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Fresh beginnings
The clash at Rohtak
Message in a bottle |
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China’s assertion of power
Those bus rides!
TURNING POINT: reviving THE flagging economy
‘Indo-Pak business can provide cushion to relations’
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Fresh beginnings
A
new civilian government will replace another civilian government, for the first time in 65 years in Pakistan. Riding on the change will be the electorate’s hope that the Pakistan Muslim League (N) of Nawaz Sharif will be the harbinger of change. Sharif has won a large number of seats and there is no doubt that he will soon be the Prime Minister of Pakistan for the third time. Sharif has tapped deep into his home ground, Punjab, where his party won most of the seats it fought. There is no doubt that the voters wanted a change, which is why the incumbent Asif Ali Zardari’s Pakistan People’s Party was trounced badly, even as Imran Khan’s Pakistan Tehreek-e-Insaf registered wins which were significant, but not as impressive as had been expected in some quarters. Sharif has much to do in Pakistan. He is expected to push Pakistani economy, which has been registering a less-than-impressive growth rate of under 4 per cent a year. The man credited with the Lahore-Islamabad expressway is also expected to give a boost to infrastructure creation and to tackle energy shortages, that have become perennial in the nation. He will need to strengthen various institutions and administrative machinery in the country, without getting into confrontation with the judiciary and the armed forces, something that cost him his second term as Prime Minster when General Pervez Musharraf staged a coup and ousted him in 1999. Sharif’s relationship with the Taliban will come in for greater scrutiny now, and he will have to tackle domestic terrorism, which marred even the recent elections. Internationally, he has taken a populist stand against the US drone attacks in Pakistan, something that his rival Imran Khan, too, opposed vociferously during campaigning. The US-Pakistan relationship is going through a rather delicate phase and Sharif will have to negotiate the best he can with the major geo-political interests in the region. He has spoken about his desire to improve relations with India, and Prime Minister Manmohan Singh, too, has responded positively to these overtures. Clearly the man who will be Prime Minister of Pakistan has much on his plate, he will have to display administrative ability, dexterity and maturity in performing the job. His supporters will certainly hope that he is third time lucky.
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The clash at Rohtak THE violent clash at a village near Haryana's Rohtak town could have been avoided with a little tact and foresight. That trouble has been brewing for the past sometime over the possession of a religious place by the head of a dera was known in advance. Followers of the Arya Samaj have openly opposed the proposed takeover by the dera head, who had remained in jail for 22 months on the charges of murder and attempt to murder before being released in 2008. Since there was a violent clash over the same issue in 2006, this should have alerted the authorities concerned. Posters had appeared in the area waning of a "fight to finish". A call for holding a "panchayat" was given by the Arya Samaj. Yet the police did not take adequate measures to stop the situation from boiling over. The police could have made preventive arrests of Arya Samajis, who came from various parts of the state. Instead, it allowed them to converge at the trouble spot and then used excessive force. Three persons reportedly died in police firing and more than 100 people, including policemen, were injured. The police obviously is not trained to handle volatile situations. Since the order to restore the "ashram" to the dera came from the Supreme Court, the protest by Arya Samajis was unwarranted. The police is duty-bound to help the dera chief get possession of the "ashram". The protesters claim they were holding a peaceful march and the police over-reacted. Only the magisterial inquiry ordered by Chief Minister Bhupinder Singh Hooda will establish who is to blame. The protesters must be made to pay for the damage caused to public property. Police incompetence also must not go unnoticed. Once again, the political and police leadership at the state level has been caught sleeping.
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Message in a bottle THE success of bottled water is a miracle of aggressive marketing that has made us believe in the safety of bottled water. Several studies have been conducted internationally to ascertain their supremacy over tap water under different criteria of purity and safety, yet the riddle continues to perplex. Traditionally, mineral water sold under all sorts of brands is obtained either from the purest of sources like natural springs or spas. For this category of mineral water, bottlers cannot make any changes in its composition, or even chlorinate it. The cheaper variety, sold mostly at dhabas, bus stands etc., is usually obtained from underground reservoirs. This is where the problem brews. With depleting natural springs and rising demand for bottled drinking water, it is the latter variety that is in wider circulation and where pollutants are found, which also include a high level of chemicals used in the purification process. After receiving complaints, Health Minister Ghulam Nabi Azad has written to the food regulators, including the Food Safety and Standards Association, to check the bottling plants supplying such drinking water and also collect water samples from the water collection sites to ascertain not only the quantity but also the source of pollutants. Yet the news about the suspected contamination of bottled water has failed to surprise consumers, who feel that they are always shortchanged because of poor quality control and an ineffective vigilance authority. In a study conducted by the Central Pollution Control Board in Delhi in 2000-2001, coliform bacteria were found in all the five brands that were tested. An earlier study, conducted by the Ahmedabad-based Consumer Education and Research Society found bacteria in all the 13 brands tested. Manufacturers will always claim that their products comply with the standards laid down, but it is for the regulatory bodies to ensure the standards for a basic need like drinking water are adhered to.
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Always remember that you are absolutely unique. Just like everyone else. — Margaret Mead
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China’s assertion of power
THE recent developments in Ladakh are a matter of particular concern, from a country which is known to have expansionary territorial plans against India and skillfully practises a soft speech and strong stick policy. The history of Sino-India relations since the meetings of Pandit Nehru with Premier Zhou in 1954 and 1960, the war of 1962 and constant abuse of the soft-spoken Dalai Lama, the most peaceful and globally respected spiritual leader, without any sign of remorse, should be important considerations in our China policy. The three-week stand-off is over but India has been tested. The five tents, 19 km inside India, were certainly supported by a bigger supply chain. How we deal with the aftermath of the latest incursion is an important issue of perception by the world. If not handled skillfully, it could encourage many more negative forces to operate against India and could lead to more incursions. First, the principle that leads to such incursions into India is the assertion of national power, an important indicator of which is economic progress as reflected in different indices like those developed by Clifford German and Ray Cline. In earlier centuries, a country that attained the status of economic super-power had worked towards it by starting from a base of domestic security. Be it the Great Britain or the United States of America. Once, security is provided to its citizens and its friends, the country flourished economically, attracted talent and foreign direct investment (FDI) from across the world and became a super-power, an economic engine for the world. China has already recorded phenomenal economic growth rates for over two decades and attracts the largest flow of FDI amongst developing countries, amounting to more than US$120 billion per annum. If Hong Kong is included, the annual inflow of FDI is nearly US$200 billion. In contrast, India attracts about US$30 billion annually. The quest to become a super power has China flexing its military muscles, especially in its neighbourhood and aspiring to be the heir-apparent to the global super-power. Consequently, it is a matter of further strengthening its position when it bans rare earths exports or fights with Japan for some small isolated island. In its pursuit to establish its hegemony in the region, India is a convenient punching bag, to recover its image of strength. Be it the building dams on the waters of the Brahmaputra on the Chinese side or developing and managing sea ports across the Arabian sea facing India’s territory, India has maintained a stoic silence. In fact, since 1962 there seems to be a fearful respect for China and Indians are generally perceived to be in awe of their mighty neighbour. There are many cogent theories that are being propounded by learned scholars to explain the behaviour of China. Each theory seems legitimate but misses on an important aspect, economics. Such power displays in the region simply to establish hegemony, pollute the regional environment and distract India in a border dispute can impact the flow of foreign direct investment to India, especially North India. In many investment decisions, especially involving multinationals, proximity to a volatile border or neighbour is a significant negative factor. And even more importantly and concerning is a myth that is being perpetuated that China is unassailable. The situation reminds a normal citizen of the history of Mahmud Ghazni, who also had a myth surrounding him that Ghazni can never be vanquished. How he had prepared and announced the raid on Somnath Temple a year in advance. But, more importantly, there was no military preparation to meet the forces of Mahmud Ghazni when he raided Somnath. Similar is the history of Muhammad Ghori in 1192 AD and the Mughals in 1526 AD. The story of the British conquering India is also not very different. Indian history is replete with instances of lack of military preparedness and diplomacy – basically lack of objectives, vision, strategy and resolve. Consequently, the golden sparrow was bled to poverty, slavery; and social, political and economic exploitation in its own country. China seems to be following Sun Tzu, a renowned war strategist –“The supreme art of war is to subdue the enemy without fighting” and that “all war is deception”. This implies astute diplomacy, a strong army and a strong resolve. Consistent with this strategy is the historical narrative of China: (a) it was the “Middle Kingdom” to which the peripheral kingdoms paid tribute and are therefore an inalienable part of the modern Chinese state. (b) modern China has existed for two millennia, ignoring its origins on the East coast and rule by the Mongol, Tibetan and Manchu dynasties for centuries. In contrast, India has a long history of rule by invading armies and foreign mercantilists. India may have some lessons to learn, the most important being to plan and strategise its objectives. India needs to develop a vision of what our country will be in the next 25 years and beyond. India is steadily growing and the flowing animal spirits should not be deterred and distracted by such events. To aspire to be an economic super-power, India needs to cultivate a perception that the country and the government are strong to protect the investments and wealth within the borders. To ensure such an environment conducive for economic growth and attracting global investment, India needs to introspect and build a strategy for short, medium and long runs. To deter the recurrence of incursions, especially given China’s record on Panchsheel since the 1960s, India should probably assign responsibility of border patrolling exclusively to the Army. Also, probably, the defence budget should be enhanced and a technology-driven border monitoring be considered. Equally important may be the strengthening and re-skilling of the diplomatic corps to meet the needs of a new India. Finally, think-tanks dedicated to geo-political strategic research need to be established. These entail fiscal costs but hopefully will keep India on a high growth path. To consolidate its economic strength built laboriously in the last two decades, the government must ensure a secure environment where countries in the neighbourhood, small or big, don’t bully India, and the global perception of India is that of a strong
nation.
The writer is the RBI Chair Professor, Indian Institute of Management,
Bangalore.
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Those bus rides! WHEN a Facebook friend recently posted a spoof on how overloaded would the planes be if Haryana ever launched a state-owned airlines, my thoughts went back to those golden days of mid-80s, when we as students used to ride Haryana Roadways (HR) bus from Panchkula to Chandigarh. Somewhere around 1985 when Panchkula, as Chandigarh’s satellite town, was still in infancy, Route 84 to 86 of HR, besides Route 30C of CTU, served as a vital link between students residing in Panchkula and educational institutions of Chandigarh. Long gaps between bus frequency, topped by commuter rush, always ensured that bus stops were full and morning routes super-loaded. Students mostly preferred an HR over CTU route for various reasons, the topmost being those ultra-witty and friendly Haryanvi conductors. They always had audience (read students) in splits with their one-liners. Their rustic wit and style was just inimitable. Yes, they were the morning commute showmen. Those were the days when movie theatres were gasping for life and the television was synonymous with Doordarshan. ‘Oye chore, kripyaa aagey ne mar ley. Tere jutti mein ke gond laagi se’ (Hey dude, why don’t ‘please’ go and die ahead. Are you stuck by glue), the conductor’s jovial move-ahead-shout would always bring smiles on many faces. I don’t know why, but what I always found funny was that despite sometimes the bus not being full, students would just prefer to hang onto the rear door of the bus rather than be inside. A sharp word of advice aimed at those dangling dudes would come in fast and furious: Bahar latak key ke krishi darshan dekh reha, andar chitrahaar dekh le (Why watch a peasant’s programme outside when you can watch more colourful programmes inside)? Our droll man in the khakhi would remark with an oblique reference to college-going girls in the bus. The ‘within’ scene indeed was like Chitrahaar, sometimes. Some love stories did blossom as the bus ferried students of both genders. So much to the extent that once a conductor even remarked: “Yo neeli gaadi toh kaamdev ke teer se zyadaa ghaatak sey” (This blue bus is more effective than Lord Cupid’s arrow). The remark had an authority of experience stamped on it. Earthy, sharp, sometimes full of sarcasm. That’s how their sense of humour was. Was it always benign is another point of discussion. I remember how once when two Nigerian students waved an already overloaded bus to stop, the driver slowed, thought for a while and before could hit the pedal again, the conductor shot: “Arrey aage ne chadhaiyo, nazaar na laagey teri bus ko phir” (Ask them to board from the front and no one would then be able to cast an evil eye on your bus). Surely, the reference was to their dark skin but Haryanavi humour, being the way it is, cares two hoots for being politically, culturally or racially correct. Almost every commuter had something funny to narrate whenever those morning rides would come up for discussion. When I shared an anecdote with a friend, he told me how once a conductor asked a 30-something youth to buy a ticket. The passenger while declaring that he carried a student pass could never produce one: “Shakkal se pensionaarthi laagey, tere kaani pass kahan se aa gaya (You look like a pension petitioner, how come you carry a student pass?)” was the quick repartee as our ‘bus man’ made a visual assessment. Later, my commute to the university got faster, sans morning humour, when my dad got me a two-wheeler. The bus ride phase was over yet makes me nostalgic. And I have promised myself whenever I visit India next, I’ll ride a HR bus just to imbibe that rustic wit all over again. Yes, a HR bus ride is on my bucket
list.
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TURNING POINT: reviving THE flagging economy
‘Institutions, not whims, to run the country’
You have handled Pakistan’s economy earlier. In what shape is it today? It is a very difficult situation. For the first time in history, our growth rate is down to 3 per cent, from an average of 5-5.5 per cent for the first 55 years. With population growth rate of over 2 per cent, there is hardly any increase in per capita income. The poverty and unemployment are worsening. This leaves us less revenue, so our fiscal situation becomes bad. With low export, the current account deficit increases. The second problem is the last government has been extremely irresponsible in fiscal management. The borrowings have been unbelievable — the total debt was Rs 6 trillion when the government came, today it has crossed Rs 13 trillion in five years. Debt servicing will consume more than 50 per cent of our tax revenues. The balance of payment has been somewhat more manageable because of remittances — $13-14 billion a year. But then we have to pay back $5 million to the IMF in the next year and a half. Is the Pakistan economy going the Europe way? Not as bad because we still have 3 per cent growth, Europe is in the negative. Our first priority, therefore, is economic revival. If we do not push the growth rate to 6 per cent, no problem can be solved, and to do that we have to revive investment. Investment had touched 20 per cent of the GDP in the early ’90s; now it is 12 per cent, which yields a growth rate of only 3 per cent. So how do you revive the economy? We have said in our manifesto that since there is no single driver of growth, we have to use several mutually reinforcing engines of growth. The first important sector is energy. On one hand you have shortages, and on the other there is potential, and Rs 10 billion investment can come in five years if you change the policy. Second, foreign investment in livestock and energy sector, though foreign investment will take time because of the law and order situation. Third, oil and mineral sector — we have copper mines and other areas where foreign investment can come. Fourth, we have a huge infrastructure gap to fill, including housing. We can also convert some of the remittances from abroad into investment, as India is doing, by offering them opportunities like share percentage, new floatations and special products. Last but not the least, revival of hope and confidence of the business community, at which Nawaz Sharif is very good! How do you go about doing that? Sharif will call a meeting of the business community soon, and tell them, “Look, I want to help you; now things have changed and I have promised good governance, opportunities and a level-playing field.” He has done this in 1991 and 1997. The next task will be correcting the fiscal imbalance by stopping the haemorrhages. First comes the losses of the corporations and the second is unessential non-development expenditure — subsidies, bureaucracy, etc — which our manifesto has said will be cut by 30 per cent. Are you advocating privatising various corporations? Once we put them in shape. Right now they cannot be privatised. A solution is to select people from the business community to manage the corporations, as was done with banks to turn them around. The last government did not appoint chief executives on merit. They were political appointees who interfered in the business. In the first few days, we have to do this. For fiscal deficit, we have to raise revenue, which is a longer-term task. The solution is a massive database of all incomes and access for the revenue authorities to that. Every house or car that is bought should be available on record. Even if we don’t transform immediately, we can start with a cut in the expenditure and raise revenue to some extent. What about going to the IMF? If you go to the IMF in a non-dynamic situation like the present, they say cut subsidies, expenses, but nothing happens. If you revive the economy, then the need for adjustment becomes less. So we first have to revive the economy and make it more manageable. We do not want the traditional IMF package, which is only stabilisation. We want stabilisation with growth. We have done that in 1997. All we need from the IMF is a little more time to pay back the $5 billion that we owe them. What would you do for power? Addressing shortages is one of the promises on the PML-N manifesto. Power is a complex issue. Our manifesto has a short, medium and long-term programme. The root cause of the problem is the 1994 policy of the PPP government, in which they offered 6.5 cents per unit of energy to anyone setting up a power station based on imported oil. This was tragic because in 1991 we had signed the Water Accord to promote hydro-projects because you have to depend on local resources. They added 6,500 MW to the 10,000 MW total capacity at that time, offering an exorbitant price of 6.5 cent base plus cost of oil. At that time oil was $10-15 dollars a barrel, now it is $100. The cost of producing one unit of electricity from oil is now Rs14-15, while it is sold at Rs 9 per unit. India has 70 per cent coal-based generation. In the long run, Pakistan has to improve the energy mix with local resources, coal and hydro. It has to produce electricity at a price lower than the sale price of Rs 9. There is also theft, transmission losses and non-payment of bills, adding 10 per cent to the circular debt. This can be solved through good governance. The other need is major restructuring of the way you buy and sell electricity. India has a wholesale market for energy in which one board buys or sells energy to another even for half an hour. In Pakistan, provincial governments cannot do anything. The system is over-centralised. The security issue is important in Pakistan, as it discourages investment. Given the uncertainty in Afghanistan, what do you think the current government needs to do to address the terror problem? Terrorism has its roots in the Russian invasion of Afghanistan. That is when the Americans set up these madarsas to train Mujahideen. It funded and armed them. They did a remarkable job of defeating a superpower. But what happened, the US abandoned Afghanistan in 1991; and all the seven commanders who were fighting with the Russians started fighting each other for territory. Three years later, soldiers who had fought for them and wanted peace, revolted against the commanders and became Taliban. They then managed to bring peace to Afghanistan, eliminated drugs, disarmed and set up a government. By 1998, they had captured 90 per cent of the territory and actually brought peace. When 9/11 happened, the US invaded Afghanistan. Have they achieved a single objective of invading Afghanistan? There is no peace, no suppression of terrorism, no democracy and no development. And they pushed all the Mujahideen into our territory, telling us to take care of them. It is very tragic. What is to be done now....? First of all, the departure of the US from Afghanistan will create an enabling environment. But then you need a strong government here, which I hope now Nawaz Sharif will provide, with the army and other stakeholders coming on board on developing a common strategy. The strategy obviously has to be a multi-pronged approach. First of all, you have to prescribe the ground rules. We won’t talk to anybody who does not accept our Constitution, judiciary and Parliament. So the writ of the State has to be accepted. Those who do not accept the State will be dealt with militarily; and those who accept it can come to the negotiation table. Hopefully we have a good chance to do this. When you were the Finance Minister, you promoted trade between India and Pakistan. But it has since been stagnating. How does business move forward between the two countries? Pakistan had made significant movement in 2004. For the first time, a decision had been made to move away from its earlier stand that unless Kashmir is resolved, there would be no economic cooperation. CBMs, negotiations and trade started, and the peace process got moving. Unfortunately, extremist activity disrupted the peace process. Secondly, Pakistan did much more in terms of trying to promote its own infrastructure, although the trade balance was in India’s favour. Also our concerns on non-tariff barriers have not been fully addressed. There are a lot of studies that have been done on this subject. The two countries have set for themselves a target of taking trade from $2.5 billion now to $10 billion — India $9 billion and Pakistan $1billion, yet we are ready for it. Pakistan’s business community is anxious to improve economic relations with India. Currently our business houses face problems when they go to India to open outlets. There is a lot of unwritten bias against them at the customs and local official levels. Some kind of mistrust has travelled. What will you do to revive the process? That is related to non-tariff barriers. But Nawaz Sharif has already said he wants better relations with India, which has thus far not reciprocated on many initiatives. This requires a high-level political contact, which could be started in the coming weeks, where we can decide who has to do what. Do you think trade will now be divorced again from Kashmir? Everything has to be discussed. A lot of concessions were made by Pakistan, but without any reciprocation. What is the big change in Pakistan you see since your last government? The democratic process and structure is much stronger. That is a big change. Previously, every time the transition from military rule was in uncertain terms. You were looking over your shoulder for the generals and the judiciary. But now we have a more stable situation. The entire country wants democracy, everybody is interested in elections. We have institutions in place. Earlier, the President could appoint anybody as leader of the Opposition, and anybody could be appointed caretaker Prime Minister, or to the judiciary or election commissioner. Now there is a system, plus free media. That is why the elections were far fairer this time. Elections were also reasonable in 2008 as well as this time because the army was not there. Previously, most elections were managed by the military. This is the first time that democracy has become stronger. The government can now start governing according to democratic principles. It knows its responsibility to the people, and has to deliver. For example, manifestos of parties have been discussed this time, and people have been explained how we plan to implement those. In the PML-N manifesto, we have 32 concrete targets in different sectors of the economy, which everybody is going to remind us of every three or six months. Accountability to the electorate is a healthy thing. You thus see a turning point for a new Pakistan? If the international geopolitical situation allows us, it can become a real turning point, particularly on terrorism and other related problems. If the global interactive circumstances become unfavourable, then of course it will take longer. Yes, it can be a new Pakistan in the sense that we have to do much better now. We are the slowest growing economy, so the first thing to do is to revive the economy. Then the label of Pakistan being a breeding ground for terrorism is not a good thing for us. We have to have a more reasonable situation, for which we need to gain our rightful place in the international arena, but that again requires better geopolitical conditions.
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‘Indo-Pak business can provide cushion to relations’ The Pakistan economy has been stagnant, growing 2-3 per cent over the past couple of years. What has been the impact on the country? Just as in India, when growth falls below 5 per cent there are serious reservations about the country’s multi-party and coalition governments. In today’s world, I think if any developing country starts growing less than 5 per cent, you will have huge issues in terms of provinces being divided and not getting along. These are all symptoms of countries that are not doing well. This is what is showing in Europe also, and these issues are coming up because the economies are not growing. These things create huge problems and pressure. What would you recommend to put Pakistan on the path to high growth? The key issue is that our public sector organisations are losing humongous amounts of money and these are also creating a ground for corruption. An airline or power sector run by the government becomes a matter of patronage for politicians to give out jobs. So the system is broken down to an extent. And if we privatise these, and put them in the hands of people who are beyond the purview of the government, then we may be able to eliminate corruption to a great extent. Which are the areas the government should move out of? There are many: like the procurement of commodities such as wheat and sugar. Why should the government come into play when this leads to corruption, and corruption leads to a point where people who should not be elected get elected. What would be the bold decisions you expect the new government to take? We have already taken those bold decisions — we privatised our telecom sector, banking, and freed up the import and export sector — there are no sanctions to put up any project in Pakistan. So we have the experience of taking bold decisions successfully. Now we need to take them further. The power sector is the biggest loss-making sector, and our railways runs very badly. There are so many entities that the government needs to get out of. The estimate is that our economy has over Rs 1,500 billion worth of leakages in this system. The balance of payment situation is precarious and the new government may be forced to approach the IMF. In the short term, the IMF is a solution, but we really need to fix the economy. For example, India did not have much reserves in 1991, and then FDI started. If we get our act together and set the governance issue right, then we can get a lot of FDI. We also need to open up trade with India. That is not only because it is beneficial for both the countries, but it also gives Pakistan a credit rating we desire. There are so many people outside who want to invest in this country but only after they are sure governance will improve. We might need help from the IMF in the immediate context; otherwise we can handle things ourselves. You mentioned doing business with India as a key initiative. Trade between the two countries has remained well below the potential. What are the reasons? There are lots of people who want free trade with India and there are as many who do not want this. It is the same in India also. Sometimes we are more willing to do it, but India is not. My own companies are also trying to do some business with India but there are so many non-tariff barriers that we face. The Prime Minister of India and the Union Minister of Commerce and Industries are very keen to do it, but there are other people in India who are sabotaging it. We send consignments to India and sometimes all kinds of things come out of our consignments, like narcotics in cement. But in other countries where we export, including Africa, we find nothing like that. It is all managed, I can tell you this. What is the way out to improve trade between India and Pakistan? What we need is to open many more border points, and not one. It’s all choked up and we need to have more routes, including by air. Air India does not fly to Pakistan and the reason they give is that it is not viable to fly between Pakistan and India. If India start the flights, the business will pick up. No flight ever makes money for the first two or three months. We need a consultative body where some Indian businessmen and some of us could sit together and do certain things so that we create our own linkages independent of the government, so that if something happens like the recent jail deaths then we could provide that cushion. I hope the new government will take this up forcefully. But I am worried: if both countries end up with weak coalitions, then it will not be good. Earlier Pakistan used to feel its business would be swamped by India if trade was opened. Also, politicians felt a greater linkage would dilute their emphasis on the Kashmir issue. What is your own assessment? We don’t believe that we would be swamped by Indian business. We, in fact, have stronger institutions, like banking, which is one of the healthiest in the world. It was privatised a while back, while India has still not opened up the financial sector. We have certain logistic advantages too, like for cement production we have limestone. On the manufacturing side, if we are at a disadvantage, then we can fix it by sitting down with India and telling them that certain tariffs will gradually come down in five years to give our people time. In the meantime the Indian market can be opened to our business. Please try to remember that every time trade is opened up between countries, it is the smaller that benefits — in Mexico, Canada and Europe we have seen the same thing, as with India and China. I feel we need to compete more in the interest of our consumers. Maybe we can get Indian partners and investment. And the Kashmir issue… Kashmir is a serious issue. But I think the only way you might have some solution on Kashmir is to actually get closer. You know when we start moving freely from one place to the other, we may become a borderless country. Today who cares if you are in France or in Germany in Europe? We are moving to a situation where in 20 to 30 years people are going to be global citizens. You could be an Indian working for a Russian company living in Australia. So who are you? The old formulae or thought does not hold good anymore. The Tribune, you may know, was the largest circulated newspaper in undivided Punjab before Partition, so our readers have a stake in the region. What can be done to improve trade between the two Punjabs? That’s a very good point. It would benefit both the Punjabs. It happens all over the world. Look at the Americans, some parts of the US and Canada are more intertwined than others. Similarly, I am one of the few people who advocate looking at Gujarat too, which at present we really don’t care about — who runs it and what is happening there. Mr Modi has done a miracle with 11 per cent growth rate. I would suggest we get closer to Gujarat and learn what they have done. Some day, if certain concessions need to be given to Pakistan and Mr Modi is the Prime Minister, chances are he would be in a position to give more because he has always been viewed as a hardliner. So whatever he does people would not question it. I think we need to reach out to our neighbours. When you talk of attracting investment from India, the security situation in Pakistan is a matter of concern. How much impact has that had? It is not as bad as it is made out to be. Today the bad news is only that people want to see the new TV channels. There is a new world that has emerged. I think bringing in foreign investment can actually provide jobs for people. That is one way of reducing the problem of terrorism in this and other parts of the world. And I really think it is in the interest of India that Pakistan should do better. Can you imagine a country of 200 million people in constant turmoil; and Afghanistan is on our border. How will it affect foreign investment coming in to India? We need to do things that make these two countries appear like one, and I think the security issue is an over-blown matter. Once our relations with India get better then it becomes a mirror image for other countries to see.
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Sartaj Aziz has twice served as Pakistan’s Finance Minister during Nawaz Sharif’s first and second terms as Prime Minister. The veteran Pakistan Muslim League-Nawaz ( PML-N) leader was a professor of economics and during his stints as finance minister is acknowledged to have driven Pakistan’s liberalisation and privatisation programme in the 1990s. He is considered a key PML-N ideologue on both economics and foreign affairs.
Mian Mohammad Mansha owns and runs Pakistan’s biggest conglomerate, the Nishat Group, widely regarded as the ‘Tatas’ of Pakistan for the way it conducts its business. With annual revenues of Rs 9,000 crore, Mansha holds diverse and major business interests in textile, banking, insurance, cement, power and aviation. The Nishat Group has operations across the globe, mainly in Sri Lanka, Azerbaijan, the UAE, USA, Hong Kong and Bahrain. Mansha also serves as the chairman of Muslim Commercial Bank (MCB), one of Pakistan’s largest private banks. With Pakistan’s economy becoming a major concern, the new government is likely to treat it as its first priority. Mansha spoke to The Tribune in his office at the MCB headquarters in Lahore.