FINANCE Minister Shaukat Aziz is back to his old theme song of reducing the number of federal taxes to three —- direct tax, import duties and sales tax. The rest of the taxes will be abolished gradually, he says, without indicating a time-limit.

The government is considering this proposal seriously, he says. Three years ago when he became finance minister, he had affirmed the same and added that the number of provincial taxes would be reduced to seven or eight from around 26. The number of provincial taxes has been reduced to some extent, but the incidence of those taxes have been made very high, like the property tax in Sindh, stamp duty and the cost of transfer of property.

Among the federal taxes, he has done away with the wealth tax, reduced import duty under IMF pressure and trimmed some other taxes while at the same time increasing the total amount of revenues. Shaukat Aziz says that to reduce the number of taxes and lower their rates which he has promised, the tax base has to be broadened. The governor of the State Bank, Dr Ishrat Hussain, says the number of taxpayers should be raised to three million, which is ideal. Meanwhile the current number of taxpayers is estimated to be between 1.8 million and 2.3 million.

It is not obvious how the finance minister can slash the number of taxes at one end, along with a reduction in the rate of duties and simultaneously increase the total amount of revenues! That is all the more so as if the tax-base is broadened, the new taxpayers are likely to be small taxpayers and may not add to the cumulative revenues in a big way.

The fact is that of the three taxes mentioned by Mr Shaukat Aziz, the import duty too is likely to yield less amount of revenues under pressure from the WTO and the globalization trends. In fact commerce minister Humayun Akhtar Khan had said earlier that if the import tariff is done away with altogether, Pakistan’s economy can flourish and become far more competitive.

In view of such prospects the government is trying to widen the sales tax net further and make it applicable to all forms of sales of wood as well as to the new and old Baara markets. It is also proposing to set up more custom check-posts for expanding the intelligence network. Scanning machines are also to be installed at all airports. All that, along with a reduction in import duties is expected to reduce smuggling and increase the customs revenues. Meanwhile, the CBR expects 300,000 more income taxpayers this year as a result of various vigilance measures.

The increase in revenues as well as the number of taxpayers is to be achieved through a friendly approach to the taxpayers, reduction in the contact between taxpayers and the taxation officers, and the discretionary powers of the CBR officials.

The government is also taking measures to reduce the expenditure particularly by repaying the costly loans, as those of the IMF by borrowing money cheap from the market. It is coming up with a jumbo bond of Rs 30 to Rs 40 billion for 15 years and a foreign exchange loan of five hundred million dollars.

Simultaneously the anti-corruption measures are being stepped up. The recovery of Rs. 900 million from 14 persons involved in the country’s largest fraud case in the Employees Old Age Benefit Institution is a remarkable example of how such corruption has spread in various sectors of the government. In fact the amount involved is much larger, but this much has been recovered by letting the employees seek the benefit of plea-bargaining.

On the same day a former district zakat committee chairman Mirza Mehboob Ali was arrested for large scale misappropriation of zakat funds. The same day‘s newspapers reported illegal payments of Rs 70 million in the Punjab agriculture department. Investigations by the Punjab Assembly public accounts committee indicate the amount involved may rise to Rs 700 million. All this shows the range and diversity of corruption in the country, and hardly any public body appears to have been spared by the clans of the corrupt.

While public funds are being looted in this manner, Sindh education minister Irfan Marwat reports he has in hand some 14,000 shelter-less schools in the province. There are no boundary walls, roof, or provision of water in these schools. Sindh is famous for its ghost teachers. No wonder, education in the province is making small headway. If the contracts for publishing books were given to favourites of the officers of the education board, the quality of the textbooks is seen to be too low.

While the salaries in most departments are very low, they appear to be pretty high in some departments or for some officers in certain sections. Now the Small and Medium Enterprises Bank has been set up with its branches to help the small investors, but last week the finance minister told the National Assembly that the chairman of the bank was drawing about two lakh rupees a month plus perquisites and privileges and that 17 others in the bank were also getting one lakh rupees per month. Such pay scales came as a surprise to the members of the National Assembly. If little tax is collected and that is misspent, the expectations of the public from the government cannot be fulfilled. The financial world is now witnessing the interesting case of Josef Ackerman,the chief executive of Deutsche Bank, who is considering to resign after he was charged with breach of trust for his role in approving large bonuses to his Mannesmann executives. If convicted Ackermann could face up to five years in Jail. Following this development, Deutsche Bank is considering moving out of Germany, as that would be gainful taxation-wise as well.

In New York the members of the New York stock exchange are calling for the ouster of Kenneth Langone, director of the exchange, after obtaining the premature exit of its chairman Richard Grasso, for giving themselves large retirement benefits.

The world is not in a mood to offer very high salaries for the chief officers after the top executives of Enron and Worldcom were found sadly wanting in the performance of their job. But we in Pakistan go our own way, heedless of the concerns and trends in the world. After the Sindh Assembly was expanded a great deal following the elections, we have in Sindh 13 out of 16 advisers to the chief minister who are unelected. And despite the law that a member of the National or Provincial assembly should be a graduate, five of the advisers are non-graduate including some non-matriculates. And they will be getting the same salary and perquisites as other ministers.

If public funds are wasted in this manner and unqualified persons appointed to advise the chief minister, the result can be negative administration which creates more problems than solve any. The outcome is the negative newspaper headlines that we see every day.

In Pakistan people pay taxes not only in the name of taxes, but also under other heads like the surcharge for petrol, for example, which is about Rs. 15 per litre and is no less than a tax, but it is called a surcharge instead of honestly treating it as a tax.

As far as the people are concerned whether they pay the tax directly or indirectly, they want a return for the tax and not more officers in their new Toyota Corolla cars. The government appoints the officers who tend to use the additional resources, but does not care to check whether they deliver or not.

In fact, as far as the people are concerned, the more the officers and staff, the more the corruption and the more the rules, the larger the corruption. What the people want is a government that delivers, beginning with law and order and ending with justice in the courts delivered reasonably quick. If instead they have a government that misgoverns or does not govern at all and lets the forces of chaos prevail and the people fear the police more than the criminals. That is not what they expect in return for taxation, and they will not pay full taxes if there is such an administration. The finance minister may say his business is to collect tax, not to maintain law and order. But as far as the people are concerned it hardly matters. So it is up to the prime minister and the president to make sure that the people get what they want and what they need, and do not fear the instruments of the government as instruments of oppression, and avoid seeking their assistance.

Turning around such a government and making it truly functional is not easy. And paying some of the officials’ very high salaries alone is not going to make them effective or more functional as some banks show. What we need is real leadership to make the best of what we have, and meet the needs of the people instead of asking them for more, when there is no certainty of better deliveries.

A YEAR ago this week, the British government released the first of two intelligence dossiers outlining the threat posed by Iraqi weapons of mass destruction. The September dossier included the (by now infamous) claim that these could be deployed within 45 minutes of an order to do so.

Events since the dossier’s release, both at home and in Iraq, have made the first anniversary a less than happy one for the government. The biggest damper on the government’s spirits was Labour’s shock defeat in the Brent East byelection. The London constituency has long been a Labour stronghold. The last MP, Paul Daisley (whose death in May prompted the byelection), had a majority of 13,047. The Tories came second in that 2001 election, the Liberal Democrats a distant third. On Thursday night, however, the political landscape in Brent East underwent a dramatic transformation as the Liberal Democrats secured a 1,118 vote majority. Their candidate, Sarah Teather, has — at 29 years — become the youngest MP in the House of Commons.

Brent East was a shock not just because of the 29 per cent swing away from Labour but also because it was the first time in fifteen years that Labour had lost a byelection. Inevitably, questions have arisen about why Labour lost and, more important, about whether Brent East is just a mid-term blip or a sign of things to come?

The immediate answer to the question of ‘Why?’ is without doubt Iraq. It would be no exaggeration to say that Iraq has become an unstaunchable wound for the British government (and especially for Prime Minister Tony Blair): one that simply will not stop bleeding.

The flow of blood started metaphorically when Tony Blair sided with George Bush and sidelined the United Nations: many at home condemned the unilateral decision to go to war. It increased as, despite relatively easy ‘victory’ in Iraq, weeks became months and still no WMD (or any evidence of WMD programmes) were found. And the bleeding became literal as British soldiers started to die in Iraq. As with the US, British fatalities since the end of ‘official hostilities’ have surpassed those during the war.

Lack of WMD and British body bags were never going to be good news for the government. But equally — taken alone — they were never going to pose a threat to its survival.

The Hutton inquiry into the death of Ministry of Defence scientist, Dr David Kelly, has produced a steady drip-drip of allegations against the government. Failure to protect the identity of Dr Kelly is, ironically, among the minor misdemeanours that the inquiry is revealing. Infinitely more serious is the mounting evidence that the government was determined to go to war against Iraq, and that it presented and quite likely exaggerated the intelligence information it had in order to do so.

It was recently revealed that on February 10 this year, the joint intelligence committee warned the prime minister that Al Qaeda and its cohorts ‘continued to represent by far the greatest threat to Western interests, and that threat would be heightened by military action against Iraq’. The JIC’s assessment could not have been more accurate: post-war bomb attacks in Saudi Arabia, Indonesia, Pakistan, and of course Iraq are bloody testimony to that. Tony Blair chose to ignore the JIC’s warning. Worse, he chose not to share it with the parliament, which at the time was voting on whether to go to war.

Liberal Democrat leader Charles Kennedy pointed out the significance of the JIC’s report (as well as other material coming to light in the Hutton inquiry) on the decision to go to war: ‘If parliament had known what the country now knows the very vote which led us into this unnecessary conflict could and should have had a very different outcome indeed.’ It is extremely difficult to avoid the conclusion that Blair misled the parliament. In British politics, there can be few greater sins.

The Brent East result could therefore be either (or both) of the two possible verdicts on the Iraq war: a verdict on the failure to find Iraqi WMD and the growing mess in that country, and/or a verdict on the government’s honesty and trustworthiness.

There is another possible explanation for Sarah Teather’s shock victory: Labour’s domestic record. Even here Iraq enters the picture: many Britons feel that, in his eagerness to support America’s ‘war against terror’, Tony Blair has lost sight of their priorities and concerns. Unlike in the US, these are not terrorism and security but the bread and butter issues of jobs, schools, hospitals and trains. Unfortunately for Labour, Blair’s policies on these are almost as unpopular as his Iraq war: tuition fees for students, foundation hospitals, a collapsing rail system — none of these endear voters to Labour.

Given a choice, the government would much rather ascribe its failure in Brent East to domestic gripes than to the Iraq war — and even less to lack of public trust. It is not hard to fathom why. Domestic political gripes are survivable, so too foreign policy blunders, but deception is invariably fatal.

If Brent East was about domestic governance, then Labour can rest easy. Voters traditionally use mid-term byelections to signal their concerns about the incumbent government: come general elections, they revert to their old voting patterns. Byelections are not a barometer for national voting. Hence in 2005 (when the next general election is due), Labour can be confident of retaining its parliamentary majority — and even of winning back Brent East.

But should Brent East be about Iraq, then Labour has reason to worry.

At best, the government’s handling of Iraq raises questions about its judgment and competence: was it wise for Blair to so blindly follow George Bush? To sideline the UN, and cause huge rifts with continental Europe? To sacrifice British lives and spend billions of pounds on a futile war? Blair will have a tough time answering these questions.

At worst, Iraq raises questions about the honesty and trustworthiness of the government. Did Tony Blair mislead the parliament and the British public? Can his word be believed in future? Do the British people want such a person — deceptive and manipulative — as their prime minister? Blair will have an infinitely tougher time answering these questions.

The consensus among political pundits is that Brent East was about the latter: a pointer to public mistrust in the government more than anger at its failed Iraq policy. But in either scenario — lack of public confidence in Blair’s judgment or in his word — Labour can expect to pay the price in forthcoming elections: first council, European and London mayoral polls, then in the 2005 general election. The party can brace itself for big losses in the former, and a significant reduction in its majority in the latter.

As for Tony Blair, there is already talk in Labour circles of replacing him with a less tarred figure — the Chancellor, Gordon Brown, perhaps. The party could decide that Blair has become an electoral liability rather than an asset. Even if he survives, his credibility and authority will have been severely eroded.

Labour and Blair’s one source of solace in this unhappy anniversary week is the sorry state of the opposition Conservatives. Even an untrustworthy Blair looks more attractive to the British electorate than Tory leader Iain Duncan Smith. As for the Liberal Democrats, in a few years time they could present a viable alternative to Labour. But for now they are still the third and smallest party in British politics, making their mark in local, European and even national polls — but falling far short of a parliamentary majority.

Labour thus remains on track for re-election in 2005. But the message coming loud and clear from Brent East is that the relatively easy run it and its leader have enjoyed over the past nine years is over: from now on, things are going to get a lot tougher.

SOMETHING very important happened in Mexico last fortnight. You could tell, because the European and American trade negotiators were so cross as they left the 146-nation trade talks at Cancun that they were practically spitting.

The European Union’s trade commissioner, Pascal Lamy, damned the World Trade Organisation as a medieval structure in urgent need of reform, and US trade representative Robert Zoellick bluntly threatened to take his business elsewhere: “We are going to keep opening markets one way or another....We are not waiting forever. We are moving elsewhere.”

‘Elsewhere’, as Zoellick’s European counterpart made clear, could mean the abandonment of the whole multilateral WTO process in favour of bilateral trade deals where the sheer size of the rich countries’ economies would let them steamroller poorer trading partners. “We will have to have a good, hard think among ourselves,” said Lamy. “Should we maintain multilateralism as our priority?...Circumstances are such that when you get a bit of a shock we have to make sure that we still all agree on this (approach).”

The shock was the fact that the Europeans and Americans did not get their way at Cancun. The WTO, like the International Monetary Fund, the World Bank, and even the United Nations, began life as a developed-world institution to regulate relations among the rich countries. All these organisations gradually expanded to include the world’s developing countries as well, but in every case control remained in the hands of the rich. Until Cancun, when the usual divide-and-rule tactics of the rich suddenly failed.

The Group of 21 which made its first appearance at Cancun is as important for the future of international trade as the creation of the first trade unions were for the future of industrial relations. Suddenly, the economically weak begin to have some real negotiating power — so long as they stay united. It was the remarkable solidarity of this new G-21 grouping, led by China, India and Brazil but including other important middle-income countries like South Africa, Argentina, and Egypt, that broke the negotiating strategies of the rich countries.

There was a danger implicit in the process of expanding the WTO to include practically everybody in the world from the very start. It enabled the industrialised countries to impose a set of trading rules on the world that opened up rich new markets for them, but it also carried the risk that the more numerous poor countries might gang up to resist the rich world’s self-serving version of the rules.

In practice, they never did, even though the West was getting away with disgraceful abuses likes the high tariffs on food imports and the huge subsidies for food exports that are strangling agriculture in the developing countries. The rich countries were always able to bully or seduce vulnerable poor countries into making separate deals, and the idea of a common front of the poor never got off the ground. Until China joined the WTO two years ago.

India and Brazil had tried to make this strategy of a common front work several times before, but it was the presence this time of China, with an economy too big to let it be bullied or bluffed, that gave the G21 a new and unshakable unity. “This is the first time we have experienced a situation where...we can sit at the table as equals,” said South Africa’s trade minister Alec Erwin. “This is a change in the quality of negotiations between developing and developed countries.”

The first consequence of this new balance of power, inevitably, was that the talks at Cancun collapsed. The European and American negotiators were wholly unprepared for the level of resistance encountered by their more brazen proposals (like an EU demand that the Third World accept a revived version of the Multilateral Agreement on Investment, killed off by massive popular protests in 1998, as the price for a mere 45 percent cut in EU export subsidies on food). They blustered, they tried to pick off the weaker members of the G21, they threatened to abandon the whole WTO process — and none of it worked.

The Mexican chairman finally pulled the plug on the Cancun summit when a group of African countries walked out, but it was not a failure. Brazilian Foreign Minister Celso Amorim, the unofficial spokesman of the G-21, said that “we are quite optimistic for the medium and the long term. We will have an increased capacity to negotiate and if a deal comes it will..service the global system as a whole.” Rather than just serving the special interests of French and American farmers and of Western-based multinational corporations, he presumably meant, though he must realise that any deal will have to respect their interests too.

Just as trade unions were not really about overthrowing capitalism but about redistributing power within the system, so the G-21 is not about destroying global trade but about redistributing its benefits. After they have got over their initial shock, the rich countries’ negotiators will go back to the table and start looking for common ground, and doubtless they will find lots of it.

But the one-sided reign of the rich at the WTO is over — and any moderately imaginative person will be starting to wonder when this approach might also be applied to other rich-world institutions like the World Bank, the IMF and the UN. — Copyright

THE weekly meeting of Power Anonymous was held in Washington.

“My name is George W. and I am a recovering power addict. I guess I inherited my liking of power from my father. I first started using power heavily when I became governor of Texas. The fellows I hung out with were all power abusers. Some drank it, and others sniffed it.

“I had no choice but to use it myself because it was in my genes. I tried to kick the habit when I came to Washington, but I didn’t know this was the center of power for the free world.

“I could buy all the power I wanted on any street corner. Every time I woke up I had to have a fix. Then I would go to my office and my staff said I didn’t have enough of it. It wasn’t long before I started having nightmares. I believed people on the hill were out to get me.

“Some say I am still on a power trip. But if I hadn’t hit bottom, I wouldn’t be here tonight.”

“My name is Donald R. I work in the Pentagon. As a matter of fact, I am the Pentagon. Next to George W., I have the most power in America. I can send troops anywhere I want to and no one can stop me except George W., but he never understood what real military power was all about and left the decisions up to me.

“I have more power because George believes me more than he does Colin. I got my first taste of power when, as secretary of defense, I was flying a fighter plane over the no-fly zone in Iraq. I saw several tanks explode and realized that I had enough power to blow up anything I wanted to.

“Power didn’t come cheap. It came from billions and billions of dollars, but I had it to spend. The fact that I’m here tonight doesn’t mean I’m cured. Any day I can go back to getting high on it. There are 12 steps to Power Anonymous. I’m still on the first one. Giving it up is much tougher than you think.”

“My name is Colin P. I used to be a general but in my present job nobody really listens to me. At the beginning, I was hooked on power, but as time went by it was harder and harder to keep it.

“That’s one of the reasons I’m coming out of the closet. If you can’t get real power you can’t take a chance with the adulterated stuff.

“I hope to help other secretaries of state who don’t realize what so-called power trips do to your health.” “My name is Condoleezza R. and I came late to power. Originally I wanted to be a pianist, but friends got me to try power and I became high on it. I hope to break the habit because power makes me look too serious — I know how important being on ‘Meet the Press’ is.

“But I also know that after all the news shows your thinking becomes fuzzy and power becomes an addiction. Power Anonymous is my last resort. If I can’t stop using power, I will wind up in the gutter and on ‘The Jerry Springer Show.”’

“My name is Dick C. I don’t have much power except with the energy companies. The reason I am here is that I like to circulate with all you people. George W. is my role model. Once he was power mad, but he now realizes that it is not always the answer.”

The meeting adjourned and everyone had doughnuts and coffee. They promised to meet next week — unless there was another war, in which case they all might break their vows.— Dawn/Tribune Media Services

IN his interview to the Fox TV when President Bush was asked if he was willing to give the United Nations more authority in order to obtain a new resolution, he said, “I’m not so sure we have to, for starters.” He went on to add, almost condescendingly, that the United Nations could help write a constitution because “they’re good at that.” He also said that when it came time for elections, the United Nations might oversee the process. “That would be deemed a larger role.”

With no substantial concessions to the views of the other permanent members of the UN Security Council being on offer, the first question will be whether Pakistan will vote for the American sponsored resolution on Iraq. In formulating a response President Musharraf will have to take into account the fact that French President Chirac has made it clear that if the resolution does not conform to what the French are seeking his country will abstain but will not veto the resolution.

It should also be noted that on one fundamental question — the legitimacy of the governing council — the French have already thrown in the towel maintaining that they would be happy if the authority, under the aegis of the UN, could be transferred to the governing council even though this council has been selected and anointed by the Americans. If the resolution is going to be adopted in any case should Pakistan needlessly antagonize the United States? I assume that President Musharraf will say that Pakistan will go along with the consensus.

The second and knottier question will be the participation in the multi-national force. In the public statements that President Musharraf has made so far in New York, he has sought to stress that “for the moment” such participation would be extremely unpopular in Pakistan but this situation could change if the request for a “Muslim” force came from the Iraqi people. President Bush may well inform Musharraf that the Iraqi governing council, recognized as the legitimate representative of Iraq by the UN Security Council and the UN credentials committee, would make such a request and would direct it at Muslim states that are not Iraq’s immediate neighbours since the Shia majority on the governing council could very well have doubts about the impartiality of Arab forces from its Sunni neighbours or even from Turkey. On the merit of the case, one can argue that allowing Pakistani troops to participate in peacekeeping in Iraq is as much a favour to the Iraqi people as it is to the occupying forces. It could be projected as the fulfilling of an obligation to a Muslim people who have already suffered enormously during the last twentyfive years of Saddam’s repressive regime.

It is probable that President Musharraf will temporize the decision suggesting that time would be needed to prepare public opinion at home and that an immediate decision may not, in any case, be necessary since America’s troubles with maintaining its current troop levels will start in about six months. It should be noted as a matter of interest that Secretary Powell said, in a TV interview on September 22 that while India would probably find it politically difficult, “Pakistan I think is still something of an open question”.

But there is no doubt that even when the “cover” of a request from the governing council has been provided there will be controversy at home. Pakistan’s decision on this question and paying the domestic political cost involved should depend on the direction of discussions on subjects of more fundamental interest to Pakistan.

On India President Musharraf will be told that the United States wants talks between India and Pakistan to resume, that the failure to follow up on the “gesture” by Vajpayee in April, was disappointing but while they could persuade India not to let tensions rise to Dec ‘01 levels they could not force India to abandon its insistence on a cessation of cross-border infiltration as a condition for the resumption of Indo-Pak talks.

While there may be a repetition of the mantra that Pakistan needs to do “more” there will also be a more or less categorical assurance that the current abatement in tension between the two countries will continue and that India will be discouraged from talking about “pre-emptive attacks” etc.

In other words, Pakistan should be prepared to live with the fact that India-Pakistan relations will remain frozen at the current unsatisfactory level at least for the next year or so or until India’s national elections are over and that American public statements while calling for the resumption of a dialogue will also ask Pakistan to do more to halt infiltration.

As regards the arms imbalance in the region reassuring noises will be made but it will also be emphasized that America would now develop relations with each country independently departing from the “zero sum” game approach of the past. In other words military cooperation with India would not be decisively influenced by the impact it had on the arms balance between India and Pakistan.

There will not, I believe, be any offer to offset the early warning capabilities that India has acquired through the US sanctioned purchase of Israeli Phalcon Radars, by providing Pakistan with even a modest AWAC capability such as the E2C. Instead what the Americans will try and push is defence equipment that enhances border surveillance or anti-guerrilla capability while ignoring the conventional weapon upgrades that Pakistan needs, particularly in the air.

This is the reality with which we have had to live over the last couple of years particularly since Clinton’s visit to South Asia and since the new administration outlined its determination to build a strategic alliance with India. President Musharraf appeared to be anticipating something of this nature when he told Peter Jennings that the even split between defence assistance and economic assistance of the $3 billion package of American assistance over five years was an American proposal and that he would want this to be changed so that more of the assistance could be economic. It is a development that will be warmly welcomed in Pakistan particularly if the addition in economic assistance is used for the social sector and the rehabilitation of the infrastructure.

On Afghanistan Musharraf will hear words of praise about the cooperation in apprehending the Al Qaeda adherents but there may also be hard words said about the presence of Taliban not only in the remote reaches of the tribal areas but in such major population centres as Quetta and Chaman, about allegations that it is these Taliban that plan and carry out operations in southern Afghanistan and about allegations that Pakistan is, in the words of Richard Haass, messing about in Afghanistan.

This is the issue of prime concern to Pakistan. President Musharraf should be forthright in pointing out the deleterious impact America’s ill-advised policies in Afghanistan have had on Pakistan. The recent changes effected in the Afghan defence ministry by President Karzai may not be enough to induce Pushtun participation in the UN sponsored and Japanese financed $200 million disarm, demobilize and reintegrate (DDR) programme. Ethnic balance must be brought about in other government ministries also.

Until the withdrawal of Panjsheri forces from Kabul is effected, the Karzai regime will remain dominated by the Panjsheris and be viewed with suspicion. The ISAF’s planning for deployment outside Kabul must be expedited, the size of the force and its mandate extended to the whole of Afghanistan. Elections cannot be held by June’04 or even later unless this is done. The Loya Jirga in December ‘03 must invite tribal elders, not warlords. Election rules must be fair and not those the Panjsheris wanted.

Pakistan may be accused of messing around in Afghanistan but the fact was that the current situation in Afghanistan was imposing a higher price on Pakistan than on any other country. Pakistan suffered because so long as this situation persisted it would be difficult to persuade the Pushtuns in Pakistan to withdraw support from the Taliban. Pakistan suffered because such support also strengthened the extremists in Pakistan.

It suffered because its economy paid the price for the smuggling that, along with opium, had become the mainstay of the warlords. It suffered because the first destination of Afghan opium, grown under warlord patronage, was Pakistan. It suffered because without stability in Afghanistan, it could not trade with the Central Asian states or provide an outlet for their energy resources.

Pakistan may have been justly accused of interference in Afghan internal affairs in the past but now its proposals were essentially for bringing stability to Afghanistan. If the US and its allies were prepared to implement these proposals, Pakistan would find it easier to justify to its own people the deputation of forces to Iraq.

To my mind this is much more of a win-win trade-off for the United States than it is for Pakistan and should be seen in that light.

(Concluded)

The writer is a former foreign secretary of Pakistan.