| June 01, 2008 | Sunday | Jamadi-ul-Awwal 26, 1429 |
To send a letter to the Editor
Click here
Reforming the exam system
Minorities’ rights
Closure of Rice Canal feared
KSE fall – investors or players?
Lessons from goodwill tours
Islamic school in Australia
Terrorising Pakistan
Extremism
Readers are requested to restrict their comments to a maximum of 400 words. We reserve the right to edit letters for reasons of clarity and space. Letters, including those by e-mail, should carry the complete postal address of the sender. The views expressed in these columns do not necessarily reflect the views of the newspaper.—Editor
ON May 21, the SBP announced an increase in the discount rate by 1.5 per cent, mandating banks to pay minimum of five per cent on their savings deposits, which constitutes 43 per cent of the banking sector deposits as against the present weighted average of 2.1 per cent, as also the reserve requirement, so as to curb inflation.
It is a known phenomenon that with each interest rate hike of the central bank, commercial banks make upward revision in their existing lending rates. Since banks will now have higher deposit cost because of high rates of savings deposits and high cash reserve requirement, they will attempt to recover these from their existing borrowers generally those with long-term commitments, as fresh loans will generally be discouraged.
The immediate impact will be that businesses which are engaged in speculation will adjust their loans immediately. One such immediate visible factor of this decision is evident from the fall of the stock market.
The increase in deposit rates and high reserve requirement would, to an extent, curb the inflation the impact of which will be seen over the time, it will at the same time also reduce bank profitability.
Those tied up in long-term commitments will be most affected. One such category of bank borrowers will be the mortgage loan holders having commitments of 15 to 25 years and largely coming from the middle-income strata. Their present benchmark rate is in the range of 14 to 17 per cent, which would now follow increase by at least five per cent and stand somewhere between 19 and20 per cent for the least.
Also, the bank mortgage financing rates are highly disproportionate if we look at the western world where housing is considered a basic necessity and mortgage financing is available at affordable rates.
One reason for the high rate is the lack of a refinancing mortgage market for which work began several years ago by the SBP but with no visible development so far. It clearly lacks the requisite expertise to do so.
Further it has failed to harness banks to divert segment of their funds at affordable rates for this purpose or to impose some form of cap on such high rates of lending.
While some relief has been provided to savings deposit holders, this decision will adversely affect mortgage borrowers. Since by raising the interest rates the SBP’s intention is to protect the low-income groups, it would have been wise to cap the housing loans as well before it is too late.
The SBP should take action that lowers inflation and provides a level playing field for both borrowers and banks. It was already aware that inflation is on the rise, savings account deposit holders are being deprived of their due share, excess liquidity in the market is fuelling speculation, rates of mortgage lending are high and higher spreads are contributing to profit of banks at an unacceptable rate.
The SBP was also aware that previous interest rate hikes remained insufficient to curb speculation, rising inflation and erosion of the rupee’s value. Needless to add circumstances warranting the increase in the discount rate, warranting an early action from the central bank existed since long and is no new phenomenon.
The rise in the discount rate could have been gradual, as is done by other central banks, increasing it quarterly by 25 basis points till its objectives are achieved. Raising the discount rate by a very high margin as 150 basis points suggests that the action is much delayed.
The SBP claims it has improved the quality of human resource significantly by attracting people from the market at market scales. A blunder of this magnitude suggests that something is wrong at the decision-making level.
While the hike is justified, the astronomical rate at which it is taken is unjustified as it will contribute towards defaults, thwart growth, affect small borrowers, hurt the SME sector and affect consumer loans.
It could also be seen as a political move by certain quarters, particularly in the wake of a new government just at the initial stage. It may, therefore, not be unjustified to conclude that the SBP has acted too late and too little. The decision is thus likely to have widespread ramifications than those that meet the eye.
A CONCERNED PAKISTANI
Saudi Arabia
GOOD education is one of the priorities of the present government in Sindh. Starting with the fact that the prevailing examination system is based on unfair practices, the foremost act on the part of the relevant authorities would be to discourage recourse to unfair means adopted in the examination, and other additional matters.
There is a network of people operating in and around the examination centres to promote use of unfair means because a lot of money is involved.
The practice of changing seating arrangements and accommodating some candidates in special halls to facilitate them has also been noticed many a time. Allowing extra time to the selected candidates and replacement of answer sheets/extra sheets to help them in cheating are also in trend.
Alteration of admission slips, interpolation therein and impersonation also go unpunished many times. Verifying the credibility of the invigilation staff before assigning them the task of examination has so far remained the lowest priority.
Malpractices in examinations have particularly contributed to the overall deterioration in the standard of education in the province.
To resolve the various issues/factors responsible for the increasing tendency to use unfair means in the examination, a comprehensive law is being proposed in the Sindh Assembly. It will cover the whole scope of examination and deal effectively with all elements who indulge in malpractices. Such a law should entail appropriate penalties, including social disadvantages for offenders.
The malpractices that are commonly committed in the examination (at the pre-conduct, conduct and evaluation stages) range from leakage of question papers to copying, changing answer books, impersonation, misconduct at the examination centre, approaching invigilators/examiners, making false entries in award list/ examination registers, issuing fake certificates/degrees, sale of an examination centre to organised gangs where cheating/unfair means are arranged, etc..
As there is no law to regulate the examination system and to stop the copy culture and cheating, there must be some legislation to regulate all examination centres in the province. Keeping in view the gravity of the matter, I had drafted a bill titled ‘The Sindh Elimination of Copy Culture and Cheating in Examinations” and submitted it in the assembly but it became victim of the non-serious attitude of the previous government.
However, with the new government and the new assembly in place, I hope to present the bill once again in the house to ensure that our examination system is well regulated and cleansed of all vested interests and mafia groups that at present rule the roost.
HUMERA ALWANI
MPA, Thatta
IN continuation of your timely and thought-provoking editorial, “Minorities’ rights” (May 29), I would like to make some suggestions.
Immediately, a minority commission should be set up under the chairmanship of a sitting or retired Supreme Court judge.
The commission should be adequately empowered financially, administratively and judicially (including suo motu powers) to penalise wrongdoers and provide rehabilitation and compensation to affected persons.
The commission should also be charged with the preparation of a report on the state of affairs, including recommendations, for the prime minister, within six months.
Separately, a parliamentary commission should be set up to provide quotas, reservation in government departments, semi-autonomous organisations and educational institutions for minorities. They should also consider the increase of minorities’ seats in the National Assembly, and in the Senate (which is possibly already under way).
The present system of proportional representation of minorities should be replaced with directly-elected MNA seats.
This will mean separate electorates, in addition to their casting votes in general seats as Pakistani citizens, in future elections.
The repeal of discriminatory laws should be undertaken by parliament immediately.
Compensation and redressal of the wrongs done to the affected minorities, including past incidents and instances that have not already been addressed by the judiciary, should be carried out by the minorities commission.
The ministry of minorities affairs should be a separate ministry under a member of the minorities from parliament.
This ministry should be autonomous and not subservient to any other ministry.
I should like to congratulate you on your editorial once again and draw the attention of all concerned to the dire plight of the minorities – in violent disregard of Quaid-i-Azam Mohammad Ali Jinnah’s declaration of Aug 11, 1947.
RAJA TRIDIV ROY
Federal Minister
Islamabad
It appears that Sindh irrigation authorities have finally decided not to discharge water into the Rice Canal as no action has yet been taken despite an SOS call via the letter of Dr Zazhid Hussain Jatoi (May 26).
Rice cultivation in Sindh, therefore, has come under serious threat due to non-availability of water, which is stated to be diverted towards cotton-growing areas.
This year the country has suffered immensely on account of wheat shortage artificially created due to lopsided polices of the government. But if water is not provided to the rice fields of Sindh instantly, people will starve of their staple diet for which blame will solely rest on the irrigation department of the province.
I, therefore, request the prime minister and the Sindh chief minister to please intervene and direct the irrigation authorities to immediately release water into the Rice Canal as every passing day now will result in irreparable damage to rice cultivation.
QAZI BASHIR AHMED
Hala
IN the last few days the Karachi Stock Exchange has fallen dramatically. There was expectation that it would fall but the magnitude was not expected. All day the market was almost at a lower lock (index over 500 point minus), but suddenly went to positive zone.
Has the country’s economic and political situation become stable?
The KSE circular, KSE/N-3542, gave the players a breathing space.
The question that a regulator should ask the management of the KSE is: why was there a need of the circular? Apparently, it looked as if it was to bail out certain market players. Are these players investors or speculators?
And those who benefited should be investigated to make the market stable so that the real investor enters the market and the purpose of the stock exchange is accomplished.
I would also like to have the definition of ‘correction in market’.
SMALL INVESTOR
Karachi
ALTHOUGH there is much merit in what Jawed Naqvi has written in his column, ‘Correct school textbooks before writing the university thesis’ (May 26), I would like to present the other side of the coin: the goodwill tours to India were started by Karachi schoolboys about 10 years ago. There were four more tours, but Jawed Naqvi does not seem to know about any of them. A pity.
In 1997 on a casual invitation from the then prime minister, I. K.Gujral, 16 members of a Karachi school’s hockey team left on a sports-cum-goodwill tour to India. (“If I have the time I will be happy to meet the students,” wrote the prime minister.) These boys came from lower middle and middle class families who had never ventured out of the city, let alone board a plane. Their families were conservative who, by and large, looked upon India as ‘enemy country’, Hindus as kafirs or at least ‘mushriks’. Studying in an all-boys’ school, they had no opportunity to befriend girls, except their own sisters and cousins. Not even the students of their girls’ branch.
The group visited Delhi, Agra, Aligarh, Panipat, Faridabad and Lucknow. They stayed at the boarding house of their host schools, AMU’s VIP guest house and in the homes of their hosts in Panipat.
They savoured pure vegetarian food at an Ayurvedic hospital where they were served with great affection by the Vaids (doctors) themselves. Leaving Kala Aam Guest House in Panipat, they ate from the same plate as the Indian boys and girls not because there was a shortage of plates but because “they enjoyed eating this way!”
At a reception given by the Indian Council for Cultural Relations, where students of other schools were also invited, they exchanged gifts and wore one another’s blazers if only to hoodwink their teachers.
So touched was the VC of AMU by the affection of Pakistani boys that he presented a beautifully crafted trophy from Moradabad to them even before the match had taken place. “This is not for winning the match but for winning our hearts.” The 1997 tour was followed by four other tours visiting Ajmer, Allahabad also. The group played hockey matches, contested the Indian boys in the swimming pool, knocked around the cricket ball, addressed morning assemblies and other congregations. The tours were covered extensively in the newspapers, television and radio.
“You are all so nice, then why do our parents speak so disparagingly about the people of Pakistan?” asked a twelfth grader of DAV School in Faridabad. The groups called on prime minister Gujral, chief ministers Mulayam Singh Yadav and Sheila Dixit and, but for Phoolan Devi’s assassination, would have had an audience with Atal Behari Vajpayee.
When the group ran out of funds and could not travel by the Pink City express from Ajmer to Delhi, Amitabh Bachhan chipped in with a generous Rs20,000 as a ‘token of affection for young Pakistani friends. The group discussed education in Pakistan at Delhi University’s Training College and participated in a discussion on NDTV on whether India should play Pakistan in sports.
The youngsters won the debate. They had the older generation moved to tears with their presentation of Manto’s Toba Tek Singh in all performances.
The boys still keep in touch with the Indian students through email and letters and pioneered the “Aao Dosti Karen” programme.
ANWAR ABBAS
Via email
ACCORDING to a story in Dawn (May 28), an Australian council has rejected plans for an Islamic school in a rural area on Sydney’s outskirts that have stirred controversy and allegations of racism.
In its own report, the BBC Urdu service, too, had revealed that this school, meant for 1,200 students, has been denied permission ostensibly for administrative reasons, but that didn’t satisfy the local Muslim community, which perceives the whole thing as discrimination (May 27).
It would be of interest for the readers and even the Australian government to know what I had learned some months back about another Islamic school in Australia. This one named ‘Malik Fahd Islamic School’ and is located in Chullara, which is also a suburb of Sydney. It provides education up to the high school level.
The really important thing about it is that it has a very high standard of education and is rated among the top three schools in Australia. If I remember correctly, even the local or national Australian authorities provide funds for running it, to relieve the burden on the students. A friend’s daughter, who had studied there, secured a top position in the entrance examinations to a university.
This should leave no doubt in anybody’s mind about the capabilities of the Muslims to run schools in an exemplary manner or for their students to benefit from them and to attain enviable grades.
On the other hand, if bias is shown and obstacles created in their education and other matters, they can only get alienated, which will be counterproductive for all concerned.
K. CHAUDHRY
Karachi
The statement made by Home Land Security Head Michael Chertoff that Pakistan might see assassinations like Benazir Bhutto and strings of bombing of civilian and official sites only reflect how much the United States is concerned about the safety of Pakistan’s future.
In other words, Michael Chertoff has shown discontent with the on-going dialogue with the militants within Pakistani borders.
He thinks that the only way to negotiate with these individuals is the language of force and if any political process helps negotiate the peace process, it is going to be nullified by targeting the main stream politicians.
His statement should be seen as a threat not only to the leadership of Pakistan Muslim League (N) but also to the other leaders who are vocal against the US policy in Pakistan.
The statement is a direct attack on the sovereignty of Pakistan and on the people who are trying to take an independent view on the issue of war on terror.
The United States seems to be trying its level best to undermine the restoration of judges by putting pressure on different political groups to deliver a policy that is inline with the US stakes in the region.
Terrorism is as big a menace for Pakistan as it is for others and it should be dealt with keeping in mind the local dimensions. The pushing and shoving on the part of the US to have Pakistan deliver on its terms is no less than terrorism within itself.
SHAZIB HAMEED
Lahore
THIS is apropos of Kuldip Nayer’s incisive article (May 30). I agree that the BJP’s success in six states in a row shows that communalism in India is re - emerging as the BJP is anything but secular. But Mr Nayar’s conclusion that “Muslim extremists only aggravate the situation because they strengthen the BJP” is not sound. Rather it is other way round.
It is the BJP - led pogrom and extremism which is fomenting Muslim extremism. My point can be vindicated by the fact that earlier terrorist attacks inside India were blamed on ‘foreign hand’ as was the rhetoric of the then government but now these are ‘home - grown’, thanks to Gujarat carnage and second - rate treatment meted out to Muslims.
AKHTAR FAROOQ
Kasur
You can also send letters to the Editor
Just send your message to the following address: letters@dawn.com
Make sure you include your full name, postal address, e-mail address, and in the case of Pakistan your day-time telephone number.
