x THE World Bank’s recent suggestion that it is willing to pick up a significant chunk of the tab for the implementation of the Poverty Reduction Strategy Paper (PRSP) is hardly unexpected. The bank, along with its sister institutions — the International Monetary Fund (IMF) and Asian Development Bank (ADB) — have been exceptionally accommodating to the Pakistani government in the post-September 11 period. They were so impressed by the Musharraf’s track record that they insisted that only if there were assurances of “continuity of reforms” initiated by his regime funds would continue to be available even after the October election.

It seems that all the three institutions are convinced that the Jamali government is up to the task. The IMF has recently approved the latest tranche of over $100 million under the Poverty Reduction Growth Facility (PRGF) that will net Pakistan a total of $1.3 billion over three years. The ADB has suggested that much more than the $2.4 billion that has already been committed to Pakistan for the next three years could be on the cards if “continuity” is ensured. And now the World Bank has weighed in with a commitment to provide funding of $1.8 billion for PRSP implementation over the next three years.

Interestingly, the prime minister’s adviser on finance — likely to be a full federal minister again now that he has been elected to the Senate — has repeatedly said that the current PRGF loan will be the last agreement that the country will sign with the IMF. This seems to make sense given the fact that the World Bank and the ADB are going to be pumping enough money into the country so that the IMF World hardly need to chip in. Indeed, Shaukat Aziz has estimated that six billion dollars will be required from the World Bank and the ADB to see the poverty reduction strategy reach fruition.

It all sounds very pleasant. But as usual, the debate about the efficacy of these monies, and the long-term impact of massive accumulation of debt, is conspicuous by its absence. Perhaps more importantly, the PRSP continues to be advertised as the panacea for Pakistan’s economic woes, while in reality it is simply a dope for the adjustment policies that have been imposed on the country for over two decades. And there is talk that once the PRSP is complete in a few weeks’ time, parliament might be bypassed, with the Pakistan Development Forum — a donors get-together in Paris — having the final say in the matter.

The PRSP process to date has failed to include even a limited discussion of the impacts of adjustment on the economy, and more importantly on the poor. With the full PRSP in the final preparation stage, the process remains dubious, even as participation and country ownership continue to be touted as the hallmarks of the exercise. Provincial PRSPs are being prepared, with the PRSP for Balochistan the only one that has been released so far. This document mentions very clearly that in the three consultative sessions held during the preparation process, the only participation from Balochistan was of government officials.

Intriguingly, the Balochistan PRSP also points out that one of the consultation meetings was held in Dubai, and organized by the British government’s Department for Foreign International Development (DFID). When agencies such as DFID are organizing the national consultations that are supposed to relate to the PRSP, and such sessions are not even held in the country, it becomes very clear how much country ownership or broad-based participation there really is.

Meanwhile, petroleum prices continue to be increased, and gracious donors continue to demand cutbacks on civil servants’ salaries and perks, as part of the so-called rightsizing of the administration, and the speedy sale of public assets such as the Karachi Electricity Supply Corporation, PTCL, Habib Bank Limited, and the National Bank of Pakistan. So-called exemptions on the general sales tax (GST) are being abolished every now and then, making more and more basic commodities that form a large part of the household budget of the poor less and less accessible.

There are many other precepts to the adjustment paradigm that have been consistently emphasized by the international financial institutions (IFIs). Corporatization of virtually all sectors, including agriculture, fisheries, education and health is on the cards. In other words, for basic services and livelihood people by and large will be at the mercy of the market forces. But perhaps more important than anything else is the manner in which the private sector is being promoted as a sovereign entity in the economy.

Both the interim-PRSP (I-PRSP) and provincial PRSP for Balochistan have distinct sections describing future plans to exploit available oil and gas resources. It is well known that recent tensions in Balochistan between tribal chiefs and the authorities have been caused by a dispute over new discoveries of gas reserves and the question of rights to these reserves. It is interesting to recall that the tribal Taliban leadership in Afghanistan too were bitter about the US plans to build a pipeline from Turkmenistan through Afghanistan that eventually precipitated the current US-led “war on terror”.

There has been much talk around the world over the past 18 months about the politics of oil. Many analysts believe the impending war on Iraq has a lot to do with the control of that country’s oil resources. There should be little doubt that the neo-liberal paradigm being propagated by the IFIs through non-transparent processes such as the PRSP is intimately linked to the politics of oil and gas. The I-PRSP suggests a heavy focus on “de-regulation, liberalization, privatization, and greater utilization of indigenous resources; attracting foreign investment and entering into new alliances with international oil and gas companies”. A new investment policy for offshore oil and gas exploration announced in January 2001 lowered the corporate tax rate from 55 per cent to 40 per cent.

The World Bank and the ADB remain at the forefront of plans to build the long-awaited pipeline through Afghanistan, with both having committed financing the preliminary feasibility study in an agreement with the governments of Turkmenistan, Afghanistan and Pakistan. Meanwhile, in Pakistan the Oil and Gas Development Corporation (OGDC) has been slated for privatization, despite the fact that it remains one of the few state-owned companies that generate large profits.

There is no logic in privatizing OGDC, except of course, to ensure that oil and gas assets be handed over to US big business, which, incidentally, has ties with virtually all the senior members of the Bush administration, including George W. Bush himself, Vice-President Dick Cheney, Secretary of Defence Donald Rumsfeld, and National Security adviser Condoleeza Rice.

These are serious concerns about how openly and unashamedly national sovereignty is being compromised. The US and the IFIs are propagating an economic philosophy that is based on hollow premises and that has systematically disempowered poor countries like Pakistan. The effects of continuing to divest ourselves of our state assets are likely to be massive and painful. It is simply not enough to say that we need to continue privatizing to increase fiscal space for us so as to be able to finally generate enough money to implement an effective poverty reduction strategy. There are many other ways of conceiving economic policies that are just and have gone through the democratic processes.

The problem lies in our acceptance that gimmicks such as the PRSP are viable, and actually offer something different from what we have seen and heard till now. What is needed is much broader information dissemination on highly important issues such as the PRSP, and then critical debates relating to such issues. The parliament, meanwhile, as the primary forum for democratic decision-making in the country, should have the final mandate on the issue. The democratic process is already crippled, and it is up to those who are convinced of the need to strengthen it, including the opposition parties, to bring the PRSP and similar issues within the orbit of political discourse, so as to be able to rejuvenate whatever has been left of our democracy.

AS President George W. Bush and Prime Minister Tony Blair prepare to unleash a ruthless war on Iraq, I am reminded of a lecture I was invited to attend on a recent visit to Britain at the Foreign and Commonwealth Office in London. The subject of the talk by Lord Phillips of Sudbury was “How democratic is modern Britain”. He spoke on the issue in the context of how close the British parliament is to the people who elect it.

The speaker’s credentials can be judged from his contribution to public life — he was a trustee of Scott Trust (the owner of Guardian/Observer for ten years and he is the founder president of the Solicitors Pro Bono Group. Hence his opinion carried weight when he expressed his displeasure at the state of Britain’s democracy.

Lord Phillips spoke in the context of the falling voter turnout in Britain which, according to him, reflects the younger people’s lack of interest in politics. He informed his audience that only one in four of the British voters under 25 years of age voted in an election, which was half that of the turnout in Europe. He felt that commercialization of modern life was depoliticizing the people.

The second factor he highlighted was the growing complexity and volume of laws and lawmaking. He admitted quite candidly that he himself could not understand many of the laws which had been passed, even though he is a lawyer by profession. In 1999, the British Parliament passed 35 critical Acts and over 3,000 other pieces of legislation which ran into 12,776 pages. He felt that the government was trying to regulate society by an over-dose of legislation.

Today, the issue Lord Phillips dwelt on three weeks ago appears to be even more pertinent than at that time. British democracy is at a point of crisis. But it is not on the specific counts which Lord Phillips identified, though the depoliticization of the voter has had an impact on how the government operates in that country. The brewing political crisis in Britain has come to a head on a foreign policy issue which can hardly be described as being beyond the comprehension of the lay public — the impending Anglo-American war on Iraq.

In the last few months it has been becoming increasingly evident that a substantial section of opinion in Britain does not approve of Mr Tony Blair’s policy of going the whole hog in support of the Bush administration’s stance on a war on Iraq. Two anti-war public rallies, especially the second one on February 15 which drew nearly two million people out on the streets of London as well as another 750,000 in Glasgow, were ample demonstration of the strong pacifist mood that prevails in Britain today.

It is strange that this mood is not reflected in government policy, and that to an extent substantiates the point Lord Phillips made about the parliament being out of touch with its constituents. In France and Germany, the governments appear to be more in sync with the public mood. Logically, the British government should have effected a shift in policy when it failed to sell its point of view to the people who elected it to office. It is mystifying why Mr Blair has decided to confront his own people. While he continues to play what his critics in the British parliament have accused him of, the “American poodle”, the public has been disenchanted by the glib talk of the power wielders and their apologists.

With a relatively free media than in the United States, Britons are exposed to a diversity of information and opinion which find expression in the newspapers as well as on television — even the BBC. The public is thus not fed on one-sided propaganda designed to serve the interest of big business and the government. The peace movement in Britain has been spontaneous and easier to mobilize. Not surprisingly, the opinion polls — the latest was by Channel-4 Television — have found two-thirds of the people questioned saying that it would be wrong to attack Iraq while the inspectors were doing a useful job. In fact, more people felt that President George W. Bush was a greater threat to peace than President Saddam Hussein.

Mr Tony Blair’s dilemma has been heightened by the fact that he can no longer rely on the total support of his own Labour Party. The resolution he introduced in February in the House of Commons to obtain the sanction of the parliament to enable him to go to war against Iraq was countered by an amendment which was upheld by 122 Labour Party MPs. In fact, without the support of the Conservative Party, Mr Blair would have been out on a limb. This was described by the Guardian as the biggest revolt within a governing party for more than a century.

The events of the coming days will not only be a test of democracy in Britain. They would also prove to be the starting point of a process of change in the international system. Although the British prime minister has so far held firmly to his position, he has to be mindful of his constituency. The slight modification in the Anglo-American stance in the past few weeks, when diplomacy was given a chance and then the holding of the war summit in Azores on Sunday, were designed to appease the British public by assuring them (unsuccessfully though) that Mr Blair was acting independently. Faced with the voice of dissent from the ‘parliament of the street’, Mr Blair managed to delay the war which was expected to be launched in early March. But now it seems that President Bush is at the end of his short-length diplomatic tether, and the developments at the United Nations on Monday — the ‘hour of truth’ to use Mr Bush’s words — will show what is to come next.

With the French — with the backing of Russia and China — so adamant about blocking a new resolution sanctioning an attack on Iraq, especially when President Saddam Hussein appeared to be cooperating with the arms inspectors, Mr Blair is now in a quandary. By not heeding the voices of sanity coming from his own people — including his cabinet colleagues and the Labour back-benchers — he has isolated himself.

Three cabinet colleagues and two ministerial aides have already resigned. More resignations could follow if the resolution the Prime Minister has put before the House authorizing “all means necessary” to disarm Saddam Hussein fails to win the support of the majority of Labour MPs. Interesting times lie ahead for British democracy.

For Mr Blair the situation also amounts to making a choice between the two camps which have emerged on either side of the Atlantic. Britain has traditionally distanced itself from continental Europe — it was a latecomer to the EU and has still to join the euro system. But in the past, it has always come round to joining hands with its partners across the Channel. It has, however, never been required to choose between Europe and America as it has to do in the present case.

Significantly, the protest in Britain has a strong anti-American overtone. More than the negative diplomatic repercussions of the war and the massive loss of civilian lives it will cause, the overwhelming concern has been that Mr Blair is following blindly the lead given by President Bush. As things stand at the time of writing, the alienation between the people and the parliament seems to be intensifying.

As for the implications the present developments have for international politics, there is not much to speculate about. The changes are there to stay. The unipolar world dominated by the sole superpower — that is the United States — has given way to a bipolar system which will gradually assume a multipolar complexion. Of course, the process of change is slow and what we see today is a fluid situation. If anything, Mr George Bush has helped crystallize the new equations. In the long run this will facilitate the restoration of the equilibrium which was disappeared in 1991 with the collapse of the USSR.