Economic ties with Malaysia

Malaysia is a country with rich experience in various economic and financial development fields. Over the years it has also been known to have made very good investment decisions and its priorities in the economic field have been rated as fairly good by international standards.

It was, therefore, highly encouraging to see Pakistan putting the state visit of Malaysia's Prime Minister Abdullah Ahmed Badawi to mutually beneficial use by discussing in depth the possibilities of expanding economic and trade relations between the two Muslim countries.

Indeed, an expanded cooperation between the two would certainly enable Malaysia to explore increased trade opportunities in the Middle East and Central Asia, as Pakistan is situated at the crossroads of these two regions plus South Asia.

On the other hand, Malaysia could facilitate Pakistan's an entry into the ASEAN markets. The two can start with joint venture arrangements in the field of cotton textiles to jointly exploit the opportunities offered by the textile quota-free world markets.

They could also enter into joint ventures in palm oil with the markets of Central Asia and the Middle East in mind. Also, they can further enhance cooperation in the fields of power and water.

Malaysia has already set up the first phase of one power project (Liberty Power) in Pakistan and is interested in being offered the second phase as well. Pakistan's water and power minister Liaquat Ali Jatoi did well to invite Malaysian investors to participate in the bidding process of the Uch power project, the Faisalabad power project and another one in Punjab as well.

Pakistan's public sector construction units, NESPAK and NPCC, which have good experience in building large, medium and small dams and water resource projects could try for such ventures in Malaysia as well.

Malaysia can also make good profits if it invests in Pakistan in the fields of real estate, housing, construction, information technology and telecommunications.

Also, Pakistan has a large surplus of skilled and relatively cheap manpower which labour-short Malaysia can use to its advantage. The two countries could also learn from each other's experience in science and technology, education, culture, Islamic banking, Islamic banking and insurance and other Islamic investment instruments.

Malaysia would surely find the liberal investment laws in Pakistan, its level of macroeconomic stability, and its high growth rates as well as its investment-friendly climate highly attractive.

Trade between the two countries is very low. This has to be addressed urgently but with care so that any growth in trade is not lopsided in either partner's favour.

The one major factor discouraging increased trade between the two is the fact that both had remained largely importing countries throughout the past 30 years. It is only in the last ten years that Malaysian has become a significant exporter.

Lately Pakistan is also making successful attempts to orient its foreign trade towards exports rather than import. So, this is the right time for the two to take a deeper look at this aspect of their relations.

They can start with exploring the possibility of entering into an agreement for preferential treatment of their respective goods in each otter's country. Later, if found successful, they could also think of joining hands in a free trade agreement.

Land privileges

The allotment of 502 plots in Islamabad to bureaucrats in 1988, the details of which were recently placed before the Senate by the minister for housing and works, is highly unfair and cannot be justified on any ground.

The plots were allotted under what is said to be a 'discretionary quota' and were given to the officials at rates far below their market price. So, along with serving and retired officers of the armed forces, the country's bureaucrats happen to be the next group which has the privilege of being sanctioned government land at throwaway prices.

The premise used in both cases by their parent organizations is that since the individual has decided to serve the country for the rest of his or her life, and given that salaries in their professions, compared to what can be earned in the private sector, are quite low, it is only fair that during their lifetime they be given the opportunity of buying land at highly subsidized rates.

There are, however, some flaws in this reasoning. For instance, civilians are not given the opportunity of being able to buy government land at subsidized prices. Instead of initiating measures that would help the poor and the impoverished, this country seems to have an inverted system under which a cabal of the mighty and the powerful is able to apportion precious national resources for itself.

To make this inversion complete, such acts that would probably be illegal in most civilized countries, have the sanction of law. A case in point is that of the defence housing societies, where land allotments to serving and retired armed forces officers have the sanction of the government.

Clearly, a poor labourer's family is in greater need of subsidized land for housing than the family of a senior bureaucrat or army officer. These particular 500-plus allotments were made 17 years ago.

It would be much better if the government had scrapped all such 'discretionary' schemes because more often than not the discretion is exercised by officials in their own interest and to the detriment of the national exchequer.

Eliminating poppy cultivation

Prime minister Shaukat Aziz and NWFP Governor Syed Iftikhar Hussain Shah appear to hold divergent views on the status of poppy cultivation in the country. While Mr Aziz said the other day that cultivation had been controlled and that poppy growers had been provided with an alternative means of livelihood, the NWFP governor last month pointed to the government's failure in putting a halt to poppy growing by tribesmen in the areas adjoining Afghanistan.

What is clear though is that Pakistan has witnessed a resurgence in poppy cultivation that, before the 2001 rout of the Taliban, had been virtually eliminated. But now, there are once again fears that the drug scourge that has afflicted the country for so long will worsen, causing the existing population of 3.5 million habitual drug users to swell.

There is no doubt that to eliminate poppy cultivation in Pakistan, it would be necessary to contain the situation in Afghanistan. Poverty and a rampant gun culture, wielded by Afghan warlords, have combined to create a situation where the narco-trade has come to dominate the economy, constituting some two-thirds of the country's GNP.

Kabul has to try hard to extend its writ to all parts of the country and tackle the scourge on a nation wide basis. But it is equally important to address the concerns of our own farmers and to develop the backward areas where the poppy crop is grown.

This would provide the people with more livelihood choices and reduce the influence of local drug barons. The task is not impossible. As mentioned earlier, Pakistan successfully eradicated poppy cultivation in previous years, a feat for which it won international accolades. It cannot afford to rest on its laurels now. Otherwise, matters could go out of control and head towards a point of no return.