ONCE more the economic numbers don’t look very good. The rate of GDP growth will, most probably, fall below three per cent for financial year 2001-2002. The government estimated it at 3.3 per cent. If that is the case, it will be the second year of a below three per cent growth rate. If there has been any pick-up in investment, it must be very modest. And the incidence of poverty must have increased significantly once more. What is the reason for this continuing slump?

A few days ago, I was interviewed by a TV programme that is shown every Sunday in Washington and is run by a group of Pakistanis. “You are one of the few regular columnists writing for a Pakistani newspaper who has remained positive about the achievements of the Musharraf regime,” said the interviewer. “Why is that the case?” he asked.

I gave a detailed answer. I said economists recognize something the common man is not willing to accept — that there is some lag between the adoption of good policies and their impact on the performance of the economy. Much has been achieved by the team in Islamabad and the results would have begun to show. Unfortunately, that will not happen now for some more time to come. The government was estimating GDP growth to increase to 4.7 per cent in 2002-2003, and to 5.2 per cent the following year. It is highly unlikely that these targets will now be met.

This time it is not public policy that must shoulder the blame for the continuing slump in the economy. That is where responsibility lay for a couple of decades. The economic stagnation that General Pervez Musharraf and his colleagues have had to deal with is the consequence of several decades of extremely poor management. As such, the change will not come overnight. Some manifestation of positive change would have become apparent, but for the troubles on the border.

The Pakistani economy has been seriously threatened by the on-going near-war with India. The military effort Pakistan has been forced to mount is diverting scarce resources into defence and is scaring desperately needed foreign capital from flowing into the country. In the article last week I speculated on the Indian motives for the extraordinary amount of pressure it is putting on Pakistan.

In an editorial that appeared in the June 5 issue of The Wall Street Journal, the newspaper took a line very similar to the one I had used. “Some in India fear Mr. Musharraf less because he has made a strategic choice to ally his country with the US If he succeeds, Pakistan could become stronger as a regional competitor and a model for India’s own Muslim population of 150 million. We hope that India isn’t looking for a pretext to intervene militarily on grounds that it knows that it would win and that this would prevent the emergence of a moderate and modernizing Pakistan,” wrote the newspaper. This is the first time I have seen a balanced comment by The Journal on the developing situation in South Asia.

As I suggested in last week’s article, General Musharraf has to find his way out of the triple-bind into which he has been put by the on-going conflict with India. Two of these is the possibility of an open conflict with India and a sudden pressure on Pakistan’s relations with the West. The third is the judgment on the part of a large number of foreign investors that Pakistan is not a safe place to invest in. How does General Musharraf change that perception? While India maintains a menacing presence on the border, thousands of foreigners flee South Asia, fearful that the continuing tension between the two countries may result in a nuclear war. They will not invest in the region if tensions continue. That is General Musharraf’s third bind.

He is faced with a number of serious challenges. To meet some worsens the other. He must, for instance, forge a relationship with India which would have it fully respect Pakistan’s sovereignty. At the same time, he must deal with the aspirations of the people of Kashmir. If he is seen giving too much to India under that country’s unrelenting pressure, he will create serious problems for himself within Pakistan. The Islamic fringe of the population is already very angry with him. He may also begin to lose some of the following he has enjoyed among the people he has described as Pakistan’s vast but silent majority.

All this must be very worrisome for him. Unhappy people don’t make good economic actors. Pakistan’s long delayed economic revival depends critically on General Musharraf’s ability to produce a reasonable amount of serenity in the country. That goal seems more distant now than it appeared a few months ago. When General Musharraf visited Washington in February of this year, he projected a confident figure. He felt — and he was most probably right — that he had the full backing of a large majority of Pakistani people.

He was also popular among the leaders of the West who applauded him for his courage and sagacity. Today, only three months later, some shine has worn off the welcome mats that were put out for him at that time in many parts of the world. He should get the shine back on these mats for the simple reason that Pakistan’s economic well-being depends to a considerable extent on the way foreigners view the country.

Pakistan’s current economic situation is such that unless foreigners — not only the governments but also individual investors — don’t develop a favourable impression of the country, it would not be possible for it to escape the trap of low investment and low growth. Without western help, both by the government and individual investors, Pakistan will not be able to close the gap between the amount of resources it must invest to get the economy moving again and the amount of money the people, the country’s businesses and the government can save. This investment-savings gap has bedevilled Pakistan since its birth 55 years ago. To close it, Pakistan will have to rely initially on foreign capital flows.

In this context, reconstructing relations with the West — in particular with the United States — is extremely important. Both sides must begin to understand why each needs the other. The reason why the United States requires Pakistan has been gone into in considerable detail by a number of western analysts. The June 1-7 issue of The Economist devoted its cover story to that subject. As already suggested above, economics is the main reason why Pakistan needs the US to be on its side. Unless it achieves that and unless it begins to draw in foreign capital, Pakistan will not be able to deal with the problem posed by an anemic rate of economic growth.

What has kept Pakistan in this situation for more than a decade is a low and declining rate of investment. Total investment as a share of GDP fell throughout the 1990s. It declined from around 18 per cent of GDP at the beginning of the decade to about 13 per cent by 2000-20001. It takes investment in both public and private sectors for the economy to grow. Some investments bear fruit quickly such as in irrigation or industrial plant. Some take more time such as investments in physical infrastructure — roads, highways, railways, ports, and airports.

Some take even longer to produce results. That is the case with investments in education, health and family planning — in improving the quality of human resource, in other words. Investment in institution-building also takes time, effort and patience. And, it has taken economists a while to recognize that poorly functioning institutions inhibit development and increase transaction costs within an economy. Of late economists have also begun to recognize the importance of social capital by which they mean establishment and maintenance of institutions that bring people into constant contact with one another. Social capital contributes positively to development but it takes time to create and nurture it.

Pakistan needs all five types of investments — investments in productive assets, in physical and human capital, and in institutions and social capital. Unfortunately for Pakistan, attention given to these five areas over the last several years has been exceedingly low. The result is a rate of growth in GDP that will hover around three per cent or so unless some serious restructuring is done in the economy. Good rains and better prices in international markets for Pakistan’s traditional exports may increase the rate of growth by a notch or two beyond three per cent.

Conversely, an adverse turn in the weather or in the terms of trade could lower the growth rate below three per cent. The current structure of the Pakistani economy is such that a rate of growth of much beyond three per cent a year does not seem possible. To go beyond, the country must evolve systems that allow the people, the businesses and the government to save more and to invest the savings in the areas that will contribute to accelerating the rate of growth.

Investments are made by both public and private sectors. The two normally complement each another. Governments build infrastructure, establish regulatory institutions, develop legal frameworks, maintain law and order. Some also spend on health, education, water supply and sanitation. In a few cases, governments have also provided housing to some segments of the society.

Housing provides a good example of the way public and private sectors complement each another. Building a house is usually the most important investment ordinary people make. Since the investment is lumpy — it is large compared to the annual income of the person making the investment and has to be made within a short period of time — not many people have the resources to do it.

The government can help by establishing house-building finance corporations which will provide loans to be amortized over a long period of time. These corporations should preferably be in the private sector. But the government should ensure that a robust legal framework exists that makes it possible for them to stay in business. Such a framework will allow the house-owner to own undisputed title over the land on which he builds his property and for the lending agency to foreclose the property in case of default on the loan.

Private sector investments contributing to developments can be divided into two parts — those undertaken by firms and those made by households. Almost all investments made by firms — that are formal in the sense that they are registered somewhere or the other or operate informally or in the informal sectors — contribute to promoting development. On the other hand, only a few household expenditures produce development. Expenditure on health, education and housing are some of those that fall in that category.

How has Pakistan invested in the past, how much it is investing at the moment and what are the areas in which investments should be made by both public and private sectors are the subjects I will explore in this space next week.

“I CALLED upon Mr. Jinnah this morning (December 9, 1947)”, wrote Sir L. Grafftey Smith, high commissioner for the United Kingdom, in Karachi, in a secret and confidential despatch addressed to Mr. Noel Baker at the Foreign Office in London, “to welcome him back to Karachi after his long absence in Lahore.

“There have been alarming reports about his state of health, and I was relieved to find that he was not notably more feeble than before he went away five weeks ago. He is, of course, wispily frail in body, but he seemed to be completely master of his nerves. The fire of his fanatical ardour is certainly in no way diminished.”

Mr. Jinnah developed, not for the first time, his personal opinion — (which has acquired the strength of an obsession) — that Lord Mountbatten is the person most directly responsible for the tragic events which followed on partition. He recalled the detailed information given in early July last to the Viceroy, and to the leaders of both parties, regarding the sinister intentions of the Sikh rulers of Patiala and Faridkot, and of Master Tara Singh, and the general agreement then reached was that the Sikh plot must be nipped in the bud.

He described in some detail the Viceroy’s first reaction and his intention of drastic and deterrent action to prevent the consummation of Sikh plans, and he deplored that, in the event, nothing had been done to frustrate the conspiracy. He assumed that Lord Mountbatten had been persuaded by the Indian leaders to hold his hand.

“Turning to Kashmir, Mr. Jinnah said that the most urgently important matter for decision was the form of administration to be set up in Kashmir on the cessation of hostilities. He had no doubt that India intended to retain control of Kashmir and to accept no form of plebiscite unfavourable to that end.

Impartial administration of the state after the ceasefire was essential and without the guarantee of such a development he himself could not ask the Muslims in Kashmir to lay down their arms. He did not personally favour the intervention of the United Nations Organization or of any other outside authority. He still preferred the solution suggested by him to India on November 1, 1947, that the two Governors-General, duly authorized by their respective Dominions, should accept responsibility for the task of setting up a neutral administration in Kashmir and organizing a plebiscite”.

Fifty-four years after Mr. Jinnah’s death, we cannot look back with much pleasure on our foreign policy and the way we handled the Kashmir dispute. The present position is that Kashmir has been swallowed up and is now a part of the Indian Union. We are told to lay off, bow our heads, give up our support for the Kashmiris, forget about the plebiscite and the Kashmiris’ right of self-determination enshrined in umpteen Security Council Resolutions, forget all the promises made to them by the Indian leadership and accept Indian usurpation of Kashmir as a fait accompli.

If we succumb to American pressure and Indian threats, silent, mournful, abandoned, broken, bleeding Kashmir will almost certainly recede into darkness and be forgotten. But this will not be the end of our humiliation. This is only the first sip, the first foretaste of a bitter cup which will be proffered to us in the days to come.

The tragedy is that the world knows that in Kashmir, India is faced with what can only be described as a terminal colonial situation. It is now abundantly clear that India can hold its own in Kashmir solely by the application of brute force. The population does not welcome its presence and would not vote for the continuation of its control in any electoral process which was remotely free. And yet, the massacre of innocent men, women and children by Indian security forces continues without arousing the conscience of the West.

Today we are facing the greatest danger in our history since 1971. One million troops backed by artillery, tanks and missiles are on the border. Wars come very suddenly in the subcontinent. People are haunted by a fear that war might burst from a clump of trees, from a meeting of two patrols, from a threatening gesture, a black look, a brutal word, a shot!

I have lived through a period when one looked forward, as we do now, with great anxiety and uncertainty to what would happen in the future. A great responsibility, therefore, rests upon those who hold power if, by any chance, against our wishes and against our hopes, trouble should come. The situation is incomparably more dangerous today. In the past, we had or we thought we had American support, the so-called American shield, against aggression. We cannot say that now. We stand alone in the ring.

We do not want war and we will not fire the first shot. But if a situation were to be forced upon us in which peace could only be preserved by liquidating what President Musharraf calls “our two core assets” then I say emphatically that peace at that price would be a humiliation for a country like ours to endure. As Bismarck once said, “he who seeks to buy the friendship of his enemy with concessions will never be rich enough”. We would be well advised to heed these words of wisdom. One day President Roosevelt told Mr. Churchill that he was asking publicly for suggestions about what the Second World War should be called. Mr. Churchill said at once, “the unnecessary war”. Should war break out between India and Pakistan, the verdict of history would be that it, too, was “an unnecessary war”, that never was a war more easy to stop than that which threatens our two countries today. Great quarrels, it has been well said, arise from small occasions, but seldom from small causes.

Strange, what has happened to us. What animosities thrive under conditions of excessive proximity? Two great masses are confronting each other — an irresistible force and an immovable object. The battle, if it comes, will be a clash between two great human masses, and the stronger or the more determined will win. At times of stress, Churchill often recalled some particular quotation that expressed his feelings. The quotation read, “Fear not the result, for either shall thy end be a majestic and enviable one, or God shall perpetuate thy reign upon the waters”.

We are at the crossroads. Sometimes, once in a long while, you get the chance to serve your country. It has fallen to General Musharraf to carry the awesome responsibility and the heavy burden destiny has placed on his shoulders. He must prepare the people for the challenges that lie ahead and lead by example. For Romans in Rome’s quarrels / Spared neither land nor gold, / Not son, nor wife, nor limb, nor life.

Such, I believe, is the temper of the hour in Pakistan today. The nation is prepared for every sacrifice so long as it has leadership, so long as the government shows clearly what they are aiming at and so long as the nation is confident that those who are leading it, will not sacrifice its honour and its “core assets”.

I will unsay no word that I have spoken or written about the failings of President Musharraf’s government. But all this fades away before the grim spectacle that is now unfolding. The past, with all its bitter disappointments, its follies, its failures and its tragedies flashes away. This is no time for proscriptions. This is no time for recriminations. We should pass a sponge across the past. With the collapse of all civil institutions, the only cohesive force left behind is the army, and the army alone. It is also the only shield we have against foreign aggression.

Destiny has placed a grave and awesome responsibility upon General Musharraf. At this darkest hour in our history, the nation must stand solidly behind the army. The security of the nation, as they say, is not at the ramparts alone. Nothing should therefore be done to weaken the army. Nothing should deflect its attention from its primary task. Everything must be subordinated to the requirements of national defence. All for the nation. All for Pakistan. Such is my motto.

WHEN India and Pakistan conducted their nuclear tests in 1998, even those of us who condemned them, balked at the hypocrisy of western nuclear powers. Implicit in their denunciation of the tests was the notion that Blacks cannot be trusted with the Bomb. Now we are presented with the spectacle of our governments competing to confirm that belief.

As diplomats’ families and tourists disappear from the subcontinent, western journalists arrive in Delhi in droves. Many call me. “Why haven’t you left the city?” they ask. “Isn’t nuclear war a real possibility? Isn’t Delhi a prime target?” If nuclear weapons exist, then nuclear war is a real possibility. And Delhi is a prime target. It is.

But where shall we go? Is it possible to go out and buy another life because this one’s not panning out?

If I go away, and everything and everyone — every friend, every tree, every home, every dog, squirrel and bird that I have known and loved — is incinerated, how shall I live on? Who shall I love? And who will love me back? Which society will welcome me and allow me to be the hooligan that I am here, at home?

So we’re all staying. We huddle together. We realize how much we love each other. And we think, what a shame it would be to die now. Life’s normal only because the macabre has become normal. While we wait for rain, for football, for justice, the old generals and eager boy-anchors on TV talk of first strike and second-strike capabilities as though they’re discussing a family board game.

My friends and I discuss Prophecy, the documentary about the bombing of Hiroshima and Nagasaki. The fireball. The dead bodies choking the river. The living stripped of skin and hair. The singed, bald children, still alive, their clothes burned into their bodies. The thick, black, toxic water. The scorched, burning air. The cancers, implanted genetically, a malignant letter to the unborn. We remember especially the man who just melted into the steps of a building. We imagine ourselves like that. As stains on staircases. I imagine future generations of hushed schoolchildren pointing at my stain...that was a writer. Not She or He. That.

I’m sorry if my thoughts are stray and disconnected, not always worthy. Often ridiculous.

I think of a little mixed-breed dog I know. Each of his toes is a different colour. Will he become a radioactive stain on a staircase too? My husband’s writing a book on trees. He has a section on how figs are pollinated. Each fig only by its own specialized fig wasp. There are nearly a thousand different species of fig wasps, each a precise, exquisite, synchrony, the product of millions of years of evolution. All the fig wasps will be nuked. Zzzz. Ash. And my husband. And his book.

A dear friend, who’s an activist in the anti-dam movement in the Narmada valley, is on indefinite hunger strike. Today is the fourteenth day of her fast. She and the others fasting with her are weakening quickly. They’re protesting because the MP government is bulldozing schools, clear-felling forests, uprooting hand-pumps, forcing people from their villages to make way for the Man dam. The people have nowhere to go. And so, the hunger strike.

What an act of faith and hope! How brave it is to believe that in today’s world, reasoned, closely argued, non-violent protest will register, will matter. But will it? To governments that are comfortable with the notion of a wasted world, what’s a wasted valley?

The threshold of horror has been ratcheted up so high that nothing short of genocide or the prospect of nuclear war merits mention. Peaceful resistance is treated with contempt. Terrorism’s the real thing. The underlying principle of the “War Against Terror”, the very notion that war is an acceptable solution to terrorism, has ensured that terrorists in the subcontinent now have the power to trigger a nuclear war.

Displacement, dispossession, starvation, poverty, disease — these are now just the funnies, the comic-strip items. Our home minister says that Amartya Sen has it all wrong - the key to India’s development is not education and health but defence (and don’t forget the kickbacks, O Best Beloved).

Perhaps what he really meant was that war is the key to distracting the world’s attention from fascism and genocide. To avoid dealing with any single issue of real governance that urgently needs to be addressed.

For the governments of India and Pakistan, Kashmir is not a problem, it’s their perennial and spectacularly successful solution. Kashmir is the rabbit they pull out of their hats every time they need a rabbit. Unfortunately, it’s a radioactive rabbit now, and it’s careening out of control.

No doubt there is Pakistan-sponsored cross-border terrorism in Kashmir. But there are other kids of terror in the valley. There’s the inchoate nexus between jihadi militants, ex-militants, foreign mercenaries, local mercenaries, underworld Mafiosi, security forces, arms dealers and criminalized politicians and officials on both sides of the border. There’s also rigged elections, daily humiliation, “disappearances” and staged “encounters.” And now the cry has gone up in the heartland: India is a Hindu country. Muslims can be murdered under the benign gaze of the state. Mass murderers will not be brought to justice. Indeed, they will stand for elections. Is India to be a Hindu nation in the heartland and a secular one around the edges?

Meanwhile, the International Coalition Against Terror makes war and preaches restraint. While India and Pakistan bay for each other’s blood the coalition is quietly laying gas pipelines, selling us weapons and pushing through their business deals. (Buy now pay later). Britain, for example, is busy arming both sides. Tony Blair’s “peace” mission a few months ago was actually a business trip to discuss a one billion pound deal (and don’t forget the kickbacks, O Best Beloved) to sell Hawk fighter-bombers to India. Roughly, for the price of a single Hawk bomber, the government could provide one and a half million people with clean drinking water for life.

“Why isn’t there a peace movement?” western journalists ask me ingenuously. How can there be a peace movement when, for most people in India, peace means a daily battle: for food, for water, for shelter, for dignity? War, on the other hand, is something professional soldiers fight far away on the border. And nuclear war — well that’s completely outside the realm of most people’s comprehension.

No one knows what a nuclear bomb is. No one cares to explain. As the home minister said, education is not a pressing priority. Part of me feels grateful that most people here don’t have any notion of the horrors of nuclear war. Why should they, on top of everything else they go through, have to suffer the terror of anticipating a nuclear holocaust? And yet, it is this ignorance that makes nuclear weapons so much more dangerous here. It is this ignorance, that makes “deterrence” seem like a terrible joke.

The last question every visiting journalist always asks me is: Are you writing another book? That question mocks me. Another book? Right now? When it looks as though all the music, the art, the architecture, the literature — the whole of human civilization means nothing to the fiends who run the world — what kind of book should I write?

It’s not just the one million soldiers on the border who are living on hair-trigger alert. It’s all of us. That’s what nuclear bombs do. Whether they’re used or not, they violate everything that is humane. They alter the meaning of life itself. Why do we tolerate them? Why do we tolerate these men who use nuclear weapons to blackmail the entire human race? —Courtesy:Z-Net

The writer is an Indian novelist and a leading anti-war activist.