| 02 February 2004 | Monday | 10 Zilhaj 1424 |
Coming out of debt trap
Today when the Muslim Ummah is faced with problems and challenges of all kinds, including dire threats from hostile quarters, it should recall and draw inspiration from the spirit of sacrifice and steadfastness that Hazrat Ibrahim displayed earning the Divine promise: "I will make thee an Imam to the Nations." Eid-ul-Azha is the most appropriate occasion to pray for the fortification of our faith and fraternal ties to overcome the challenge posed by inimical powers.
The message and mission of the Khalilullah (Friend of God) touched its culminating point in the prayer of the last Prophet (Peace be upon him) taught by Allah in these words: "Say 0 Muhammad, verily my Lord has guided me to a path that is straight, a religion of right, the path trodden by Ibrahim, the true in faith and he certainly joined no gods with God..."
The example of Hazrat Ibrahim has a special significance in our present predicament. For upholding this glorious example dedication of the highest order and spirit of sacrifice are needed. Only then will its rewards follow. We must search our hearts to see if we are embracing only the symbols and rituals without the substance.
In slaughtering an animal do we tame the animal within us that keeps rearing its head? The Quran clearly says: "It is not their meat nor their blood that reacheth Allah; it is your Taqwah (piety) that reaches Him." The way to fulfil this obligation needs patience and persistence and not merely ritualistic observance or sermons.
As we swear by the Sunnah, we should search our souls to see how far we are prepared to follow it in spirit and action. The present is one of the most crucial phases in the history of the Muslim Ummah. The need for strengthening the bonds of brotherhood in the face of threats and dangers, is manifest. The bane of sectarianism and dissensions must be rooted out.
The principle of mutual tolerance and help must be accepted and practised to achieve fraternal unity and cohesion and emerge as a dynamic force. Those who divide their faith and break up into sects are enemies of Islam. Sanctity of life as defined in the Quran and Sunnah must be realized as an antidote to terrorism.
The unity, equality and discipline in evidence during the Haj should be the guiding motto of the millat. In order to garner the promised rewards in this world and hereafter, we should regulate our lives according to the tenets of our faith. The broader spirit of the most humanizing creed that is Islam must be imbibed.
Those who perform Haj and chant "Here I Come O, Lord" make a solemn commitment and its significance should be fully grasped. Only when the stimulus of belief is deeply and genuinely imbibed will the required response be forthcoming. Countries which swear by Islam should rise above their narrow interests and mutual squabbles to become a nation in the real sense.
When our actions conform to our claims and professions, we will pave the way for our individual and collective progress. The Muslim countries should move towards a truly Islamic order. We should concentrate on its higher and noble ideals and values instead of getting locked up in avoidable differences and divisions. If we close our ranks and collectively use our abundant resources and move forward together, we can once again rise to commanding heights.
It is time to motivate and mobilize the Islamic fraternity and face the daunting issues of the millennium. Mere rhetorical professions of allegiance to the tradition of Hazrat Ibrahim and ritualistic offerings are not enough to realize the rewards of his supreme sacrifice.
Coming out of debt trap
Pakistan's economic managers have accomplished what seemed almost impossible only a couple of years back. They have managed to retire this week a part of our costly debt amounting to $1.7 billion, saving in the process as much as $300 million in interest payment.
Under its debt management strategy evolved in recent years, the government is focusing all its fiscal efforts on getting rid of the high-cost debt at the earliest and, at the same time, borrowing for future needs on soft terms and without conditions attached.
This strategy, the government hopes, will enable it to restore the country's economic sovereignty and also allow it enough fiscal room to peruse the twin but inherently conflicting goals of growth and poverty alleviation. There is, indeed, a lot of logic and common sense in this approach.
Pakistan's chronic dependence on borrowed resources dates back to the 1950s when the country was getting all its defence equipment from the US almost free of cost and its wheat under PL480.
It was then that we ruined our agriculture and our taxation system by using the resources mobilized by selling the PL480 wheat in the open market to finance our annual budgets. As a result, from then onwards we needed to borrow hard currencies for food imports and from local banking sources to make up for the shortfalls in domestic savings. Most of the loans which we borrowed in this period and subsequently were, however, on very soft terms.
It was only in the 1990s - when we became the most sanctioned country in the world - that these soft loans dried up and we had to go around the world seeking commercial debt, thus putting an unbearable burden on our resources. Developments since 9/11 have proved to be a providential rescue for us from a hopeless economic situation.
So we have to be very careful this time while utilizing this wind-fall relief which perhaps would not last for long. However, continuing to keep a tight leash on public sector spending, especially in social sectors in order to be able to prepay loans of multilateral aid agencies like the ADB, is likely to prove counterproductive in the long run.
Controlling budgetary deficits is being prescribed as the panacea for all economic ills by the multilateral aid agencies and we seem to have blindly accepted the nostrum.
How does one explain then the fact that China's economy has been growing at a phenomenal rate year after year despite its very high budgetary deficits? Even India is maintaining a fairly high growth rate even while having very high budgetary deficits both at the centre and in the states.
One hopes the fiscal space gained as a result of generous debt rescheduling allowed to us in December 2001, the gradual accumulation of foreign exchange reserves since, and now with the beginning of the process of retirement of costly debts, is put to efficient use for the expansion of our socio-economic capacities in education, health and job generation without much loss of time. Incidentally, one always thought that the costly part of our debt related to our bilateral commercial borrowings in the 1990s. But to know that even the ADB was lending money to us on such harsh terms is rather shocking.