Monday, March 31, 2008

Gillani Acts On Wheat, Energy Crises

With global commodity prices and inflation hitting new highs, Pakistan and other emerging economies are faced with serious challenges. The rising inflation of staples such as wheat has already claimed Pakistan's former ruling coalition as a victim. Many other developing countries' governments are likely to fall as well unless these challenges are addressed effectively.

Knowing the importance of wheat for Pakistanis, the government of Prime Minister Syed Yousaf Raza Gillani has begun to take steps to alleviate the wheat crisis. The first steps, announced yesterday by Ministry of Food and Agriculture, deal with providing incentives to farmers to grow more wheat. The price of 40Kg of wheat has been raised by more than 20 percent to Rs. 625.00 (US$9.90) from Rs 510.00 (US$7.90). The government plans to build a 5-million-tonne strategic reserve from the 2007/08 crop, but farmers had rejected the procurement price of 510 rupees per 40 kg as below domestic and international market levels. In addition to price support, the government has announced support for agriculture equipment purchases with the first batch of 50 bulldozers (out of total 300) arriving from China in July this year. These would be put on trial for two months in difficult terrain of NWFP and Balochistan to increase wheat production.

Pakistan saw a surge in wheat and flour prices in the domestic market after a shortage in September and had to import nearly 1.6 million tonnes in spite of producing 23.3 million tonnes of wheat in the 2006/07 crop year.

The south Asian country of 160 million people consumes about 22 million tonnes of wheat a year, according to Reuters.

For the financial year 2007/08, the government has fixed a wheat output target of 24 million tonnes, but farmers and food ministry officials say that target is impossible to achieve and estimate output will be 21 million to 22 million tonnes.

Industry officials say lower-than-expected output may force the government to import between 1 million and 2 million tonnes for stocks and domestic needs.

In addition to the wheat crisis, the other major crisis angering Pakistanis is the continuing brown-outs resulting from 2500-3000MW electricity shortage. Prime Minister Yousuf Raza Gilani is all set to ink the first-ever power sector pact of his government with a Chinese company, Dong Fong, today for setting up 525 MW thermal power plant with an investment of $450 million at Chichoki Mallian (Sheikhupura), sources close to the Private Power Infrastructure Board (PPIB) managing director told Business Recorder, Pakistan's Financial Daily Newspaper.

Business Recorder is reporting that its sources have expressed serious concern over the cost escalation, saying lower project cost could have been negotiated by a team of experts. The Dong Fong was already in the process of setting up thermal power plant of 450-500 MW at Nandipur (Gujranwala), though several questions had been raised by the Euro Dynamics International, a Lahore-based firm, that the second lower bidder joint venture of Chinese company does not meet the qualification and requirement of combined cycle plant.

Earlier, former prime minister Shaukat Aziz had signed a memorandum of understanding (MoU) with the Qatar Investment Authority (QIA) and the Alstom-Marubini to set up 450-500 MW thermal power plant at Chichoki Mallian, but a couple of months ago, the pact was terminated when the sponsors did not come up with tariff petition.

Notwithstanding allegations of cost escalation and possible corruption, these are all steps in the right direction by Mr. Gillani's new government. The real question is: Would these steps be sufficient to address the severity of the two crises? Or do we need a more comprehensive plan of action beyond these first steps? A comprehensive, long range plan that addresses the underlying issues of the impact of growing population, increasing global demand and rising inflation that show no signs of abating? Let's wait and see what Mr. Gillani's "first 100" days deliver.

Sunday, March 30, 2008

Karachi Peace Essential For Pakistan Economy

The business community in Karachi welcomed the support of the Muttahida Qaumi Movement for the new prime minister Mr. Gillani. Good relations between Pakistan People’s Party and the MQM are considered vital for the business community in Pakistan.

According to Pakistan's Dawn newspaper, Shamim A. Shamsi, president of the Karachi Chamber of Commerce and Industry, urged the new team to revisit economic policy issues and resolve them for the good of the people.

“It was wise of the PPP to take the MQM on board as it is an integral part of the current reality of the province. The decision bodes well for Karachi and therefore the country,” Majyd Aziz, a senior leader of the business community, said.

Peace in Karachi is considered crucial for Pakistan's economic growth and prosperity. According to Wikipedia, Karachi is the financial capital of Pakistan and the biggest port city; it accounts for the lion's share of GDP and revenue. It generates over 65% of the total national revenue (federal and provincial taxes, customs and surcharges. Karachi produces about 42 percent of value added in large scale manufacturing and 25% of the GDP of Pakistan. In February 2007, the World Bank identified Karachi as the most business-friendly city in Pakistan.

Most of Pakistan's public and private banks are headquartered on Karachi's I.I. Chundrigar Road, while most major foreign multinational corporations operating in Pakistan have their headquarters in Karachi. The Karachi Stock Exchange is the largest stock exchange in Pakistan, and is considered by many economists to be one of the prime reasons for Pakistan's 8% GDP growth across 2005. During the 1960s, Karachi was seen as an economic role model around the world, and there was much praise for the way its economy was progressing. Many countries sought to emulate Pakistan's economic planning strategy and one of them, South Korea, copied the city's second "Five-Year Plan" and World Financial Center in Seoul is designed and modeled after Karachi.

In the past, the clashes between the ruling parties and the MQM, Karachi's biggest political force, have resulted in serious economic difficulties in Pakistan. The last several years, however, have seen robust economic growth and a close cooperative relationship between the MQM and the ruling coalition in Islamabad. Any progress toward maintaining a positive relationship between the MQM and the PPP would go a long way in sustaining Pakistan's economy for the benefit of the entire nation.

Saturday, March 29, 2008

Justice Iftikhar Chaudhry Is No Angel!

"Justice Iftikhar Chaudhry was not and is not an angel" said Mr. Muneer A. Malik, the President of the Pakistan Supreme Court Bar Association, during an interview with Philip Reeves of NPR radio broadcast in the United States last year. This interview took place in 2007 after President Musharraf sacked Mr. Chaudhry and Malik launched a campaign to restore Mr. Chaudhry.

While I strongly disagree with Mr. Musharraf's decision to fire Mr. Chaudhry, I am curious to find out what Mr. Malik really thought about Mr. Chaudhry. Since Mr. Reeves did not ask the follow-up question as to what Mr. Malik meant by his "no angel" remark about Mr. Chaudhry, I can try and guess the meaning from the following snippets of publicly available information:

1. While the then Chief Justice and several other Supreme Court judges refused, Mr. Chaudhry took the oath of office as the Chief Justice under an unconstitutional "provisional constitutional order" (PCO) issued by General Musharraf after he overthrew of Prime Minister Nawaz Sharif. Having been rewarded with the high position of the Chief Justice of Pakistan, he stood by Musharraf for a long time until issues were raised about Mr. Chaudhry's own conduct in office.
2. The chiefs of two intelligence agencies, Military and Civilian, submitted written affidavits indicating that Mr. Chaudhry maintained inappropriate contacts with the agencies and sought assistance in spying on other officials including judges. Not only that, he discussed with them important cases pending in the Supreme Court on which he was to rule.
3. Once he was restored, he continued to play politics with key questions such as the President's election and the National Reconciliation Ordnance (NRO) under which the PPP leadership including late Benazir Bhutto and Asif Zardari and others returned to Pakistan for the recent elections.
4. Recently, several jurists have criticized Thursday’s meeting between Iftikhar Muhammad Chaudhry, the sacked chief justice of Pakistan (CJP), and Asif Ali Zardari, the Pakistan People’s Party (PPP) co-chairman, saying that such contacts are harmful to the judiciary’s independence. Former SCBA president Muhammad Akram Sheikh said that a Supreme Court bench, headed by Chaudhry, had stayed the implementation of the National Reconciliation Ordinance (NRO), and therefore it did not suit him to meet Zardari. The NRO provides amnesty to public office-holders charged in corruption cases between 1986 and 1999. “The late CJP, Justice Sir Abdul Rashid, refused to meet Liaquat Ali Khan, the country’s first prime minister, after he knew about some cases of the federation pending with the Supreme Court,” Sheikh said.

Mr. Chaudhry continues to show a lack of judgment in dealing with the military, the politicians and intelligence agencies. Restoring Mr. Chaudhry to the Supreme Court would amount to condoning his bad behavior and setting a bad example for the current and future holders of this high office.

As far as other supreme court and high court judges are concerned, I support the restoration of at least some of them. However, as the new prime minister and parliament consider the question of restoring judges, some of the criteria used in this process should be their behavior before and since the time they were deposed. Did they base their decisions strictly in accordance with the constitution and the laws of the country? Have they played politics from the bench? Have they avoided even the appearance of inappropriate bias or conflicts of interest? The parliament should set up a committee to investigate and hold hearings on the question of restoration of the judges before taking any action. Pakistan can not afford to have any more political generals, nor can it afford any more political judges.

Thursday, March 27, 2008

Hijabs at Harvard Gym

The Washington Post
It's a measure of America's multicultural journey over the past
half-century that we've gone from "God and Man at Yale" to Allah and
Woman at Harvard.
In a contretemps scarcely imaginable in William F. Buckley's day,
Harvard has closed one of its gyms to men for six hours a week so that
Muslim women can exercise comfortably. "Sharia at Harvard," warned
blogger Andrew Sullivan. A Harvard Crimson columnist blasted
"Harvard's misguided accommodationist policy."
Meanwhile, a separate controversy has flared over broadcasting the
Muslim call to prayer from the steps of Harvard's main library during
Islamic Awareness Week. Three graduate students, writing in the
Crimson, argued that the prayer sowed "seeds of division and
disrespect" by declaring that "there is no lord except God" and that
"Mohammad is the Messenger of God." Harvard, they wrote, "should not
grant license to any religious group, minority or otherwise, to use a
loudspeaker to declare false the profoundly important and personal
beliefs of others."
Buckley, who died last month, famously proclaimed that "I would rather
be governed by the first 2,000 names in the Boston telephone directory
than by the 2,000 people on the faculty of Harvard University." Were
he still with us, he would no doubt be saying "I told you so," except
more polysyllabically. Leave it to the Ivy League to abandon its
cherished secularism -- in defense of Islam.
My reaction is more along the lines of: "Get a grip." It's reasonable
to set aside a few off-peak hours at one of Harvard's many gyms. It's
not offensive to have the call to prayer echoing across Harvard Yard,
any more than it is to ring church bells or erect a giant menorah
I share the apprehensions stirred up by the more radical followers of
Islam, with their drive to restore the caliphate and subjugate women.
But I come to this issue as a member of another minority religion,
Judaism, whose adherents often seek flexibility from the majority
culture in order to practice their faith. As with Islam, my religion's
more observant believers endorse practices -- segregating the sexes at
prayer, excluding women from engaging in certain rituals -- that I
find disturbing, bordering on offensive. I have relatives who would
shrink from shaking my hand. Still, I would defend to the death their
right not to touch me.
Certainly, accommodation has its limits. Ten years ago, Orthodox
Jewish students at Yale sued -- unsuccessfully -- after the university
refused their requests to live off campus because, they claimed,
living in co-ed dorms would violate their religious principles. Muslim
students at Australian universities are demanding course schedules
that fit into their prayer times and separate, female-only dining
areas. In Britain, female Muslim medical students have objected to
being required to roll up their sleeves to scrub and to exposing their
forearms in the operating room. Fine with me if they need a place to
scrub in private, but your right to exercise your religion ends where
my safety begins.
A regime of reasonable accommodation inevitably entails difficult --
Talmudic, even -- line-drawing. That's not true of the claim that the
call to prayer offends because it proclaims publicly what other
religions are polite enough to keep private: the exclusive primacy of
their faith. Surely even Harvard students aren't so delicate that they
can't cope with hearing speech with which they disagree -- in a
language they don't understand.
All of this matters not because it's Harvard but because it
underscores that America is not immune from the tensions over Islamic
rights that have gripped Western Europe. In the Washington area
earlier this year, a Muslim runner was disqualified from a track meet
after officials decreed that her body-covering unitard violated the
There have been similar disputes over women seeking to wear
headscarves on the college basketball court or while walking the
police beat. More problematically, Muslim cabdrivers at the
Minneapolis airport sought unsuccessfully last year to be excused from
picking up passengers carrying alcohol.
The wisdom of the Framers ensures that some of the excesses of Europe
-- in both directions -- won't be replicated here. The French ban on
students wearing headscarves would not only be unimaginable in the
United States, it would also violate the Constitution's free-exercise
clause. The archbishop of Canterbury recently suggested that the
British legal system should incorporate aspects of sharia law; that,
too, would be unimaginable here and would violate the establishment
But the Constitution goes only so far to help American society
navigate the familiar issues raised by this unfamiliar religion.
Muslim women who enroll at Harvard and turn up in hijabs at its gyms
reflect a strand of Islam that society ought to encourage, the better
to compete with its more odious cousins.
Harvard authorities managed to get this one right -- Buckley's
preference for the Boston phone book notwithstanding.

Source: By Ruth Marcus, The Washington Post
Wednesday, March 26, 2008; Page A19

Wednesday, March 26, 2008

Is Pakistan a Democracy Now?

Pakistan has a new prime minister elected by the new parliament chosen by the people in largely free, fair and peaceful general elections held by President Musharraf's government last February. As expected, the new prime minister Makhdoom Syed Yousaf Raza Gilani comes from an influential feudal family in Southern Punjab. In the absence of a large, powerful middle class, this is the best that one could hope for as an outcome of the electoral process. But does this mean we are closer to a functioning democracy now?

Emergence and sustenance of democracy and democratic institutions requires a large and powerful middle class. With the exception of India, all other functioning democracies have gone through the transition from feudal to industrial societies where a large middle class exercises its free will to support and maintain civil societies and rule of law. They believe in due process rather than arbitrary rule, a hallmark of military and feudal rulers.

In India's case, Prime Minister Nehru and the Indian National Congress leadership, mostly from the middle classes, seized control and successfully emasculated the Indian feudal class by extensive and real land reform immediately after independence. This never happened in Pakistan. Even though most of India is mired in deep poverty, an average Indian is better educated than an an average Pakistani and the enrollment rate of children in school is much higher, giving hope for a better future. India is beginning to emerge as an industrial economy and acquiring global industrial units like Corus steel and Jaguar.

Pakistan can possibly evolve from feudal to industrial society with a large middle class but it is likely to be a very long and slow evolution, given the history of our recalcitrant feudal leadership. Under Musharraf, the middle class has grown rapidly. I think this is likely to slow down to suit the whims of the feudal class for continuation of the patron-client society they prefer.

Indian Companies Going Global

India's Tata Motors Ltd has agreed to acquire Jaguar and Land Rover, the well known international luxury brand names. The price tag of $2.3 billion represents a real bargain at a fraction of what Ford paid to buy these brands a few years ago. The Wall Street Journal reports that the deal, expected to be made final with regulators sometime during the second quarter, capped off months of discussions between the parties and much speculation among investors about the fate of the brands in the sale. The process began last June when the U.S. auto maker hired Goldman Sachs Group and Morgan Stanley to run an auction of the two units, part of its Premier Automotive Group.

While this high-profile deal by an Indian company is making headlines around the world, the data shows that Indian companies have been on a global shopping spree for a several years. The number of Indian companies that are investing abroad has been steadily growing ever since the Tata Group successfully acquired UK's Tetley Tea for $430 million four years ago. According to KPMG, Indian companies shelled out $1.7 billion in the first eight months of 2005 for acquiring 62 overseas companies. While the IT sector, banking and financial services and pharmaceutical companies have been the most active in M&A deals, increasingly other sectors too are getting in on the act. If the small and mid-sized Indian companies too go in for acquisition deals - in the $1 million range - this could give a tremendous boost to India's manufacturing sector, D.V. Venkatagiri wrote in late 2005.

The acquisition binge further intensified with Tata Steel's $13.6 billion takeover in 2007 of Corus, the British steel company. The Aditya Birla group made a $6 billion bid to buy Novelis, a Canadian aluminum company, and Suzlon, a wind-power company, offered $1.6 billion for REpower, a German turbine maker. Ranbaxy, one of India's top pharmaceutical companies, which has spent $500 million acquiring 14 companies abroad since 2004, joined the bidding for the generics business of Merck, a German pharmaceutical company, at about $5 billion. Then Reliance Industries, one of India's two largest groups, was reportedly in talks with three U.S. companies - Dow Chemical, Chevron and GE and two European retailers, Carrefour and Sainsbury, about possible deals. There has been so much foreign acquisition talk by Indian companies it seemed as if herd instinct had replaced financial caution, reports Forbes magazine.

Both Tata and Birla are cushioned by substantial internal cash reserves that will enable them to cover debt taken on with the acquisitions, says Nimesh Kampani, chairman and managing director of JM Financial, a leading Indian investment bank. Kampani says companies that aren't part of large diversified groups, such as Ranbaxy or Suzlon, "have to be much more careful in foreign acquisitions."

Still, the pressure on these and other Indian companies to go global will continue. In 2007, 34 foreign acquisitions totaling $10.4 billion were reported by Indian companies as completed or pending, according to Dealogic, a British research firm. That is almost half of the $23.1 billion total for all of last year.

Indian companies have two targets abroad: businesses that enable them to grow beyond India and become globally competitive, and those that add value in terms of markets, brands, technology or raw materials. In the first category, globalization is forcing companies to choose what to do because they could be vulnerable to foreign takeover bids in a market downturn.

"Scale is a key competitive weapon," says Rajeev Gupta, Indian managing director of Carlyle, a U.S. private-equity firm. "You have to have scale working for you, and that will lead some companies to sell and some to buy. All the top family companies are clear that they have to make choices."

Sources: Wall Street Journal, Forbes, ICFDC (India)

Tuesday, March 25, 2008

Khadim or Makhdoom?

Makhdoom Syed Yousaf Raza Gilani has been elected and sworn in as the new prime minister of Pakistan. He won by a massive margin of 264 to 42.

The new prime minister belongs to an influential and spiritual shia family of Multan, born on June 9, 1952 in Karachi, Pakistan. His father was a descendant of Syed Musa Pak, a leading Sufi spiritual figure of Multan of the Qadiri Sufi Order of Shi'a Islam. Syed Musa Pak hailed from the Iranian province of Gilan. One of Gilani's maternal aunts is the wife of Pir Pagara. Makhdoom Syed Yousaf Raza Gilani is married and has four sons and one daughter, Fiza Gilani and one grandson. The eldest son of the Makhdoom, Makhdoom Syed Abdul Qadir Gilani, is marrying the grand-daughter of Pir Pagara today in Karachi.

The Makhdoom recieved early education at La Salle High School at Multan. He graduated with BA in 1970 and MA in Journalism from University of the Punjab, Lahore in 1976.

The Makhdoom began his political journey from the platform of Pakistan Muslim League during General Zia-ul-Haq's martial law in 1978. He joined the Muslim League's Central Working Committee. He was also a cabinet member in the three-year government of Prime Minister Muhammad Khan Junejo. He served as Minister of Housing and Works from April 1985 to January 1986 and Railways Minister from January 1986 to December 1986.

After a short stint with the Muslim League, the Makhdoom joined the Pakistan Peoples Party in 1988 and has since remained PPP's loyal and steadfast supporter. In the Benazir Bhutto government of 1988-1990, Gilani was again a cabinet minister: He was Minister of Tourism from March 1989 to January 1990 and again served as Minister of Housing and Works from January 1990 to August 1990.

In the Benazir Bhutto government of 1993-1996, the Makhdoom was elected the Speaker of National Assembly of Pakistan, which he stayed till February 1997.

He has been elected various times as Member of National Assembly from Multan. In the 2008 general election, he beat PML-Q leader Sikandar Hayat Bosan.

While the Makhdoom deserves to be congratulated for winning the nod from the PPP-PML(N) leadership to become the new prime minister, it is hard to see this development as a new beginning and a clean break from the past. He is part of the feudal club and a creature of the military, not unlike the "democtartic" leaders of the past. He owes his position to the family wealth and connections buttressed by the claim to being a descendant of Prophet Muhammad(PBUH).

Just prior to the recent elections in Pakistan, the BBC talked about the feudal shadow over Pakistan as follows: "In many cases they(feudals)are also able to claim the loyalty of thousands, sometimes hundreds of thousands, of "murids" (devotees) who believe they are directly descended from local saints. On top of this, they usually control the "station and katchery" (the police and the courts) which ensures the compliance, willing or not, of the local populace." Please read my February post on this subject.

As long as the feudal system and the feudal lords remain powerful in Pakistan, it will continue to have Makhdooms (lords) rather than Khadims (servants) in leadership positions.

Sources: Wikipedia, BBC News, Haq's Musings blog

Saturday, March 22, 2008

All Marriages Are Made in Hell

The PPP, the PML(N), President Pervez Musharraf and Pakistanis have been witnesses to several political marriages of convenience in the last 20 years. Examples include Bhutto-Zardari marriage, Bhutto-Musharraf marriage and Zardari-Sharif marriage.

Mr. Asif Zardari has emerged as the most powerful person in Pakistani politics in the wake of Benazir Bhutto's assassination and the subsequent PPP victory in the recent elections. Mr. Zardari was heavily involved in the the government and politics of Pakistan during the PPP's last two terms as the ruling party. Some of the questions that often beg for answers revolve around Benazir's opinion of her marriage to Asif and how her perception of Asif evolved over time. While it is hard to get accurate answers to such questions, it is possible to guess based on the words and actions of Benazir during her 20 year marriage to Asif Zardari.

When Benazir was engaged to marry Asif back in 1987, she told the New York Times that she agreed to the marriage, negotiated by her mother and other relatives over the last year, as a matter of "religious obligation and family duty." She went on to say "I must confess that if it hadn't been for my own peculiar position, where I have to consider the political ramifications of every step I take, then perhaps this would not have been an arranged marriage, but, in the circumstances, it seemed the only course," she said.

During her two terms in office, Benazir's husband was widely believed to be involved in corrupt dealings on major contracts with foreign firms doing business in Pakistan.
In fact, he earned the nickname "Mr. Ten Percent" for the 10% commission he is alleged to have demanded and got on every significant deal. In 1998 when Mr. Nawaz Sharif was the prime minister, The New York Times reported as follows: "A decade after she led this impoverished nation from military rule to democracy, Benazir Bhutto is at the heart of a widening corruption inquiry that Pakistani investigators say has traced more than $100 million to foreign bank accounts and properties controlled by Ms. Bhutto's family."

The 1998 NY Times report further said "But they trace the pervasive role of her husband, Asif Ali Zardari, who turned his marriage to Ms. Bhutto into a source of virtually unchallengeable power."
"In 1995, a leading French military contractor, Dassault Aviation, agreed to pay Mr. Zardari and a Pakistani partner $200 million for a $4 billion jet fighter deal that fell apart only when Ms. Bhutto's Government was dismissed. In another deal, a leading Swiss company hired to curb customs fraud in Pakistan paid millions of dollars between 1994 and 1996 to offshore companies controlled by Mr. Zardari and Ms. Bhutto's widowed mother, Nusrat", according to the NY Times report.

Benazir was well aware of the damage Mr. Zardari had done to the PPP and her personal reputation and worked hard to keep her husband away from the political spotlight. In fact, she asked him to go to New York and stay there in an apartment away from the media to be neither seen nor heard.

Rita Payne of the BBC wrote as follows in a recent column published on Her ability to switch alliances for political advantage was in evidence after the 1999 coup, when Nawaz Sharif was sacked by Pervez Musharraf. Initially she welcomed the move but was back in the studio three months later to condemn President Musharraf’s performance. Is the honeymoon over, I asked her as we waited for the interview to begin. She responded with a rueful smile, “all marriages are made in Hell." Sadly, there wasn’t another opportunity to follow this up."

The political marriage of convenience between Benazir and Musharraf arranged by the United States leading up to the Bhutto/Zardari amnesty and Bhutto's return happened much later.
Everyone now knows how that marriage turned out. While Musharraf kept his end of the bargain, Benazir quickly turned on Musharraf for her political advantage. Unfortunately, she did not survive to see the success of her party and Zardari took effective control of the PPP. However, it seems that the key phrase from her lips "All marriages are made in Hell" may be an allusion to more than her problems with Musharraf at the time Ms. Bhutto made the statement.

While the history of such marriages does not give us much confidence in their potential success, only time will tell if the latest marriage of convenience between PPP and PML(N) will succeed.

Friday, March 21, 2008

The Prophet I Know.

As the Muslim world celebrates the birthday of Prophet Muhammad (Peace Be Upon Him) today, it's important to remember his teachings and the life he lived to learn how to deal with the serious crises Muslims face today. Here is how I remember the Prophet I know from my reading about his life:

Secular Education:
The Prophet I know instructed Muslims to "go as far as China to seek knowledge". It was clear at the time that China was not a Muslim nation. It is therefore safe to conclude that the Prophet encouraged all necessary efforts to seek all knowledge including secular education.

Faith and Reason:
The Prophet I know brought the Holy Quran to humanity, the Book that repeatedly and emphatically challenges readers to "Think" and "Ponder" for themselves. This is the best proof that Islam wants Muslims to embrace and reconcile faith and reason. It was this teaching that brought greatness to Muslims in seventh through thirteenth centuries following the death of Prophet Muhammad.

The Prophet I know showed compassion and understanding when a Bedouin person entered the Prophet's mosque in Medina and urinated, an act that infuriated the Prophet's companions. He restrained his companions and asked them to show understanding for the ignorance of the Bedouin.

The Prophet I know spoke softly and briefly. His last khutbah was a mere 430 words lasting a few minutes. He did not make long, fiery speeches.

Response to provocation:
The Prophet I know responded to abuse by prayer. When the people of Taif threw rocks at him, he responded by praying to Allah to give guidance to those who abused him.

Respect for Life:
The Prophet I know brought the Holy Quran, the Book that equates " unjust killing of one person" with "the killing the entire humanity". It commands respect for life.

It is more important than ever for Muslims to make a serious effort to understand what Prophet Muhammad (PBUH) stood for and how he lived his life. The issues of education, faith, reason and compassion need to be understood in the light of the Quran, the Sunnah and the Hadith. It is this understanding that will help guide the Ummah out of the deep crisis it finds itself in.

Thursday, March 20, 2008

Concerted Campaign Against China

With China's resurgence on the world stage and its hour of well-deserved glory approaching at Beijing Olympics this summer, those opposed to China are out in force to spoil it for the Chinese people.

The efforts to recruit athletes to stage protests in front of the news media during the Olympics and the recent troubles in Tibet and Western China do not appear to be spontaneous. The West-based Free Tibet and Team Darfur movements and their media-savvy supporters, including many celebrities, athletes and actors, are attempting to foment trouble in China before, during and after the Olympics.

The pressure is building up on national Olympic committees as well. The US Olympic Committee has come under criticism for its stance on protests. In response, the Committee spokesman Darryl Seibel said no U.S. athlete would be reprimanded or censured for expressing a critical opinion about China's human rights record, so long as it is done in an appropriate setting. The code of conduct that 2008 U.S. Olympians will sign asks them only to respect the terms of the Olympic Charter.

A growing number of athletes from all over the world have been signed up by Team Darfur, an organization committed to raising awareness about the crisis in Sudan.
It wants to put pressure on the Sudanese authorities, and also those countries, like China, that do business with Sudan. Team Darfur plans to highlight the issue at the Beijing Olympics. Canada's former Olympic swimmer Nicky Dryden, a Team Darfur campaigner, wants athletes to make a stand during the Beijing Games.

Steven Spielberg, a high-profile Hollywood producer and director, has decided to relinquish his role in producing the Opening and Closing ceremonies for the Beijing Games. Now there are fears that his withdrawal may be followed by that of other western stars associated with the Games. There was speculation yesterday that the music producer Quincy Jones, who is writing the theme tune, might pull out. A spokesman described the reports as “speculation” but added that Jones was “keeping an eye on the situation”.

What really worry the Chinese authorities are the growing calls for a boycott of the Games. A poll of nearly 2,500 people for The Sunday Times today shows strong support for Spielberg’s stand, with 49% saying they would back a boycott by British athletes, against 33% who said such a boycott would be wrong. The poll found that 75% thought Spielberg was right to pull out and just 12% thought he was wrong.

In Lhasa, where howling Tibetan mobs turned on ethnic Han Chinese and Hui Muslims last Friday in the worst violence in nearly 20 years. Many businesses owned by the Han Chinese and Hui Muslims were attacked and burned. It should be noted here that most Hui are similar in culture to Han Chinese with the exception that they practice Islam, and have some distinctive cultural characteristics as a result. For example, as Muslims, they follow Islamic dietary laws and reject the consumption of pork, the most common meat consumed in Chinese culture, and have also given rise to their variation of Chinese cuisine, Chinese Islamic cuisine. Their mode of dress also differs only in that adult males wear white caps and females wear headscarves or (occasionally) veils, as is the case in most Islamic cultures.

News agencies report that a homemade bomb was thrown at a paramilitary vehicle yesterday. Police fired teargas to disperse onlookers and schools were ordered to close early. It was unclear how many people were hurt. Residents said four police were killed or wounded but officials would not comment.

The Chinese premier has accused the Dalai Lama of organized violence by the Tibet government in exile along with its western supporters. The scenes of violence perpetrated on the streets of Tibet and neighboring provinces raise questions about the non-violence preached by the Dalai Lama and his supporters. The Dalai Lama, speaking to the media in India, has denied supporting violence. He has offered to resign if the violence continues.

But the anti-Chinese protests and violence across Tibet and in neighboring provinces have continued where many Tibetans live. According to the news reports from a remote corner of Gansu province, hundreds of Tibetans on horseback galloped through a town shouting “Come back Dalai Lama” and “Free the Panchen Lama”, before ripping down a Chinese flag and raising a Tibetan snow lion banner.

Both the Indian and Nepalese governments have taken steps to curb the Tibetans and other international protesters attempting to use their soil for protests and marches against China.

Regardless of one's political views on Darfur, Tibet or China policies, it is not hard to conclude that the efforts to disrupt Beijing Olympics are being orchestrated by a coalition of well-known anti-Chinese individuals and organizations with an ax to grind. It is a shame that sports and politics are being mixed to the detriment of promoting a better understanding through international sporting events. This campaign directed at China is likely to damage the Olympics movement and the athletes around the world.

Wednesday, March 19, 2008

Growing Remittances Offer Lifeline To the Poor

Pakistan reported over 20 per cent growth in remittances from overseas Pakistanis during the first 8 months of fiscal 2007-8. The country ranked number 12 in the world with over $4b in this period. High oil prices and strong economies in the oil-exporting Middle Eastern countries are contributing to strong demand for migrant laborers.

According to a report titled "Remittance Trends 2007" by the World Bank , the flow of remittance globally continues with a robust growth with developing countries taking the lead as major recipients. The growth of remittances to developing countries remains robust because of strong growth in Europe, Middle East and Asia.

Total global remittances in 2007 were estimated by the World Bank to be $318bn of which $240bn went to people in developing countries.

"In many developing countries, remittances provide a life-line for the poor," the World Bank's senior economist Dilip Ratha told the BBC. "They are often an essential source of foreign exchange and a stabilizing force for the economy in turbulent times."

In 2007, Indian workers sent back $27bn (£13.6bn), according to new figures from the World Bank. The other countries in the top five were China with $25.7bn, Mexico's $25bn, the Philippines at $17bn and France with $12.5bn.

The top country from which money was sent was the US with $42bn in recorded outward flows. It was followed by Saudi Arabia, Switzerland and Germany.

Global remittances from migrants are now three times as large as the flows of official government aid to developing countries.

A Woman Speaker: Another Token or Real Change?

Pakistan's new Parliament on Wednesday made history by electing the country's first female speaker from the party of late Benazir Bhutto.

Fehmida Mirza, 51, a businesswoman and medical doctor from a political family in Sindh province, elected to Parliament three times, won 249 of the 324 votes cast in a ballot in the National Assembly, or lower house. Her only challenger received 70 votes. Dr. Fehmida's husband, Dr. Zulfiqar Mirza, is a close friend and ally of Asif Zardari, the widower of Benazir Bhutto.
"I am honored, I am humbled and happy," Mirza told reporters shortly before voting began. "It is one thing to sit in opposition but this chair carries big responsibility ... I am feeling that responsibility today and will, God willing, come up to expectations," she said.

In addition to the election of the first female speaker of parliament in Pakistan, the inauguration of new parliament is historic in another way: There are no burqas in sight with the defeat of the cleric alliance MMA. The real question now is whether these "history-making" events represent a real change or they are just cosmetic?

Writing in a prior post "Are Women in Pakistan Better Off Today?" I wrote as follows: "Most of the women represented in Pakistani parliament are from the same privileged, feudal class that is largely responsible for discrimination against women in Pakistan. The women in parliament have not been particularly vocal in raising the women's issues in parliament and they have not offered any serious legislation other than the Women's Protection Bill that was offered and passed because of President Musharraf's personal intervention. The word "feudal princess" often used to describe late Prime Minister Benazir Bhutto applies well to the majority the women members of parliament in Pakistan. There is a continuing large literacy gap of as much as 45 percent between men and women and the opportunities for rural women's education remain elusive."

Though articulate and accomplished as a politician and a medical doctor, Dr. Fehmida Mirza fits the description of a feudal princess in the same way that Ms Bhutto did. Only time will tell if Dr. Mirza will break this stereotype and ring in real fundamental changes in the political process by being a positive and practical role model for women.

Tuesday, March 18, 2008

Fighting the Twin Crises of Inflation and Power Cuts

As Pakistanis suffer greatly from the twin crises of hyper inflation and prolonged, daily power cuts, the life for them is getting more and more difficult every day. The traditional approaches to solve these problems such as increasing governmental subsidies for food and fuel and building more conventional fossil-fuel based generating capacity are not likely to work cost-effectively and sustain ably in the long run. It is time for Pakistanis to explore creative options to find workable, long-lasting solutions.

Economists often talk about the impact of supply and demand and consumer behavior on inflation. In fact, the consumer price index calculations in the US rely partly on consumers substituting cheaper alternatives for commodities experiencing higher inflation. For example, it is assumed that when the price of steak goes up, consumers start eating chicken instead. The often-criticized substitution process rationalizes this method to eliminate inflation from the US Bureau of Labor Statistics (BLS) basket of goods and services. Indeed, substitution is proof of inflation. When a product's price rises out of consumers' ability to afford purchasing it, its clearly evidence of inflation.

Unfortunately, this assumption of substitution is not always valid, particularly when a staple food or a common form of energy is involved. For example, the people in Pakistan rely on wheat flour for most of their caloric intake. It is possible but not easy to make a substitution, particularly in a very short time-frame unless it is forced upon them due to complete lack of availability or affordability. Similarly, people are used to getting electricity from the grid or using an existing diesel-based emergency generator.

With continuing and dramatic increases in world-wide food and fuel prices, it is clear that heavy subsidies will only bankrupt the emerging nations' governments and prove ineffective in the long run. Instead, it is incumbent upon all governments, including Pakistan and India, to promote substitutions such as potatoes, rice or other sources of starch for wheat. On the energy front, solar power (roof-installed, local and central generation) or wind power should substitute for fossil-fuel generated electricity grid. Recently, Kyocera has announced production of 1.6MW roof-installed solar panels for homes that can easily supply all the needs of a large home, particularly in mostly sunny South Asia. While expensive upfront, such a strategy would alleviate the widespread power shortages and prove more cost-effective in the long run. It will also help reduce environmental pollution and greenhouse gas emissions.

Substitution should be pursued as a strategy to give incentives to both the private sector and the consumers to produce and use alternatives for commodities experiencing the highest inflation rates. In general, each nation needs to diversify its sources of food and energy by encouraging more production and consumption of such alternatives. The governmental incentives can come in the form of tax credits, partial subsidies, and bringing foreign expertise and capital to help set up production of desirable alternatives. With growing populations and world demand, there will continue to be upward pressure on prices of basic commodities. The strategy of developing alternatives, therefore, needs to be a long term and a sustainable strategy.

The substitution strategy can set the stage for a larger effort to grow the economy and improve the living standards without damaging the environment. It can spur innovation and unleash the creativity of the people in Pakistan to deal with the real problems of the day while creating opportunities, jobs and wealth and build a stronger society. It can begin to address the serious environmental issues of the day such as global warming that threatens all life on the planet. It can help Pakistan avoid making the mistakes the West has made in its drive to industrialize. It can help Pakistan do well and do good at the same time.

Monday, March 17, 2008

The Afghan War: Is it Dangerously Escalating?

With America's Iraq front relatively quiet, the world's attention is beginning to turn to the forgotten war in Afghanistan grabbing the spotlight. Some of the recent headlines proclaim as follows:

Monday, March 17, 2008
A suicide bomber in southern Afghanistan killed seven people, including three civilians and three NATO soldiers, as the Afghan military and the ...
Source: Bloomberg

Monday, March 17, 2008
Despite New Highways, Afghans Drive at Own Risk.
Afghan drivers say the road, and other highways like it, are more like the Wild West.
Source: NPR

Monday, March 17, 2008
Missile Strikes Kill 20 In Pakistan;
Parliament Convenes amid Tensions with Musharraf;
110 Arrested in Connection with Bombing of FBI Agents
Source: Informed Comment

Monday, March 17, 2008
Air strike kills 9 militants following bombing in Pakistan, U.S. says
Source: Reuters

Sunday, March 16, 2008
Missiles from an unmanned drone flattened a suspected militant safehouse Sunday in Pakistan's tribal area along the Afghan border, killing 20.
Source: Associated Press

Thursday, March 13, 2008
Taleban Calling the Shots: In a country that is nearly wholly reliant on wireless communications (for lack of any land-line infrastructure), the main mobile networks (all privately run) have begun switching off service at night after attacks on 10 cell towers, the latest on Tuesday night. Score this round for the Taliban.
Source: Foreign Policy Passport

May 13, 2007
Scores of civilian deaths over the past months from the heavy U.S. and allied reliance on airstrikes to battle Taliban insurgents are threatening popular support for the Afghan government and creating severe strains within the NATO alliance.
Source: International Herald Tribune

Most observers, including this scribe, see these headlines as a sign of dangerous escalation of the war in Afghanistan with growing likelihood of expanding into Pakistan and affecting the entire region. Not only are the Taliban resurgent in Afghanistan, they are boldly attacking with impunity inside Pakistan under the new energetic leadership of Baitullah Mehsud.

There are parallels here between the Afghan war and the war in Indochina which began in Vietnam but grew to engulf the entire region including Cambodia and Laos. In Indochina, the US became frustrated with the lack of progress against the Viet Cong and blamed the existence of Viet Cong sanctuaries in the neighboring countries. This was followed by the US invasion of both Laos and Cambodia, resulting in more than a million deaths in carpet bombing. A similar situation is developing here, if you substitute the Viet Cong by the Taleban. The growing US frustration against the Taleban is creating a dangerous situation with the US mounting more and more cross-border attacks into the tribal region of Pakistan.

In spite of their differences with the Bush policies in Iraq, the leading US presidential candidates seem to be in agreement with attacks on insurgent targets in Pakistan, paving the way for a possible "Gulf of Tonkin" type resolution in the US Congress. This situation makes it very likely that the war in Afghanistan will become a regional war outlasting several US administrations, just like the Indochina war did in the 1960s and the early 1970s. With the presence of three nuclear powers in this region, this time the regional war could be catastrophic for the entire region and the world. In such a situation, the US may not be able to pull out like it did in Vietnam. The US policy makers would be well advised to tread with care as they contemplate their policies and actions to deal with the Afghan insurgency.

Sunday, March 16, 2008

Pakistani Debt Default Concerns Rise

Pakistan, whose credit default swaps (CDS) have more than doubled since October 2007 because of growing political uncertainty and tension between rival parties, is expected to join Markit's iTraxx Asia ex-Japan Index of credit-default swaps. This follows a dramatic increase in demand to trade on the credit default swap contracts for Pakistan, reports Pakistan is also slated to join the 20- member sub-index for non investment-grade governments and companies.

Credit-default swaps are an indicator of the cost of bond insurance that varies with the risk of bond default. Credit default swaps are usually bought by bond holders from credit insurance companies like Ambac, FGIC, and MBIA. These insurers reimburse bondholders in case the bond issuing companies or governments default. A basis point on a credit-default swap contract protecting $10 million of debt from default for five years is equivalent to $1,000 a year. This is the first time Pakistan is being included in an index of bond default swaps since it got a B+ rating from S&P and started raising capital through borrowing in the international commercial debt market. Prior to this, Pakistan was considered such a high-risk that it could only borrow from IMF, World Bank, Asian Development bank and other similar institutions that lend to the poor nations deemed not credit-worthy. Pakistan did not have access to the commercial credit markets in the 1990s. Pakistan is becoming more active in raising money in global capital markets despite its volatile politics. Last month the country said it was considering issuing a sovereign bond issue, although it has yet to provide further details behind its plan.

It should be noted that the international and the US bond markets have been seriously unsettled recently due to the sub-prime mortgage backed securities crisis. Just yesterday, the Federal Reserve had to bail out Bear Stearns in the United States. Still, the value of Bear Stearns stock dropped by a half in a single day. There are serious concerns about the default of collateralized debt obligations (CDOs) and the ability of the bond insurers such as Ambac to protect the holders of such securities. This has led to a severe credit crunch in which the major banks are unwilling to loan money to each other.

Saturday, March 15, 2008

Obama Under Fire For His Pastor's Views

"We bombed Hiroshima, we bombed Nagasaki, and we nuked far more than the thousands in New York and the Pentagon, and we never batted an eye," Rev. Jeremiah Wright said in a sermon on Sept. 16, 2001. This is not all. Sen Barack Obama's pastor Rev Wright went on to touch the third rail of the American politics: He criticized the US support for Israel against the Palestinians.

"We have supported state terrorism against the Palestinians and black South Africans, and now we are indignant because the stuff we have done overseas is now brought right back to our own front yards. America's chickens are coming home to roost," he told his congregation.

These remarks by Rev Wright in video-recorded sermons are being played over and over again the US media for the last day or so. The US media are reporting that Rev. Wright married Obama and his wife Michelle, baptized their two daughters and is credited by Obama for the title of his book, "The Audacity of Hope." The early reactions indicate that the Obama support is being eroded in spite of Mr. Obama publicly disagreeing with the pastor's candid views and distancing himself from his pastor.

An ABC News review of dozens of Rev. Wright's sermons, offered for sale by the church, found repeated denunciations of the U.S. based on what he described as his reading of the Gospels and the treatment of black Americans.

"The government gives them the drugs, builds bigger prisons, passes a three-strike law and then wants us to sing 'God Bless America.' No, no, no, God damn America, that's in the Bible for killing innocent people," he said in a 2003 sermon. "God damn America for treating our citizens as less than human. God damn America for as long as she acts like she is God and she is supreme."

In his latest book "Marching Toward Hell" Michael Scheuer, the former head of CIA's Bin Laden unit seems to agree with the "chickens coming home to roost" theory. According to his research on what motivates Bin Laden and his supporters to attack the US and Western interests around the world, he blames the US foreign policy. In fact, he has condensed his learnings in two books published last year. The first is titled "Imperial Hubris" and the the most recent one is "Marching Toward Hell". In both of these books, he rejects the common refrain heard in the United States that "Al-Qaeda hates us because we stand for freedom and democracy". Instead, he argues that it is our interventionist policies around the world that motivate our enemies to be so determined to commit violence against our interests. He singles out our policies in the Middle East and our unqualified support for Israel as the biggest obstacles to a peaceful coexistence between Islam and the West. Among the prominent US political elite, all of the mainstream parties and leaders disagree with Sheuer's message. The only two people that show any agreement with Sheuer are Congressman Dennis Kucinich, who recently dropped out of the Democratic primaries and Congressman Ron Paul, the Republican candidate running a distant third in the Presidential primaries. Ralph Nader, the latest to announce his entry into the presidential race, has similar views but his bid is unlikely to gather much support.

It is worth noting here that Rev Wright's views are not too different from those of Rev Martin Luther King expressed in the 1960s. Reverend King called the United States "the greatest purveyor of violence in the world today" back in the 1960s at the height of Vietnam War. From Vietnam to South Africa to Latin America, King said, the U.S. was "on the wrong side of a world revolution." King questioned "our alliance with the landed gentry of Latin America," and asked why the U.S. was suppressing revolutions "of the shirtless and barefoot people" in the Third World, instead of supporting them.

At the time, the Reverend Martin Luther King also became a target of criticism by the national media. Time magazine called it "demagogic slander that sounded like a script for Radio Hanoi." The Washington Post also chimed in saying "King has diminished his usefulness to his cause, his country, his people."

The media reactions to the Rev Wright videos are quite predictable. The commentators and the pundits are clearly having a field day. The real question now is how the voters would react. The voter reaction could make or break Obama's bid for presidency.

Friday, March 14, 2008

Shaukat Aziz Urges Support for New Government

Former Pakistani Prime Minister Mr. Shaukat Aziz visited Southern California recently and met with a group of Pakistani-Americans. Here are some of the excerpts of what he said as reported in Pakistan Link, a California weekly covering news and issues of interest to Pakistani-Americans:

Shaukat Aziz said the US should continue unimpeded assistance for the new democratic government in Pakistan. The two countries should focus on strengthening the relationship, deepening and broadening multi-faceted cooperation, and promoting greater people-to-people friendship.

Aziz stated that he was elated that the elections in Pakistan were free, fair and safe. Underscoring that the polls had proved that the majority of Pakistanis were "progressive and moderate", he expressed the hope that the new government would "take Pakistan forward on the path of stability, development and progress".

Aziz said Pakistan has a unique relationship with the US. It is the most allied and the most sanctioned ally of the United States.
"Pakistan-US relations are important for both countries as well as for peace, security and development at the regional as well as international levels," he pointed out.

"One of the key challenges is effectively dealing with difference of perceptions on some important issues", Mr Aziz observed that despite a close relationship between Pakistan and the USA, "anti-Americanism in Pakistan or misunderstandings about Pakistan and its society in the US commitment to fight terrorism and extremism and its contribution and sacrifices in the counter-terrorism struggle are not always fully recognized in the US".

"Continued assertions that Pakistan is not doing enough to combat terrorism contribute to a perception of mistrust about the relationship. There have also been threatening statements about the possible military strikes against terrorist targets inside our tribal areas. In order to avoid any negative fallout there has to be a realistic appreciation of the scope of counter-terrorism cooperation and better understanding of Pakistan's contribution and sacrifices in this endeavor", he added.

Mr Aziz asserted: "It is imperative to avoid any assertions or action that would undermine our sovereignty, be inconsistent with international law, unacceptable to the people of Pakistan and detrimental to the ongoing counter-terrorism cooperation." He claimed that he served the country with zest in the last eight years without taking a day off. He was enjoying time off to "recharge".

Karachi Booming in Spite of Power Outages

A Tale of Two Pakistans:

A little more than six years ago, immediately after the Sept. 11 attacks on U.S. cities, few sane investment advisers would have recommended Pakistani stocks.

They should have. Their clients could have made a fortune.

Since 2001, the nuclear-armed South Asian country, blamed for spawning generations of Islamic militants and threatening global security, has been making millionaires like newly minted coins.

As Western governments have fretted about Pakistan's nuclear weapons falling into the hands of militants, the Karachi Stock Exchange's main share index has risen more than 10-fold.

And it is not just that Karachi is a thinly traded market, able to be dragged skyward at time by speculators. Profits have taken off as well.

Even last month's assassination of opposition leader Benazir Bhutto, and the brief but terrifying tornado of violence it unleashed, failed to make much more than a dent in the market.

Businessmen are more worried than brokers, but all agree it will take more than Bhutto's death to destroy this boom, which has been based on open-door investment policies and privatization.

"It's sad, and it does affect the business, but I guess it's been happening for so long that people just get used to it," shrugged Omer Sabir, who sells luxury sports cars from upwards of $100,000 each at Karachi's only Porsche dealer.

Home to 14 million people, Pakistan's biggest city is booming.

The port city, notorious as the place where U.S. journalist Daniel Pearl was kidnapped and beheaded by Islamist extremists in 2002, has seen property prices soar and shopping malls sprout up.

Foreign banks such as Standard Chartered and ABN AMRO have bought up local banks. Just this month Bank Muscat and Japan's Nomura Holdings agreed to a $200 million takeover of Pakistan's Saudi Pak Bank.

Barclays is also looking to build a local business.

Even during frequent power blackouts, Pakistan's bankers can see by the light of their generators that profits are good, among the strongest bank returns in the world, says Invisor Securities.

At Karachi's underground night-club scene, which is literally, underground, sons and daughters of the upper middle-class drink vodka, whisky or just soft-drinks in glittering semi-darkness and listen to DJs play the latest beats.

But right now, the party might be coming to an end.

The stock market is still trading just 3 percent below its life-time closing high of 14,814.85 points, but the outlook is far less certain than six years ago, when President Pervez Musharraf began his reforms, spurring local and foreign investment.

The economy, which averaged around 7 percent annual growth in the five years to June 2007, is slowing and inflation is rising. Foreign investment and the farm sector, two important drivers of Pakistan's economic success story, have also moved down a gear.

The street is also getting angry.

For many Pakistanis, the boom has been mainly a spectator sport. They can see the new shopping malls but cannot afford to buy anything there. About a quarter of them still live in poverty, earning around 1,000 rupees, or $16, a month, though the proportion has been falling, according to 2006 government data.

A few blocks away from the Porsche dealership, men and women line up in vain for hours to buy a bag of flour at a government store. Power blackouts make the winter bleaker still.

"I have been coming here for a month and, look, my hands are empty," said Taj Fareed, showing his palms as he stood near a crowd jostling at the door of a government store to buy flour.

So if these Pakistanis find their voice in elections scheduled for Feb. 18, will there be changes in store for broad economic policy and the rich crust of Pakistan society?

The answer from businessmen, political analysts and economists seems to be a unanimous but rather hopeful "no."

"Whoever comes in next, I can assure you that they will follow the same policies," said Javed Faruqi, leaning back in his chair in the high-rise executive suite of Samaa, one of several new TV channels born out of a surge in advertising spending.

Samaa occupies the same tower as business channel CNBC Pakistan, a Middle East-backed franchise launched in late 2005.

"I don't see it going into reverse but there may be a struggle with the forces who do want it to go into reverse," admits Tahir Ikram, programming director for CNBC Pakistan.

Islamist parties, and their campaigns against Western decadence and corruption, appeal strongly to the poor, but recent polling suggests the mainstream parties will dominate the next government, assuming the Feb. 18 elections are free and fair.

Bhutto's party, Pakistan's biggest, has been campaigning under the slogan "Food, Shelter, Clothing" and still plans to contest the elections, but political analysts do not expect it to usher in a state-driven economy if it wins power.

"The overall direction of the Pakistan economy would be the same," said political analyst Hasan Askari Rizvi.

Riaz Haq's Note: This Reuters story was published in January 2008, prior to the elections of Feb 2008 in Pakistan. The investor enthusiasm has not dampened in spite of the defeat of pro-Musharraf PML(Q) and increasing violence in major cities. On the contrary, the KSE-100 has made new highs above 15000 level in March 2008. Please see my blog post: Pakistan's Stocks Continue to Defy Gravity.

Thursday, March 13, 2008

Insights into a Suicide Bombing in Pakistan

While Pakistani authorities have had little success in catching perpetrators in most of the bombings, there have been several arrests in a November suicide attack on a Pakistan Air Force bus near an air base in Sargodha, 120 miles west of Lahore.

According to Associated Press, the probe by police and intelligence agencies into the attack provides insight into how the NWFP-based militant groups function and shows they are attracting recruits in other regions and ethnic groups.

Interrogation of a key suspect, a 19-year-old former madrassah student, Omer Farooq, who is accused of helping prepare the motorcycle-borne bomb used in the attack that killed at least eight people, revealed how he shuttled between his home village near Sargodha and South Waziristan during the planning.

A police report on his questioning obtained by the AP says Mr. Farooq learned as a youth how to handle guns and explosives at training camps in Kashmir, a predominantly Muslim region split between Pakistan and India. Islamic separatists have pursued a bloody insurgency in Indian held portion for years.

According to the report, Mr. Farooq said he took orders for the November attack from another Sargodha-based militant, Mohammed Tayyab, who provided the money to buy potash, an explosive material often used in Pakistan for making firecrackers.

Mr. Farooq said he and another militant recruit he refers to only as Bilal bought the potash at a market in Lahore. They transported it by public bus to Mr. Farooq's home, where he packed it into milk containers attached to a motorbike, with the help of the bomber, Mohammed Abid, whom he said came from Waziristan to stage the attack.

Mr. Farooq, who has not faced trial and does not yet have a lawyer, told of Mr. Tayyab warning them that the plan to attack a military vehicle was "an order of the high command," the report says.

"He added this is jihad and this is what we must do to secure the blessing of God. He threatened us, whoever tries to ditch the operation, his head will be cut off," the report quotes Mr. Farooq as saying.

Aftab Khan Sherpao, who was the top civilian security official in the outgoing national government, said that despite dozens of arrests of major terrorists in the six years since Pakistan abandoned its support of the Taliban regime in Afghanistan, the suicide bombing network is spreading.

"The fact is that they are moving from tribal areas to the cities. They have carried out attacks in Rawalpindi, Sargodha and Lahore," Mr. Sherpao told the AP. "They are present in all of our major cities."

Authorities have blamed Taliban militant leaders like Baitullah Mehsud for the wave of attacks, including the Dec. 27 assassination of former Prime Minister Benazir Bhutto. Mehsud operates from the lawless South Waziristan region, where al Qaeda leaders are also believed to hide.

Recruits for suicide bombings, which became a favored militant tactic in Afghanistan two years ago before spreading to Pakistan, often go for training in Waziristan before staging attacks, officials say.

But reaching into Pakistan's main province of Punjab, the country's business and farm hub where people have different ethnicity and language to the Pashtun tribesmen in the northwest, requires local help.

"You need to have the support of local facilitators to carry out such attacks, and no suicide bomber can operate without such support," Mr. Sherpao said.

Source: Associated Press

Wednesday, March 12, 2008

India's Arms Build-up and Problems with Russia

India is in the midst of a huge arms build-up with massive defense spending planned for the next five years. With 10% increase year-over-year, India's defense budget for this year is $26.5b. The question facing the Indian defense establishment is where to get the sophisticated new equipment and training they need. In spite of the tall claims of India's indigenous development and production capacity, more than 80% of what they own today has come from their traditional supplier Russia. It is well known that Russia's industrial base and support infrastructure have significantly atrophied since the demise of the Soviet Union. Russia now derives such a disproportionate amount of revenue from oil and gas that the non-energy industrial sector has diminished in significance for the Russian economy. According to Times of India, India has complained to Russia about the unreliability of some of its weapon systems as well as tardy product support in execution of several projects. Top-level sources say it has been made very clear to Russia that apart from "quality control" of the military equipment being bought from it, India wants assurances on maintenance of delivery schedules of contracted weapon systems, uninterrupted supply of spares and life-term product support. The Indian Air Force is upset with the "distortions" on the canopies of the Sukhoi-30MKI Phase-3 fighter jets. This comes at a time when India is on the verge of signing a $1.6-billion deal with Russia to acquire another 40 Sukhoi-30MKIs, in addition to the 190 such jets already contracted through two big deals in 1996 and 2000. In addition to several recent crashes of Russian-built fighter aircraft, the BBC reports that there have been issues related to the acquisition of the aircraft carrier named Admiral Gorschkov. From a negotiated price of $700m, the Russians subsequently demanded $1.2bn with delivery delayed till 2013.
Around the same time, the Indian navy has refused to accept an upgraded diesel-powered submarine after delays in the installation of a missile system.

India's Admiral Mehta has called for a government review of military ties with Russia, amid growing resentment within the military about the Russian attitude to their needs. These irritants and other disagreements over trade and India's foreign policy have all served to put a strain on once close relations, according to the BBC.

The US and European suppliers present alternatives for the Indians with warming ties between India and the West after the end of the Cold war. However, this would be a dramatic change for the Indian military to integrate their new equipment into the existing units trained and equipped to use Russian-made weapons systems. While it is possible to do so, it would take a long time and a lot of work to pull it off. In the meanwhile, the transition is likely to damage relations with Russia which have already cooled recently. According to BBC reports, when India's foreign and defense ministers visited Moscow last year, President Putin allegedly refused to meet with them. In fact, Foreign Minister Pranab Mukherjee, next only to the prime minister in seniority, was not even given an appointment by the Russian prime minister. And when Indian Prime Minister Manmohan Singh travelled to Russia at the end of last year, he curtailed his visit to just 28 hours.

Is the PPP-PML(N) Coalition Up To The Task Ahead?

The drama between the PPP and the PML(N) and within each party that has unfolded during the last 48 hours clearly shows the lack of competence and maturity of their leadership in handling the very basic political disputes in their ranks. In the midst of rising terrorist violence claiming many innocent lives on a daily basis, the petty personal differences and mutual suspicions have clearly trumped any discussion of how to deal with the real challenges Pakistan faces today. The simplistic answer being parroted by the two parties and their mindless followers seems to indicate the belief that everything would be fine as soon as Musharraf steps down and the judiciary under Iftikhar Chaudhry is restored. I believe this answer is misleading. Pakistan's problems are much bigger than any one individual or institution. The resolution to these problems of rising violence, high worldwide inflation of food and fuel prices and continuing political instability will require all Pakistanis to work as a team. What Pakistan needs is a unifying leadership, not a divisive bunch with personal ambitions and vendettas against others.

The very public and crude manner in which a PPP stalwart Makhdoom Amin Fahim has been snubbed by both parties is nothing short of absolutely astounding. Not only does it smack of personal ambitions of a few individuals gone awry but also of the ethnic prejudice. But beyond that, it inspires little confidence in the leadership qualities of Asif Zardari and Nawaz Sharif and their closest lieutenants.

As the entire Pakistani nation holds its breath waiting for a peaceful power transfer, the coalition can not even agree on who will be the prime minister in the new set up. This clearly does not augur well for democracy in Pakistan.

Tuesday, March 11, 2008

Can Pakistan End Suicide Bombings?

With yet another incident of twin-bombings involving suicidal attackers taking their toll in Lahore today, there are clearly mounting concerns about this scourge. From six suicide bombings in 2006 in Pakistan, the tally went up to 62 in 2007, more than tenfold increase in just one year. According to the South Asia Terrorism Portal, at least 1,523- civilians were killed in terror-related violence in 2007 and more than twice that number injured. The average is now more than one per week – the last week saw three in a row. No one is safe from this scourge. Those praying in mosques, or at funerals have been no safer than others at political rallies or while crossing a street.

Dr. Pervez Hoodbhoy, writing in Pakistan's Dawn newspaper on March 9, 2008, describes in detail how this menacing phenomenon is taking its toll and the factors that are contributing to its alarming increase. In addition to the American drones launching attacks and killing many innocent people in Pakistan, Dr. Hoodbhoy holds Pakistanis culpable for what he describes as "human drones" killing innocent Pakistanis in large numbers. He says: "Why do so many Pakistanis suddenly lose their voice when it comes to condemning suicide bombings? Is it because the bomber kills in the name of Islam? Are people muted in their criticism lest they be regarded as irreligious or even blasphemous?"

I couldn't agree with Dr. Hoodbhoy more. The real question is how do we stop this self-destruction of a nation that has serious consequences for the entire world and force a course reversal? If the great majority of Pakistanis including the apologists for the bombers truly condemn the actions of the few, would it be sufficient? These bombings have spawned a new culture with its roots in the Afghan resistance of the Soviet Union in 1980s backed by US, Pakistan and Saudi Arabia. This culture has developed in two decades in Pakistan's tribal belt and gained strength more recently. There are many culprits, Pakistanis of all stripes are culpable to varying degrees. But so are many others. In my humble view, there are no quick fixes. We (Pakistanis backed by Americans, Saudis, the Europeans etc.) must start by addressing what Dr. Hoodbhoy describes as the "enabling environment of poverty, deprivation, lack of justice, and extreme differences of wealth" making the environment "perfect for demagogues". At the same time, we must continue to act against those who orchestrate these crimes in the name of Islam. If we do one without the other,the chances of success are zero. If we do both, we can entertain the hope of ending it in a decade or two. It's in the best interest of all to begin this effort quickly and earnestly.

Click here for the full text of Dr. Hoodbhoy's piece in Dawn titled "The War of the Drones".

Monday, March 10, 2008

Pakistan Stocks Continue to Defy Gravity

As growing concerns about the state of the US economy took their toll on share prices in Asia, the Karachi stock market continued its rally and KSE-100 touched a new peak of 15,085.18 points level during last week ending on March 8, 2008.

"The signs of formation of coalition government of PPP, PML (N) and ANP have revived investors' confidence and they have once again started investment in the share market, which pushed the index to new high level," analysts said, according to The Business Recorder, Pakistan's Financial Daily.
The KSE-30 index went up by 239.90 points, to close at 18,607.19 points level from 18,367.29 points.

Market capitalization jumped to a new peak of Rs 4.661 trillion from Rs 4.618 trillion, an increase of Rs 42.465 billion. Average daily trading volume of ready market stood at 285 million shares, while overall some 1.294 billion shares were traded during the week.

On Friday, the Indian market closed in the deep negative territory with the BSE Sensex closing below the psychological level of 16000 and the NSE Nifty settled below the 4800 mark. The market tumbled since the initial bell tracking the news from the global markets and remained in the negative territory throughout the trading session. Also, the rising of inflation to 5.02% in February 2008 added to the negative sentiments in the market. The inflation grew to nine months high due to rise in prices of fruits, vegetables and oil seeds. The BSE Sensex closed lower by 566.56 points at 15,975.52 and NSE Nifty fell by 149.80 points to close at 4,771.60. We expect that the market may remain volatile during the trading session.

The markets in Tokyo, Taipei and Shanghai did not fare any better. The Nikkei and other indexes in Asia were in negative territory. The stock market in Shanghai fell by 3.59% to a seven month low on continued inflation worries.
Taiwan's benchmark Taiex index fell 2.7%, which was its biggest fall for six weeks.

In spite of the KSE-100 defying gravity seen in the rest of Asia and the world, there is still a big cloud hanging over the market with the expected transfer of power in the next few weeks. Any hint of serious confrontation between the new government and President Musharraf could easily erase all the stock market gains and pull the KSE-100 into deep negative territory.

Malaysia's National Front Suffers Setback

Malaysia's opposition made significant gains in Saturday's elections. The alliance of three opposition parties led by former Finance Minister Anwar Ibrahim won 82 of 222 seats in the national Parliament, up from only 19 seats. By controlling one-third of Parliament, opposition parties will be able to block government efforts to amend the constitution. They also took control of five out of 13 states, up from one state previously. They included Penang, home to much of Malaysia's industrial base and to billions of dollars in U.S. and other foreign investments. These elections were held amidst the usual allegations of vote rigging by international organizations such as the Human Rights Watch. The results signaled that Malaysia, one of the world's most economically advanced Muslim-majority nations and the U.S.'s 10th-largest trade partner, could become a model of peaceful democratic change in the Islamic world. Although the jury is still out, this perception is further reinforced by the recent Pakistani elections where the ruling coalition was trounced by the opposition.

Under the decades-long rule of Malaysia's National Front, Malaysian economy has been completely transformed from a natural-resource base to a modern industrial base. The former prime minister and a retired National Front leader Mahathir Mohamad founded the regional alliance ASEAN along with former Prime Minister Lee Kuan Yu of Singapore and late President Suharto of Indonesia. The three leaders, credited with the rapid economic and industrial development of the region, ruled with an iron hand for a long time. The current Malaysian opposition leader Anwar Ibrahim was abruptly removed as Deputy Prime Minister and Finance Minister, jailed and tortured by Mr. Mahathir Mohamad during his term in office.

As Yaroslav Trofimov of the Wall Street Journal reports, the spread of uncensored new media, such as the Internet and cell-phone text messaging, helped opposition parties break the government's stranglehold on information flow, harnessing public anger over mounting inflation, widespread corruption and inept governance. Combined with rising resentment by ethnic Chinese and Indian minorities over long-standing affirmative-action policies designed to benefit the country's Muslim ethnic Malay majority, this anger coalesced into a perfect storm of protest against Prime Minister Abdullah Ahmad Badawi's government.

Mr. Abdullah is now facing growing pressure to step down. Former Prime Minister Mahathir Mohamad, who named Mr. Abdullah to replace him in 2003, also demanded the premier's head, accusing him of "destroying" the National Front.

Sunday, March 9, 2008

PPP Infighting Becomes Public

As the headlines in Pakistan proclaimed the formation of the PPP-PML(N) coalition at a summit meeting between Asif Zardari and Nawaz Sharif, there were obvious signs of rift emerging within the PPP. Makhdoom Amin Fahim, the PPP leader who faithfully guided the party during Beanzir Bhutto's self-imposed exile, told the news media that he was not invited to join the negotiations with PML(N) nor was he present during the announcement. In fact, he learned of the news through the media reports. While still maintaining his loyalty to the party, he was clearly agitated by this development.

There have also been reports of Sind-Punjab tussle on the choice of the prime minister within the PPP. In the Geo News show ‘Who would be the prime minister’, Makhdoom Amin Fahim said that the prime minister should be from Sindh and he was the candidate for this post. He said that he was a senior member of the party.
Mohtarma Benazir Bhutto and Asif Ali Zardari had also offered him the PM slot.

On the other hand, Chaudhry Ahmad Mukhtar insisted that the PM should be from Punjab. He also claimed to be a senior member of the party, as his family's had a long association with the Bhutto family since 1967. He also challenged that Makhdoom Amin Faheem was ever offered to become PM. Other names that have been mentioned are Raja Mahmood Qureshi and Syed Yusuf Raza Gilani.

The fact that Mr. Zardari has chosen to make deals with other parties without Mr. Fahim's participation is the clearest indication yet that Amin Fahim is either out of the running for the position of prime minister or, that he would not be fully empowered even if he gets the nod from Zardari. The real power will, in fact, continue to be in the hands of Mr. Zardari.

This is clearly an inauspicious beginning for the PPP and the new coalition. It calls into question Zardari's intentions and personal ambitions. It raises issues such as how the PPP unity can be maintained in the absence of an adult Bhutto at the head of the party. It also creates doubts about the durability of any coalition arrangements with other parties. This situation is likely to strengthen President Musharraf's position in dealing with the new civilian government.

Is Hillary Clinton Muslim?

As Obama gets closer to making history by clinching the Democratic nomination for US Presidential Elections in 2008, a number of stories are beginning to proliferate in the US media on the following questions: Is he really Christian as he says he is? Or is he secretly a Muslim? Why is his middle name Husain? Did he attend an Islamic School in Indonesia as a child? Is he really committed to supporting Israel? Would Obama take oath of office on the Bible? Why is the Black Muslim leader Louis Farrakhan endorsing him? Why does Obama want to talk to Iran without preconditions?

This debate has not been lost on the stand-up comedians such as Jon Stewart and Stephen Colbert of the Daily Show. Of particular interest to the bigots has been Obama's middle name which they emphasize greatly. Here's a take on this as applied to Hillary RODHAM Clinton's middle name to make the point:

Saturday, March 8, 2008

Are Women In Pakistan Better Off Today?

As the world celebrates International Women's Day today, it is natural to ask if Pakistani women have made substantial real progress in the last 5 years under President Musharraf. The answer to this question depends on who you ask and how you judge women's progress. In terms of the women's political representation in the nation's parliament, there has clearly never been a better time. The discriminatory laws such as the Hudood ordnance have been repealed. There are other indicators such as women's presence in the traditional male professions such as law, medicine, business, the police and the military. We have seen women inducted and grow in numbers in each of these male-dominated areas. Women's ranks have also grown in the nation's mass media and they are much freer than ever to express themselves in the choice of appearance, speech, dress, arts, entertainment etc. There have even been performances of The Vagina Monologues in Pakistan. Localized with Urdu and Punjabi words, The Vagina Monologues was first staged in Islamabad in 2003 for an audience of 160, mostly women, followed by performances for mixed audiences in Karachi and Lahore. Organized with AMAL, an NGO working on gender rights in Pakistan, the actresses added information about local incidents of violence against women and honor killings.

Along with the signs of women's progress in Pakistan, there have also been high-profile incidents of violence against women, such as the rape of Mukhtaran Mai that forced an honest discussion and debate on the status of women in rural Pakistan. Most of the women represented in Pakistani parliament are from the same privileged, feudal class that is largely responsible for discrimination against women in Pakistan. The women in parliament have not been particularly vocal in raising the women's issues in parliament and they have not offered any serious legislation other than the Women's Protection Bill that was offered and passed because of President Musharraf's personal intervention. The word "feudal princess" often used to describe late Prime Minister Benazir Bhutto applies well to the majority the women members of parliament in Pakistan. There is a continuing large literacy gap of as much as 45 percent between men and women and the opportunities for rural women's education remain elusive.

In summary, the Musharraf era has seen measurable progress in improving the situation for women. However, a lot more needs to be done. What is really needed is a fundamental change in social attitudes toward women, particularly in rural Pakistan. A massive effort is required to make both men and women aware of the need and the benefits of women's empowerment for a better future of Pakistan. Healthy, educated and empowered women can help bring up better children to build Pakistan as a modern society that cares for its people.

Thursday, March 6, 2008

New Indian Billionaires And Growing Rich-Poor Gap

The booming Bombay stock market in 2007 and the benefits of globalization have seen India's billionaires list swell to 40 on the Forbes Billionaires List. The Indian billionaires combined wealth has more than doubled from $170 billion to $351 billion in 2007. While Bill Gates has slipped to number three spot from number one, the number 4, 5, 6 and 8 spots in the top 10 are now occupied by Lakshmi Mittal, Mukesh Ambani, Anil Ambani and KP Singh from India.

The news of the newly-minted Indian billionaires is bringing sharper focus on the growing rich-poor gap in India. The Times of India reports Communist Party leader Sitaram Yechury claiming that on the one hand, 36 Indian billionaires constituted 25% of India’s GDP while on the other, 70% of Indians had to do with Rs 20 a day. "A farmer commits suicide every 30 minutes. The gap between the two Indias is widening," he said.

The growing wealth gap is also a big concern in other BRIC countries such as China and Russia. Fully a third of the new billionaires come from Russia (35), China (28) and India (19). The Chinese government is trying to tackle the growing rich-poor, urban-rural divide, a major cause of the rise in incidents of social unrest and violence in the world's most populous nation. The estimates of the urban-rural income gap vary by anywhere from 3 times to six times.

It is not unusual to see the rich-poor gap in the early stages of explosive growth in economies where the focus is on wealth creation rather than distribution. However, if this continues for an extended period of time, there is significant potential for widespread social unrest and serious political insatiability that can threaten the very foundations of a nation. From the recent speeches by the political leadership in India and China, it is clear that there is an acknowledgment of the issues and willingness to work on more equitable distribution of the fruits of progress.

Click here for complete list of Forbes Billionaire.

Here's a video clip of Prof Jayati Ghosh of Nehru University talking about growing rich-poor gap in India:

Is Democracy Right For Pakistan?

Pakistan's Constitution:
As Pakistan lurches forward to hopeful and positive change in the wake of the recent elections, there is a lot of talk about what is the right form of viable democracy for Pakistan. Examples of democracy in India, the United Kingdom and the United States come to mind. Given our colonial past and common history with India, many Pakistanis naturally gravitate toward the British and the Indian models as also reflected in Pakistan's 1973 constitution. The assumption is that the 1973 constitution will serve us well as a basis for democracy. Let's examine this assumption and look at a realistic transition to democracy.

British Democracy:
The British democracy has its roots in the Magna Carta issued in 1215. The Magna Carta was the first document which was forced onto an English King by his subjects to limit his powers by law. In practice Magna Carta mostly did not limit the power of the King in the Middle Ages; by the time of the English Civil War however it had become an important symbol for those who wished to show that the King was bound by the law. So the Magna Carta was meant to limit the powers of individuals and create some checks and balances in the governance. The United Kingdom does not have a written constitution. The British democracy has gone through many ups and downs as it evolved over the last 800 years based on the Magna Carta to its modern form with institutions of executive led by the prime minister, judiciary led by the law lords in the upper house and the the legislature consisting of mainly the British house of commons. In spite of the long history of democracy, the British government is known to have acted without the support of its people in matters such as the decision to join the US invasion of Iraq.

The US Democracy:
The US democracy began with the the revolutionary war motivated by the people's desire for participation in decision making of the government. It was inspired by the slogan "No taxation without representation". It was a revolt against the British monarchy. In its early days after independence, one of the US founding fathers Alexander Hamilton said, " The masses are asses". US democracy restricted voting rights to "white men owning property" for a long time. Blacks were held as slaves and women denied suffrage for more than a century. The biggest single addition to the US constitution was the addition of the "Bill of Rights", the first ten amendments to the US constitution which, like Magna Carta, focused on limiting the powers of the government. In 1867,fourteenth amendment passed Congress, defining citizens as "male". The women finally got their voting rights by the passage of "Susan B. Anthony amendment" in 1920, after a long struggle. It took a hundred years after the bill of rights and a bloody civil war for the black slaves to be freed by the emancipation proclamation. And another hundred years after that to repeal segregation and pass voting rights act. So the US democracy has taken a long time, blood and sweat to get to where it is today. And yet it remains imperfect: Today, the US elections, legislation and policies are heavily influenced by the corporate money and powerful lobbyists. Neocons supported by the military-industrial complex have led us into a disastrous war that Nobel Laureate Joe Stiglitz describes as a "Three trillion dollar war". George W. Bush has been hard at work to shred the bill of rights and packing the courts with judges that support giving extra-ordinary powers to the executive branch, particularly the president.

Indian Democracy:
The Indian democracy is modeled after the British democracy but with a written constitution and the president substituting the queen as the head of state. Indians have had more than a dozen largely free and fair general elections in the past 60 years and smooth, peaceful power transfers. There are strong institutions such as an elected parliament, powerful judiciary and a functioning executive.
In spite of living up to the definition of a functioning democracy, the Indian democracy has failed to serve the vast majority of its people who remain mired in extreme poverty, lack of education and basic health care. The license raj and official corruption are rampant and the people of India continue to suffer from the excesses of the powerful government bureaucracy. The few high-profile high-tech companies and several Indian billionaires cited as the successes of Indian resurgence fail to hide the fact that there are very few jobs being created relative to the needs, and high rates of poverty and low wages make life difficult for an average Indian.

Pakistani Democracy:
Pakistan has had checkered history of attempts to establish democracy. The failure of the politicians and the interventionist military have made things difficult. Compared to India, the Pakistani economy and the average standard of living have not been bad. As William Dalrymple of the Guardian wrote in August 2007, "...and first-time visitors to Pakistan are almost always surprised by the country's visible prosperity. There is far less poverty on show in Pakistan than in India, fewer beggars, and much less desperation. In many ways the infrastructure of Pakistan is much more advanced: there are better roads and airports, and more reliable electricity. Middle-class Pakistani houses are often bigger and better appointed than their equivalents in India." So while democracy in Pakistan has been missing in action, the reality on the ground is that the people in Pakistan are slightly better off than the the people in India. While free, fair and peaceful elections by Musharraf in Pakistan are very welcome, I am a little leery of accepting this as a fundamental change in Pakistan. This vote is more a protest vote based on basic bread, security and electricity crises they were subjected to in the last few months as the polls showed Musharraf going from 60% favorable rating down to 15% within about a year. People have responded by recycling the old, failed, and thoroughly corrupt feudal politicians and given them a third chance hoping things will improve. If they fail in solving the basic problems of food and fuel and security (a tough challenge by any measure), I wouldn't be surprised to see the same voters yearning for and welcoming another coup with a new general as a strongman. Let's all hope I'm wrong but we have seen this film replayed several times in Pakistan's 60 year history. Let's hope the PPP and the PML(N)leaders are returning to power as a duly chastised and reformed bunch.

The Future of Democracy in Pakistan:
In the long run, I do remain hopeful that Pakistanis will find a way to a form of democracy that best suits them. As the experience in the US and the UK shows, it will probably evolve over time if the democratic process, however flawed it may be, is allowed to continue to play out. Let's hope Pakistan achieves a better system of democracy in a lot less than 200 years, a democracy that is responsive to the needs of its people and serves them well.