AS the nation commemorates today the historic passing of the Pakistan Resolution of 1940 in Lahore, which in practical terms triggered the Pakistan Movement and brought us independence, it is well worth remembering that the independence the Founding Fathers envisaged had an inherent role for the corporate sector to play to ensure the proposed country’s independence in real terms.
An independent country ensures for its citizens, among other things, freedom from oppression, the right to make their own decisions, having a say, if not controlling, their own destiny, and utilisation of resources/wealth for their prosperity. In short, independence is nothing without economic independence.
In undivided India, entrepreneurs serving the masses and leading the economy from the Hindu community far outnumbered Muslim businessmen.
Naturally, things had to change once the Muslims of the subcontinent, under the leadership of Quaid-i-Azam Mohammad Ali Jinnah, decided to get a country of their own. But, historically speaking, the Muslim community in the subcontinent had not quite been business-savvy.
Our own history stands testimony to the fact that economic independence is what matters above every other aspect of sovereignty. Every individual in Corporate Pakistan has to behave like a frontline soldier ensuring the economic well-being of the motherland.
During the Mughal rule as well as in the post-1857 era, Muslims, largely speaking, remained averse to the idea of making money, while the other communities, especially the Hindus, made major strides in this regard. Muhammad Ali Jinnah knew that only a separate homeland will give the Muslims economic emancipation. We have seen his vision come true.
The country has grown manifold since independence despite a romance with various versions of governance. Our people are tech-savvy regardless of the many obstacles in the way of free and fair growth, including the denial of equal opportunities, and, yet, we are better off than an average Indian.
The financial industry, owned and managed by Muslims got badgered both in 1947 and then in 1971. And it is in the context of 1971 that we would try to see the national corporate sector as March 23, 1940, which is the day the Pakistan resolution was passed, and March 26, 1971, which is when the erstwhile East Pakistan celebrates its own Independence Day as Bangladesh, together signify a landmark moment in the history of Corporate Pakistan.
It started its journey of economic emancipation, at least in terms of mindset, in March 1940, and then it underwent a second major adjustment in March 1971 after having undergone the first upheaval in August 1947.
At the time of creation of Pakistan, East Pakistan had 22 banks, registered locally and West Pakistan had only 14 banks. According to the RBI rating scale, the banks under the A-1 and A-2 categories of West Pakistan were Habib Bank and the Australasia Bank.
Habib Bank Limited was formed at the request and direction of the Quaid in Bombay in 1942. Post-partition it moved its headquarter to Karachi, again at the behest of the Quaid. Habib Bank Limited had 31 branches spread across the subcontinent of which only nine were located in what constituted Pakistan.
In East Pakistan, there was also the historical Faridpur Banking Corporation, founded as a commercial bank in 1870. Ironically, The Punjab National Bank, which was formed in 1894 in the city of Lahore, moved to India despite having a 79-branch strong presence in West Pakistan.
Between 1947 and 1971, many large, medium and small-sized business establishments moved to East Pakistan, where comparatively labour costs were low.
East Bengal historically had a plantation economy. The Chittagong and Sylhet hill tracts were home to the world’s largest tea plantations. Besides, Muslims from neighbouring Burmese and Assamese territories, and some prominent business families like the Ispahanis, Adamjees, Saigols, etc. had initiated the setting up of factories and industries.
The Adamjee Jute Mills was the largest jute processing outfit. The oil refinery in Chittagong and Karnaphuli Paper Mills owned by the Dawoods were all lost out to the separation of East Pakistan. And, Pakistan received no compensation.
While there definitely was a case of social, politico and economic discrimination against East Pakistanis, its magnitude was not as damaging as was the perception that was created globally; courtesy, the nexus between the separatists and India.
To the disadvantage of Pakistan, which was at the time being ruled by an intoxicated junta, the Indians were able to achieve great diplomatic successes at the Capitol Hill, the White Hall, and other significant world capitals, in creating the exaggerated perception that the action against a belligerent political party was actually the carrying out of some kind of ‘genocide’.
The deployment of development resources was always tilted in the favour of West Pakistan. The East Pakistanis always thought that West Pakistan was prospering based on the foreign exchange earnings of East Pakistan’s exportable surpluses.
Jute purchase was disadvantageously priced. East Pakistanis believed that the West Pakistanis were consuming not merely their share of the bread, but were, in fact, devouring the whole bread. Mujibur Rahman is said to have stopped his cavalcade while heading to Islamabad to attend an All Parties Conference (APC). He got out of the car and went into prostration on the wide road. Many wondered if he was praying or was perhaps kissing the ground. But when he got up, he said: “I was smelling Jute!”
It was just a reflection of how East Pakistan thought the West Pakistan was progressing on the export earnings from jute that was produced in the eastern wing.
Match factories in the East Pakistan were owned mostly by entrepreneurs from the West. Following the attacks upon their life and property by the Mukti Bahini, who were being generously aided by the Indians, they abandoned their business and assets. They took the first available flights to West Pakistan.
An owner of two match factories and a jute mill, known to this scribe personally, traded his assets for air ticket for himself and family to West Pakistan. He never went back.
Between 1960 and 1965, the GDP per capita was 4.4 per cent in West Pakistan compared to a dismally low 2.6 per cent in East Pakistan. From a high of almost 70 per cent of total exports of Pakistan emanating from East Pakistan in the mid-1960s, the contribution declined to less than 50 per cent by the time of its separation in 1971.
East Pakistanis lamented about the unjust distribution of the foreign aid, too. Most were taken by Islamabad, they argued. Towards the end of the 1960s, there was growing realisation amongst West Pakistani politicians and business elite that the Bengali population, although in the majority, was not getting its fair share; so half-heartedly, there was a move to pour development funds into East Pakistan. As a gesture, Dhaka TV was the second television station of united Pakistan that became functional.
In 1971, besides the State Bank of Pakistan, there were 10 West Pakistan-headquartered banks compared to two in based in East. The 10 banks had a network of 920 branches, while the two other banks had 155 branches in East Pakistan.
The State Bank of Pakistan became the Bangladesh Bank (Central Bank) and the Pakistani banks were merged without any compensation to their owners with the local banks; some got lumped with the existing institutions, while others were merged into the newly-formed ones.
The National Bank of Pakistan has today become the Sonali Bank; the Habib Bank is Agrani Bank, the United Bank is Janata Bank; and the Australasia Bank is now the Pubali Bank.
Pakistan at the time of partition was short-changed and due to international machinations of diabolical nature, it suffered again when the majority province seceded.
Today’s Pakistan is still a blessed land where people have built factories, some within and many without the ambit of either legality or social acceptability.
The country saw capital concentration and the emergence of the ill-famed 22 families during the 1960s. The industries did provide employment opportunities, but also became instruments of social and labour exploitation. Consequent to this, we have seen nationalisation and then privatisation within three decades.
Politically speaking, we lost East Pakistan due to ill-founded political philosophy. In no way, Bangladesh’s creation can ever be termed a negation of the Two Nation Theory. Bangladesh is an independent country; not a part of India’s Hindutva politics.
All said and done, industries have mushroomed, education is available, and employment levels are decent. There is no intent to spoil the mood of the readers on this auspicious day by recounting the many ills attending to our political, legal, religious and social setup. There have been occasions when as a nation we have confused the free with the easy.
All other things in life are of the least value against freedom, which is precious. Freedom on a platter was an impossibility, and Jinnah had it for us with great faith, resolve and determination.
Muslims, in India, just as they are struggling today to find a voice in the political, economic and social space, would have been worse off, if we had no Pakistan. And therein lies the biggest lesson that we may learn from our own history, taking March 23, 1940, as the starting point. Economic independence is what matters above every other aspect of independence.
Today, there is a need to drive our younger generation towards entrepreneurship. And for this purpose, entrepreneurship should be part and parcel of our education system, enabling us to grow our economy.
Independence and economic performance are linked with each other. Political independence is meaningless without economic independence. It is important to create an enabling environment for economic activities to flourish, strengthening its processes to achieve economic stability and growth.
In a manner of speaking, every individual in Corporate Pakistan is a frontline soldier ensuring the economic independence of the motherland. Do we, in the corporate sector, realise this?
The writer is a banker with an academic bent of mind.