KARACHI: Seminar expresses concern over civilian casualties
By Our Reporter
KARACHI, Nov 1: Participants of a seminar expressed concern over the mounting civilian casualties in Afghanistan in the US air strikes on the pretext of eliminating Al-Qaeda network and to overthrow the Taliban.
They were of the view that the US-led strikes had resulted in additional payments on account of unprecedented war risk premium and freight rate hikes, besides increasing the cost of Pakistan’s exports, and substantially eroding its competitiveness.
The seminar on “The Aftermath of 11th September”, was organized by PAF-Karachi Institute of Economics and Technology, on Wednesday.
Lt-Col (retd) Iftekhar Ahmed criticizing the US said that Sept 11 was a doomsday for the American people and totally shattered the myth of security of the US from foreign attacks.
He was critical of the rationale behind the US post-Sept 11 policy and said their was no justification for the killing of innocent Afghans on the pretext of eliminating Al-Qaeda and Taliban. He also criticized the Indian government for its belligerent policy towards Pakistan.
Naeem Sadiq, chief executive, Quality Concerns, equated the US-led coalition’s strategy to avenge the Sept 11 terrorists attacks with the “barbarian Mongols.” He was critical of the laws passed by the US, which curtailed liberty and rights of the American people. He feared that Pakistan was being threatened by Talibanization.
Former finance secretary Aftab Ahmed was of the view that Pakistan had no option but to support the coalition due to its weak economic condition.
His advice was to develop and sustain agriculture-based economy and increase the export of agricultural products.
Renowned industrialist Yusuf Shirazi made a strong case for using the opportunity for debt write off.
Though the speakers were unable to quantify the impact of America’s Afghan war on Pakistan’s economy, they were of the view that the paradigm shift in policy stance by the US and others in the aftermath of Sept 11, would have far reaching consequences for the region, in particular for Pakistan.
There are likely to be important long-term macroeconomic effects on Pakistan and some short-term macroeconomic impact.
The speakers were of the view that the post-Sept 11 events had dealt Pakistan “a sharp economic blow,” estimated at least one billion dollars this year alone. The figures could rise if the Afghan situation was not resolved in a short period, they said, pointing to the estimate of loss by the federal finance minister, who had said that the loss during the current fiscal year would be in the range of $1 to 2.5 billion, depending on the duration of the crisis.
The investment activity in the country has come to a virtual standstill, they said. The domestic investor’s confidence was at the lowest ebb and foreign investment was not likely to pick up due to the heightened uncertainty, said Zubair Motiwala, former president of the Karachi Chamber of Commerce and Industry.
The oil and gas exploration activity by foreign investors has come to a grinding halt, who have left without indication as to when they would return, he said, adding that privatization of public sector units might have to be postponed in order to realize the worth of the national assets.
Pakistan’s external sector, which accounts for over 30 per cent of the GNP, has also been greatly disrupted. The $10.1 billion export target for the year 2000-1 would now be difficult to achieve. Export losses could be in the region of $1.5 billion, they pointed out.
There has been cancellation and holding back of export orders by the US and European importers, because of the impression that Pakistan might not be able to comply with the orders due to media hype of the situation. If cancellation of orders persists and no fresh orders are placed, it will result in industrial unemployment leading to law and order situation.
The unkindest cut has been inflicted by the levy of war risk surcharge, as Pakistan has been declared to be in the war zone without any justification, he said. Imposition of the war risk premium on cargo coming to Pakistan is making our imported raw materials costlier adding appreciably to the cost of production.
Pakistani shipments have been put on hold at New York port for examination in the wake of Anthrax threat, which has added to the woes of exporters, the participants said.
The sharp appreciation of rupee vis-a-vis dollar by almost 4 per cent in inter-bank market since Sept 11 is eroding our export competitiveness, posing a threat to export trade.
It was pointed out that foreign banks were not honouring LCs from Pakistani banks and want confirmation by foreign banks, which saddles the importers with additional costs.
