Qarz Utaro Mulk Sanwaro : A scam or a fraud?

In Pakistani political discourse, it was continuously mentioned by pro-Musharraf and anti-PML(Nawaz) groups that National Debt Retirement Program (NDRP) infamously known as Qarz Utaro Mulk Sanwaro launched by Nawaz Sharif in his second term to mobilize national (domestic as well as from diaspora) funds to pay off expensive local and/or international debt was a scam as their wasn’t any noticeable reduction in national debt.

Below I present excerpt from State Bank of Pakistan (SBP) Annual Report 2001 (when Nawaz Sharif was in exile and General Pervez Musharraf was ruling as president) so that reader cannot claim that we are talking fudged numbers here.

The National Debt Retirement Program (NDRP) was launched on February 27, 1997 to solicit funds from non-resident Pakistanis (NRPs) towards retiring the country’s external debt. Resident Pakistanis were also allowed to participate in the scheme using their foreign currency accounts, FEBCs, FCBCs, traveler cheques, remittance from abroad or by surrendering hard currency. Deposits in three currencies (US Dollar, Pound Sterling, and the German Deutsche Mark) could be placed in the following:
  • An outright donation with no payback (referred to as NDRP I).
  • Qarz-e-Hasna deposits for a minimum period of two years; no interest payments but principalrepayments could be taken in Rupees or hard currency (NDRP II).
  • A profit bearing deposit for a minimum period of two years (NDRP III).

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Table 8.9 shows the total stock from NDRP I, II, & III as of end June 2001. The majority of these donations, Qarz-e-Hasna, and profit bearing deposits were made in the first year of the scheme. Subsequent years have seen minor inflows. As can be seen from the table, the largest inflows havebeen in the profit bearing deposits.

As far as the usage of NDRP funds is concerned, the equivalent Rupees generated under NDRP I & II are credited to the government account with SBP. The foreign exchange component, against which these Rupees are generated, form part of the central bank’s foreign exchange reserves. The federal government has used these Rupees to retire domestic debt of about Rs1.7 billion, which carried a 17.3 percent rate of interest per annum. Inflows from NDRP III form part of SBP’s foreign reserves, while the generated Rupees are credited to the mobilizing institution. For collections in Rupees, the amount collected by commercial banks is surrendered to the relevant SBP local office, which credits the government account on receipt.

Below is a table extracted from SBP Annual Report 2008

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National Debt Retirement Program row shows that SBP paid off the funds to the creditors.

Just to put things in perspective, Pakistan’s external debt was in excess of US$ 30 billion and Qarz Utaro Mulk Sanwaro raised around $178million in foreign currency which is equivalent to less than 0.6% of our external liabilities.

When people say that Nawaz Sharif expropriated funds of Qarz Utaro Mulk Sanwaro scheme, they have no idea what they are talking about. That is why, you will see that politicians or journalists do not make such claims on media_electronic or print. Its only their supporters in the general population.

AQ Khan and Nuclear Bomb : Part IV : Reining in the army

No sooner had she [Benazir Bhutto] entered office than the military called on her with a special briefing. The subject was Kashmir, where the insurgency ignited by Generals Beg and Gul had fallen into a lull. Bhutto had a new director general of military operations, Pervez Musharraf, an ambitious and wily officer, who requested permission to revive and escalate the campaign. Musharraf had been Hamid Gul’s artillery pupil and had made his name battling it out in Kashmir. He had fled India as a child with his family in 1947, leaving an ancestral home in New Delhi to be occupied by Hindus, and he bore a deep-seated hatred of India’s attempts to encroach on Pakistan’s territory, particularly in Kashmir and Bangladesh. Musharraf had advanced through the ranks by focusing on all of the military’s non-negotiables, as defined by Gul’s secret manifesto penned in 1987. At the behest of army chief General Beg, in 1987 Musharraf had led a newly formed alpine commando unit in a pre-emptive strike on Indian positions in Siachen, only to be beaten back.

Undaunted, Musharraf had in 1988 been called on by General Beg to put down a Shia riot in Gilgit, in the north of Pakistan. Rather than get the Pakistan army bloodied, he inducted a tribal band of Pashtun and Sunni irregulars, many from the SSP which … mounted a savage pogrom, killing more than 300, and when the fighting had subsided Musharraf opened an office for SSP extremists in Gilgit, helping spread their influence across Pakistan. After Zia’s death in August 1988, Musharraf had got closer to Generals Beg and Gul, and played the extremist card many times.

In October 1993 he suggested to prime minister Bhutto that she change the rules of war and give the army sole responsibility for deciding the timing of conflicts, as Beg had argued, suggesting the move would enable the Pakistani military to react quicker if there was ever a pre-emptive strike by India. But Benazir Bhutto refused again, fearful of what an unfettered army would do.

Unfazed, Musharraf moved on, setting out his special plan for Kashmir. “He told me he wanted to ‘unleash the forces of fundamentalism’ to ramp up the war,” Bhutto recalled. Musharraf wanted to recruit from among the Sunni extremists cultivated by Zia in the Punjab and the remote Northwest Frontier Province, many of whom had already tasted war in Afghanistan. According to the military’s own tally, dipping into these groups could fetch as many as 10,000 new jihadis to send over the border into India. Bhutto gave Musharraf the go-ahead. She needed the military on her side. “Second time around I did not want to rock the boat,” she said.

After getting Jamat-e-Islami, Jamiat Ulama e Islam on board, Musharraf won support from the Markaz Dawa Al Irshad (MDI). The MDI had already formed a military wing known as Lashkar-e-Taiba (LeT), formed in 1990 in Kunar province, Afghanistan, with a goal of restoring Islamic rule to the whole of South Asia, Russia and even China.Through Musharraf’s patronage, LeT would become the largest jihadi organization in Pakistan.

The remaining factions to emerge, who were to produce fodder for Kashmir and elsewhere, were entirely the creation of Musharraf himself and included Harkat-ul-Ansar (HuA), formed by the merger of two armed Sunni factions founded in the era of the Afghan war in order to oust the Soviets.14 HuA was to become the most vicious and unscrupulous of all the militant groups.

Over the border in India, the recruitment drive was immediately obvious, its story told in the bloodshed that soon catapulted Kashmir into crisis. The joint intelligence committee in New Delhi estimated the Pakistani military was spending $7.5 million per month to reinvigorate the proxy war.15 They presented a file of evidence to the US, warning that fundamentalists were being infiltrated into Kashmir and Musharraf was at the helm. But the US was not interested.

In 1994, Musharraf, as director general of military operations, recognized the potential of the Taliban as a client army that could become a client government. An expert in sectarian politics, Musharraf also recognized them as a righteous Sunni army. If necessary, they could be called upon to ….. act as a buffer against Iran.

Bhutto’s government was in step. Interior minister General Naseerullah Babar wholeheartedly backed the Taliban plan. A die-hard Pashtun and former confidant of Zulfikar Ali Bhutto, General Babar was said to have single-handedly captured a seventy-strong company of Indian soldiers in the 1965 war, for which he was awarded the Sitara-e-Jurat or Star of Courage. Unlike the ISI, his interest was not in religious war. General Babar saw the Taliban as a tool to impose peace. “They looked useful,” the general recalled.18 “When one compared them to the horses we had backed in Afghanistan already, they were pedigree. The Taliban would bring order, restore morality and more important than any of these things, the peace they imposed would enable us to open up trade across the region into Central Asia and beyond. They were intended as a poultice: drawing out the bad blood.”

With the involvement of Jamiat Ulema Islam, the only Islamist faction in Bhutto’s coalition government, which was close to the merchants and [transport] agencies based along the Pakistan–Afghan border, General Babar sanctioned a broadening of Musharraf’s secret supply operation for the Taliban, which city by city was marching eastwards. Bhutto wrestled with the decision. Although backing the Taliban went against her secular instincts, she knew it was impossible to survive in Pakistan without engaging with sectarian forces.

To rein in the ISI and win back US support, Bhutto acted rapidly on a piece of raw intelligence that dropped into her lap. On 7 February 1995 crack troops answerable only to the prime minister raided an Islamabad guest house and seized Ramzi Yousef, who had been living there secretly under ISI protection for two years. Waiving legal formalities that would have allowed the case to drag on indefinitely (and enable Yousef to be sprung by his supporters in the army), Bhutto had him immediately extradited to the US. One month later, on 8 March, after Yousef’s supporters had responded by shooting dead two Americans who worked at the US consulate in Karachi, Bhutto ordered a tentative crackdown against the extremists, placing Maulana Azam Tariq, the second in command of the Sipah-e-Sahaba, which had paid Yousef to kill Bhutto, and Maulana Masood Azhar, a leader of Harkat-ul-Ansar, which had kidnapped the tourists in Kashmir, on an exit control list.56

Even this mild response drove sections of the military wild. In September 1995, Bhutto uncovered plans for a coup led by Major General Zahir-ul-Islam Abbasi, director general of infantry corps at the army high command.57The ISI was everywhere and Bhutto was losing control. Then she received an uncomfortable call from Washington: her military attaché had been caught running a counterfeit currency racket. Brigadier Khalid Maqbool, who was in reality the ISI station chief, had been passing fake $100 bills so sophisticated that the US Treasury was later forced to change the design of the note.60 Maqbool refused to explain to his prime minister what he had been doing or under whose authorization he had done it and was deported from the US back to Pakistan. “It was hugely embarrassing,” recalled Bhutto.61 “We made up a story in the end to cover the scandal and said the bills had come from Afghanistan after the US contingent left. No one believed us. We behaved like gangsters and our credibility was shot to pieces.”

Excerpted from “Shopping for Bombs: Nuclear Proliferation, Global Insecurity, and the Rise and Fall of the A.Q. Khan Network

AQ Khan and Nuclear Bomb : Part III : Nuclear Yard Sale

But first Musharraf would need to make an overt display of strong-arm tactics to get the US off his back. After Clinton returned to Washington, Musharraf’s new man, General Feroz Khan, met Einhorn’s special group and assured them that his namesake A. Q. Khan would have to abide by the new regulations of the National Command Authority along with everyone else. He also advised that Lieutenant General Syed Mohammed Amjad, head of Pakistan’s National Accountability Bureau, had been ordered to quiz A. Q. Khan over allegations of corruption and private profiteering. Nawaz Sharif had used the same ruse in 1998, telling the US that the ISI was investigating Khan, despite the fact that the spy directorate’s chief knew of no such investigation. Amjad’s report would never surface and he later resigned, disaffected with his brief. The elusive inquiries—which got nowhere or never happened—coincided with a handful of high-profile, theatrical raids conducted by the ISI, including the storming of a C-130 plane that was supposedly chartered by Khan and heading for North Korea. When nothing incriminating was found, Musharraf claimed: “We got some suspicious reports … [but] unfortunately, either you know, he was tipped off or whatever … we just could not catch them red-handed.” One of those who led the raids was more candid. “We rang KRL first and checked the coast was clear. This was meant to demonstrate a point.” Husain Haqqani was incredulous. “It was a lot of hot air. The military had been in sole control of KRL and PAEC since Zia’s days. They had always been in charge of Khan—in that all of his activities were governed by their orders. And now he was being portrayed as operating beyond the state. It was a put-on show for the US.”

It was to the military orders that governed Khan that Musharraf next turned. Since Zia’s time, every sale had been sanctioned by the military and now Pakistan’s chief executive decided to legitimize nuclear proliferation altogether. Musharraf ordered the publishing in national newspapers of the secret menu that A. Q. Khan had long been touting around Iran, Iraq, North Korea, Africa and the Middle East. Everything on the menu would still be available, the government announced, the only difference being that in future a permit would be required from the Defense Control Committee, chaired by Musharraf and whomever he picked as his prime minister. The advertisement hit the streets on 24 July 2000, and Washington was horrified by what it read:

The items listed in the advertisement can be in the form of metal alloys, chemical compounds, or other materials containing any of the following: 1. Natural, depleted or enriched uranium; 2. Thorium, plutonium or zirconium; 3. Heavy water, tritium, or beryllium; 4. Natural or artificial radioactive materials with more than 0.002 microcuries per gram; 5. Nuclear-grade graphite with a boron equivalent content of less than five parts per million and density greater than 1.5 g/cubic centimeter.

It was the whole shebang, everything anyone needed to make a nuclear bomb.  Listed was equipment “for the production, use or application of nuclear energy and generation of electricity,” including “gas centrifuges and magnet baffles for the separation of uranium isotopes” and “UF6 mass spectrometers and frequency changers.” They made it appear that Pakistan was for the first time applying rigorous export controls to a prohibited trade that was to be governed by the Pakistan authorities. In reality the advertisement blew to pieces the Nuclear Non-Proliferation Treaty and decades of arms controls which had to date kept the nuclear club down to five declared and a handful of undeclared nuclear powers—and was Musharraf’s clumsy bid to find a get-rich-quick scheme for Pakistan.

Former army chief General Beg saw the advertisements for what they were and, writing in an Urdu newspaper, championed them as the Islamic Atoms for Peace. “This is the best way for Pakistan to pay off her debts,” he argued, conceding that Pakistan “used to sell atomic material and equipment quietly and secretly.”

If any more evidence were needed that Khan’s proliferation activities were being actively promoted by Musharraf’s military regime, it came in November 2000 when the Pakistan army staged “IDEAS 2000,” an international munitions fair in Karachi.52The central exhibit was a large Khan Research Laboratories booth promoting the sale of centrifuges with an after-sales consultancy service that included “installation, repair and maintenence” thrown in. Alan Coke, a senior editor from Jane’s Defense Weekly, who visited the KRL booth, recalled: “They were handing out glossy brochures offering the kind of technology that would be directly applicable in a nuclear weapons program, the whole kit and caboodle, all in one.” When Coke asked a KRL representative if everything in the brochure was cleared for export he was told: “Of course, it wouldn’t be on the shelf if it wasn’t.”

Excerpted from “Shopping for Bombs: Nuclear Proliferation, Global Insecurity, and the Rise and Fall of the A.Q. Khan Network

For further reading

Why Pakistan is advertising its nuclear wares

Interview of General Aslam Beg confirming and actually supporting the ad!

 

How to spot a lying Dictator? It’s the percentages, stupid.

A lot of numbers are flying around in the media nowadays. Opinions have become polarized on every subject after financial crisis, Arab Spring, War on Terror etc. To give weight to their arguments, opinion makers quote made up (or so it seems) statistics to give credibility to their side of the story.

Most recently, King Mohamed VI of Morocco held a referendum to seek approval for  his proposed reforms. His proposal was approved by almost 99% of voters. From Huffington Post:

Moroccans on Friday overwhelmingly approved a new constitution their king says will bring the country much-needed democratic reform, the Interior Ministry announced.

The preliminary results showed a 98.94 percent approval rating and 72.56 percent turnout and appeared to indicate strong belief by Moroccans in the king’s promises of reform just months after hundreds of thousands marched throughout the North African country calling for more democracy.

98.94% approval rating and 72.56% turnout. Now where have I seen such numbers and referendum on such unilaterally proposed reforms before? There are no points for guessing that Pakistan would be the correct answer. We have a history of holding such referendums by military dictators.

When Ayub Khan appointed himself ruler of Pakistan, he carried out referendum to give legitimacy to his rule after deposing Iskandar Mirza in a bloodless coup. From Wikipedia

In 1960, he held an indirect referendum of his term in power. Functioning as a kind of electoral college, close to 80,000 recently elected village councilmen were allowed to vote yes or no to the question: “Have you confidence in the President, Field Marshal Mohammed Ayub Khan, Hilal-i-Jurat?” Winning 95.6% of the vote, he used the confirmation as impetus to formalise his new system.

The next referendum was carried out by next military dictator Gen Zia after deposing Zulfiqar Ali Bhutto in a coup (it wasn’t bloodless as he had Bhutto hanged).  And the question asked by him was

Whether the people of Pakistan endorse the process initiated by General Muhammad Zia-ul-Haq, the President of Pakistan, for bringing the laws of Pakistan in conformity with the injunctions of Islam as laid down in the Holy Quran and Sunnah of the Holy Prophet (PBUH) and for the preservation of the Islamic ideology of Pakistan, for the continuation and consolidation of that process, and for the smooth and orderly transfer of power to the elected representatives of the people.

Say what? Come again?

From Wikipedia

It was reportedly approved by 98.5% of voters, with a turnout of 62.2%.

Finally, it was Musharraf’s turn and he carried out another sham referendum. (Since this happened in my life time, I have seen with my own eyes military bringing in people from interior Sind by truck loads at one of polling stations half an hour before election commissioner visited the place at NIC building, off Sharae-Faisal, Karachi). The question posed in the referendum was

For the survival of the local government system, establishment of democracy, continuity of reforms, end to sectarianism and extremism, and to fulfill the vision of Quaid-i-Azam, would you like to elect President General Pervez Musharraf as President of Pakistan for five years?

From Story of Pakistan

According to the Government there were 78 million eligible voters. Eighty seven thousand polling stations were set up, including booths set up at prisons, hospitals, petrol stations, workplaces, and markets. However, there were no voter lists or constituencies, and anyone who could prove his identity and age could vote at any polling station. According to the Government estimate, around 98 percent of the counted votes backed General Musharraf continuing in office and the turnout of the referendum was said to be around 70 percent.

What’s with the obsession of dictators with approval ratings reaching almost 100%? And when voter turnout has normally been less than 50%, how come voter turnout in referendums reach 70%? Don’t they know that this puts the credibility of the results into question.

Once these usurpers have legitimized their rule for the said period promising reforms, it turns out that by the time they leave (rather “forced to leave”) and take their reforms with them, the country is worse off compared to when they took over.

Based on this history, I will give King Mohamed VI of Morocco a maximum of 10 years of sham reform before he is booted out or is restricted to his palace.

Whereas these dictators create an infrastructure of polling/votes before quoting statistics, we have an Interior Minister who has taken to quoting percentages like a magician creating them out of thin air at his whims. But that is for another post.

Military rule in Pakistan: same old shit

I had received the following videos earlier but someone resent them to me today. They are circa 1959 and have an interview of Ayub Khan. Despite the upbeat nature of the report (the west and western media has always supported our military rulers) what is amazing is how Ayub Khan’s talk reminds of similar talks made by Musharraf. More than that, it begs the question that if military rule is so good for Pakistan why is it that when the ruler leaves us, we find ourselves in worse situation despite their claims of bringing true democracy instead of sham democracy or claims of democracy does not suit the genius of people.

The reporter is neither sarcastic nor there is any hint of cynicism when he says that 95% of Pakistanis favored Ayub Khan which begs the question is the reporter was naive? If not, I want to smoke what he is smoking. Doesn’t it remind you of 97% affirmation that Musharraf received in his referendum.

Ayub’s rhetoric in the report reminds me of Musharraf as he used to say the same things.

 

 

 

Altaf Hussain : Coming to terms with mortality

Yesterday Altaf Bhai made a statement (and here) that he may be martyred by none other than foreign powerful forces. For a person who has sought asylum and comfort in the west and has spent his life blaming (rightly or wrongly) punjabis, sindhis, pathans, haqiqi, army and ISI, dissident groups for the ills facing his people, it construes an absolute U-turn from past policies to point finger towards west most probably US considering his latest outburst where he said that he would have ended all relations with US (according to a ticker on GEO though I cannot find the news now).

Normally, he would have asked his workers to keep an eye on their sworn enemies i.e., Pakistanis of non-mohajir origin _pathans, punjabis etc (the usual suspects) after he is martyred so that his followers carry forward his mission. However, before his impending martyrdom he is pointing fingers at US. What gives?

For those who do not live in Karachi or have not lived in Karachi, they cannot assume the magnitude of this statement. Had he been killed before making such a statement, it would have consolidated his followers against pathans, punjabis etc and would have lead to worst rioting this city would have ever seen (and it has seen more than its share). However, after this statement, his followers would be like a ship without a rudder for two reasons :

  1. Mainly because he has not groomed a successor and it may result in territorial fights amongst various MQM MPAs for control over land and bhatta and
  2. forever groomed and trained to consider non-Mohajir Pakistanis as enemies and the suddenly to have distant US as a very abstract enemy may not be a strong enough concept to keep MQM followers from disintegrating into various factions.

Any ideas or conspiracy theories on this change of heart? One theory that comes to mind after the news emanating from the west that Imran Farooq was murdered by MQM as he was about to join Musharraf’s All Pakistan Muslim League and lend it his full vocal support is that Altaf Hussain does not want MQM to give support to Musharraf. There could be two reasons:

  1. He may have been asked to play second fiddle to Musharraf which Altaf bhai’s ego would not want to do or
  2. being used to extracting benefits and promises on account of his large number of seats in provincial and national assembly, Musharraf and his (apparently western) backers are not willing to concede the requested gains to MQM for their support.

Hence, the powerful forces in west may have decided that Altaf has become too big for his shoes and its better to take him out and Altaf Hussain realized that his time on this earth is up.

Watch out Mr. President

From Dawn

LARKANA: President Asif Ali Zardari on Monday said that they will not take revenge for the murder of former Prime Minister Benazir Bhutto.

Who does he think he is helping by not bringing the killers and murderers on trial? This is the third prime minister that has been killed in this country and he believes that he is doing the nation a favor by letting the murderers go.

Justice delayed is justice denied. Rather in this case, by not bringing the murderers to the book (Zardari has claimed on numerous occasions that he knows the culprits) Zardari is keeping the door open for future prime ministers as well as civilian president (watch out Mr. Zardari) to be killed without any fear of getting caught or punished. He is not doing anyone any favors least of all himself.

Despite the fact  that two people who stood to gain the most by Benazir Bhutto’s murder were Zardari and Musharraf, I like to believe that he is a bereaved widower. However,  by making such statements he is not helping his case.

UPDATE: Someone posted an SMS that she got

Bilawal to Zardari, “dad its been 2.5 years since we became maskeen, when would we catch the murderers?”


Zardari,”Maskeen to pehlay hi ho, qatil pakarwa kar yateem bhi hona chahtay ho?”