PML-N in the field

WITH the PML-N’s decision to eschew an election boycott, the stage is now set for polls which promise some lively participation from the mainstream political parties. The boycott drama, which should have been behind us now, has taken a bizarre turn. Having failed to reach a consensus on the boycott issue in their critical meeting on Sunday, the APDM participants had glossed over their disagreements by announcing that all component parties were free to go their own way. Not to anyone’s surprise, the PML-N decided to enter the electoral fray only to find itself being thrown out of the APDM that Mian Nawaz Sharif had himself founded in July. In any case that is not expected to affect the prospects of the PML-N which has other more serious challenges to contend with.

How the participating parties fare in the elections now depends on numerous factors such as their ability to enter into seat-sharing arrangements, the position they adopt on the restoration of the pre-PCO judiciary in their election campaign, and their success in mobilising the voters who have been depoliticised over the years and are, by and large, apathetic and cynical vis-à-vis the game of politics that is being played out in the country. But the key factor on which the outcome of the January elections depends is the role the government is willing to play. The ball is now in its court. With most parties in the field, the caretaker governments in Islamabad and the provinces are expected to do their job honestly and not show any partisan biases. Unfortunately, the caretaker administrations that have been constituted are not neutral. Apart from the fact that the prime minister is a member of the PML-Q, some ministers have close relatives who are contesting the elections. This ethical anomaly and the continued curbs on the media have created doubts about the intentions of the caretakers, more so because the emergency has served to hinder the political parties’ ability to take their programme to the people.

More importantly, the presence of the local bodies on the scene casts doubts on how fair the elections can be. A strong and independent Election Commission, if it is allowed to exercise its powers without any let or hindrance, can help neutralise this element to some extent. The commission should prove its mettle if the PML-Q is tempted to use the official machinery and the power of the municipal governments to influence the election results. Hence it is important that the caretakers should allow the commission to function without any interference. In fact, it would be best if the government seriously considers holding in abeyance the powers of the local government, especially the nazims and naib nazims, who exercise immense authority at the grassroots level. Their capacity to influence the voters and actually interfere in the working of the election machinery knows no bounds. Now that Pakistan is to hold elections and the major parties are contesting, it is important that the electoral exercise is not only fair and free with a level playing field for all participants, it should also appear to be so. The country can ill-afford to go through another flawed exercise that can be catastrophic.

From bank to house

PAKISTAN’S primary mortgage market remains small and underdeveloped as it reflects the fundamental weaknesses and distortions in the economy. Over the years, the total housing finance exposure of commercial banks and DFIs has grown to Rs116bn, which is only one per cent of the GDP, and includes HBFC’s share of Rs40bn. The entry of the banks in this segment of the economy gave the market its first push in 2004 as it expanded by 56 per cent in 2005 only to slip back to about 28 per cent in 2007. The growth rate has now dropped mainly due to rising interest rates — the mortgage credit price has risen to 12-13 per cent from seven to eight per cent in less than three years. There has also been a slowdown in the heavy investment made in the housing sector by expatriate Pakistanis returning home in the wake of 9/11. The market’s growth will slow down further in the current fiscal if political uncertainty persists.

The situation should be of concern to the government, which is pushing the banks to increase the size of the mortgage loan stock to three per cent of the GDP by 2010. Thus alone can the nationwide housing deficit of six to seven million units be reduced. The major impediments in the way of the mortgage market’s expansion will remain unless the federal, provincial and district governments decide to work in unison to computerise land revenue records, bring uniformity in the documentation procedures and improve enforcement of the foreclosure laws. In addition, bankers are also reluctant to advance housing loans because most intending borrowers — individuals or developers — are not documented properly and there is always a huge gap between their declared and actual incomes. There also exists a strong bias among the potential borrowers against installment purchase and the cumbersome documentation involved. In Pakistan, the banks handle less than 15,000 mortgage applications annually which is a fraction of what mortgage companies in other countries do. No wonder then that Pakistan’s mortgage market remains substantially lower than even the regional economies as a percentage of the GDP — mortgage lending in India is three per cent and in China 15 per cent of their respective GDPs. Mortgage finance is considered an important mechanism to lift construction activity and boost some 40 allied industries for kick-starting the economy. Therefore, it is critical that the government took effective steps to dismantle barriers to provide minimum comfort level to the reluctant bankers for facilitating mortgage lending.

Barring the way

PEOPLE’S right to freedom of movement, like so many other rights that Pakistanis are supposed to have, exists more in breach than in observance. In normal circumstances, the continuous violation of this right, however, would have raised at least some important eyebrows. Punjab’s apex court thinks differently. On Friday it ordered the provincial chief secretary and provincial police to ensure that people not living in the area housing government officers could not make it there. Apparently this is aimed at stopping daily protests outside the official residence of a Lahore High Court judge who did not take oath under the Provisional Constitution Order and is facing eviction. Only a day before this ban, 10 people were arrested from outside the judge’s residence and sent to jail.

Under emergency rule and with the imposition of Section 144, the government has assumed enormous powers to decide how many people can assemble and where. Residential neighbourhoods for the official bigwigs, under these circumstances, should be the last place where the government would allow people to gather and protest. But should this mean that in the state of emergency the authorities have got a free hand to block any thoroughfare they like? And if they fail to do so, should the courts step in to enforce the blockade? Isn’t it the same thing — interfering with the working of the executive — that pre-PCO courts were accused of by President Musharraf in his proclamation of emergency? Certainly no one expects post-emergency courts to take on the executive on behalf of the people but taking on the people when the executive is seen to fail in that should also be something not on the superior judiciary’s agenda. Even when courts can’t enforce people’s fundamental rights, they have a choice to stay away from becoming a party to their breach.

Housing imperatives for Karachi

HOUSING is without doubt the most important issue facing the vast majority of people living in Karachi. The failure to resolve it is creating stress, uncertainty and homelessness for the poorer and lower-middle-class sections of society and increasing the rich-poor divide.

Since independence, a large housing demand-supply gap has always existed in Karachi. Previously this gap was accommodated in katchi abadis.

However, this is becoming difficult as land that could previously be used for katchi abadis is now required for meeting the demands of global capital and the emerging middle class. Due to this, prices of land in katchi abadis have become unaffordable, even for the better-off among the poor. As a result, entire families have now started living on the streets and in public spaces.Surveys suggest that the majority of these are those who have been evicted from their previous homes due to rising rent and land use changes or due to the break-up of extended families, often because of disputes related to ownership or to a lack of space. Once, Karachi housing-related professionals were very proud that unlike other mega cities of South Asia, people did not sleep in the streets in their city. This is no longer the case.

The demand for strategically located land by commercial interests, often promoted by profit-seeking mega projects, is also evicting people from existing katchi abadis. Since 1997, more than 50,000 Karachi households have had their homes bulldozed. More than half these evictions have taken place in the last four years. In addition, since then 1,777 huts have been burnt, rendering more than 12,000 homeless. Nineteen minor children, four young girls and six adults were burnt alive in these incidents. Plazas have been constructed on some of these locations.

About 50 per cent of the evictees have been offered a plot of land in a relocation site. Urban Resource Centre surveys of the relocation sites, which are 20 to 25 kilometres away from the city centre, show that relocation has impoverished the affectees. This is because their travel costs have increased by more than 100 per cent, their women can no longer work, their children’s education has been disrupted, utilities are not available unlike previously, and the long hours of travelling to and from work increase stress and disrupts family and social life.

News items indicate that the state intends to demolish katchi abadis in key locations and build eight-storey flats and commercial centres in their place. The affected katchi abadi residents are to be allotted an apartment in these new developments. This proposal is an open invitation to corruption and will not serve the interests of the residents. It has failed in the case of the Lines Area Project in Karachi and has never been successful in other countries except where there are strong governments.

Fish vendors, hawkers, motor mechanics and small commercial enterprises cannot operate from high-rise apartments. Therefore, the upgradation of katchi abadis is the only viable solution. However, under the present rules only abadis that were formed before March 23, 1985 are eligible for regularisation. This means that about half of the katchi abadi population is vulnerable to eviction. In the interests of justice, equity and pragmatism, it is necessary to extend this cut-off date to June 30, 2007. The Punjab government has wisely extended it to December 31, 2006.

The major objection of the anti-katchi abadi-regularisation lobby is that they are ‘eyesores’. However, experience from other Third World countries shows that they can be made extremely attractive with very little investment. This writer has offered to be an honorary advisor for a pilot project of this sort for two katchi abadis.

Surveys for the Karachi Strategic Development Plan 2020, a comparison of the 1981 and 1998 census and other official documents show that housing conditions in Karachi have deteriorated. For example, in 1978 the katchi abadi population was 55 per cent of the total population of Karachi. In 1980 it was 43 per cent. This decline was due to the social housing policies of the Bhutto government in the ’70s.

In 1998 the katchi abadi population was 50 per cent of the Karachi population (700,152 households) and in 2006 it was 61 per cent (1,200,000 households). ADB figures indicate that 50.5 per cent of Karachi residents live below the poverty line. For katchi abadis this figure is 89 per cent of which 54 per cent are chronic poor. This is a major increase from previous surveys.

In addition, in the 1980 housing census houses with separate latrines were 74 per cent, separate kitchens 65 per cent and separate bathrooms 69 per cent. In the 1998 census, these figures have fallen to 47, 48 and 34 per cent respectively.

The Karachi Strategic Development Plan 2020 survey shows that 34.4 per cent of households earn less than Rs5,000 and 41.4 per cent earn between Rs5,000 and Rs10,000 per month. It is estimated that these households spend 75 per cent of their earnings on food items and 18 per cent on utility bills. This means that the current housing market cannot possibly be accessed by over 75 per cent of Karachi households.

Given the above conditions, a massive social housing programme is required for Karachi. An essential ingredient of this plan has to be strategically located land on or near the main corridors of movement or near major work centres. Such land is available but hoarded for speculation. To bring it into the land market, a heavy non-utilisation fee of at least 10 per cent per year of its value is required. This will also make land prices more realistic.

In addition to the extension of the cut-off date, the imposition of the non-utilisation fee and the adoption of upgrading of katchi abadis rather than redevelopment, a few more ingredients for social housing are required. One, between now and such a time as we can close the demand-supply gap, informal settlements will be required. Plans should be developed for the creation of settlements on the Khuda Ki Basti model for a five-year period.

Given the changing sociology of Karachi, the major demand in the next decade is going to be for low- and lower-middle-income built units rather than plots. These can be provided on the basis of recovery of their costs at Rs10,000 to Rs20,000 down payment and a monthly payment of Rs1,500 to Rs3,000 for over a 15-year period. If the price exceeds this, it should be subsidised from other sources.

However, the major problem for making such housing initiatives successful is related to accurate targeting and making speculation difficult. Models for both of these can be developed with the help of katchi abadi CBOs. Initial research also shows that with changes in bylaws and through innovative layouts, development costs can be halved of what they are today. However, none of this is possible without political will and the creation of effective institutions.

OTHER VOICES – Sindhi Press

Why uncertainty prevails

UNCERTAINTY still prevails. In official circles the option of postponing the election was still being weighed. It seems the demand by many politicians has made an impact. The PPP has suggested that a national government be formed and elections be postponed for six months.

If a national government is formed, the proposal for the postponement of elections will be generally acceptable. If this is not done, the arrangements for holding elections will betray the likelihood of rigging. Postponement would also remove the cause for many parties boycotting the polls and would minimise the uncertainty. If possible, a national government should be formed.

Some official quarters have hinted at the construction of big dams, which has revived unrest among the smaller provinces. Sindh, Balochistan and the NWFP have been opposing these controversial projects for decades. Raising this controversy at this stage has further increased the gulf between the centre and the already estranged provinces. When people are considered irrelevant and problems increase to intolerable levels, the crisis worsens. If people are not taken into confidence when planning the entire political process and governance, it is inevitable that space is made for dictatorship.

The opposition parties are expressing concern at the possibility of government-backed candidates rigging the elections. But there is no one to redress their grievances. This has created an unpleasant situation for many classes and parties. If elections are held in such circumstances, they will not have credibility. One can imagine the stature of the governments that will be formed.— (Dec 9)
Awami Awaz

NFC award & apprehensions

RECENTLY released official data suggest that the centre has transferred about Rs91bn to the provinces as their share in the federal revenue in the first quarter (July-Sept) of the current financial year, which amounts to less than 20 per cent of the year’s target of about Rs465bn.

The current expenditure of the federal government during this quarter stood at Rs340bn, marking a higher rate of spending. If the practice continues, the full year’s expenditure will stand at Rs1,350bn, almost 28 per cent more than the Rs1,056bn target.

According to the interim award the straight transfers to the provinces for the next year have been projected at Rs62.8bn, compared to Rs70.3bn during the current fiscal year, showing a decline of almost 11 per cent. The NFC award has remained a very contentious and controversial issue as provinces have been demanding a larger share. They have been claiming an enhancement in their share as their right.

The 20 per cent fall in the transfer of resources indicates that the economy of the country is moving in a direction that cannot be termed healthy.

Here we would like to remind the federal government that the level of development in the four provinces is not the same. The industrialisation, backwardness and poverty levels vary while the problems are compounded by factors such as migration, natural calamities and disasters which may affect some provinces more than others. These ground realities should also be considered while formulating the NFC award and the transfer of funds to the provinces. — (Dec 8)
Ibrat

— Selected and translated by Sohail Sangi