| March 11, 2002 | Monday | Zilhaj 26, 1422 |
Please Visit our Sponsor (Ads open in separate window)
Saving Sindh’s agriculture
Pakistanis’ release
TRUE to his ‘go-it-alone’ style of dealing with global issues, President Bush has unilaterally slapped an eight to 30 per cent customs duty on the import of most steel products for three years. The new rates of duty, which will become effective from March 20, have been widely condemned and threaten to provoke a trade war. Announcing his decision on Tuesday, the US president said that he had provided “temporary safeguards to the steel industry and its workers to adapt to the large influx of foreign steel.” The president has obviously taken advantage of WTO rules which specifically allow temporary restraints on trade if imports cause serious harm. According to Mr Bush, the global glut of steel is the result of 50 years of protection and subsidies provided by foreign governments to their steel industries. Those affected by the US decision, meanwhile, attribute the sorry plight of American industry to its reluctance to restructure at a time when such action has become an economic compulsion. The unilateral measure has exposed the nature of US commitment to free trade, and provoked an angry response from a number of nations. The European Union has been quick to file a complaint with the World Trade Organization and hinted that it will take retaliatory action.
The steel industry worldwide is going through a difficult phase, with supply far outstripping demand. According to the Paris-based International Iron and Steel Institute, the global industry has, in recent years, been working at 77 per cent of its capacity, producing 827 million metric tons a year for a market that could only absorb 722 million tons. Given this situation, the US steel industry has suffered the most because of its inability to compete. An excessively strong dollar, paradoxically, has added to the woes of the US steel industry by reducing competitiveness of US industries and encouraging imports. Since 1998, 31 US steel mills — almost 50 per cent of the US industry — have gone bankrupt or applied for bankruptcy protection. Thirty-nine steel producing countries met in Paris in 2001, under the auspices of the Organization of Economic Cooperation and Development (OECD), to consider the crisis and decided to reduce production by 100 million tons by 2010. They also agreed to meet again on April 18 this year to deliberate over new developments. But under domestic political compulsions, President Bush — otherwise the most vocal proponent of free trade — did not wait for the meeting to take place, preferring to take unilateral action.
Predictably, the move provoked an angry reaction from the EU, Germany, Japan, Brazil, Turkey, Russia, China and other nations. Even the US media strongly criticized the move, with the Wall Street Journal stating that by raising the tariff “Bush had his worst day in office.” The WTO is likely to take a long time to settle the dispute. Meanwhile, the implementation of the tariff rise will disrupt existing trade patterns and cause uncertainty in the market. The US action may serve to temporarily prop up the local steel industry by diverting demand from imported steel to domestic products. However, the move could harm its steel-using industries, especially the already depressed automobile sector. The most apt market solution, in many economists’ view, is not to impose hefty tariffs but to provide relief to industries through an adjustment in the exchange rate. If the countries affected by the US move take retaliatory action, as they have indicated, it could spell the beginning of a mini-trade war.
THE presidential grant of Rs 10 billion for the rehabilitation of Sindh’s irrigation system comes as a long-awaited relief in a vital sector of the province’s economy. The canals in Sindh need to be lined to reduce waterlogging and seepage, which, over the decades, have blighted its agricultural land. The decision to install telemetry equipment at the two dams and 18 barrages along the Indus basin system to monitor the availability and flow of water should help curb water theft. Together, the two measures give some hope to Sindh’s farmers, who have suffered because of a shortage of some 40 million acre feet of water. The fixing of the irrigation channels will take at least a year, but, when completed, it should help stop wastage.
Given its geographical location at the tail-end of the Indus water system, Sindh has a unique topography, which makes the river its lifeline in terms of supporting agriculture and fisheries, and holding back sea water from encroaching on cultivable land. The damage caused to Sindh in all these areas since 1994 has been enormous: there has been a 15 per cent increase in waterlogging and seepage-related problems, and thousands of acres of cultivable land has been lost to the encroaching sea water. This destroyed the livelihoods of many coastal communities and forced them to migrate from the delta region by the thousands. Today, 39 per cent of Sindh’s cultivable land lies wasted; this figure in 1959 stood at only 12.4 per cent. The president’s bail-out package will at best do its bit in reversing some of the damage done to Sindh’s irrigation, and comes as an SOS measure providing relief in the short term only. In the ultimate analysis, the development of Sindh’s full agricultural potential depends on an equitable sharing of the Indus water among the provinces.
AFTER repeated criticism from rights groups and behind-the-scenes efforts by the Pakistan embassy, the US Justice Department is finally expediting the release of hundreds of Pakistanis held in connection with the Sept 11 probe. According to a Pakistani consular official, most of the 150 or so captives will be deported to Pakistan by the end of April, leaving behind around a dozen against whom investigations will continue. Authorities in America had arrested over 1,200 people on suspicion of being involved in the attacks on the World Trade Center and the Pentagon. However, not a single case has come up where investigating agencies established that a detainee was indeed connected to the attacks.
Having found nothing substantial against them, the US authorities tried to justify their action by charging most of the Pakistanis with minor violations like visa overstays or unpaid parking fines. Many opted to be deported to escape this seemingly unending harassment. Two cases stand out. The first is that of fifty-five-year-old Mohammad Butt, who died while in detention last December, apparently because of a heart attack brought on, as some critics say, by the conditions of his confinement. The other refers to the plight of Shakir Baloch, under detention since Sept 20, who spent five months in solitary confinement. Mr Baloch’s crime: entering the country illegally, something that hundreds of thousands do every year along America’s southern border. One hopes that the US authorities will clear most of these cases by the target date. In addition, the remaining dozen Pakistanis whose incarceration will continue should be given access to legal help and their cases, too, be finalized to avoid a miscarriage of justice.