the identity of the beneficial owner of the account. . . . Shortly after opening the account in Dubai, Mr. Schlegelmilch signed a standard referral agreement with Citibank Switzerland private bank guaranteeing him 20 percent of the first three years of client net revenues earned by the bank from each client he referred to the private bank.” In other words, Citibank was contracting to pay a finder’s fee for millions brought in from dubious sources. Citibank went on to open three accounts in Switzerland for Zardari, with Schlegelmilch as the signatory. In October 1994, Citibank records show that $10 million was deposited into Capricorn’s Dubai account by Razzak Yaqub’s company, A.R.Y. International Exchange. In December, Razzak Yaqub received an exclusive import license and proceeded over the next three years to ship more than $500 million in gold to Pakistan. Additional deposits flowed into the Dubai and Swiss Citibank accounts, and funds also were shifted to Citibank Channel Island subsidiaries. The original ceiling on the accounts of $40 million was reached quickly.

Related Links:

Haq's Musings

Microsoft Accused of Bribing Pakistani Punjab Minister

Inaction Against Corruption in South Asia


Avery Acknowledges Bribing Pakistani Officials

FCPA Violations Involving Indian Entities

The Story of Graft

Anti-Corruption Day, Blagojevich and Zardari

Bhutto Convicted in Switzerland

Corruption in Pakistan

Transparency International Survey 2007

Is Siemens Guilty?

Zardari Corruption Probe

Monday, July 28, 2014

Don't Forget to Pray and Tweet for Gaza on Eid

"Gaza is Israel's Warsaw -- a vast concentration camp that confined and blockaded Palestinians. We are witness to a slow-motion process of genocide." Professor William I. Robinson, University of California at Santa Barbara.

The "slow-motion process of genocide" in Gaza that the Jewish-American professor refers to has just accelerated in the last few weeks with relentless Israeli bombing of the civilian population with most modern and extremely lethal weaponry supplied by the United States.  Over 80% of the 1000+ casualties in Gaza are civilians so far while the overwhelming majority of casualties (about 40) on the Israeli side are of Israeli soldiers.

It's not just US arms that are aiding and abetting this accelerating genocide targeting the Gaza children of Palestinians; the US mainstream media and the US politicians are active collaborators in this crime against humanity.

Fortunately, the western media, particularly the US media, now has serious competition from the rapidly growing social media. And Israel and its supporters are badly losing this war for the hearts and minds of the people of the world.

Source: Twitter

Even in the United States, in spite of the pro-Israel US mainstream media propaganda, a recent Gallup poll shows that the tech-savvy younger generation of Americans age 18-29 believes by 2:1 that "Israel's actions are unjustified".

Source: Gallup

The most popular hashtags in support of Gazans are #GazaUnderAttack and #PrayForGaza. Please do not underestimate the power of the social media. I urge you to join the social media battle to support Palestinians in their hour of need by tweeting with pro-Gaza hashtags #GazaUnderAttack and #PrayForGaza.
Related Links:

Haq's Musings

Gaza Compared With Nazi Concentration Camps

Zionist Power Grows in Washington

Pictorial Review of Young Gaza Victims

Israel's Gaza Attack is Criminal, Not Defensive

Is Obama True Friend of Israel?

Who Rules America?

Friday, July 25, 2014

BJP Makes "Akhand Bharat" Part of Indian School Textbooks

“Students, how would you go about drawing a map of India? Do you know that countries like Pakistan, Afghanistan, Nepal, Bhutan, Tibet, Bangladesh, Sri Lanka and Burma are part of undivided India? These countries are part of Akhand Bharat.” Tejomay Bharat (Shining India)  by Dinanath Batra
Tejomay India (Shining India) is just one of six of Batra's books made "must read" by education ministry for students at all of 42,000 primary and secondary schools in the State of Gujarat, the home of India's Hindu Nationalist prime minister Mr. Narendra Modi.

Hindu Nationalists' "Akhand Bharat" includes Pakistan, Afghanistan, Nepal, Bhutan, Tibet, Bangladesh, Sri Lanka and Burma
Batra, the man who oversaw revisions in Indian history textbooks for the country's National Council of Education, Research and Training (NCERT), recently forced Penguin India to recall and destroy all copies of "The Hindus: An Alternative History"  by University of Chicago scholar Wendy Doniger published by Penguin Books about 5 years ago. Explaining his opposition to Doniger's book, Batra told Time magazine: "The entire book is objectionable, but yes, that is one of our main objections. She is insulting our gods and goddesses and religious leaders and texts and even our freedom fighters. I don’t have any objection to sex and neither does our religion, as long as it’s within the parameters of religion."

Batra shares something in common with Nigeria's Boko Haram for his vehement opposition to western education. He calls western-educated Indians “children of Marx and Macaulay” who are “defaming Hinduism”, according to India's First Post. He also feels that there is no need for English language education and instead advocates the teaching of Sanskrit to students along with a an emphasis on the mother tongue ("with 20 percent for Sanskrit") with Hindi as a second language.
India Arms Build-Up in Pursuit of "Akhand Bharat"? Data Source: SIPRI 

Hindu nationalists have been battling scholars over history for decades. They tried to do in California what their Indian counterparts have already done in India. They attempted to change California history textbooks in 2006, when they argued unsuccessfully to include their claims like the indigenous origins of Aryans and tried to deny the terrible impact on hundreds of millions of Indians of the caste system and misogyny prevalent in Hindu texts and Aryan culture. Hundreds of history scholars from US and South Asia helped defeat this attempt by Hindu American Foundation (HAF) and its allies in the United States.

India's textbooks suffer from many problems ranging from deliberate distortions to outright incompetence. The errors range from misspelling "Suez" Canal as "Sewage" Canal and referring to Africans as N---ers" to false stories of India's Muslim rulers' atrocities on Hindus.

With regard to anti-Muslim propaganda in Indian textbooks, Dr. D.N. Pande, author of "History in the Service of Imperialism", summarized his conclusions in a lecture to members of the Rajya Sabha in 1977 when he said: “Thus under a definite policy the Indian history textbooks were so falsified and distorted as to give an impression that the medieval period of Indian history was full of atrocities committed by Muslim rulers on their Hindu subjects and the Hindus had to suffer terrible indignities under Islamic rule.”

Retired Justice Katju of the Indian Supreme Court has said that Dr. Pande came upon the truth about Tipu Sultan in 1928 while verifying a contention — made in a history textbook authored by Dr. Har Prashad Shastri, the then head of the Sanskrit Department in Calcutta University — that during Tipu's rule 3,000 Brahmins had committed suicide to escape conversion to Islam. The only authentication Dr. Shastri could provide was that the reference was contained in the Mysore Gazetteer. But the Gazetteer contained no such reference, according to a report in The Hindu newspaper.

Further research by Dr. Pande showed not only that Tipu paid annual grants to 156 temples, but that he enjoyed cordial relations with the Shankaracharya of Sringeri Math to whom he had addressed at least 30 letters. Dr. Shastri's book, which was in use at the time in high schools across India, was later de-prescribed. But the unsubstantiated allegation continued to masquerade as a fact in history books written later.

The Hindutva project to rewrite South Asian history appears to be gaining new momentum with the rise of Narendra Modi. If allowed to proceed unchecked, this revisionism could prove to be very destabilizing and dangerous for India, Pakistan and the entire region.

Related Links:

Haq's Musings

Rise of Narendra Modi

Hindu Academic Forces Destruction of Scholarly Book on Hinduism 

Hindutva Whitewash of History

Pro-Modi Candidate in Silicon Valley Congressional Race

Sonal Shah in the White House

Gujarat Muslims Ignored By Indian Politicians

Indian-American Lobby Emulates AIPAC

Pakistani-American Demographics

Minorities are Majority in Silicon Valley

Indian Kids Rank Bottom on PISA, TIMSS

Monday, July 21, 2014

Pakistan Joins 3D Printing Revolution

3D printing (also called stereolithography or additive manufacturing) is a process for making a three-dimensional object of almost any shape. It uses a 3D model or other electronic data source primarily through additive processes in which successive layers of material are laid down under computer control.

3D printing technology was introduced in Pakistan when Robotics Lab was launched in 2011 in Karachi. It was founded by two friends Afaque Ahmed and Yasin Altaf  who had previously worked in Silicon Valley. They bought a 3D printer for the lab as a tool to help children learn science.

In addition to serving children, the Robotics Lab has attracted commercial clients such as Pak Suzuki Motors, architecture firms and college students doing senior projects, according to the Express Tribune newspaper. The founding duo is now looking for ways to expand its audience.“Our goal is to push this science lab to TCF schools, a nationwide school network covering about 150,000 underprivileged students,” says Ahmed. The project, however, is currently pending because of funding constraints. “We have asked them to find some big donor for this purpose. Currently, we train these children only through field trips to our labs.”

3D printing has excited Pakistanis like Ali Ahsan to build his own 3D printer, according to a story published in Pakistan Today. He was inspired to make things by his father. “My father was a ‘maker’. He always enjoyed problem solving wanted to make life easier. We never saw electricians, plumbers, carpenter coming to our house. He use to do everything by himself and fortunately as a kid I always stood beside him carrying tools and watching what he is doing. That’s what made me a mechanical engineer, a little different as I was pre-trained by a full time mentor. “It was a favour that I wanted to return by doing something similar for my own children. With 3D printing, I can’t tell you the exact moment it all started, but my wife and I spared a room (we call it the Maker Room) with all sorts of tools electronics. And that’s sort of where it all began! The first thing we made were LEGOs for my children and we ended up at LEGO Mindstorm. With an environment of learning you actually don’t have to teach they learn by mimicking you".

Softonix, a Karachi-based creative design agency, started a commercial 3D printing service to offer 3D models to their clients starting in 2012. As the popularity of 3D printing grew among the users of the service, Tayyab Alam told 3DPrint.com that “seven out of ten calls asked us for 3D printers instead of the 3D printing service.” Softonix responded to growing demand by launching 3D Xplore subsidiary to sell 3D printers.

"So we started working on the plans to design and manufacture Pakistan’s very own 3D printer brand, and finally we launched [our line of] 3D Printers for consumers, back in March 2014,” said Alam. “Xplorer 3D is Pakistran’s first 3D printing brand, providing state of the art and affordable 3D Printers. Currently our printers are being manufactured in China and assembled in Pakistan, but we do have future plans to start manufacturing them right here. Currently our product range starts from DIY 3D printing kits to professional level 3D printers.”

Working replicas of expensive scientific equipment could be made for a fraction of conventional costs using cheap 3D printers, possibly saving developing world labs thousands of dollars each time, says a researcher who has authored a book on the subject. The advances in 3D computing mean the age of appropriate technology – affordable, sustainable solutions designed and built to meet local needs – may be here, argues Joshua Pearce, a materials science and engineering professor at Michigan Technological University in the US, in an article in last month's Physics World magazine, according the Guardian newspaper.

3D printing technology has the potential to revolutionize manufacturing. It can be used for 3D model-making, rapid prototyping and production of a range of products for industrial and consumer applications as well as prosthetic limbs and human organs. CAD files for such products can be created by designers from scratch for new designs or downloaded from the web in stl format and modified and customized.

While the industrial use of 3D printers has accelerated, the consumer market for 3-D printing will reach $600 million in 2017, up from $70 million to $80 million last year, according to Kenneth Wong, an analyst at Citigroup Inc. in San Francisco.

Here's a video of a friend Ali Hasan Cemendtaur from Silicon Valley visiting Robotics Lab in Karachi:

Here's Lisa Harouni on 3D Printing:

DEVELOP3D Live: Lisa Harouni, Digital Forming - Talk from DEVELOP3D on Vimeo.

Related Links:

Haq's Musings

Robotics in Pakistan

Inquiry Based Learning in Pakistan

Pakistani-American Pioneered 3D Technology in Orthodontics

Pakistani Brothers Spawned $20 Billion Security Software Industry

Pakistani-American Ashar Aziz's Fireeye Goes Public

Are there Good Hackers? 

Pakistani-Americans Enabling 2nd Machine Revolution

Pakistani-American Shahid Khan Richest South Asian in America

Two Pakistani-American Silicon Valley Techs Among Top 5 VC Deals

Pakistani-American's Game-Changing Vision 

Minorities Are Majority in Silicon Valley 

US Promoting Venture Capital & Private Equity in Pakistan

Pakistani-American Population Growth Second Fastest Among Asian-Americans

Edible Arrangements: Pakistani-American's Success Story

Pakistani-American Elected Mayor

Saturday, July 19, 2014

Pakistani-American Pioneered 3D Technology in Orthodontics

Zia Chishti, a Pakistani-American serial entrepreneur,  founded his first company Align Technology in 1997 in Silicon Valley on the idea of creating clear plastic braces by using advanced 3-D computer imaging. The technology now trademarked as Invisalign has helped millions of people straighten their teeth for a beautiful smile without enduring the pain and unsightly looks of the traditional steel brackets and wires used in orthodontics.

Zia Chishti and Kelsey Wirth
After graduating from Stanford Business School, Chishti wore braces when working as an investment banker at Morgan Stanley. When his braces were removed he wore a clear plastic retainer. He noticed that when he did not wear the retainer for several days his teeth would move. However, putting the retainer back on helped bring his teeth to their desired, straightened state. It was this observation that a clear plastic device was capable of moving his own teeth that led to Chishti to conceive a process that became the Invisalign System.

A background in computer science gave Chishti the insight that it was possible to design and manufacture an entire series of clear orthodontic devices similar to the retainer he wore, using 3- D computer graphics technology to straighten teeth. He and his co-founder Kelsey Wirth started Align Technology in 1997 to realize this vision. The process has now evolved to make extensive use of 3D printing for creating a series of braces to apply gentle pressure to straighten teeth over several months. In 2012 alone, the company printed 17 million transparent dental braces for patients.

Align Technology went public in 2001 raising $130 million by selling 10 million shares at $13 each. The company's 2013 revenue was $660 million and net income was $65 million.

Chishti also started The Resource Group (TRG) in Pakistan in 1999. TRG Pakistan claims to be "the country’s largest provider of BPO services with 4 locations in Karachi and Lahore – Pakistan’s largest cities and financial centers". A 2005 Washington Post story introduced what TRG does in these words: "In a chic downtown lobby across the street from the Old Executive Office Building (in Washington DC), Saadia Musa answers phones, orders sandwiches and lets in the FedEx guy....And she does it all from Karachi, Pakistan".

Chishti also founded OrthoClear in 2005 along with several other former Align employees to compete with Align. OrthoClear received $10 million in VC funding from London-based 3i Group and set up its production facilities in Lahore, Pakistan. Soon after, Align Technology slapped OrthoClear with a lawsuit for patent infringement and filed a parallel petition with the US International Trade Commission for unfair competition.

Align claimed that OrthoClear utilizes Align's trade secrets and infringes twelve Align patents, comprising more than 200 patent claims, in the production of the OrthoClear aligners at a facility in Lahore, Pakistan. The complaint requested the ITC institute an immediate investigation and ultimately issue an exclusionary order, enforced by U.S. Customs and Border Protection, excluding OrthoClear aligners from importation into the United States.

OrthoClear Inc. and Align Technology Inc. settled their litigation in a Consent Decree with a promise by OrthoClear to stop accepting cases in the United States and a payment of about $20 million from Align for OrthoClear's intellectual property.

After the Align settlement, some of OrthoClear employees left OrthoClear and joined ClearCorrect in Lahore, Pakistan.  ClearCorrect argued and the International Trade Commission (ITC) agreed that ClearCorrect and its former OrthoClear employees did not violate the Consent Order when they imported digital dental data from Pakistan to make ClearCorrect aligners. However, a Federal Circuit said last week that such rulings are not reviewable by the ITC under the ITC's own rules until after the completion of the investigation, and that the ITC never waived its rule.

The Court ruled that the language used by the parties in the 2006 Consent Order was adequate to prohibit importation by electronic transmission, and remanded the case to the ITC to determine at trial whether the former OrthoClear (now ClearCorrect) employees violated the Consent Order by transmitting digital dental data to ClearCorrect.

The Court did not reach the question of whether section 337 gives the ITC jurisdiction over electronic articles (an issue Align won with both the Administrative Law Judge (ALJ) and the ITC and now the subject of a separate ClearCorrect appeal). The case will now be remanded back to the ITC, which will presumably assign a new ALJ to handle the case going forward. So the litigation goes on while the consumers continue to pay the high price for use of clear braces.

Related Links:

Haq's Musings

Pakistani Brothers Spawned $20 Billion Security Software Industry

Pakistani-American Ashar Aziz's Fireeye Goes Public

Are there Good Hackers? 

Pakistani-Americans Enabling 2nd Machine Revolution

Pakistani-American Shahid Khan Richest South Asian in America

Two Pakistani-American Silicon Valley Techs Among Top 5 VC Deals

Pakistani-American's Game-Changing Vision 

Minorities Are Majority in Silicon Valley 

US Promoting Venture Capital & Private Equity in Pakistan

Pakistani-American Population Growth Second Fastest Among Asian-Americans

Edible Arrangements: Pakistani-American's Success Story

Pakistani-American Elected Mayor

Tuesday, July 15, 2014

Pakistani Brothers Spawned Multi-Billion Dollar Security Software Industry

The year was 1986. Most personal computers used floppy disks to boot and to move files from one computer to another. Floppy disk was also the medium used by Amjad and Basit Alvi, two Pakistani brothers living in Lahore, to create and spread history's first known PC virus called "The Brain".  Here's how Mikko Hypponen, a software security expert, described it last year at DEF CON, world's largest hackers convention held in Las Vegas:

Creators of First PC Virus: Amjad Farooq and Basit Farooq Alvi

"It's surprisingly advanced, and it has surprising features, including a capability of hiding itself. So when your PC is infected by Brain, and you go and look at your floppies, you will not see Brain on the floppies. It's watching you watching it, and if you try to look at the copy of Brain, it fools you and gives you a clean image of a floppy instead. And we would call this a stealth virus, at the time....
These guys weren't evil at all. They weren't evil even then, 25 years ago, when they wrote the first PC virus. Their intention was never to cause harm to anybody, and they didn't, of course, realize that they made history when they wrote the first PC virus. But Brain was the only virus they ever wrote and they never meant to destroy any data or cause any harm for anyone".  

The Brain, also known as The Pakistani Brain, is the virus that challenged John McAfee to develop anti-virus software. Later, John McAfee launched his company that was acquired in 2010 by Intel for $7.7 billion.  McAfee is just one of several security software companies inspired by the Pakistani Brain virus. Gartner estimates that the security software industry revenue was about $20 billion in 2013.

Cloud security is the latest incarnation of the security software industry. Companies like Fire-eye founded by Pakistani-American Ashar Aziz are leading  cloud security revolution in Silicon Valley.

Here are some of the reasons for the success of Fire-eye as described by Business Insider:

1. The company's flagship product solves a really hard computer security problem. It is able to stop hack attacks that were previously almost impossible to stop.

2. FireEye bought another security firm, Mandiant, for $1 billion. Mandiant was famous for uncovering links between Chinese hackers and attacks on U.S. companies.

3. With Mandiant, FireEye launched a cloud computing security service that competes with SourceFire. SourceFire is the company Cisco bought last summer for $2.7 billion.

4. The company beat expectations on its fourth quarter with revenue of $57.3 million, a beat by $1.26 million, and EPS of $-0.35, a beat by $0.03.

5. Some Wall Street analysts have been really gung ho on the company. Wells Fargo started tracking it a month ago, saying it was "a once in a decade opportunity to invest in a truly disruptive technology."

The world has dramatically changed since the 1990s when Wintel ruled the roost. PC is no longer the dominant device. Smartphones and tablets have brought the era of mobile cloud computing where neither Intel nor Microsoft enjoy leadership position. Even developing countries like Pakistan are deploying cloud computing applications. A Google sponsored survey in Pakistan found that mobile computing is expected to overtake desktop computing this year. Several new and more innovative and powerful players have emerged to in this market.

As more and more enterprises embrace cloud-based computing, cloud security is becoming a hot area for many entrepreneurs. This shift means over $2 billion annual market for cloud security vendors like Fireeye and Elastica. Researchers at Gartner forecast the highest growth to occur in cloud-based tokenisation and encryption, security information and event management (SIEM), vulnerability assessment and web application firewalls.

Recently, a Silicon Valley cloud security start-up Ealstica was launched by Rehan Jalil, a Pakistani-American alumnus of NED University of Engineering, Karachi, Pakistan. Elastica received $6.3 million funding from Mayfield Ventures, a premier Silicon Valley Venture Capital firm.

Several analysts have recently upgraded Fireeye to buy with the target price above $100.

Related Links:

Haq's Musings

Pakistani-American Ashar Aziz's Fireeye Goes Public

Are there Good Hackers? 

Pakistani-Americans Enabling 2nd Machine Revolution

Pakistani-American Shahid Khan Richest South Asian in America

Two Pakistani-American Silicon Valley Techs Among Top 5 VC Deals

Pakistani-American's Game-Changing Vision 

Minorities Are Majority in Silicon Valley 

US Promoting Venture Capital & Private Equity in Pakistan

Pakistani-American Population Growth Second Fastest Among Asian-Americans

Edible Arrangements: Pakistani-American's Success Story

Pakistani-American Elected Mayor

Upwardly Mobile Pakistan

Friday, July 11, 2014

Mobile Money Revolution: Pakistan Surges Ahead of India

Pakistan government is handing out Rs. 40,000 per family to nearly a million internally displaced persons (IDPs) through mobile service operator Zong's mobile SIMs. The government is attempting to ease the discomforts of displacement for such a large number of people displaced after the start of Pakistan Army's Operation ZarbeAzb  to root out terrorists from North Waziristan tribal agency. Zong is one of several mobile service operators offering Easypaisa m-money service. It was pioneered by Telenor Pakistan.

Easypaisa moved $3.5 billion in fiscal 2012-13. Bangladesh's bKash did $4 billion over the same period. These figures were well ahead of the $3.2 billion moved in comparable period by India's M-Pesa mobile money network, according to New York Times.  Over the last 12 months, the m-money market volume in Pakistan has reached 153 million annual transactions worth US$ 6.2 billion, according to Asian Development Bank.

Easypaisa M-money Growth in Pakistan (Source: ADB) 

Pakistan’s m-money infrastructure has grown rapidly since the launch of the first domestic initiative in October 2009. This expansion has been enabled by a liberal financial and telecommunications regulatory framework, and active private sector participation. Four out of five cellular mobile companies currently operating in Pakistan have launched m-money systems in partnership with financial institutions. The m-money market volume has reached 153 million annual transactions worth US$ 6.2 billion.

There are two ways through which m-money services are offered in Pakistan. Over 95% of m-money transactions are done through mobile banking (m-banking) agents, and the rest are processed directly through customers’ mobile-wallet (m-wallet) accounts, using mobile phones. M-banking agents (retail points) provide the basic infrastructure for Pakistan’s m-money services, whereas customers’ m-wallet accounts currently have a limited role in the m-money services market.

It is believed that the reason why India lags behind Bangladesh and Pakistan in mobile money is because its regulators require mobile operators to work with banks to provide the services. Mobile networks would prefer to have their own agents who can cash out the digital money into hard currency. Much of the infrastructure is already in place, because there are so many locations where customers can top up on airtime. But the mobile operators are not allowed to use those sales outlets as financial agents in India.

Related Links:

Haq's Musings

Branchless Mobile Banking Takes Off in Pakistan

Pakistan Ranks High in Microfinance

Pakistan Deploying Mobile Apps to Improve Governance

Pakistan Mobile Broadband Faster Than India's

Pakistan's Media and Telecom Revolution

Thursday, July 3, 2014

Pakistan's Mobile Internet Speed of 1.5 Mbps Beats India's 1.3 Mbps

Even  before 3G and 4G roll-outs, Pakistan's mobile data users enjoy an average bandwidth of 1.5 Mbits/sec and peak bandwidth of 14.7 Mbits/sec, according to a report published by Akamai Technologies, Inc. The Akamai data includes usage from smartphones, tablets, computers, and other devices that connect to the Internet through mobile network providers. The only mobile broadband option available to users in Pakistan has so far been PTCL's EVO.

Results of Google-sponsored Survey in Pakistan Source: Express Tribune

Akamai Technologies, the creator of this report, operates an Internet content delivery network headquartered in Cambridge, Massachusetts. Akamai's network is one of the world's largest distributed-computing platforms, responsible for serving between 15 and 30 percent of all web traffic around the world.

Mobile Broadband Speeds. Source: Akamai

Akamai report ranks 16 countries in Asia by mobile Internet speeds. South Korea tops the list with average 14.7 Mbits/sec and 41.3 Mbits/sec peak. Vietnam is at the bottom with 1.1 Mbits/sec average and 6.5 Mbits/sec peak. India ranks second from bottom with 1.3 Mbps average and 8.7 Mbps peak.

With 3G and 4G roll-outs currently underway in Pakistan by multiple carriers, companies like Zong are talking about delivering  speeds of up to 42 Mbps while other companies are offering 3G speeds of up to 21 Mbps. Even if they fall short, I expect that the average mobile broadband speeds in Pakistan should still be lot faster than what's available in the country today.

Related Links:

Haq's Musings

Pakistan Rolls Out Mobile Apps in Public Sector

Pakistan Launches 100 MBPS FTTH Broadband

Mobile Internet to Overtake Desktop in 2014 in Pakistan

Biometric Information Technology in Pakistan

Power Theft in Pakistan

Mobile Banking in Pakistan

Mass Literacy Through Mobile Phones

Online Education in Pakistan

Pakistan's Telecom Revolution

Wednesday, July 2, 2014

Die-hard Pakistani Football Fans Support Brazilian Soccer Team in World Cup 2014

Pakistan-made Brazuca soccer ball is believed to have started high football fever in cricket-crazy Pakistan. The most fanatic among Pakistani soccer fans are the Sheedis of the Karachi slum of Lyari. Since Pakistani football team does not qualify to play in the World Cup, the sheedis' favorites are the Brazilians with whom they have much in common. Sheedis, like many Brazilians, are part of the worldwide African diaspora created by the slave trade.

Lyari Football Club
Who are Sheedis?

Sheedis are thought to be the descendants of African slaves brought to the shores of Pakistan at the height of the international slave trade that started in the 7th century and continued into the 18th century.

Also known as Siddis in other parts of South Asia, they are believed to have arrived in India in 628 AD at the Bharuch port. Several others followed with the first Arab invasions of Sindh in 712 AD. The latter group are believed to have been soldiers with Muhammad bin Qasim's Arab army, and were called Zanjis. Siddis are related to the Bantu peoples of Southeast Africa. They were brought to the Indian subcontinent as slaves by the Portuguese.

The Sheedis of Pakistan, also known as Makranis, live primarily along the Makran Coast in Balochistan, and southern part of Sindh. In Karachi, they are mainly concentrated in Lyari. Pir Mangho is revered by Sheedis as their patron saint. Sheedis have an annual celebration in Manghopir area around the shrine of their patron saint.

Soccer Fever in Lyari:

People bring big screen television sets and projectors into the streets to watch Brazilian team play against their opponents at dozens of spots in Lyari . Others head to a nearby sports complex for a screening, where hundreds of adults and kids arrive toting mats and picnic baskets, according to a PRI Radio report. Here's a excerpt from it:

"Almost everyone here supports the Brazilian team, and residents proudly point out that the neighborhood has been labeled “mini-Brazil" thanks to its fervor. “God willing, Brazil will win today and it will keep on winning," says one boy sitting on the ground surrounded by his friends. Other boys express their admiration for their hero, Neymar, a star Brazilian forward. Karachi's roots in soccer go back to the days of the British Empire. As one of British India's key seaports in the early twentieth century, many ships carrying European sailors would dock here. In their free time, visiting sailors played soccer near the harbor and would invite locals to join them. “This became a tradition — that whenever sailors came, these people used to go there and play with them,” says Nadir Shah Adil, a veteran journalist from Lyari. While much of Pakistan took on the British game of cricket, says Adil, people in Lyari chose soccer. It wasn't just because of the European sailors, though. Soccer was also a much more affordable sport for poor Lyari residents."

Street Child Football Championship:

Earlier this year, Pakistan's football team made up of mainly Lyari kids surprised the world by winning third place in the Street Child World Cup held in Rio de Janeiro, Brazil. The team drew special praise for crushing arch-rival India 13-0 at the Rio tournament.

Pakistanis scored 2-0 win against Kenya and a 3-0 triumph against Mauritius before drawing 1-1 with the US team to reach the top in their group. In the quarter-finals, they defeated the Phillipines 3-2 but lost to Burundi 3-4 in the semi-finals. They played US again for third-place match and won 3-2 on penalty kicks to clinch the bronze medal in the seven-a-side tournament.

Hope For Lyari:

Lyari is a place known mainly for its poverty, drugs, violence and gang warfare that have ravaged the area for decades. Lyari gangsters with names like Baba Ladla, Rehman Dakait, Uzair Baloch and Arshad Pappu make more headlines than the neighborhood's sports talent in boxing, football and other sports.

Recent success in the Rio Street Child Football World Cup and now the Soccer World Cup 2014 fever represent an opportunity for the government and the civil society to offer Lyari youngsters an alternative to the life of drugs, violence and gangs. Let's hope that they will seize this opportunity.

Related Links:

Haq's Musings

Science of Pakistan-Made Brazuca 

Gangs of Karachi

Johnson-Ali Model of Success in Olympics

Commonwealth Games 2010

Geo Sports Ban 

IPL Mixes Business, Sports and Entertainment

Pak Cricket Needs Top Batting Coach and Sports Psychologist

Tuesday, July 1, 2014

Riaz Haq's Ramadan Sermon

Indeed, Allah will not change the condition of a people until they change what is in themselves. Al-Quran 13:11

Muslims around the world have welcomed the holy month of Ramadan once again this year. Mosques and the Muslim mass media are resonating with the usual exhortations to fasting and extra prayers to earn maximum reward during the most blessed month of the Islamic calendar.

As I hear these exhortations, I am thinking in my own mind as to what would be a perfect sermon that would be most relevant to contemporaneous Muslims, particularly Muslims in Pakistan today. It is unlikely that I would be asked to deliver a khutba this month. However, if I were asked, here's what I would say:

My Dear Muslim Brothers and Sisters:


I begin in the name of Allah, the most beneficent and the most merciful.

"Ramadan is the (month) in which the Quran was sent down, as a guide to mankind and a clear guidance and judgment (so that mankind will distinguish from right and wrong).." (Quran 2:183)

Clearly, the Holy Quran is our guide to living our lives as Muslims. It is about praying, fasting and giving to the poor. However, it's clearly not just about Huqooq ul Allah. It's as much about Huqooq ul Ibad as it is about Huqooq ul Allah.

What does respect for Huqooq ul Ibad mean in Pakistan's context?

1. Respect Human Life:

First, the respect for Huqooq ul Ibad means that we should respect the needs and the rights of our fellow human beings. Not just Muslims. But all humankind. The Quran  (13:117) says "And We have sent you not but as a mercy for the 'Alameen" (all creation)". Our Prophet Muhammad  (PBUH) came to us as "Rehmat ul lil Alameen", not just Rehmat ul lil Muslimeen. The first among these rights is the right to life. We must not accept or condone the taking of innocent human life under any circumstances. We must not sympathize with groups such as Al Qaeda and the Taliban who proudly take "credit" for killing innocent people.

2. Do Not Steal:

Second, the respect for Huqooq ul Ibad means that we must not steal, and yes, that includes stealing electricity. We must not "fix" our meters to avoid paying fully and honestly for what we owe to the electric company or any other utility companies.

Bribe in Ramadan

Please take seriously the ads such as the following from Peshawar Electric Supply Company: "Do your fasting, pay zakat (charitable donations) and serve your parents, but do these things by the light of legal electricity."

3. Earn an Honest Living:

Third, the respect for Huqooq ul Ibad means earning an honest living. We must not use fasting as an excuse for not doing an honest day's work for our employers. Breaking your fast with food or beverages that have not been honestly earned will void your fasting and prayers.

4. Don't Harshly Judge Others, Particularly People of Other Faiths:

Prophet Muhammad sought counsel with Christian monk Waraqa ibn Nawfal and protection for 90 of his persecuted followers by appealing to Negus, the Christian King of Abyssinia.

Will non-Muslims who do good be excluded from paradise? The answer is NO. Here's Chapter 2 Verse 62 of the Holy Quran:

Translation:  "Surely those who believe, and those who are Jews, and the Christians, and the Sabians, whoever believes in God and the Last day and does good, they shall have their reward from their Lord, and there is no fear for them, nor shall they grieve"
My dear brothers and sisters in Islam:

We often lament the decline of the Muslim world in the last few centuries. We vociferously complain about corruption and violence in our countries. We often pray to Allah SWT to make things better for us. But we  must heed Allah's words in the Holy Quran: Indeed, Allah will not change the condition of a people until they change what is in themselves.  This Ramadan will be another wasted opportunity if we don't begin to act to make things better for ourselves. As Allah SWT says in the Holy Quran (13:11):

Surah Ar-Ra'ad in Al-Quran 13:11

Translation: For each one are successive [angels] before and behind him who protect him by the decree of Allah . Indeed, Allah will not change the condition of a people until they change what is in themselves. And when Allah intends for a people ill, there is no repelling it. And there is not for them besides Him any patron.

Here's how Allama Iqbal captured the spirit of this Quranic ayah in the following Urdu couplet:

Khuda nay Aaj tak us qaum ki halat nahi bedli
No ho jis ko khyaal aap apni halat kay badalnay ka

Here's a video discussion on Huqooq ul Ibad in Islam:

Respecting Rights in Ramadan; Abbottabad Commission Report; BBC Documentary on Altaf Hussain from WBT TV on Vimeo.

Related Links:

Haq's Musings

Is Ramadan an Excuse to not Work? 

Huqooq ul Ibad--Respecting Rights of Fellow Humans

Appeal to Stop Power Theft in Ramadan

Ramadan Commercialization By Mass Media

Misaq e Madia ad Jinnah's Vision of Pakistan

The Prophet I Know