Musharraf Accelerated Financial and Human Capital Growth in Pakistan

Pakistan experienced rapid economic and human capital growth in years 2000 to 2008 on President Pervez Musharraf's watch. Savings, investments and exports hit new records and the rate of increase in human development reached new highs not seen before or since this period.

Savings and Investments:

Domestic savings rate reached 18% of the GDP and foreign direct investment (FDI) hit a record level of $5.4 billion in 2007-8. This combination of domestic and foreign investments nearly tripled the size of the economy from $60 billion in 1999 to $170 billion in 2007, according to IMF. Exports nearly tripled from about $7 billion in 1999-2000 to $22 billion in 2007-2008, adding millions of more jobs. Pakistan was lifted from a poor, low-income country with per capita income of just $500 in 1999 to a middle-income country with per capita income exceeding $1000 in 2007.

Pakistan Per Capita Income 1960-2012. Source: World Bank 

The PPP government summed up General Musharraf's accomplishments well when it signed a 2008 Memorandum of Understanding with the International Monetary Fund which said:

"Pakistan's economy witnessed a major economic transformation in the last decade. The country's real GDP increased from $60 billion to $170 billion, with per capita income rising from under $500 to over $1000 during 2000-07". It further acknowledged that "the volume of international trade increased from $20 billion to nearly $60 billion. The improved macroeconomic performance enabled Pakistan to re-enter the international capital markets in the mid-2000s. Large capital inflows financed the current account deficit and contributed to an increase in gross official reserves to $14.3 billion at end-June 2007. Buoyant output growth, low inflation, and the government's social policies contributed to a reduction in poverty and improvement in many social indicators". (see MEFP, November 20, 2008, Para 1)

Human Capital Development: 

In addition to the economic revival, Musharraf focused on social sector as well. Pakistan's HDI grew an average rate of 2.7% per year under President Musharraf from 2000 to 2007, and then its pace slowed to 0.7% per year in 2008 to 2012 under elected politicians, according to the 2013 Human Development Report titled “The Rise of the South: Human Progress in a Diverse World”.

Primary Enrollment Source: Economic Survey of Pakistan

Youth Literacy Rate Source: Economic Survey of Pakistan

Overall, Pakistan's human development score rose by 18.9% during Musharraf years and increased just 3.4% under elected leadership since 2008. The news on the human development front got even worse in the last three years, with HDI growth slowing down as low as 0.59% — a paltry average annual increase of under 0.20 per cent. Going further back to the  decade of 1990s when the civilian leadership of the country alternated between PML (N) and PPP,  the increase in Pakistan's HDI was 9.3% from 1990 to 2000, less than half of the HDI gain of 18.9% on Musharraf's watch from 2000 to 2007.

R&D Spending Jumped 7-fold as % of GDP 1999-2007 Source: World Bank

Acceleration of HDI growth during Musharraf years was not an accident.  Not only did Musharraf's policies accelerate economic growth, helped create 13 million new jobs, cut poverty in half and halved the country's total debt burden in the period from 2000 to 2007, his government also ensured significant investment and focus on education and health care. The annual budget for higher education increased from only Rs 500 million in 2000 to Rs 28 billion in 2008, to lay the foundations of the development of a strong knowledge economy, according to former education minister Dr. Ata ur Rehman. Student enrollment in universities increased from 270,000 to 900,000 and the number of universities and degree awarding institutions increased from 57 in 2000 to 137 by 2008. Government R&D spending jumped from 0.1% of GDP in 1999 to 0.7% of GDP in 2007. In 2011, a Pakistani government commission on education found that public funding for education has been cut from 2.5% of GDP in 2007 to just 1.5% - less than the annual subsidy given to the various PSUs including Pakistan Steel and PIA, both of which  continue to sustain huge losses due to patronage-based hiring.

Pakistan's High-Tech Exports Tripled as % of Manufactured Exports. Source: World Bank

To see a discussion of the above subject and the current situation, please watch the following video:

http://vimeo.com/84504051



Civil-military Stand-Off on Musharraf Trial; Musharraf Govt's Performance Record from WBT TV on Vimeo.

Related Links:

Haq's Musings

Musharraf Earned Legitimacy By Good Governance

Musharraf Wants to Face Trial; Military Opposed to it

Saving Pakistan's Education

Political Patronage Trumps Public Policy in Pakistan

Dr. Ata-ur-Rehman Defends Pakistan's Higher Education Reforms

Twelve Years Since Musharraf's Coup

Musharraf's Legacy

Pakistan's Economic Performance 2008-2010

Role of Politics in Pakistan Economy

India and Pakistan Compared in 2011

Musharraf's Coup Revived Pakistan's Economy

What If Musharraf Had Said No?

Human Development in Musharraf Years

Meat Consumption: Carnivorous Pakistanis Sit Atop Food Chain

A recent study published in Proceedings of the National Academy of Sciences and Nature magazine reports that Pakistanis are among the most carnivorous people in the world.

The scientists conducting the study  used "trophic levels" to place people in the food chain. The trophic system puts algae which makes its own food at level 1. Rabbits that eat plants are level 2 and foxes that eat herbivores are 3. Cod, which eats other fish, is level four, and top predators, such as polar bears and orcas, are up at 5.5 - the highest on the scale.

Trophic Levels Map Source: Nature Magazine

After studying the eating habits of 176 countries, the authors found that average human being is at 2.21 trophic level. It put Pakistanis at 2.4, the same trophic level as Europeans and Americans. China and India are at 2.1 and 2.2 respectively.

Source: Proceedings of National Academy of Sciences

The countries with the highest trophic levels (most carnivorous people) include Mongolia, Sweden and Finland, which have levels of 2.5, and the whole of Western Europe, USA, Australia, Argentina, Sudan, Mauritania, Kazakhstan, Pakistan and Turkmenistan, which all have a level of 2.4.

United States Department of Agriculture (USDA) also published recent report on the subject of meat consumption. It found that meat consumption in developing countries is increasing with rising incomes. USDA projects an average 2.4 percent annual increase in developing countries compared with 0.9 percent in developed countries. Per capita poultry meat consumption in developing countries is projected to rise 2.8 percent per year during 2013-22, much faster than that of pork (2.2 percent) and beef (1.9 percent).

Per Capita Meat Consumption and Income Source: USDA

India and China with the rising incomes of their billion-plus populations are expected to be the main drivers of the worldwide demand for meat and poultry.

Pakistan's goat meat consumption of 779,000 tons in 2011-12 ranks it among the top 3 in the world. 1.7 million tons of beef consumption in Pakistan is ranked  9th among beef consuming nations. In addition, 834,000 tons of poultry meat consumption puts it among world's top 20.

Source: Economic Survey of Pakistan 2011-12

Along with rising meat consumption, there has also been a big surge in milk consumption with the ongoing livestock revolution in Pakistan. Pakistanis consumed nearly 39 million tons of milk in 2011-12, according to Economic Survey of Pakistan. This translates into 223 Kg of milk consumption per person which is about the same as the developed world's per capita milk consumption and more than twice that of neighboring India's 96 kg per capita.

Although meat consumption in Pakistan is rising, it still remains very low by world standards. At just 18 Kg per person, it's less than half of the world average of 42 Kg per capita meat consumption reported by the FAO.

Being mostly vegetarian, neighboring Indians consume only 3.2 Kg of meat per capita, less than one-fifth of Pakistan's 18 Kg. Daal (legumes or pulses) are popular in South Asia as a protein source.  Indians consume 11.68 Kg of daal per capita, about twice as much as Pakistan's 6.57 Kg.

Another ingredient popular in South Asian cuisine is vegetable oil.  It's an important source of fat and protein for a nutritious and tasty diet. Edible oil consumption soars during the holidays as hundreds of millions of people eat sweets and fried foods during the September-December festive season.   Pakistanis use about 20 Kg of oil, the per capita amount recommended by the World Health Organization, while Indians consume about 13 Kg per capita.

Celebratory occasions like Eid or Diwali push sugar consumption in South Asia. Pakistan's per capita sugar consumption is about 23 Kg while India's is about 20 Kg per person per year.

Although still below average relative to the world, per capita consumption of meat, milk and edible oil is rising with rising incomes and standards of living in both India and Pakistan. As the dietary habits change, it'll be important for policy makers and health and fitness professionals to watch the changes and help educate the people about healthy eating and its environmental impact.

Related Links:

Haq's Musings

Pakistan Among Top Meat and Dairy Consuming Nations

Pakistan Leads South Asia in Value Added Agriculture

Livestock and Agribusiness Revolution in Pakistan

Pakistan's Rural Economy Showing Strength

Solving Pakistan's Sugar Crisis

Food, Clothing and Shelter in India and Pakistan 

Is India a Nutritional Weakling?

India Tops World Hunger Charts

Musharraf Earned Legitimacy By Good Governance

Former President Musharraf's detractors argue that he lacked legitimacy because he came to power through a coup which removed a duly elected government in 1999.

Implicit in Musharraf's opponents' argument is the assumption that the electoral process is the only source of legitimacy for a ruler. It ignores the possibility that the will of the people can also be expressed in ways other than elections to confer legitimacy on a leader. It rejects the notion that a leader can earn legitimacy in the eyes of the people by delivering results to the people through good governance.

Public Opinion Surveys:

Such an expression of people's will can come in many forms, including results of frequent public opinion polls conducted by multiple professional pollsters in Pakistan and many other countries around the world. One such credible survey is done regularly by Pew Global Research.  It shows that the majority of the people believed the country was headed in the right direction in Musharraf years. It also shows that people's satisfaction with Pakistan's direction has been in rapid decline. It has sharply fallen to about 8% in 2013.

Source: Pew Research in Pakistan

Another survey conducted by Gallup Pakistan  in August 2013 shows that 59% of Pakistanis have a positive view of President Muaharraf (31%  say they hold a favorable opinion of him and another 28% say he was satisfactory). 34% have an unfavorable opinion of the former ruler.

Judiciary and Parliament Approval:

Musharraf's actions of 1999 were legitimized by Pakistan Supreme Court in Syed Zafar Ali Shah v. General Pervez Musharraf, Chief Executive of Pakistan (PLD 2000 SC 869). In addition to endorsing the coup, the Supreme Court granted extensive powers to the new Musharraf Government, empowering it to unilaterally amend the 1973 Constitution and enact new laws without the approval of Parliament.

Musharraf held parliamentary elections in 2002 and subsequently won a parliamentary vote to confirm him as President of Pakistan.

Good Governance Under Musharraf:

When Musharraf took over in 1999, Pakistan was essentially bankrupt with just a few hundred million dollars in reserves and a heavy debt load which it couldn't repay. Economic growth plummeted to between 3% and 4%, poverty rose to 33%, inflation was in double digits and the foreign debt mounted to nearly the entire GDP of Pakistan as the governments of Benazir Bhutto (PPP) and Nawaz Sharif (PML) played musical chairs. Before Sharif was ousted in 1999, the two parties had presided over a decade of corruption and mismanagement. In 1999 Pakistan’s total public debt as percentage of GDP was the highest in South Asia – 99.3 percent of its GDP and 629 percent of its revenue receipts, compared to Sri Lanka (91.1% & 528.3% respectively in 1998) and India (47.2% & 384.9% respectively in 1998). Internal Debt of Pakistan in 1999 was 45.6 per cent of GDP and 289.1 per cent of its revenue receipts, as compared to Sri Lanka (45.7% and 264.8% respectively in 1998) and India (44.0% and 358.4% respectively in 1998).

So what did Musharraf do to gain the trust of a very large number of Pakistanis who supported his rule after the 1999 coup? He undertook a number of economic and regulatory reforms to rejuvenate the country's economy. Deregulating telecommunications and liberalizing electronic media business, particularly television, immediately brought in significant first wave of domestic and foreign investment and created media and telecom boom in the country. Banking and financial services sector took off and rapidly grew and created lots of jobs. A construction boom followed which more than doubled per capita cement consumption and created millions of new jobs. Exports nearly tripled from about $7 billion in 1999-2000 to $22 billion in 2007-2008, adding millions of more jobs.

Pakistan Savings Rate as Percent of GDP (Source: World Bank)

Source: Credit Suisse and Cement Industry

Per Capita Cement Consumption in Pakistan Source: Credit Suisse and Cement Industry

Thanks to the dynamic economy under President Musharraf's rule, Pakistan created more jobs, graduated more people from schools and colleges, built a larger middle class and lifted more people out of poverty as percentage of its population than India in the last decade. And Pakistan has done so in spite of the huge challenges posed by the war in Afghanistan and a very violent insurgency at home.

The above summary is based on volumes of recently released reports and data on job creation, education, middle class size, public hygiene, poverty and hunger over the last decade that offer new surprising insights into the lives of ordinary people in two South Asian countries. It adds to my previous post on this blog titled "India and Pakistan Contrasted in 2010".


The PPP government summed up General Musharraf's accomplishments well when it signed a 2008 Memorandum of Understanding with the International Monetary Fund which said:

"Pakistan's economy witnessed a major economic transformation in the last decade. The country's real GDP increased from $60 billion to $170 billion, with per capita income rising from under $500 to over $1000 during 2000-07". It further acknowledged that "the volume of international trade increased from $20 billion to nearly $60 billion. The improved macroeconomic performance enabled Pakistan to re-enter the international capital markets in the mid-2000s. Large capital inflows financed the current account deficit and contributed to an increase in gross official reserves to $14.3 billion at end-June 2007. Buoyant output growth, low inflation, and the government's social policies contributed to a reduction in poverty and improvement in many social indicators". (see MEFP, November 20, 2008, Para 1)

Contrary to what Musharraf bashers dismiss as "aid-fueled " or "consumption-driven" economy in 2002-2007, the economic growth was actually driven by private savings and investments. Private domestic savings rate was over 18% of GDP in Musharraf but has slumped to just 7% in recent years. Pakistan attracted record foreign direct investment (FDI) in telecom, banking, manufacturing and other sectors of the economy. Annual FDI flow into Pakistan reached $5.4 billion in Year 2007-08. As to US aid during and after Musharraf's years in office, it has actually tripled in size from $700 million in 2007-8 to $2.1 billion since 2010. If aid alone were responsible for economic growth, then the GDP growth rate should have accelerated, not plummeted, after Musharraf left office.

Pakistan FDI as Percent of GDP (Source: World Bank)

In addition to the economic revival, Musharraf focused on social sector as well. Pakistan's HDI grew an average rate of 2.7% per year under President Musharraf from 2000 to 2007, and then its pace slowed to 0.7% per year in 2008 to 2012 under elected politicians, according to the 2013 Human Development Report titled “The Rise of the South: Human Progress in a Diverse World”.

Overall, Pakistan's human development score rose by 18.9% during Musharraf years and increased just 3.4% under elected leadership since 2008. The news on the human development front got even worse in the last three years, with HDI growth slowing down as low as 0.59% — a paltry average annual increase of under 0.20 per cent.

Rising University Enrollment in Pakistan Starting in 2001-2002. Source: ICEF Monitor

Going further back to the  decade of 1990s when the civilian leadership of the country alternated between PML (N) and PPP,  the increase in Pakistan's HDI was 9.3% from 1990 to 2000, less than half of the HDI gain of 18.9% on Musharraf's watch from 2000 to 2007.

Acceleration of HDI growth during Musharraf years was not an accident.  Not only did Musharraf's policies accelerate economic growth, helped create 13 million new jobs, cut poverty in half and halved the country's total debt burden in the period from 2000 to 2007, his government also ensured significant investment and focus on education and health care. The annual budget for higher education increased from only Rs 500 million in 2000 to Rs 28 billion in 2008, to lay the foundations of the development of a strong knowledge economy, according to former education minister Dr. Ata ur Rehman. Student enrollment in universities increased from 270,000 to 900,000 and the number of universities and degree awarding institutions increased from 57 in 2000 to 137 by 2008. In 2011, a Pakistani government commission on education found that public funding for education has been cut from 2.5% of GDP in 2007 to just 1.5% - less than the annual subsidy given to the various PSUs including Pakistan Steel and PIA, both of which  continue to sustain huge losses due to patronage-based hiring.

So Why Didn't the Musharraf Miracle Last?

It takes a long time to build and very little time to destroy a beautiful, well-manicured garden with flourishing plants and flowers. A new incompetent, lazy and corrupt gardener can turn it into a disaster by failing to fertilize, water and prune. That's what happened in Pakistan in 2008. A healthy, well-run and growing economy was quickly turned to shambles in a very short time because of policy inaction and neglect. Here's how Pakistani economist Dr. Ashfaque H. Khan explained it in 2010: "What went wrong? Why one of the fastest growing economies in the Asian region until two years ago has been totally forgotten in the region? Firstly, the speed and dimension of exogenous price shocks (oil and food) were of extraordinary proportions. Secondly, the present government found itself totally ill-prepared and clueless in addressing the challenges arising out of the shocks. While rest of the world was taking corrective measures and adjusting to higher food and fuel prices, Pakistan lurched from one crisis to another."

Constitution Not Suicide Pact: 

To those who say nothing should trump the constitution of Pakistan, let me remind them that there is legal precedent to suggest  that there are things more important than the constitution. "The Constitution is not a suicide pact" is an oft-repeated phrase in American political and legal discourse. It refers to the belief that constitutional restrictions on governmental power must be balanced against the need for survival of the state and its people. It is frequently attributed to Abraham Lincoln who is said to have used it in answering charge that he violated the United States Constitution by suspending habeas corpus during the American Civil War. Others who have used it include Justice Robert H. Jackson (Terminiello v. Chicago, 1949) and Justice Arthur Goldberg (Kennedy v. Mendoza-Martinez, 1963).

Here's a video discussion on the subject:


Civil-military Stand-Off on Musharraf Trial; Musharraf Govt's Performance Record from WBT TV on Vimeo.

Related Links:

Haq's Musings

Musharraf Wants to Face Trial; Military Opposed to it

Saving Pakistan's Education

Political Patronage Trumps Public Policy in Pakistan

Dr. Ata-ur-Rehman Defends Pakistan's Higher Education Reforms

Twelve Years Since Musharraf's Coup

Musharraf's Legacy

Pakistan's Economic Performance 2008-2010

Role of Politics in Pakistan Economy

India and Pakistan Compared in 2011

Musharraf's Coup Revived Pakistan's Economy

What If Musharraf Had Said No?

Human Development in Musharraf Years

Musharraf Wants to Face Trial But Pakistan Army Opposes it

President Musharraf strongly believes he is innocent of all of the charges leveled against him and he wants to go through his treason trial under Article 6 of the Pakistan Constitution. However, Pakistan Army does not want to see its former chief and a retired four-star general tried and convicted because it would set an unacceptable precedent for the entire military.

The theory is that if Musharraf's trial were to go through in a court made up of civilian judges, it would essentially nullify the Army Act which does not recognize the jurisdiction of civilian courts over Pakistani military officers. Under the Army Act, the military officer can only be tried in a military court even for charges relating to violation of civilian laws.

Prior to Nawaz Sharif government's attempts to drag Musharraf into civilian courts, there was a similar effort made the PPP government two years ago to try in a civilian court two retired senior Army officers with financial mismanagement in NLC (National Logistics Cell) scandal. General Kayani thwarted it by bringing them back in military service and insisting that they be tried in a military court.

The military has already made a soft intervention in General Musharraf's case when it took him to a hospital when he was on his way to a waiting court which, after summarily rejecting all of the defense attorneys' pretrial motions, appeared ready to charge Musharraf and convict him under Article 6 after a rushed trial.

The soft intervention appears to be a warning to Nawaz Sharif's government, the prosecutors and the judges that Musharraf's trial is unacceptable. If the government persists in its efforts to try the former general, a hard intervention in the form of a coup can not be ruled out. This is a critical moment in the long and rocky history of civil-military relations in Pakistan.

To learn more about it and other current topics, please watch the following video:

http://vimeo.com/83912166


SP Chaudhry Aslam Killed; Musharraf's Trial Hurts Civil-Military Ties; Civilians Worst Hit in Terrorist Violence from WBT TV on Vimeo.

Related Links:

Haq's Musings

Pak Media Cheers as Vindictive Politicians, Judges Pursue Musharraf

Lest We Forget by Dr. Ata ur Rehman

UN Malala Day

Treason Trial of Musharraf

Does Sharif Have an Anti-Terror Policy?

Blowback of US Drones in Pakistan

Why is Democracy Failing in Pakistan?

Viewpoint From Overseas-Vimeo 

Viewpoint From Overseas-Youtube

Karachi's "Dirty Harry" Chaudhry Aslam Killed by Taliban

“As a Muslim, my faith tells everyone has to die one day. I’m not afraid of it.”

The above quote is from Police Superintendent Chaudhry Aslam Khan, the head of Karachi City's anti-terror operations, who was a brave cop indeed. He ran out of luck today after flirting with death every day for decades. He was killed in a suicide attack near Essa Nagri at the Lyari Expressway in Karachi on Thursday. May his soul rest in peace!

SP Chaudhry Aslam Khan RIP

Tehrik-e-Taliban Pakistan (TTP) has claimed responsibility for the "successful" attack, according to media reports. TTP central spokesman Shahidullah Shahid told Newsweek Pakistan: “Chaudhry was on our hit-list. He was directly involved in killing more than 50 mujahideen and anyone who dares to launch an operation against the mujahideen will be our target."

Earlier in the day, an anti-terror team led by Aslam conducted a raid along the Northern Bypass in the Manghopir area of Karachi and claimed to have killed three militants. A policeman also suffered injuries during the raid.

Chaudhry Aslam Khan had been shot at dozens of times in his career. He survived a massive bomb attack in September 2011 which left a huge crater where his home stood in Karachi's Defense Society neighborhood.

A 2011 Guardian newspaper story described Aslam in the following words: "Few know the dark streets as well as Aslam, a grizzled police veteran of 27 years' experience. Profane, chain-smoking and usually armed with a Glock pistol, he has earned a controversial reputation as Karachi's version of Dirty Harry – the cop who will do whatever it takes to keep the peace."

For those unfamiliar with "Dirty Harry" character, it is the name of a fictional San Francisco Police Department Homicide Division Inspector "Dirty" Harry Callahan which was immortalized by Clint Eastwood. Dirty Harry has come to symbolize a no holds barred cop who relentlessly pursues bad guys to remove them from the streets.

Chaudhry Aslam was a very courageous officer who put his life on the line to protect the citizens of Karachi. It will be extremely difficult, if not impossible, to replace such a dedicated and committed police officer.

Related Links:

Haq's Musings

Pak Terror Deaths Decline But TTP Threat Looms Large

Nawaz Sharif's Silence on Taliban Terror in Inaugural Speech

Taliban vs. Pakistan

Nawaz Sharif's First 100 Days

Yet Another Peace Deal and Shia Blockade

Taliban Insurgency in Swat

Musharraf's Treason Trial

General Kayani's Speech on Terror War Ownership

Impact of Youth Vote and Taliban Violence on Elections 2013

Imran Khan's Social Media Campaign

Pakistan Elections 2013 Predictions 

Why is Democracy Failing in Pakistan?

Viewpoint From Overseas-Vimeo 

Viewpoint From Overseas-Youtube 

Pak Terror Deaths Decline in 2013 But TTP Threat Still Looms Large

Total number of deaths in Pakistan terrorist violence declined from 6,211 in 2012 to 5,279 in 2013, the lowest since 11,704 fatalities suffered in 2009, according to figures compiled by South Asia Terrorism Portal.

Source: SATP

While civilian casualties remained essentially flat--down only slightly from 3007 in 2012 to 3001 in 2013-most of the overall drop from 6,211 to 5,379 occurred in fatalities suffered by the security forces and the terrorists.

Pakistan's biggest province Punjab with more than half the country's population remained relatively unscathed  by terrorist violence with just 81 terror casualties in 2013. By contrast, FATA, Sindh, KP and Balochistan suffered disproportionately  with 1,716, 1668, 936 and 960 terror-related deaths respectively.

Source: SATP

Sindh suffered the most civilian casualties in 2013 with 1285 dead in terrorist attacks. It is followed by 718 in Balochistan, 603 in KP, 319 in FATA and 64 civilian deaths in Punjab. Few terror-related deaths in Punjab, Pakistan's biggest province, appear to be the main reason why terrorism is not seen as a major problem by majority of Pakistanis in public opinion surveys. According to a survey conducted by the International Republican Institute (IRI), 42% respondents said electricity is the single most important issue facing Pakistan; while 21% said inflation, 12% said unemployment, 10% said terrorism and 3% each cited law and order, corruption and poverty as the most crucial issue. Only 1% considered gas/petrol shortage as the single most important issue of Pakistan.

Pakistan Savings Rate as Percent of GDP (Source: World Bank)

Pakistan FDI as Percent of GDP (Source: World Bank)

It seems that Pakistan's new prime minister Mr. Nawaz Sharif's agenda is set in response to the surveys like the IRI survey which are heavily influenced by the perceptions of his party's political base in Punjab. While the Sharif government is focusing on the energy and the economy, it is hard to de-link these priorities with action on terrorism. With Pakistan's domestic savings rate at an all-time low of just 4.3% of GDP, the country badly needs foreign direct investment in energy sector to revive the economy. Such foreign investment is unlikely to materialize in a big way without first tackling the scourge of terrorism in the country. What is urgently needed is a comprehensive strategy and a clear plan of action to fight terrorism in a coordinated fashion.

Related Links:

Haq's Musings

Nawaz Sharif's Silence on Taliban Terror in Inaugural Speech

Taliban vs. Pakistan

Nawaz Sharif's First 100 Days

Yet Another Peace Deal and Shia Blockade

Taliban Insurgency in Swat

Musharraf's Treason Trial

General Kayani's Speech on Terror War Ownership

Impact of Youth Vote and Taliban Violence on Elections 2013

Imran Khan's Social Media Campaign

Pakistan Elections 2013 Predictions 

Why is Democracy Failing in Pakistan?

Viewpoint From Overseas-Vimeo 

Viewpoint From Overseas-Youtube 

Pakistan Stock Index KSE-100 Among World's Top 5 Performers in 2013

Karachi's KSE-100 Stock Market Index was up 49.4% (37% in US$ terms) in 2013, beating all but four stock indices in the world. It handily beat Morgan Stanley's MSCI emerging market index which remained essentially flat. By comparison, India's main stock index rose just 8.89% in the same period. The remaining three BRIC countries--Brazil, Russia and China-- all saw their key stock indices decline in 2013.

KSE-100 vs MSCI Emerging Markets Index Source: Wall Street Journal

This is a continuation of the bullish trend seen in 2012 when KSE-100 also rose nearly 50% to top all Asian market indices. As of December 31, 2013, KSE-100 is up 329% since the end of 2008. It is being driven mainly by rapid growth in revenue and profits of the listed companies. Even after the strong run-up, the market still remains cheap—currently trading at over nine times trailing 12 month earnings—a common valuation measure used by stock analysts, according to Wall Street Journal.

World Stock Indices Performance 2013 Source: Seeking Alpha

Dubai finished up the most in 2013 with a gain of 107.69%. Japan was up the fourth most with a gain of 56.72%, making it the best performing G7 country. The US ended up in 9th place globally with a gain of 29.6%. Of the other G7 countries, Germany finished third with a YTD gain of 25.48%, followed by France (17.99%), Italy (16.56%), the UK (14.43%) and Canada (9.55%), according to Seeking Alpha.

The fresh investor optimism in 2013 was triggered by the election of Prime Minister Nawaz Sharif whose government is seen to be business-friendly by investors and businessmen. His finance minister Ishaq Dar claimed that Pakistan's gdp growth accelerated to 5% in July-Sept quarter in 2013. It was driven by large-scale manufacturing (LSM) which grew 12.76 per cent in September 2013 from a year ago.

"Pakistan has a fairly diverse economy with a large and young population that needs to be fed and supplied basic infrastructure such as electricity," Wall Street Journal quoted Caglar Somek, global portfolio manager at Caravel Management in New York, as saying. He manages around $650 million of investments. "If you find the companies that supply those basic needs, growing at double digit with high profitability, you can buy them at valuations that are on average 30% to 40% cheaper than their emerging market peers," said Mr. Somek.

Since the general elections of May, 2013, Pakistan has seen smooth power transfer from one civilian government to another. Other major transitions include the change of President, Army Chief and the nation's powerful Chief Justice of the Supreme Court.

Power cuts are now less frequent after payment of power generation companies overdue bills by the federal government. Financing has been closed on several power projects, including ADB financing of a major coal-fired plant in Jamshoro and Chinese loans for the nation's largest nuclear power plant planned for Karachi.

Progress on economic front, however, is not matched by similar progress on the security front which remains the biggest concern for the future of the country and its economy. What is needed is a comprehensive anti-terrorism strategy and plan of action soon.

Related Links:

Haq's Musings

Foreign Investment Up, Load-shedding Down in Nawaz Sharif's First 100 Days

Pakistan to Beg and Borrow Billions More in 2013-14

Power Companies Profits Soar at Taxpayer's Expense

Does Nawaz Sharif Have a Counter-terrorism Strategy?

Pakistan's Tax Evasion Fosters Aid Dependence

Pakistan's Vast Shale Oil and Gas Reserves

Pak IPPs Make Record Profits Amid Worst Ever Load Shedding 

Global Power Shift Since Industrial Revolution

Massive Growth in Electrical Connections in Pakistan

Finance Minister Ishaq Dar's Budget 2013-14 Speech

Remembering Qazi Hussain Ahmad's Clarity, Courage and Integrity

“The (Afghan) Taliban regime cannot be termed a model Islamic government, as little of what they did was Islamic."
                                                                                                         
Tehrik-e-Taliban Pakistan's "Jihad" inside Pakistan is fasad"

"Suicide attacks are un-Islamic"

The above quotes are from various interviews and speeches of  courageous and straight-talking Jamat-e-Isalmi Chief Qazi Hussain Ahmed (1938-2013) who passed away a year ago.

Qazi sahib's honest criticism of the Taliban's terror drew the wrath of the late TTP Chief Hakimullah Mehsud. He was targeted in a suicide bomb attack which he luckily survived in November 2012. Unfortunately, he only lived for less than two months before suffering the fatal heart attack on January 6, 2013. May Allah reward him for his many good deeds, including his clarity of thought, extraordinary integrity and undeniable bravery to speak the truth in the face of danger.

Regardless of political or ideological differences one might have with Qazi Sahib, it is hard to question his courage and integrity. Such qualities are fast disappearing among the current crop of Pakistani leaders, particularly the right-wing Islamist leadership which is either complicit with or afraid of the Taliban terrorists. Qazi Sahib's successor Munawar Hasan has been the biggest disappointment in this regard.

Current JI Chief Munawwar Hasan has taken the outrageous position of calling the dead TTP Chief Hakimullah Mehsud a shaheed (martyr). Rather than condemning the TTP, he has expressed solidarity with them. He has said, "we are one with the TTP (hum aik hi ikai hain)". Adding insult to injury, he went to say that the Pakistani soldiers who have been killed in the TTP attacks are "not shaheed".

Imran Khan, whose party PTI is in coalition with Munawwar Hasan's JI, has refused to condemn the Tehrik-e-Taliban Pakistan (TTP) by name. In fact, PTI has diverted attention from TTP terror by turning the nation's focus on US drone strikes since the TTP leader Hakimullah Mehsud was killed in one such strike last year.

Maulana Fazl ur Rehman, the leader of Jamiat Ulema Islam (JUI-F) and former ally of JI in MMA coalition, has offered his own logic explaining why he thinks Hakimullah Mehsud is "shaheed". "Even a dog killed in any US drone attack is shaheed", he added.

I hope the first anniversary of Qazi Husain Ahmad's death serves as a reminder to Pakistan's politicians for the need of clarity of thought, courage and integrity that the departed JI leader had. Only then can Pakistan deal honestly and bravely with the difficult challenge of terrorism that is becoming an existential threat.

Here's video discussion on the subject "shaheed":

https://vimeo.com/79607015


Shaheed debate; Ashoora; India’s absence in Commonwealth meeting from WBT TV on Vimeo.

Related Links:

Haq's Musings

Pak Taliban Target Right-Wing Politicians

What is Nawaz Sharif's Counter-Terrorism Strategy?

Can Pakistan Learn From Sri Lanka's War on LTTE?

Is Hakimullah Mehsud a Shaheed? 

Imran Khan in Silicon Valley

Nawaz Sharif's Silence on Taliban Terror in Inaugural Speech

Taliban vs. Pakistan

Yet Another Peace Deal and Shia Blockade

Taliban Insurgency in Swat

Musharraf's Treason Trial

General Kayani's Speech on Terror War Ownership

Impact of Youth Vote and Taliban Violence on Elections 2013

Imran Khan's Social Media Campaign

Pakistan Elections 2013 Predictions 

Why is Democracy Failing in Pakistan?

Viewpoint From Overseas-Vimeo 

Viewpoint From Overseas-Youtube