FORMULATING a budget for a poor country that is popularly acceptable and politically sound is very tough. The needs of the people are too many and the demands of its ruling and owning classes are too varied. While its resources are small and its priorities are quite many and often in conflict with each other.

The situation in Pakistan is made more complex by its population of one hundred and forty million of which almost forty per cent live below the poverty line. And only thirty per cent of the population is fully employed and below fifty per cent of the population are below the age of twenty and a very large number of women are not productively employed. The tax revenue collection is rather inelastic.

Hence one year’s failed target often becomes the target of the succeeding year. The current years estimated revenue was 457.7 billion rupees while the actual collection is estimated at four hundred and fourteen billion. Hence the target for the next year is four hundred and sixty billion.

Adding to the problem is a large debt burden which this year has resulted in a debt servicing cost of three hundred and twenty billion, while the next year’s debt servicing will cost 289.7 billion leaving too little for other expenses and a large part of the left-over goes for defence which this year has been budgeted at 131.6 billion, while the actual expenditure will be 151.6 billion and the next year defence expenditure will be a lowered one hundred and forty six billion.

As for the rest, the bulk of the expenditure has to come in the form of borrowing including the Public Sector Development outlay of one hundred and thirty-four billion which means an increase of three per cent over the current year’s modest outlay in a developing country.

The merit of a budget cannot be determined in such circumstances on the basis of what it offers to the people in a year. It has to be decided on the basis of the total economic policy of the government. In this case the military government which Mr Shaukat Aziz represents has been in office for three years. But these three years have been exceptional years because of both external and internal happenings.

If the country suffered as a result of the international sanctions that followed the nuclear explosions, that was followed by the sanctions which came as a result of the imposition of the military rule. After that came the increasing military tension with India and the amassing of the Indian forces on our borders which invited similar measures from Pakistan.

Along with that not only the outlay on defence increased but also the internal security of the country following rise in acts of terrorism and increase in major crimes. Along with all that the government had to abide by the rigid regime of the Poverty Reduction and Growth Facility of the IMF and the Structural Adjustment Programme of the World Bank to ensure rigid fiscal discipline and monetary reforms. Managing the economy in such a context is a very tough task but Mr Shaukat Aziz has been able to do that relatively well and get the maximum benefit while permitting maximum damage to the economy.

In addition to these pressures he had to meet the rising demand for poverty reduction as poverty has been on the increase in the recent years and the people living below the poverty line have virtually doubled during the 1990s. So assisted by the IMF and the World Bank he came up with the Poverty Reduction Programme of rupees one hundred and thirty-six billion next year and he proposes to spend one hundred and sixty-one billion in 2003-2004. But what matters is not the amount proposed to be spent reducing poverty but how effectively it reaches the targeted poor and how much it actually reduces poverty and makes the people more sel-reliant.

He has chosen to distribute the relief that he has offered through which what he calls an investor-friendly budget to varied sections of the people. He has sought to help the investors by reducing the tax on banks by three per cent, corporate tax by two per cent and a far larger depreciation allowance. He has also reduced the average import duty to twenty-five per cent from thirty per cent and reduced the number of slabs to four, twenty-five, twenty, ten and five per cent. And he has also come up with a large self-assessment scheme under which twenty per cent of the returns will be picked up for detailed scrutiny and the SRO regime which is highly vexatious is to be reduced to thirty only. and the tax returns are to be treated as final assessment order.

In order to provide relief to the lower salaried class the threshold for taxation has been raised to eighty thousand rupees. There has been an increase in the sales tax, which the Finance minister calls the tax of the future. He has increased the spread of sales tax on ghee and edible oil. But since the sales tax is already levied on import of vegetable oil, the impact of GST on consumers is going to be small.

But the major issue now is whether the sales tax of fifteen per cent will be levied on domestic electric consumers. It will come as a heavy blow to them in view of the ever-increasing rise in power rates. While the press reports talk of GST coming in to effect from December. The Finance minister parried the question at the post-budget press conference. If it does come into effect soon following the pressure of the IMF and the World Bank the people as a whole will feel greatly outraged and those who now say that they having a budget a month will feel angrily vindicated.

The contrast between the external economic sector and the domestic sector of Pakistan is very sharp. While the external economic sector is marked for its over six billion dollar foreign exchange reserve, two billion dollar current account surplus, a doubling of the home remittances to 2.2 billion dollars. The domestic front is marked for the fall in savings, investment and a sharp drop in revenues when the trade and industry registered a performance far below the targeted total revenue collection which is to be four hundred and fourteen billion instead of the targeted four hundred and fifty-seven billion rupees. It now remains to be seen whether the four hundred and sixty billion rupee tax target will be achieved through a rapid mobilization of the domestic economy.

The Public Sector Development outlay at one hundred and thirty-four billion is small compared to the needs of the country and the external assistance, which is becoming available. A larger PSDP is also needed to increase the employment in he country. But even without a larger PSDP the country will register a deficit of four per cent of GDP against current year’s 4.75 per cent and that will indeed be heavy in monetary terms as the current expenditure including the Secretariat of the Chief Executive consumes a great deal of money.

The political parties are dissatisfied with the budget. They are more interested in how the people directly benefit from the budget as they are their voters, not the investors. And the people will come to gain directly very little from the budget in view of the excessive constraints on the Finance minister. But the fact remains as in a recession-hit world, Pakistan is not the only country affected by adverse external factors. Now even the West’s recovery is under serious threat. So while Pakistan has been lucky in succeeding on the external front, it has to do a great deal to improve its domestic economy in the face of opposition from political parties for political reasons.

THAT the Loya Jirga finally assembled at the Kabul Polytechnic compound on June 12 amid bickerings among the contenders of power to elect an interim government and the parliament in pursuance of the December 5 Bonn agreement shows that the war-weary Afghans have chosen the path of peaceful change.

Of a total of 1,650 delegates belonging to all ethnic groups, 1575 cast their votes. After the withdrawal of the two potential winners, ex-ruler Zahir Shah and former president Burhanuddin Rabbani under US pressure, the way was cleared for Hamid Kerzai’s easy victory against his two rivals, including an aid worker, Dr. Masooda Jalal and Mahfooz Nedai.

Karzai emerged as the winner, having got 1,275 votes, defeating his opponents, Dr. Masooda Jalal, and Mahfooz Nedai, who polled 171 and 89 votes respectively. Eighty-six delegates boycotted the voting on the ground that the Loya Jirga meeting was stage-managed by the US to endorse its protigi, Hamid Karzai.

Hamid Karzai faces the uphill task of forming a broad-based government that would represent all ethnic communities in Afghanistan. His task has been made more difficult, since the Loya Jaigah has failed to agree on the election of the country’s parliament. In the outgoing government, the non-Pakhtun ministers belonging to the Northern Alliance had held key portfolios such as defence, foreign affairs and interior. More important and difficult would be the task of re-organizing Afghanistan’s national army.

At present the Northern Alliance militia which assisted the US-led expeditionary force in Afghanistan is dominant while the International Security Assistance Force — ISAF — has provided an umbrella to the local authorites to maintain internal law and order. It remains to be seen how the Loya Jirga helps the interim administration in raising a broad-based national army that would reflect the country’s demographic mosaic. Most probably it would leave this daunting task to the Karzai administration.

Sooner or later, the ISAF, the expeditionary-turned peace force, will have to withdraw once it is satisfied that the infrastructure of Taliban / Al-Qaida has been decimated and leave the security matters to the indigenous force. It is a foregone conclusion that the US would want to have the decisive voice in the formation of the proposed Afghan army, given its apprehension of the revival of religious militancy. The composition and character of Afghanistan’s armed forces is central to the country’s stability. It seems that Washington treats the Pukhtuns as suspects and therefore relies on its Northern Alliance militia allies to whom it wants to entrust the country’s security after the departure of the peace force. That will be a fatal blunder since the Pakhtuns with 40 per cent of the population enjoy a plurality and have been the country’s ruling elite since the founding of the Afghan kingdom in 1747 by Ahmed Shah Abdali; they would not like to play the role of junior partners.

Clearly, in the outgoing administration, Hamid Karzai was not the boss and if he enjoys the same status in the new dispensation, the Pakhtuns would be alinated from Kabul. This does not augur well for the future stability of the state. Worse still, it may be a prelude to civil war.

Though defunct and outmoded, the March 7, 1973, Islamabad Accord envisaged the formation of a national army for Afghanistan for which purpose it had provided for a national defence council, representing two members from each of the seven Mujahideen factions. In addition, there is the Nicarguan model which sought to integrate the insurgents into the national army in a bid to effect national conciliation.

Afghanistan’s Loya Jirga is a body which could bring about such an arrangement provided it is free from outside interference. The Jirga did not meet for twenty-three years because the powers that he had denied it the opportunity to play its role. Even in the past it was used by the rulers as a rubber stamp to endorse the legitimacy of their rule. It can only function in an environment of peace and freedom.

The Bonn agreement has restored Afghanistan’s 1964 constitution with the exception of provisions relating to monarchy. Though the constitution is democratic in form and spirit and provides for a constitutional monarchy, it has one serious flaw. Its Article 1 declares Afghanistan a unitary and indivisible state. This system does not grant autonomy to Afghanistan’s ethnic minorities most of whom have a distinct habitat in which they are in absolute majority.

There are Tajiks, Uzbeks, and Hazaras, each of them having their own language and culture. But, in spite of this diversity, they want to remain in Afghanistan. Therefore, they will be willing partners in any power-sharing arrangement. The Taliban and Northern Alliance failed to come to an understanding on power-sharing and instead, decided to impose a military solution on each other.

On the other hand, the ruling Marxist regime of Tajikistan managed to work out a concord with Islamist-nationalist opposition in 1997. This agreement may be brittle but it tends to contain the separatist insurgency and preserve the republic’s territorial integrity to some extent.

It is important that the Loya jirga address the problem of power-sharing in the context of a federation. At any rate, the minority groups should be given maximum autonomy, leaving the federal government control over defence, foreign affairs, national finances and communications. Article I, Tile Four, of the 1964 constitution provides for a bicameral Shura consisting of Wolesai Jirga and Meshrano Jirga.

The Wolesai Jirga is elected on the basis of a single-member constituency for a period of four years by adult franchise while one third of Meshrano Jirga members are nominated by the king for a period of five years and the remaining two-thirds of the members are elected by the provincial councils, each electing one member for a period of four years by adult franchise.

Since Afghanistan is no longer a monarchy, all the members of the Meshreno Jirga should be elected by provincial councils which should be given equal representation in that body.

Like the 1964 constitution, any future document should define the status and the role of Loya Jirga to whom the Afghan nation should delegate sovereignty.

Another point to remember is that since the UN General Assembly resolution and the 1988 Geneva Accord called for the withdrawal of all foreign troops from Afghanistan and the restoration of its Islamic and non-aligned character and an end to foreign interference and proxy war in that embattled territory, it is high time these are implemented without any delay.

WHAT do you do when the public’s adulation for you starts shifting to criticism and blame? What do you do when your popularity flags and you know crucial elections are round the corner? What do you do when the right-wing agenda you want to implement is incomplete and under threat? This is the dilemma facing George W. Bush and his administration nine months after 9/11.

America’s tragedy that day proved a blessing for the new president. The man once mocked for his intellectual deficiencies, who scraped into the Oval Office on legal technicalities, who quickly alienated America’s international allies with his unilateralist ‘I only care about America’ policies (Kyoto, small arms, the ABM treaty, NMD, etc) — became a hero after 9/11.

A generous and ultra-patriotic American public forgave George Bush’s dereliction of duty on September 11, and solidly backed the war on terror. His approval ratings shot into the stratosphere and stayed there. (Even now he enjoys more than 70% approval.) The international community, whether cowed by his threats of ‘with us or against us’ or overwhelmed by the tragedy of 9/11, gave him the green light to topple the Taliban regime as he saw fit. Rarely has an American president enjoyed such a huge domestic and international consensus.

As the scale of tragedy in Afghanistan became clear, though, and as George Bush came up with his ‘axis of evil’, international support fell off. Europe and the Arab world, in particular, raised questions about US motives and warned of the dire consequences of both American policy in the Middle East and expanding the war on terror.

But the American public stood by their man. The use of cluster bombs in civilian areas, the failure to back reconstruction efforts in Afghanistan, the rejection of friendly Iranian overtures, unquestioning back-up for Sharon’s brutal reoccupation of the West Bank, Guantanamo Bay and the denial of civil liberties to many in the US - Americans accepted all these without question. In the war against terror, legal niceties and human rights could be pushed onto the back burner.

Taking advantage of the overwhelming public support for him after 9/11, George Bush pushed through a massive tax cut, got approval for huge increases in defence spending (including for the useless NMD), scrapped the ABM Treaty and made plans to attack his father’s old nemesis — Saddam Hussein of Iraq. Ordinary Americans let him do whatever he wanted. They had faith in him. They believed that he was working to protect them.

Today they are not so sure. Revelations about information acquired by the CIA and FBI (including information passed on from other countries) show that perhaps the attacks of September 11 could have been prevented. Had intelligence agencies acted on the warnings they were given, had they cooperated with each other, and had the administration appreciated the seriousness of the terrorism threat, there was a chance that the hijacking plot could have been discovered in time. As it was, bureaucratic inertia, bitter inter-agency fighting and an attorney-general who prioritized pornography and drugs over terrorism, meant that the US was caught totally off-guard.

George W. Bush cannot personally be held responsible for all those failures. Nor is it certain that, even if all leads had been followed through, 9/11 would not have occurred. Americans do not expect miracles from their president. But they do expect him to do everything in his power to protect them. This is the question they are now asking themselves: did George Bush do everything he could? The conclusion many are reaching is that he (and his administration) did not. For a leader who has made fighting terrorism the bedrock ideology of his presidency, that is a damning verdict.

Its consequences are serious. It has already caused a marked drop in George Bush’s popularity. For the first time critical questions are being asked about his policies. The domestic carte blanche that he has enjoyed since 9/11 is in danger of disappearing. With it will go the war on Iraq that he so desperately wants to wage, perhaps even NMD funding.

And there is another danger. Crucial Congressional elections are due in a few months. Thanks to Bush’s incompetence, a Republican Senator turned independent and gave control of the Senate to the Democrats. The Republicans are desperate to win it back. But the Democrats, until now restrained in their attacks on the president by the cloying post-9/11 atmosphere of patriotism and national unity, will be hard to overcome. The administration’s failures are allowing them to criticize the president and claim the mantle of ‘national protector’.

So how does Bush get out of this sticky hole of domestic criticism, waning popularity, the prospect of electoral defeat and an unfinished right-wing agenda? Answer: he tries to recreate the enabling environment of 9/11. He raises the spectre of more terrorist attacks. Faced with such a crisis, the American public will again rally behind their president, the Democrats will fall silent and Bush’s carte blanche will be restored.

The Bush administration has pursued this strategy vigorously. In the past few weeks it has warned of all manner of threats; some credible, others ludicrous. Dick Cheney set the ball rolling with warnings of another 9/11 attack in the US - no idea where or by whom, though. In early June, just after Jimmy Carter’s bridge-building mission to Cuba, Americans were told that the Castro regime was developing biological weapons and passing on dual-use technology, that could be used in germ warfare, to Iran (neatly corroborating the ‘axis of evil’).

And then on June 10 they heard the dramatic announcement by Attorney-General John Ashcroft from Moscow that a plot to set off a radioactive bomb in Washington had been foiled and the terrorist, Abdullah al-Muhajir arrested. Coming against a backdrop of mounting criticism of the CIA and FBI, the announcement restored confidence in the intelligence agencies. It also pushed Americans back into ‘9/11 mode’ — nervous, fearing imminent attacks, trusting their president.

He made little effort to calm their fears, launching a full-scale manhunt while telling them: ‘There are still people who want to harm America.’ Finally, Ashcroft’s announcement created a favourable environment for Congressional committee hearings, starting the next day, into the new Department of Homeland Security proposed by Bush. What greater proof could there be of the need for such a department?

Only later did it transpire that there was no bomb, or even evidence of a practical plot — just some scraps of paper with a handwritten ‘plan’. The ‘ruthless terrorist’ was in fact a former American gangster called Jose Padilla. And his arrest did not take place in the ‘breaking news’ fashion suggested by Ashcroft’s announcement from Moscow: Padilla had been in detention since May 8.

Even the trusting American public questioned the timing and veracity of the Ashcroft coup. The former was just too convenient; the latter an obvious exaggeration. How did Bush respond to their doubts? He stuck to his ‘raise the spectre of terrorism’ strategy, and reminded Americans of another threat: Saddam Hussein. So serious was this danger that the president authorized American Special Operations forces to kill the Iraqi leader ‘in self-defence’. Next day newspaper headlines were dominated by the Iraq story, while the White House’s cynical use of al-Muhajir for political gain conveniently disappeared from the spotlight.

The irony is that Americans today are probably more unnerved because of Bush’s politically motivated scare-mongering than because of Al Qaeda. The danger is that in raising and battling false demons (al-Muhajir, Cuba, Iran), the administration is ignoring the real causes of terrorism: injustice and oppression. Until those are addressed, America will never be safe.

THERE have been moments during the last few days when the sequence of events relating to the Indo-Pakistan face-off at the Line of Control seemed like the classic precursor to the big bang. At other times a sense of deja vu has prevailed followed by the benumbing thought that no one seems to be in control of developments, not at least on our side of the border.

Finally, there is the chilling suspicion that there is indeed a catalyst in the configuration intent on using the Indo-Pakistan hostility to pursue its own agenda (read ‘jihad’) irrespective of the damage caused to Pakistani interests.

Getting to this stage from those “early days of innocence in a fair and promising land” has involved, inter alia, the untimely death of Mr Jinnah, the dominance of the administration by the bureaucratic monolith, the ascendancy to power of the military raj, the alignment of interests of the feudal/capitalist/civil and military combine, the loss of East Pakistan, the growth of the post-Zia legacy of negative religio-fundamentalism, the experimentation with controlled democracy under flawed leadership and finally the reversion to naked military rule. Add to this the two constants pervading all events: the heedless destruction — from museum to mohalla — of the workable state apparatus left by the British, and the Indo-Pakistan war syndrome that has persisted since 1947, and the picture becomes clearer.

This loss of innocence, accomplished in the latter half of the 20th century by recourse to various dubious practices associated, since the time of Plato’s Republic, with negative aspects of statecraft and governance, is the lot of a confused, dispirited people threatened by lawlessness, insecurity of life and property, bigotry and intolerance. People who eke out their lives in rural settlements reminiscent of neolithic communities, or in unauthorized urban ghettos amidst shattered streets, killer traffic, overflowing sewers, impure water, electricity breakdowns, garbage piles, substandard schooling, inadequate medical/welfare services, non-representative governance and rowing hopelessness. It is a situation so palpable that even those abiding in gilded palaces are not immune from the effects of the urban nightmare or unaware of the swelling hubbub outside their garden walls.

This represents the condition of life of most people in the land of the pure — a clear instance of betrayal of trust perpetrated (through commission or omission) by the rulers during the past 50 odd years. A betrayal rendered more poignant by the inability of the citizens to aspire to their status of heirs to the Islamic tradition of the subcontinent. What tradition, one may ask? At the last count, 47 odd versions of the ordained Islamic form were being propagated in Pakistan, some irreconcilable with others.

A pernicious disservice indeed to the cause of unitary Islam, mentioned repeatedly in the Holy Quran in S/A 23:53, S/A 42:10, S/A 45:17, and especially in S/A 45:28 which provides that on the Day of Judgment “every sect will be called to its record. This day shall ye be recompensed for all that ye did”! What is more, some dissidents propagate a pan-Islamic order at the cost of the state. So it is pertinent to ascertain their views on the significance of the state of Pakistan in their scheme of things.

Shorn of innocence as aforesaid, and compromised on our claim to representing the subcontinental Islamic tradition, and now being brought to the stage at which our security (read “survival”) is threatened by the Kashmir problem, we need answers. Why, one may ask, with unabashed naivety, has the ruling authority failed to engage the people in a dialogue on the war and peace scenario? The only official acknowledgement of the situation has been the confrontational Musharraf telecast of May 24 aimed more at appeasing the ISI/jihadi cadres than at reassuring the civilian constituency. Since then there have been a series of Musharraf statements aimed principally at international public opinion with scant concern for domestic consumption.

After all, if our lives are placed at risk pursuant to the current confrontation, we have a right to be advised about the nature of the crisis, the official point of view pertaining thereto and the options available for dealing with the matter.

We also have a right to air our views on the subject in a forum operating under government aegis.

This suggestion is not as farfetched as it appears at first glance. When it suited General Musharraf to make a reference to the Pakistani people by means of the referendum, he did so at enormous cost and to little effect. In the same vein, a reference fashioned to meet the above criteria could be made for eliciting the views of the populace on the present situation.

This should be preceded by an audio-visual-publication campaign (i) recounting the causes of the Indo-Pakistan face-off, (ii) citing the concerned views of a random selection of public figures, (iii) discussing the options available for resolving contentious issues, and (iv) describing the likely consequences in each case, with particular reference to the implications of a nuclear attack, such as likely target areas, scale and duration of destructive factors, preventive measures, prognosis of the aftermath et al. History teaches us that the responsibility for such decisions lies invariably with the governing authority. In an egalitarian age, however, democratic practice presupposes a consensual approach, or at least, one arrived at by taking account of the views of the constituents.

Such a move would provide the general the nexus with the people denied him by the referendum and help in establishing his democratic credentials. Moreover, history would record it as the first meaningful reference made by a Pakistani head of state to the people. With restored credibility, the general would be better positioned to secure the cooperation of the Pakistani people for his future policy objectives. A desirable situation by all reckoning!

As a step in this direction, Dr. Pervez Hoodbhoy’s documentary titled, “Pakistan and India under the nuclear shadow” should by mandate be telecast countrywide by all networks. Apparently PTV Corporation has, with customary perspicacity (inspired probably by the ubiquitous shadow agencies), declined to run the film. This situation should be remedied without delay.

The documentary should also be screened compulsorily in educational institutions, hospitals, airports and wherever public viewing facilities are available, including city halls, parks (nazim-organized, like the Karachi nazim’s war rally at the Quaid’s mazar), madrassahs, and leading seminaries such as the Bannori Mosque complex, Karachi, the Ahle Hadith training centres at Muridke and Faisalabad, the JUI Samiul-Haq and the JUI Fazlur-Rehman establishments at Akora Khattak and Dera Ismail Khan, the Ahle Sunnat centres at Rohri and Multan, the JI Mansura Headquarters, etc. If this is successfully accomplished, most people will at least have some knowledge of the flip side of the nuclear coin, with the projected 12 million dead and the two-generation decimation of urban and rural life, landscape, cities and nations. Some may even wonder as to why they celebrated the post-Chaghai advent of the nuclear element in their lives.

The only merit that the bomb has is its deterrent effect. However, given the recent hostility at the LoC coupled with India’s childish refusal to engage in dialogue while crying ‘wolf’, and the fact that virtually no fail-safe measures exists between the subcontinental nuclear aspirants, Stanley Kubric’s finale of “Dr. Strangelove” may well come to pass (without alas, the possibility of Peter Sellers riding the bomb en route to ending the world).

To prevent such an occurrence the nuclear factor must be removed from the Indo-Pakistan equation, for according to an assessment made following the recent pro-war Indian street processions “the next damn fool to use the bomb will be Indian or Pakistani.” Indeed, a way must be found for ending the 55-year-old war with India. God knows of all the occasions when the Indians have baited us with hostile manoeuvres — East Pakistan and Kashmir itself being prime examples of their animosity — even though, they availed, in both instances, of the opportunities provided by us. God has nevertheless, placed us alongside them, perhaps to endorse the inevitability of sharing the subcontinent, perhaps also to drive home the point that the destruction of one will engender the destruction of the other.

There are forces in the world today that wish to accelerate such an outcome. Some of these forces are already at work within Pakistan. Their declared purpose is the promotion of their agenda at the cost of civil society, Musharraf, Kashmir, Pakistan or whatever. They must not succeed. God has endowed us with the capacity to reason. And reason we must for negotiating a passage through the seemingly impenetrable maze confronting us.

TAILPIECE: The emperor Jehangir once said, “If there be a heaven on earth... it is this, it is this, it is this.” He meant Kashmir of course. We would be better advised to reflect on the following thought: Let’s look for life with honour beyond Kashmir, let us seek it, attain it and cherish it.

The writer is a Barrister-at-Law and lecturer in legal studies.