| 20 September 2004 | Monday | 04 Shaban 1425 |
Regulating real estate business
National savings schemes
Devolution - bane or boon?
Raising literacy rate
Prospects for sugar industry
O-level students' woes
Attracting investors
Prisoner abuse
Musharraf and minorities
PPL shares
Property tax
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We still import some very basic items for the military, though we have a well-staffed directorate in the ministry of defence to promote local production of military equipment and stores, i.e., the directorate-general of military production (DGMP).
However well-intentioned the DGMP may be, there are some structural problems which need to be addressed before we can see any real progress on the road to indigenization. Prime among these is the fact that the private sector has not been fully involved in this process.
On the macro level, the advantage of indigenous defence production is even more important. At present, an increase in our defence budget inevitably involves a drain on our economy as most of the defence budget is spent on imports.
The ultimate example of successful indigenization in our country is the development of nuclear weapons. Although publicly funded, this effort was spearheaded by the Kahuta Research Laboratories which by all accounts has never operated like a public-sector organization.
While attending defence exhibitions internationally, one has had the opportunity of meeting senior officers from the KRL and their approach and attitude is pragmatic and result-oriented. Never once have they talked about files or TA/DA or expressed concern about where they might be posted next.
For a process like this to proceed efficiently, an essential pre-requisite is a close and frank interaction with the user of the store in question. Unfortunately, however, this type of user interaction is not always possible for a number of reasons:
1. Many users are loath to accept that the quality of a locally-developed product can be as good as that of an imported one, if not better. Since this bias cannot often be expressed explicitly, it translates into prevarications and delays for which the system has in-built provision.
2. Another manifestation of this bias is the changing goalpost scenario. Halfway through the development stage, users' requirements are redefined or some new parameter is introduced which involves a return to the drawing board and, of necessity, more delay and costs.
It is inconceivable that companies which have been registered with the DGDP (Directorate-General for Defence Purchase) ever since the inception of Pakistan should have to go through the whole rigmarole of security clearance when they need to register to work with related agencies. The security clearance involves nothing more than a visit from the nearest police station and we all know as to what kind of due diligence that involves.
These delays have two consequences: one, they discourage private sector involvement and, two, they result in higher costs. So we need to streamline this process. Unlike other countries, Pakistan does not in practice give any protection to its local industry.
For 100 per cent indigenization, it is imperative that local manufacturers should be able to export their goods also. But the general perception is that the DEPO (Defence Export Promotion Organization) is more concerned with promoting exports of public sector organizations.
To some extent this is understandable because public sector organizations are producing 'big ticket' items such as the Khalid tank, but if given a facilitating environment, the private sector can also play a major role.
At the press conference held on the eve of the IDEAS-2004 exhibition in Karachi, the DEPO director-general talked extensively about various developments in the public sector.
Perhaps he should also have mentioned that in the recent past Pakistan has become a net exporter of two privately-developed products which were previously imported - bullet proof jackets and fire-retardant coveralls.
OMER YUSUF
Karachi
Regulating real estate business
The real estate business has shown tremendous growth during the last couple of years. But over the past few months, it has staged such a staggering increase that it has led to fears that we may be heading for another scam.
This state of affairs calls for immediate government attention so that effective steps can be taken to save the situation before it is too late. In this respect the following measures are proposed for necessary consideration at the appropriate level:
A. Formation of new housing societies or extension of the existing ones should be banned for some time.
B. Record of all existing societies should be checked to ascertain:
i. Purchase and possession of the land for which money has been collected from the public.
ii. Grant of NOC by the development authorities.
iii. Deviations from the original plan.
iv. Reasons for delay in completion of the scheme, and
v. utilization of the money received from members. Any irregularity or failure should be severely punished.
There is immediate need to put a ban on office-bearers of a society to hold office for a second consecutive term. This will eliminate the perpetuation of interest, which often leads to corruption.
Repeated sale and transfer of plots and open trading in files should be controlled to protect the interest of genuine buyers. The real estate business should be brought into the tax fold.
This step will serve a dual purpose. On the one hand, it will regulate the real estate business and add to government revenues and, on the other, it will stop the siphoning off of investment from the stock market which has been subjected to CVT and wealth tax.
So, by taxing the real estate business the above anomaly, which is affecting the performance of the stock market, will end and the overall affairs of the property business will be streamlined.
RASHEED ASGHAR
Lahore
National savings schemes
This refers to the article "NSS schemes lure investors" (Dawn Economic and Business Review, Sept 6). Table I with the article does not list the postal savings bank accounts and postal Khas special savings accounts.
The British rulers of this country had noticed that the majority of the people of the subcontinent, mainly illiterate or semi-literate, were forced to exist on charity in their old age.
The government had, therefore, introduced official postal savings bank accounts and postal life insurance - both the schemes could be operated without much written transactions.
There was no withdrawal or transfer by cheque. Both withdrawals and deposits were made through forms available at post office counters in post offices. The premium for life insurance was deducted automatically from the monthly salary of the employee. This inculcated in these uneducated people the habit of saving in most productive period of their life for their old age.
Because of the large reductions in returns on savings accounts, both bank accounts and the subsequently introduced Khas special savings accounts, these schemes are nearly dead.
The government, having realized the financial crunch on the entire middle class, introduced two new schemes for recently retired government employees and widows. The latter has been extended to senior citizens. But these schemes do not suit senior citizens who have kept their savings in special savings accounts for the last two decades and are in their 80s or the late 70s.
All it needs to be done is to increase the return to 10 per cent per annum without withholding tax. The amounts withheld as withholding tax in the years 2003 and 2004 need to be refunded as the account holders are not in a position to obtain refund from the income-tax department. There should be no upper limit to these accounts as there are many joint accounts and in some cases of all members of a family.
H. A. HAJI
Karachi
Devolution - bane or boon?
Speaking recently to local bodies councillors and nazims at a convention in Mansehra (Aug 23), Mr Daniyal Aziz, chairman, National Reconstruction Bureau, expressed his dissatisfaction over the performance of district governments.
However, he did not mention 'the whys' of such low performance - perhaps because he was not sure about it. My curiosity grew and I had to go out in search of those whys.
I noticed widespread post-devolution disillusionment which is well-founded. We can see that the authority of deputy commissioner, who used to be a source of cohesion, has now become a bone of contention amongst new aspirants.
Under the deputy commissioner, law and order and developmental activities co-existed but now development has virtually taken over law and order. The common man now is really bewildered as the deputy commissioner used to provide 'one-window solution' for most of his needs. The district, which once was the fulcrum of the writ of government, is a hotbed of politico-factional intrigues now.
"An efficient system essentially performs on the basis of accountability which is missing altogether in this system," was the opinion of an expert on constitutional law.
"An organ has been transplanted without doing the necessary tissue-matching test," was the reply of a surgeon. "An old road has been excavated hurriedly to make a new road thus breaking household utility links," was the answer of a civil engineer. "The linchpin is lost," said a mechanical engineer.
The most valuable finding of my quest, however, was the article entitled "Drawbacks of devolution" by Ms Nafisa Shah, nazim, Khairpur district (Dawn, Sept 4 and 5). If Mr Daniyal Aziz can spare some time to read that, I am sure, he will rightly know as to why people are cheesed off with the performance of devolution.
MUHAMMAD WAQAR ASLAM
Quetta
Raising literacy rate
It is indeed a great pleasure to know that our new prime minister, Mr Shaukat Aziz, promises a much brighter and vibrant future for the young people of the country.
Being an educated and qualified man himself, he seems to understand the importance of the new generation. After being termed by many as the "architect of the economy", he should focus on the literacy level of the population which, sadly, is extremely low.
Today, only about 10 per cent of the total population receives a respectable education. Care should be taken to allocate money to improve educational standards and to help those who hover on the poverty line, so that many obstacles such as multiple deprivations, which greatly hinder the success of a child at school, can be avoided. An educated population will become a stronger and dependable workforce in the next 10 to 12 years, thus benefiting the economy.
Over the years many prime ministers have come and gone, yet one fact has not changed - the promises made to the people still remain unfulfilled. Let us hope that our new prime minister does not only know how to build castles in the air like his predecessors but also how make them a reality.
ARSLA JAWAID
Karachi
Prospects for sugar industry
The Pakistan sugar industry has done extremely well to produce more than four million tons of sugar during 2003-2004, the highest ever record. The government has taken a wise decision to buy from the industry about half a million ton of surplus sugar through the Trading Corporation of Pakistan (TCP) for export, as well as for the domestic market.
However, the situation for the forthcoming sugar production season 2004-2005, expected to start in two to three months, is not very encouraging because of the following reasons:
a. Owing to constant drought/dry season, shortage of canal water, etc, the sugarcane crop is not healthy and there is a decrease of 10 to 15 per cent in the cultivation area. The overall crop estimate is expected to be at least 20 per cent less than last year's.
b. The government cane support or indicative price instead of increasing has decreased during the last two years, and is discouraging for higher cane cultivation.
c. The world sugar price is continuously on the increase. Any further decline in world sugar production will further push up world sugar prices.
The above scenario demands a detailed study and remedial steps by the government and the industry. Some of the points which can be considered are:
a. Sugar stocks of the TCP lying in sugar mills should not be exported. They may be released only for the domestic market or exported after ascertaining the sugar production in 2004-2005, i.e., after the end of the next season.
b. The support price of sugarcane needs timely upward revision. This will help farmers to increase cane cultivation during the current autumn planting, as well as during the next spring planting of sugarcane.
c. Sugar factories may be made to pay all dues/arrears to sugarcane farmers on account of sugarcane purchased by them during the last season 2003-2004.
d. A proper policy for the import of raw sugar for re-processing and refining may be formulated by the government. It may be ensured that raw sugar is imported only through the Pakistan Sugar Mills Association (PSMA) and the quantity and timing for import be specified.
e. It will be in the interest of all concerned, i.e., the government, sugarcane farmers and the sugar industry, to delay the start of the next sugar production season 2004-2005 by at least a month.
The sugar mills of the NWFP and Punjab may not be allowed to start the season before the first week of December, and the sugar mills of Sindh before the second/third week of December. This will increase cane maturity and the sugar content and ensure regular cane supply to mills with improved efficiency and productivity.
f. The government may not interfere to keep sugar prices artificially low in the domestic market. An increase by two to three rupees per kilo of sugar is not going to affect the common man.
g. Sugar mills should encourage farmers to maximize sugarcane by giving them loans and subsidies on seed of higher-yielding and improved varieties, fertilizer, etc.
H. A. NAQVI
Ex-president, Pakistan Society of Sugar Technologists, Lahore
O-level students' woes
The policy of the Board of Intermediate and Secondary Education, Punjab, is causing much concern and distress to O-level students who have recently obtained provisional admission to Class XI.
Matric system students, admitted provisionally to Class XI, are allowed to clear their supplementary examination and their forms are registered subject to their clearing the supplementary examination. If they clear the examination, they can appear for the regular first year intermediate examinations.
Unfortunately, however, this facility is not available to students of the Cambridge system. If they have to appear in their supplementary examination - called 're-take' in the Cambridge system of examinations - their forms will not be registered. This means they lose one year and appear in the regular first year intermediate examination next year.
Hundreds of affected students of O-level will benefit if the BISE chairman issues instructions to allow the same relaxation to them as allowed to matric students.
ASIYA KHAN & OTHER AFFECTED STUDENTS
Lahore
Attracting investors
President General Pervez Musharraf is urging foreign investors to invest in Pakistan. Although a friendly environment exists in the country, General Musharraf should know that Pakistan has an image problem. That is why multinational investors are not willing to come here.
Investment flows to a country which has political stability, a real functioning democracy, an independent judiciary, where there is rule of law, not rule by one man.
A country seeking foreign investment should have an honest police and bureaucracy and should be relatively free from corruption. It should have the right man for the right job, freedom of expression and a trained and disciplined labour force. Does Pakistan meet any of the above criteria?
S.T.HUSSAIN
Lahore
Prisoner abuse
Three Americans accused of torturing Afghans in a private jail have been reportedly sentenced to 10 years in prison. Thousands of helpless prisoners in hundreds of prisons in Pakistan and across the Muslim world are subjected to physical, emotional and sexual abuse every day. It is an important point for everyone to ponder.
DR AMJID NAZIR
California, USA
Musharraf and minorities
President Musharraf, addressing an international inter-religious conference on Sept 16, remarked: "I say it with full conviction that there is absolutely no state hostility towards minorities living in Pakistan."
Amnesty International last year reported on Pakistan in these words: "The state continued to ignore abuses inflicted by private individuals or groups against members of minority communities... members of the minority Shia community, mainly doctors and other professionals, and... westerners and Christians died in targeted killings.
Preventive and protective measures were non-existent or inadequate, and action was taken to investigate such killings only following domestic and international pressure" (reference: http://web.amnesty.org/report 2003/ pak-summary-eng).
MUBASHIR KHAN
Indianapolis, IN., USA
PPL shares
I applied for a subscription for PPL shares in its initial public offering through the National Bank of Pakistan, KDA Civic Centre branch, Karachi (bank code 0013, branch code 0287). I was allotted application serial No. 28.
After balloting of the oversubscribed offer, I checked the result with the Privatization Commission, the Karachi Stock Exchange website and the NBP branch. I was informed that my application had been accepted. However, to my utter surprise, the subscription money has been refunded to me and my shares have not been credited to the relevant CDC account.
It remains shrouded in mystery as to who has been allotted my shares. Will the minister for privatization or the lead manager of the IPO (Elixir Securities Ltd) clarify the position?
SHOAIB RANA
Karachi
Property tax
The government of Punjab has exempted retired government employees from property tax on one residential house measuring up to one kanal owned and occupied by them.
But this facility does not extend to employees of autonomous bodies controlled by the government, in particular retired teachers and research scholars of public sector universities. This is despite the fact that their terms of service are the same as those of their colleagues in government colleges.
This is a clear case of discrimination and unfair treatment. The attention of the Punjab chief minister and the education and revenue ministers is drawn to redress this injustice.
DR KHALID LATIF MIR
Lahore
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