THE short-sighted policy framework proposed by the Higher Education Commission and implemented as part of the Model University Ordinance represents the most potent attack on Pakistan’s educational institutions in the fifty-five year history of the country.

If allowed to prevail, it threatens to destroy the basic principles of accessibility, equity and progress on which our educational system is founded. Furthermore, it stands to rob institutions of higher education of their academic freedom and democratic values and expose them to the whims and fancies of a select elite.

The damage that this ordinance will inflict on our society will be permanent and catastrophic. It is imperative that the affected and the others who care act decisively to defeat this assault before these champions of reform are successful in taking Pakistan’s educational institutions on the same road on which countries like Zambia have travelled with disastrous results.

For those who have not followed the developments so far, here is a brief overview. Apparently responding to the issue of lack of recognition of Pakistani degrees in western universities, and the quality of education imparted at all levels, the government has decided on a number of “reforms”. The key one among these is the formulation of a board of governors in each institution that will have ultimate authority over hiring, firing, salaries and promotions of all staff, sale and management of all property and assets associated with the institutions and fixing of fees for students. There is no recourse to appeal and the current system of a 300 or so strong senate in the public universities will be dissolved.

One recommendation is to hire university and college lecturers on a contract basis rather than tenure to dispel complacency. Research and productivity will be rewarded according to a system which offers little reward is for publishing in Pakistani journals, some for publishing in European journals and the most reward for publishing in American journals.

The pay for all university and college teachers would supposedly be raised but at the same time it would be linked to performance, which will be evaluated using a range of criteria, including their research productivity. For this increased pay for teachers, fees would be increased but not more than 10 per cent a year.

The formulation of these reforms has been done according to the guidelines of a commission headed by Mr. Shams Lakha of the Aga Khan University (AKU) with representatives from other elitist universities in Pakistan, including the Lahore University of Management Sciences (LUMS), Ghulam Ishaq Khan Institute of Technology (GIKI), and the Institute of Business Administration (IBA). The government says it has adopted these reforms through a “consultative” process by including “educationists”. Similar hierarchies and “reforms” are planned for the public health sector, or whatever is left of it.

It is not difficult to see the illegitimacy of the process through which the whole package of reforms has emerged. The Higher Education Commission is staffed primarily by representatives of private elitist universities, while those who have to bear the brunt of the proposed changes have been excluded from this “consultative” process from the outset. Faced with widespread protests by an alliance of university, college and school teachers, doctors and lawyers, the government has created new bodies to sidetrack their objections.

The commission is pressing ahead with myopic, ad hoc policies, which have no precedence anywhere in the world. For instance, a Health University has been created that now has jurisdiction over all the medical colleges of Punjab like King Edward. Recently it decreed that 30 per cent of the seats at Fatima Jinnah College would be filled on a self-finance basis, thus creating an exclusive corner for the rich. Similarly, all education colleges and institutes have been placed under an Education University, whose degree is not recognized, and whose only function is to execute the policies dictated from above. While this will no doubt be publicized as decentralization, in effect it is little different from the British colonial rulers hiring local sepoys to ‘manage’ India efficiently.

It is claimed that the board of governers will make the system more efficient. They will certainly be an efficient instrument to enforce the draconian reforms while perpetuating the power of those behind them. That it will completely kill the ‘effectiveness’ or the raison d’etre of the education system is of course besides the point. Efficiency and profits are the holy grail of the new world order and the boards will probably do its job admirably well in the interest of the private sector.

Their efficiency will be guaranteed since they will not be responsible to anybody in the ultimate analysis and no guidelines have been provided for evaluating performance. All accountability has been dispensed with, no doubt to make the system more efficient from a particular point of view.

There has of course been no dearth of such initiatives in the past. But the fact that all attempts to create such bodies have only worsened the situation while burdening the taxpayer with the expenses of running the new body seems lost on the Higher Education Commission. We are given to understand that somehow the boards will not be authoritarian or allow political influence and mediocrity that have plagued our institutions over the years.

Old government schools, universities, colleges and hospitals occupy acres of prime property. The Punjab University, for instance, has approximately 2,800 acres of property. One can only shudder to think what will happen when the vast resources of our universities will be put at boards of governors’ disposal. Indeed, one of the schools in Raja Bazaar in Rawalpindi, which was recently placed under this system has now been ‘efficiently’ replaced by shops that were allegedly sold for one crore rupees each. But then, why not turn all universities into commercial property?

Surely, this will not only take care of the fund-starved universities that are considered to be a drain on the national exchequer but also provide unprecedented funds, which can be used by the boards in the best interests of their patrons or for whatever else such resources have been used in our country’s unfortunate history.

Fees in some of the Lahore colleges where some version of the governing boards has already been implemented now range from Rs. 32,000 to 40,000 per year, with the result that a student who topped her F.A. exams was unable to study at Kinnaird College (where fees currently stand at Rs. 38,000). Even the blind can see that this trend will and can only grow, depriving middle and lower middle class students of a decent education. Since most of the boards are composed of members of private corporations (some of which call themselves educational institutions), the members are lavishly paid, with salaries of some as high as three lakh rupees a month. Instead of the state supporting students, the students will end up supporting the elitist boards and their favourites.

The fact is that with the government clearly not having any intention of increasing spending on education, further fee rises are inevitable in spite of current government reassurances to the contrary. Mr. Shams Lakha insists that parents must know the “true” cost of educating their children. In an interview to a Karachi monthly magazine, he suggested “we must inform them that even if their tuition fee is say Rs. 2,000, the actual cost of education is around Rs. 80,000 and the state is paying as much as Rs. 78,000”. How will parents know of these “true costs” if not by bearing them? The Model University ordinance has spelt out its activities in detail without saying it in so many words that what it aims at is wholesale privalization of education.

What is truly ironic is that the private universities themselves, upheld as models, would not to be what they are if it were not for government subsidies (access roads, electricity connections), international aid or simply the benevolence of their founders (the Aga Khan for the AKU). And LUMS, AKU, GIKI and IBA represent less than one per cent of the total privatized educational institutes in Pakistan. The rest have no facilities, no open spaces, no libraries worth talking about and almost no permanent staff and they produce lower quality graduates than the public institutions, but charge much higher fees.

That the quality of our public universities will go down as a result of these reforms is a foregone conclusion. Pakistan is not the first country to opt for privatization of education. In some other developing countries, privatization has already reduced access and to education and brought down quality.

Since being privatized, the English literature department at Government College, Lahore has laid off most senior staff to reduce costs. They now hire graduate girls, who are not paid more than about Rs. 5,000, a month, or retired professors who again are happy to work for a pittance. There is no commitment to research, and no quality control since teachers change from term to term.

Similarly, in hospitals junior doctors with little or no experience are in charge as higher grade and senior doctors have been forced to retire to reduce costs. The quality of both education and health are being jeopardized under the new system. How the Higher Education Commission has promised to pay higher salaries to doctors and teachers without making fees for students and patients prohibitive is beyond comprehension.

One can only imagine how competitive and inspiring one can expect one’s fellow student to be given that 30-50 per cent of them will have ‘won’ their seats in an auction. And these ‘self-finance’. The more they can “donate” above and beyond that, the better their chances of admission.

(To be concluded)

IN his first major decision Prime Minister Mir Zafarullah Khan Jamali has set up a 25-member committee to improve the investment climate in the country and rebuild investor confidence. The prime minister himself will be chairman of the committee, which will include the provincial governors as members along with the other relevant ministers and senior officials. Leaders of chambers of commerce and major investors will also be represented.

There is nothing very new about such a high powered committee. The prime minister had always been chairman of such committees, and in his absence the president had cited lack of adequate investment and the source of many of our economic ills.

During military rule Razzak Dawood had under him both the ministries of industries and commerce. That is the current practice in most modern countries of the world, including Japan at one end and Britain at the other. But now Humayun Akhtar is the minister for commerce while Liaquat Jatoi is the minister for industries. Let us hope the two can work together smoothly as they can have conflict of interests or differing perceptions on issues.

Mr Jatoi says there will now be a one-window facility in the Board of Investment to help investors solve all their problems. All the relevant departments will be represented on the board, including the utility agencies, like WAPDA. And they are expected to meet the needs of both the foreign and domestic investors.

In the past the government in Islamabad was impressed by the performance of Prime Minister Lee Kuan Yew’s office in Singapore which directly deals with the complaints of all the foreign investors and solves them promptly. Our former prime ministers sought to make a model of that for themselves to solve the problems of investors and visited that office while in Singapore, as Ms Benazir Bhutto, too, did during her visit to that country. But in reality little of that was practised in Islamabad where demands were made on foreign investors for the personal gains of the rulers or the subordinate officials.

So what matters now is not the official set-up or bureaucratic behaviour in dealing with such problems, but what is actually delivered promptly and beyond dispute.

The new committee is to have a short term, medium term and long term investment policy. In fact, for any large investment what matters is the medium and long term policy since drafting such projects takes time and as does mobilizing capital. During the period will the policy change or the procedures alter, or the government change, as has been happening in Pakistan in recent years?

We no longer talk big in terms of the capital we expect as foreign direct investment (FDI). Instead of the two billion dollars a year or more that we had talked of earlier, we now talk of one billion dollars a year. Mr Shaukat Aziz, Adviser to the Prime Minister on finance, is confident that FDI this year will touch one billion dollars in view of the heavy investment being made in the oil and gas sector and through privatization of major organizations like UBL.

This one billion dollar investment will be quite a jump from the 385 million dollars invested in 2001, following 305 million dollars in 2000 and 530 million dollars in 1999. Foreign investment was affected a great deal by a series of developments in the country and the region.

In 1998 we had the nuclear explosions which brought economic sanctions from many countries, particularly the US and Japan. In 1999 we had the imposition of military rule which brought in “democracy sanctions”. Prior to that there was the Kargil war which increased the tension between India and Pakistan. If all of that increased the political uncertainty in the country, the events of September 11 in New York aggravated the situation in Afghanistan further and Pakistan became a frontline state in the war against terror.

If all that was enough to deter foreign investors interested in Pakistan, the lasting uncertainty about the political set-up to follow the end of the military rule in Pakistan unsettled them (the foreign investors) further. And now the general elections have taken place following the controversial referendum, the possible political outcome on a long term basis is far from certain. Although Shaukat Aziz is to continue as the architect of the economic system, how much of a free hand he will have under the new political order remains to be seen.

In fact the future of this political order depends on its success in bringing about large investment, both foreign and domestic. Unless large investments are made, and enough jobs created political unrest will increase and public protest against unemployment may rise and the popularity of new political alliance like the Muttahida Majlis-i-Amal will be affected. And if public protest against unemployment does not increase too openly, large-scale crime can also increase. And that can be equally upsetting for the country.

We need higher investment for economic growth, increasing production and lowering the prices, boosting the revenues and spending more on the social sector. And we need not only foreign investment but also domestic investment, particularly when agriculture is to be developed faster and its output made more value-added which can be done quick. Agriculture needs more domestic investment and its output-input ratio can be much higher than in the industrial sector.

But Humayun Akhtar says the confidence of the investor is a currently “at the lowest ebb” which is the main cause of the decreasing local and foreign investment. The current political climate is not very helpful for the creation of that confidence. Slogans calling for investment will not bring in more investment, but positive steps and measures to improve the profitability of the investment, which currently has to be higher than in normal times in normal countries, will.

He also says that the “inflated power tariff” is the main hurdle for industrial development which is undermining the productive sector. So the new democratic government is trying to bring down the power tariff, he says.

But that has to be done without subsidizing power production on a long-term basis. Instead that has to be achieved by cutting down the heavy power theft and gross inefficiency in power production, transmission and its eventual distribution.

Can a democratic government bring such radical changes that three years of military rule could not? This is a major challenge to the new rulers as the World Bank and the Asian Development Bank, which have given large power sector development loans, will not agree to cut down the power tariff unless enough savings are made prior to that.

The other major deterrent to domestic investment was the high cost of bank loans and reluctance of the banks to lend except to their best customers. Positive action has been taken in recent times to reduce the interest rate. The discount rate of the State Bank of Pakistan has been cut by 1.5 per cent to 7.5 per cent and the export refinance rate has been reduced by one per cent to 7 per cent. The cost of loans for setting up industry using locally made machinery has been reduced in a similar manner.

Mr Shaukat Aziz and the governor of the State Bank, Dr. Ishrat Husain, have been exhorting the banks to play a more dynamic role and explore new areas to lend instead of relying on lending more to the government as the rates of returns on Pakistan investment Bonds have been slashed again.

Banks can broaden their credit base and lend to new customers if they continued to monitor the performance of the loans instead of giving large loans and forgetting all about that due to corrupt or other practices and losing the capital thereafter. If the State Bank is awake, and so are the lending banks, they need not forego their capital in the manner they had done earlier.

In fact much of the loan default and non-performing loans increased rapidly because of the high interest rates which rose high as 25 per cent. If to add to that, there was compound interest as well, the default had to snowball. And since that interest rates have come down and the banks are more vigilant now such accumulation of debt and increasing loan default are less likely, except when there is a major sustained economic upset.

We have to move towards a more rational economic order with its details in good order instead of letting an irrational system go from bad to worse. Modern high finance is not seeking crisis management or crisis resolution as much as crisis prevention which, means taking measures to prevent a crisis before it gathers full momentum.

Another irrational element in the economic system or corporate management was the high taxation at one end and heavy corruption at the other. Efforts are being made to make the taxation system rational and sustainable, along with moves to prevent or reduce corruption. That should also result in reduced accumulation of loans and large scale loan default.

In fact, the corporate sector should been encouraged to raise more capital from the market. Currently such companies rely on raising capital or loans through Term Finance Certificates (TFCs) with handsome interest for a short term period. The banks and the people buy the TFCs as they are guaranteed a reasonable return instead of the uncertain or low dividend.

More and more of them companies should now be going to the stock market to raise capitally selling their shares. The current level of the Karachi Stock Exchange Index at over 2300 points is helpful to raising capital through the stock exchanges.

Dr Ishrat Husain has called on the investing companies to come up with some substitute investment schemes in place of the national savings schemes which are lowering their interest rates and upsetting the small savers, particularly the pensioners and widows. With the KSE index doing so well and the financial sector more alive than before, they should be able to come up with such schemes which can reward the investors or savers far better.

The investors would need increasing capital, and the honest among them would prefer to get such capital in the form of share holders investment and share the profits with them. The large the number of share holders in the country the more secure can be the financial system and stable the social order, more so when it does not have a social security system. In the US half the number of households are said to own shares.

That means broad basing the capital ownership and creating a large number of stake-holders in the economic order. By creating such a system we will have larger number of persons watching the economy and a larger number of people gaining from that. Of course, such a system has to be based on trust and faith,and honouring of commitments. the earlier we have such a system, the better for us all.

SO far the war on terror has divided the world into hawks and doves. Hawks want to crush the enemy with physical might. Doves seek to understand the root causes of terrorism, to address the grievances that motivate the killers: if those can be remedied, terror itself will eventually melt away.

But what if that’s a false choice? What if it’s time for a new division: smart vs. dumb? The dumb approach says you can either be a hawk or a dove — one or the other. The smart approach says you don’t have to choose. You can, indeed must be, both hawk and dove at the same time, depending on who you are taking on.

When you’re confronting the killers themselves — the men behind last week’s Mombasa bombing, for example — the hawk should show its claws. There can be no havering or hesitation: brutal, ruthless force should be deployed against them, ideally before they strike. As they have shown from New York to Djerba, Bali to Mombasa, Al Qaeda are bent on wreaking the maximum possible havoc, the greatest civilian bloodshed. Morally, we should have no qualms about aiming every arrow in our quiver straight at their heart.

But what of those who are not themselves terrorists, but who lend tacit support — those who did not hijack the September 11 planes, but cheered the 19 men who did? There are millions like that, across the Arab and Muslim world but not only there: witness the Latin American opinion polls which showed remarkable “understanding” of the 9/11 attacks. How should a smart war on terror handle those who are not killers, but cheerers?

Here it is time to release the dove. The bystanders, the Kenyans, Saudis or Pakistanis who turn a blind eye to the Al Qaeda operatives in their midst — perhaps making a donation here, granting a safe house there — will not be won over by a western-led military crackdown. On the contrary, they will be repelled by it. They need to see the west take action on the complaints they have. That might mean an end to US support for vile dictatorships across the Arab world, it might mean resuscitation of the Middle East peace process. It could see US troops withdraw from Saudi Arabia, or the world’s richest nations finally wean themselves off fossil fuels and the accompanying desire to control the region that produces them.

Of course, such steps will not impress Osama bin Laden and his army of medieval absolutists: they are fanatics who will only be satisfied when every last infidel is dead. But it might appeal to the constituency that currently allows him and his Al Qaeda devotees to thrive in their midst.

This surely is the smart formula: a hawk’s face for the killers, a dove’s for the cheerers. In the Blairite cliche: tough on terror, tough on the causes of terror. It seems straightforward enough, yet rarely is that simple logic articulated. The right denounces any attempt even to understand the grievances that sustain terrorism as limp-wristed collusion with terror. The left, meanwhile, often makes the same category mistake, confusing any attack on hardcore terrorists with an assault on the wider constituency that surrounds them — as if a zealous desire to crush Al Qaeda is an automatic declaration of war on Islam. Both are wrong.

Still, there’s more to a smart war on terror than the realization that dove and hawk should be a combination not a choice. The hawks’ war has to be fought by smart means, too.

So far it has been reminiscent most of those legendary first world war deployments of cavalry horses against tanks: a doomed attempt to wage a new war with the aged weapons of the old. Just as those long-ago generals could not adjust to the new rules, so today’s commanders cling to their tanks and warships not realizing their uselessness against a hijacker’s knife or a human bomb. War has changed utterly, yet our masters cannot see it.

So Britain has two new aircraft carriers on order for the next decade, while our army brass still learns at staff college about reinvading Europe from the north in a two-corps invasion — as if the world is forever frozen in 1944.

Smart hawks would surely be adapting to the new war. Rather than lavishing cash on expensive, clunky hardware, they would be investing in the only resource that can possibly combat terror: intelligence. Not fancy computers at HQ, but old-fashioned human intelligence — humint in the Orwellian jargon — that would see agents diving into every pool in which Al Qaeda swim.

That would entail an enormous cultural shift. Where once our security services scoured Oxbridge for Russian speakers, now they should be crawling all over Bradford, Leicester and Burnley, looking for the young British Muslims who might subvert Al Qaeda from the inside. For they are surely the future of the war on terror.

Some of this is getting through. The biggest single growth area in the British army today is in “special forces”; MI5 recently placed a recruitment ad on an Arabic-language website. But here, too, the successful hawk knows how to be a dove, too.

“Intelligence is all about getting people on your side,” says one high-ranking European official. “That means not doing what the Americans do, knocking on doors at 3 am and carting people off to Guantanamo Bay.” Local tip-offs are the lifeblood of humint, and they don’t come if you stomp around in heavy boots.

It seems a crucial factor in last week’s Mombasa attack was the offence US agents had caused local Kenyans when they investigated the 1998 embassy bombings.

That’s true at home, too. Intelligence agencies will not be able to recruit from the ethnic minorities unless they, and the state, are seen as legitimate. “Softer, liberal measures and rhetoric” may be required, says the European official, in order to recruit those would-be agents. In other words, if David Blunkett wants to win the war on terror, he may have to go easy on British Asians’ marital and linguistic traditions.

What’s needed is a surge in creative thinking, even if some of the ideas that come are wild. Personally, I would have sympathy with the military taking over the running of civil aviation: if terrorists are going to aim anti-aircraft missiles at passenger jets, shouldn’t those planes enjoy the same protection as military ones?

There will be tough ethical challenges, too. Old-style, pre- emptive strikes against hostile armies were one thing; but what do we do when the enemy wears no uniform? Won’t an attack look like an illegal assassination of a handful of civilians? What if the enemy is plotting mayhem from another country: are they fair game, as Australia’s PM suggested this week? And are we prepared to have our phones tapped and our e-mails read, if that will help thwart, say, an anthrax attack on the London underground?

These are sharp ethical questions, but it does not mean there are no answers. Our job is to find them, to adapt past wisdom to what is a new war — in which only the smart will survive.—Dawn/Guardian Service.