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Archive for April, 1998

De-energising Power Rates

Over the past few months it has become quite apparent that Water & Power Development Authority (WAPDA) and Karachi Electric Supply Corporation Ltd. (KESC) are in a serious debt crisis. This was brought into sharp focus by the brutal murder of MD KESC Shahid Hamid several months ago by what seems clear was a professional hit team, the reason being that the late MD was delving deeper into the various irregularities that would have exposed quite a number of people. The explicit warning inherent in the gangland-type assassination was thus made quite apparent to others in similar situations. Needless to say the warning has been heeded to the detriment to the interests of the people of Pakistan even by the small dedicated band of people determined to eradicate corruption. The government has been concentrating on the Independent Power Projects (IPPs) as the major reason for the power rate crisis, that in fact was the final straw that broke the camel’s back.

Let us take the straws that count and list them under two heads, viz. (1) generation and (2) distribution of electricity and then work our way back to some of the more scandalous IPPs. Whether the generation-mode is hydel or hydrocarbon, the machinery has been over-priced. While it did not make much of a difference in hydel-generated electricity, the price padding in hydrocarbon fuel – generation machinery has kept on escalating along with the price of fuel. At least 2 or 3 WAPDA chiefs made enough money to live out lives far in excess of their basic known means, to add to this the power plants are being run quite inefficiently thereby giving us unfavourable power to price ratio. With transmission losses quite high, the basic cost of bringing electricity to the doorstep of the consumer is quite high. At the consumer’s bus-bar a completely different mafia takes over, the meter readers and inspectors. The categories of consumers are (1) industrial (2) commercial (3) domestic urban (4) agriculture (5) government departments and (6) domestic rural. Without almost any exception almost all industrial and domestic consumers cheat. One simple litmus test are the ice factories where it is comparatively easy to calculate possible consumption against the product made. For the ice presently coming out of each factory, four to five times or more greater voltage has to be used. Obviously the ice factory owner would sell at a profit which means that at least 90% of the electricity is not paid for. On a lesser scale so do commercial users since it is easy to calculate the load factor because of the air conditioners and other appliances against the energy that is paid for, the same is true on a commensurately lesser scale for domestic urban users! Government departments do not cheat, they simply do not pay their bills, at least on time. The agricultural consumer not only cheat, they hardly pay their electricity bills whether it be for tubewells or domestic use. Some areas do not pay electricity bills at all e.g. the rural areas of Balochistan and the Tribal Territories, protesting vociferously any attempt to make them do so.


Glimmer or Mirage?

While the pall of dark economic gloom continues to hover over us, some short-term indicators have started to twinkle. We continue to face a horrendous economic situation, deepened by a chronic shortfall in revenues. The magic revised figure of Rs 305 billion is still almost Rs 100 billion away in the last quarter, there is the glimmer of hope that the worst may have bottomed out and we may finally be on the road to the elusive economic recovery.

For the common man there is no issue more sensitive than food, followed by water and electricity. Last year, due to faulty projections the last elected regime defaulted on adequate imports of wheat stocks on time, with the Caretaker regime maintaining the status quo of inertia, there were “atta” riots as wheat stocks plummeted. Some PML stalwarts in Sindh took advantage of the situation to turn “atta” into gold. Wheat in tons went across the border, primarily into Afghanistan but also into other adjacent regions. This time around, the government was taking no chances and fully 4 million tons of wheat has been imported to add to the surplus stock held because of last year’s excessive import. Add to this a bumper crop this year and we are fairly wallowing in wheat. This bumper crop has been due to policy initiatives in agriculture, where the agri-credit was raised from Rs 12.5 billion to Rs 30 billion, allowing farmers a 1:2 ratio of DAP to area instead of 1:4 ratio they previously used. With support price raised, this has resulted in 12-13% increased production with 4% increased average, a 2 million ton increase. To this add the success of the Canola crop in reducing our edible oil imports by an additional US$ 300 million last year and almost US$ 150 million this year. With a world-wide slump in textiles, our domestic cotton off-take has been reduced and we have an importable surplus, enough at least to keep feeding our traditional markets. Even though our textile made-ups have gone down considerably, it has been somewhat made up by a sizable spurt in the manufacturing sector, up by almost 16%, almost 60% of it policy-related. The most significant manna has come from heaven as oil prices have crashed the world over, saving the foreign exchange earmarked for this purpose. If “el Nino” holds back in Sindh where the wheat harvest has already started and any rains would play havoc, things may well look up considerably.


Ghauri vs Prithvi

In the context of development of missiles, the HATF series of guided missiles is a fairly modest programme. In the context of the missile-race in the South Asian sub-continent, however, the launching of GHAURI on 6 April 98 at 7:23 am is a giant step towards closing the yawning gap that India is building vis-a-vis Pakistan. In real terms, GHAURI was a specific answer to PRITHVI, which in the making of and deployment thereafter was clearly Pakistan-specific. When Prithvi-2 was deployed by the Indian Army at Jullundur close to the Pakistan border, it put almost all of Pakistan’s major cities within its 270 km range. There was great euphoria in India at Pakistan’s obvious discomfort. For years Pakistan has been lobbying western capitals to restrain India from its missile programme, India cannot deny its blatant chest-beating in brushing away Pakistani fears. More explicitly, the Chairman Joint Chiefs of Staff Committee General Jahangir Karamat, spoke last year publicly about the desperate need for self-reliance in combating the Indian missile lead. Clear that no help was forthcoming from the diplomatic field, the green signal was given to the team of Pakistani scientists and engineers to go-ahead with the missile programme on an emergency basis. With the launching of GHAURI, a quantum leap has been taken to bring the level of Mutually Assured Deterrence (MAD) to even balance.


The Quaid as Jinnah

It is most difficult to portray someone as a human being when the masses consider that person as immortal. For tens of millions of Pakistanis the Quaid-e-Azam remains the ultimate (and perhaps only) symbol of everything they hold good in their lives and which they see in such short supply in our leaders since his death. As such, sacrilege though it may be, he is deified through the length and breadth of the country as an infallible human being, very conscious and in ultimate control of his own destiny as well as a hundred million or so Muslims in the 1930s and 1940s. As we know all leaders are human beings and they have the qualities and defects that every human being has, the Quaid made his share of mistakes but they were never out of ill-intent. However, in trying to portray the Quaid as without any aberrations, we may be responsible for the cynicism that the international public tend to believe about his personality and person. This adverse feeling has been enhanced by massive Indian propaganda that sees him as the villain of the piece that conspired to divide India and cost the Hindus 50 years of what they fantasized would be their hegemony after a thousand years of domination by the Muslims and then by the British. This lack of hegemony is rankling to the Hindu hierarchy.


China in a bull shop

Nothing can really prepare you for the dramatic change in the Beijing skyline, symbolizing the pulsating beat of China’s sustained economic uplift for the last decade. To hear that growth has “dropped” to just above 8% may seem like a sick joke to Third World countries (and even the four Asian tigers) who would not be averse to standing on their heads to reach that figure. Seeing China for the first time after 1990, at the start of the present economic drive, the six-lane expressway that whisks you into the city from the airport in less than 20 minutes, the double lane road of yesteryear running alongside — and also full of traffic, prepares you only partly for the Chinese miracle. In the centre of the city and as far as the eye can see in a 360 degree circle, there are high rises of not less than 20 storeys going up, maybe a score and even more. There is a dynamism in the air that envelopes you as soon as you are in the city. Where once there were thousands and thousands of bicycles among a few thousand vehicles, there are now thousands and thousands of vehicles but the bicycle has not been forgotten as a primary means of transport. Where vehicles used to comprise of standard-issue trucks, buses and a few cars, they now comprise Mercedes and Audi, Toyota and Volkswagen, Jeep Cherokees, etc and trucks and buses of various origin. Despite the two fast ring roads, elevated for most of the way, there were hints of possible traffic jams, an efficient system keeps the traffic going slowly.


Symbols for Accountability

Contrast the Chief Minister Punjab Mian Shahbaz Sharif, appearing before the Public Accounts Committee (PAC) to answer charges of corruption in the French Minehunters deal, to Ms Benazir Bhutto, required to answer questions raised by her role in the purchase of five secondhand helicopters by the Cabinet Division and refusing to do so. For someone who has a lot to answer for, she can be quite obdurate most of the time, all cooperation, honey and sugar when it suits her. With great fanfare she appeared on April Fools Day before the Nazir of the Sindh Ehtesab Bench case to take bail on a surety of Rs. 25,000, but she still refuses to appear before the PAC. Answering the PAC summons Mian Shahbaz Sharif confidently answered the queries of Maj Gen (Retd) Naseerullah Khan Babar, former Interior Minister in the PPP Cabinet, and convincingly proved to Gen Babar (and the PAC) with the help of his passport that the information given to Gen Babar based on which the General had levelled the allegations, that he had travelled to France to “influence” the French deal, were wrong. With Gen Babar not able to substantiate the charges, the evidence on record was found to be incorrect and the PAC held the allegations to be false, exonerating the Punjab CM. On this Gen Babar did the honourable thing and immediately retired from politics. Both the events are symbolic of the new season for accountability in Pakistan. Shahbaz Sharif deserves kudos for creating precedence, appearance before various forums is not only being avoided on different pretexts by Ms Bhutto but also by Mian Shahbaz’s Sindhi counterpart, Liaquat Ali Jatoi. Gen Babar did us proud by doing the honourable option available for the upright when proven publicly wrong, such things rarely happen in Pakistan, in Japan they would have committed hara-kiri. Not that senior government functionaries should start appearing in every court on every charge but when the inquisition is desired by one’s colleagues of the elected Assembly, the decorum and dignity of that institution demands the presence of those from whom propriety requires answers from, particularly pertaining to their honesty and integrity. Earlier to Mian Shahbaz Sharif’s appearance before the PAC, the PM’s appearance before the Supreme Court (SC) on a contempt of court charge in Nov 97 had symbolically conveyed to all and sundry that no matter how high the office and the mandate notwithstanding, the authority of the Supreme Court of Pakistan transcended any other authority in the matter of dispensation of justice. For politicians who subject themselves to the court of public opinion on a continuing basis, submitting to the authority of the judiciary in an environment that tends to normally manipulate justice, is an important and giant symbolic step for accountability. However politicians are not the only breed that start filibustering every time a court of law asks them to appear for some reason or the other, bureaucrats very seldom make an appearance and that only on very deep sufferance and with great resentment. Since the judiciary is still not separated from the executive, judges and magistrates below the level of the SC and the High Court remain in apprehension of the long arm of the bureaucracy.