Comments on Haq's Musings: Feudal Slavery Survives in South Asia

Here are some excerpts from an Asia Times
2010-06-04T20:00:32.279-07:00
Here are some excerpts from an Asia Times report about tax cheating by the rich and powerful feudal politicians in Pakistan:

A case in point is Sardar Farooq Legari, whose estates extend from the Punjab to the Pakhtunkhwa. In 1994-95, he reported "zero income" while he was still the sitting president of Pakistan. Imran Khan, leader of the Pakistan Tehrik-e-Insaf (Pakistan's Justice Movement) shamed the entire landed class by revealing that a practicing lawyer, Khalid Ishaq, paid more in taxes in 1992-93 than all 273 members of the National Assembly combined - 85% of whom were large landholders.

This shaming, however, did not work on lawmakers who kept evading taxes. In 1994-95, celebrated journalist-writer M Ziauddin conducted a thorough investigation into the taxable farm income and tax-paying behavior of wealthy farmers. He found that all landlords in the country pitched in just chump change of 2 million rupees in taxes in 1996 against their annual income of 600 billion rupees. On this scale, Ziauddin concluded that the landowning classes had been evading taxes of 100 billion rupees a year.

This is a blatant case of tax theft, which has spawned its own vicious knock-offs, one of which is "black money" (that is, totally untaxed wealth). In 1996, an economist estimated that black money in Pakistan grew as large as to form 40% of GDP. If left alone, tax evasion in the above-ground economy or underground economy increases the budget deficit and forces governments to shift the tax burden to consumers or to increase money supply.

In either case, it is a whammy for the poor. In the 2008-09 budget, Pakistan has set itself on the course of widening the tax net. In terms of the tax-GDP ratio, the current budget features a relatively high ratio at 14%. The tax base also is on the rise. In 1994, it consisted of an overwhelming majority of the working middle class of 800,000 tax payers, who have now grown to more than 2 million.

The government, thus, can over the next 10 years raise $50 billion - $5 billion a year - to rein in poverty. At the current exchange rate, $5 billion comes to 345 billion rupees. Economist Shahid Hasan Siddiqi believes that Pakistan is undertaxed by 400 billion rupees a year. Its tax revenue should be 1.6 trillion rupees as against the projected 1.25 trillion rupees for 2008-09.

For some of the posters here, let me share with yo...

2009-12-19T10:39:32.166-08:00

For some of the posters here, let me share with you what Sean-Paul Kelly, a traveler-blogger, thinks of India, based on the recent NY Times story on "India's Innovation Envy":

Indians, it seems, aren’t lacking in the hyper-patriotic, and India certainly doesn’t lack its boosters in the West. Alas, some folks are beginning to see the light:

"BANGALORE, India — In the United States and Europe, people worry that their well-paying, high-skill jobs will be, in a word, “Bangalored” — shipped off to India.

People here are also worried about the future. They fret that Bangalore, and India more broadly, will remain a low-cost satellite office of the West for the foreseeable future — more Scranton, Pa., in the American television series “The Office,” than Silicon Valley."

Stephen Roach of Morgan Stanley-Asia has called this wage arbitrage (Roach happens to be one of the few American economists that gets it right on India). And Americans are right to worry about this. It’s put downward pressure on services as varied as call-centers and tech support, to financial news reporting, X-ray and MRI interpretation and accounting. I would be especially worried if I were an accountant. But then again, many of the big firm accountants need not be worried, as their shilling game for Wall Street will protect them. For a time.

"Even as the rest of the world has come to admire, envy and fear India’s outsourcing business and its technological prowess, many Indians are disappointed that the country has not quickly moved up to more ambitious and lucrative work from answering phones or writing software. Why, they worry, hasn’t India produced a Google or an Apple?"

Wait a second. India does not have any technological prowess in the true sense of the word. After all, if they did, why would the Ambassador, a car model over fifty years old, made of the heaviest steel imaginable, and horribly inefficient be the best selling domestically produced car in India, still. The Nano notwithstanding.

"Innovation is hard to measure, but academics who study it say India has the potential to create trend-setting products but is not yet doing so. Indians are granted about half as many American patents for inventions as people and firms in Israel and China. The country’s corporate and government spending on research and development significantly lags behind that of other nations. And venture capitalists finance far fewer companies here than they do elsewhere."

Re-read that graph closely and you’ll begin to get an idea of the hurdles India faces. And hurdles it is doing nothing, absolutely nothing to overcome. Instead of using its domestic capital for something like infrastructure building, local elites continue to siphon it all off and live behind huge fenced in compounds paying dalits pitiful, barely life-sustaining wages.

The Supreme Court of Pakistan has unanimously decl...

2009-12-16T09:55:14.400-08:00

The Supreme Court of Pakistan has unanimously declared NRO null and void ab initio, according to Dawn News:

ISLAMABAD: The Supreme Court has declared the controversial National Reconciliation Ordinance (NRO) null and void in a short order.

In a landmark decision, the apex court unanimously decided that the ordinance was unconstitutional.

All old cases that had been dismissed under the NRO stand revived and can now be reopened as per the court orders.

The court said that all orders that were passed and all acquittals under the NRO were illegal and never existed.

The apex court in its order also said that all convictions that were held prior to the enactment of the NRO stand revived as well.

Now the Zar dari camp is expected to argue that, under the constitution of Pakistan, President Zardari is immune from prosecution as long as he is in office.

Related Links:

Swi ss Corruption Probe Against Zardari

NRO, Democracy and Corruption in South Asia

Pakistan's Intelligence Failure Amidst Daily Carnage

Here's the transcript of an NPR report on feudal power in Pakistan and how it enslaves people on the large feudal estates in Punjab:

LAURA LYNCH: The midday sun throws a harsh spotlight on weathered faces. Women crouch low, searching for, then plucking out barely ripe tomatoes. Every crease and crevice in their feet, their hands, even on their faces is dusted with dirt from the fields they farm. They work from dawn to dusk - and the landowner gets most of the income. Nearly two thirds of Pakistan's rural population are sharecroppers. One of the male workers, Abdul Aziz, says they all owe their livelihood to their boss - so they support the political party he supports. He has always voted for the Pakistan People's Party he says; the party of the late Benazir Bhutto. Bhutto and other wealthy landowners like her had always been able to count on the loyalty of those who toil for them in the fields. At her gracious home in Islamabad, Syma Khar traces her lineage - both familial and political - through the photographs she keeps in the cupboard.

LYNCH: Khar is a member of the provincial assembly of the Punjab - the largest province in Pakistan. She is also a member of one of Pakistan's most powerful families. The pictures are from the Khar family estate just outside the city of Multan. The sprawling property includes fisheries, mango orchards and sugarcane fields. Thousands of people work there - most are loyal to their masters. Syma's husband, his father, brothers, nieces and nephews have all turned that to their political advantage to gain office. The workers are by and large, poor, landless and uneducated. Pervez Iqbal Cheema of Pakistan's National Defence University says that's the way most feudals want to keep it.

PERVEZ IQBAL CHEEMA: A feudal, in order to maintain his influence, will be probably not very happy for extension of education or health facilities because as long as they have a minimum interaction with the outsiders then the chances of new ideas germinating or causing some trouble are relatively less.

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LYNCH: That star power was evident when Benazir Bhutto staged her return from exile in Karachi in October of 2007. Though it was later marred by a suicide bomb attack, the Bhutto power base in rural Pakistan bussed thousands of loyal followers in to cheer her arrival and dance in the streets. Even after she died, Bhutto's political machine ensured her husband eventually became President. And her son, Bilawal, inherited the party leadership even though he's only 20 with no political experience. In a back alley off a busy road in Rawalpindi, boys are just starting a late afternoon game of cricket. Aasim Sajjad Akhtar, rights activist and professor of colonial history at Lahore University of Management Sciences, keeps an office a few floors up. Akhtar sees the staying power of the feudals - and gives credit to the military. It is Pakistan's other power centre - staging four coups in the country's 62 year history. Akhtar says the military, interested in holding onto its own sphere of influence, finds a willing partner in the feudal class.
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KHAR: If they don't' keep that attitude then people will be doing daytime robberies because they are illiterate people. They will, you know, kidnap the daughters they will take away the children they will take away the properties, they will kill each other. So a boss has to be a boss. He has to have that sort of attitude.
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LYNCH: As a farm worker empties her bucket of tomatoes into a crate there is no smile of satisfaction - the day's work is still far from over. There's little chance her life will change soon. Several land reform programs have failed to change rural life in Pakistan. And failed to loosen the grip of Pakistan's large landowners on the country's politics.

Here's a Reuters report on feudal excesses and case for land reform in Pakistan:

Dotted around Pakistan are vast estates run by feudal landlords who command enormous economic and political power, condemning their tenants to poverty, reform activists charge.

On some of these estates, debt bondage has forced 1.8 million people to work the land for no pay, generation after generation, according to the campaigning group Anti-Slavery International. On others, sharecropping systems are practised, under which landless tenants hand over between two-thirds and half of the crops they produce to the landowner.

Unlike other countries in the region, including India, Pakistan did not carry out land reforms after 1947, and attempts in the 1950s and 1970s to reduce the size of land holdings had limited impact.

"Land reform has not taken place because the lawmakers in many cases themselves have large land holdings and will never want to transfer ownership to tenants. There will be no land reform until [the] people are in control of governance," Mubashir Hasan, a former finance minister and social activist, told IRIN.

About 2 percent of households control more than 45 percent of the land area. Powerful farmers have also taken advantage of government subsidies in water and agriculture, and benefited from technological improvements which have boosted yields, according to the World Bank.

By 1977 the biggest estates had only surrendered about 520,000 hectares, and nearly 285,000 hectares had been redistributed among some 71,000 farmers. Around 3,529 landowners have 513,114 holdings of more than 40.5 hectares in irrigated areas, and 332,273 holdings of more than 40.5 hectares in non-irrigated areas, according to the government's annual Economic Survey.

"We manage to earn a little for ourselves by selling the surplus corn and wheat that we take from the land. It is hard work, but despite this we have not been able to escape poverty. None of my four sons is educated beyond the eighth grade. We needed their labour on the land," said Kareem Muhammad, a landless tenant on a farm near the town of Okara, about 110km south of Lahore.

In Punjab, both sharecropping and fixed-rent contracts - where a rent per acre farmed is paid to the landowner by tenants - are practised. In Sindh, about one third of the land falls under fixed-rent contracts and about two thirds of the land is sharecropped, government surveys show.

The sense of injustice created by the continued hold of feudal landlords and the poverty this gives rise to has been a key factor in rising social discontent - aided and abetted by militant groups.

"I am a landless farmer. Last year my teenage son was persuaded by members of an organization engaged in jihad [holy war] to come away with them. They told him it is better to wield a gun and learn to use it than eke out a miserable existence tilling land," Riazuddin Ahmed, from Vehari in southern Punjab, told IRIN.

"My son is only 17. He saw no hope ahead of him, and therefore went away with these people. His mother and I are distraught. But we believe he has gone to the northern areas and we have no means of finding him," he said.

Former finance minister Hassan blamed this on oppression and misery. "Today, governance has collapsed. Extremism has grown and weapons have proliferated," he said.

Farming contributes 21 percent to gross domestic product (GDP) and employs 44 percent of the workforce, according to the government's annual Economic Survey. Of the total land area of 80.4 million hectares, about 22 million are cultivated, according to official data. Nearly 65 percent of this cultivated area is in Punjab, about 25 percent in Sindh and 10 percent in the North West Frontier Province and Balochistan.

Here's an LA Times report on the vicious cycle of poverty in rural India:

India has long been plagued by unscrupulous moneylenders who exploit impoverished farmers. But with crops failing more frequently, farmers are left even more desperate and vulnerable.

Reporting from Jhansi, India - She stops for long stretches, lost in thought, trying to make sense of how she's been left half a person.

Sunita, 18, who requested that her family name not be used to preserve her chance of getting married, said her nightmare started in early 2007 after her father took a loan for her sister's wedding. The local moneylender charged 60% annual interest.

When the family was unable to make the exorbitant interest payments, she said, the moneylender forced himself on her, not once or twice but repeatedly over many months.

"I used to cry a lot and became a living corpse," she said.

Sunita's allegations, which the moneylender denies, cast a harsh light on widespread abuses in rural India, where a highly bureaucratic banking system, corruption and widespread illiteracy allow unethical people with extra income to exploit poor villagers, activists say.

But here in the Bundelkhand region in central India that is among the nation's more impoverished areas, the problem is exacerbated by climate change and environmental mismanagement, they say, suggesting that ecological degradation and global warming are changing human life in more ways than just elevated sea levels and melting glaciers.

"Before, a bad year would lead to a good year," said Bharat Dogra, a fellow at New Delhi's Institute of Social Sciences specializing in the Bundelkhand region. "Now climate change is giving us seven or eight bad years in a row, putting local people deeper and deeper in debt. I expect the situation will only get worse."

An estimated 200,000 Indian farmers have ended their lives since 1997, including many in this area, largely because of debt.

A 2007 study of 13 Bundelkhand villages found that up to 45% of farming families had forfeited their land, and in extreme cases some were forced into indentured servitude. Tractor companies, land mafia and bankers routinely collude, encouraging farmers to take loans they can't afford, a 2008 report by India's Supreme Court found, knowing they'll default and be forced to sell their land.

"While a few people borrow for social status or a desire to buy a new motorcycle, in most cases it's for sheer survival," Dogra said. "When they see their children starving after several years of crop failures, many feel they have no choice."

Recent amendments to a 1976 law in Uttar Pradesh state have increased the maximum punishment for unauthorized money-lending to three years in jail, up from six months, but many loan sharks are well-connected and elude prosecution. The law specifies that lenders must obtain a state license, but the requirements for obtaining it can be vague, a situation that critics say gives bureaucrats significant leeway to enact arbitrary rules and exact questionable fees.

"I take occasional loans when we're desperate," says Jhagdu, 50, a farmer in Barora, 60 miles south of Jhansi, sitting on his haunches with teeth stained red from chewing betel nut. "When there's no rain, like now, you can't repay for a year, so the amounts can double."

Here's a report in today's NY Times about deep discontent among Pakistani youth:

LAHORE, Pakistan — Pakistan will face a “demographic disaster” if it does not address the needs of its young generation, the largest in the country’s history, whose views reflect a deep disillusionment with government and democracy, according to a report released here on Saturday.

The report, commissioned by the British Council and conducted by the Nielsen research company, drew a picture of a deeply frustrated young generation that feels abandoned by its government and despondent about its future.

An overwhelming majority of young Pakistanis say their country is headed in the wrong direction, the report said, and only 1 in 10 has confidence in the government. Most see themselves as Muslim first and Pakistani second, and they are now entering a work force in which the lion’s share cannot find jobs, a potentially volatile situation if the government cannot address its concerns.

“This is a real wake-up call for the international community,” said David Steven, a fellow at the Center for International Cooperation at New York University, who was an adviser on the report. “You could get rapid social and economic change. But the other route will lead to a nightmare that would unfold over 20 to 30 years.”

The report provides an unsettling portrait of a difficult time for Pakistan, a 62-year-old nuclear-armed country that is fighting an insurgency in its western mountains and struggling to provide for its rapidly expanding population. The population has risen by almost half in just 20 years, a pace that is double the world average, according to the report................
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The findings were sobering for Pakistani officials. Faisal Subzwari, minister of youth affairs for Sindh Province, who attended the presentation of the report in Lahore, said: “These are the facts. They might be cruel, but we have to admit them.”

But young Pakistanis have demonstrated their appetite for collective action, with thousands of people taking to the streets last spring as part of a movement of lawyers, who were demanding the reinstatement of the chief justice, and Mr. Steven argued that the country’s future would depend on how that energy was channeled. “Can Pakistan harness this energy, or will it continue to fight against it?” he said.

http://www.nytimes.com/2009/11/22/world/asia/22pstan.html?_r=1&scp=1&sq=pakistan%20youth&st=cse