Financial Management and Ghalib


Mirza Asadullah Ghalib was the greatest poet of his time and quite a large number of his poems are not only prophetic but also fit on the events in Pakistan. Mirza Ghalib once went to meet the Resident Governor of Delhi. The Governor questioned him, are you a Muslim. Ghalib’s reply was I am half a Muslim, I do not take pork but I do drink liquor and wine. This depicts Ghalib’s character and his entire dewan é the collections of his poems describes the conditions of Musalmans during those days of mutiny of 1857. In fact It was the Indian Muslims strength for Independence which later culminated into Pakistan in 1947.

Mirza Ghalib use to drink to the extent of being a drunkard but at the same time his best poems are when he use to be in high spirits. As the story goes Mirza Ghalib once went to bazaar to buy groceries, he spent the whole amount in buying wine and liquor and brought them home, when his wife questioned him about other items, his simple reply was God has promised food and not wine. So, I bought liquor with the money available with me and God will provide the other items.

So, this was Mirza Ghalib and his couplet cited above, fits on all fours with the events in Pakistan, soon after the assassination of Quaid-e-Millat Liaquat Ali Khan. After the death of Liaqat Ali Khan, it was a free for all for the politicians, who wanted the largest chunk from the body of the infant state. The worst thing that could happen was the migration of the All India Muslim League leaders from their homes to this Eldora’ do, which according to them they had founded and then wanted to reap the harvest. In 1949 the value of one American dollar was around Rs. 3.00 and the British pound was around 5.00. This did not fit in the scheme of things of the arbiter’s of the fate of Pakistan. They invested more and more in foreign currency to travel abroad and live in right royal moughal style, because they were promised Pakistan of a proud nation, which had snatched Independence from both Hindus and the British. So there was no alternative but to fall into the loan trap. Instead of aggrandizing the nation and making use of the wealth, which nature had endowed Pakistan with. The rulers discarded the advice of the Quaid and the first loan was taken in March 1952 from the International Bank for Reconstruction & Developments ( World Bank ). Pakistan also became the Member of IMF on 11th July 1950 with a promise to receive aids for imports which later turned into debt liability. All this money taken on loan was spent in providing luxury to the politicians and the bureaucrats instead of spending on nation building activity. How true was Mirza Ghalib when he said é ” Qaraz ki pittey they mein. ” Liquor and wine were never banned in the Islamic Republic of Pakistan right from 1947 till 1976 when Prime Minister Mr. Zulfikar Ali Bhutto had to ban the use of liquor and wine on political grounds. As a matter of fact in the days of the so-called glory of 1958 to 1967 Night Clubs were galore in the cities of Karachi, Dacca, Lahore and Islamabad, where more wine was consumed than water. By and large this is how the dollars obtained as loans have been consumed in Pakistan and has over burdened every single Pakistani with debt liability of which they have never been informed. Our simple people only know how to pay taxes, to let the rulers live in royal moughal style. The political inadequacy, the demon of provincialism, the lust of power and the colonial type of misrule led to the dismemberment of Pakistan in 1971 and emergence of Bangladesh. The student leader Shaikh Mujeebur Rehman of 1947 became the father of the nation of Bangladesh.

It is a pity that the potential adequacy evaporated from the minds of our politicians and the rulers to the extent that Mr. A. K. Fazalul Haq, a popular Musilm Leaguer from East Pakistan, who moved the Pakistan Resolution in 1940 at Lahore was dubbed as a traitor by Mr. Mohammad Ali Bogra, who was appointed Prime Minister by Mr. Ghulam Mohammed the then Governor General of Pakistan in 1954, not only this Shaikh Mujeebur Rehman, the popular leader of East Pakistan was arrested in Agartala conspiracy case and released was later arrested by General Tikka Khan as a traitor. Later on General Tikka Khan, the then Chief of the Army Staff slauted the same Shaikh Mujeebur Rehman as President of Bangladesh, when he visited Pakistan to attend the 2nd Islamic Summit at Lahore in 1974. Another veteran Muslim Leaguer Malik Mohammed Qasim was arrested on high treason only for writing a letter to the Chief Election Commissioner of Pakistan to fulfill his responsibility under the constitution by holding general elections in Pakistan, as the national convenor of the Lawyers Action Committee and later he was absolved of this charge when MRD was launched against the regime in 1981. These are the antiques of rulers and politicians whose activities are for them and their party and not for Pakistan and its nation.

1972 saw the establishment of another democratic government in Pakistan with a civilian Chief Martial Law Administrator and the President of the republic vested in one person, parallel of which is not found in the annals of history, the government continued to live on borrowed money which kept on mounting, and in 1977 a loan of $ 2.2 billion has risen to $ 9.65 billion in 1980 and now it is $ 37 billion. Nearly 47 % of the revenue goes to debt servicing, Pakistan is rated to be the highest debt servicing borrower of IMF and World Bank, while some other borrowers of the third world have to pay 7 % or even 1 % of their revenue to service their debt liabilities. How true Mirza Ghalib was when he said “Qaraz Ki pittey they laikin samjhtey they haam raang laigee hammari faqah masti aikdin.”

This is only the trait of Pakistani administration that we borrow to pay an earlier debt with pride and thus the debt keeps on rising like a recurring decimal. In order to shed the debt burden it is imperative that Pakistan ask for a moratorium for at least 20 years and utilize the amount required for debt servicing for nation building activities. Reduce the expenses drastically, if necessary foreign travels of politicians and bureaucrats and if we mean business even of the players must cease. There was an advice given by Mr. Chou en lai, the Prime Minister of China and Second in Command to Mao Tse Tung to the then President of Pakistan Mr. Zulfikar Ali Bhutto that instead of building his international stature, he should try first to build a strong Pakistan, that advice was conveniently ignored and scraped at the alter of personal ambition of the ruler to go down in history as a world statesman, and it was gallows that were seen, fate has these turns.

Premier Chou en lai of China use to live in a three bed room apartment and would travel to his office in Great Peoples Hall on his bicycle, where the official limousine would be available to him for state purposes and not for personal use, can we not borrow a leaf from China’s book and emulate the example of Caliph Omar, who had to account for to a commoners question for the extra three yards of cloth used in his new dress, there is no royal road to survival. For that matter a royal road has never been a source of strength for nation and the country after having learnt from Mirza Ghalib. Let us now stop drinking on loans.

Ban the imports of luxury items, rather the imports of all items which can be produced indigenously, this will provide establishment of factories and create more jobs for the manpower which is now engaged in car snatching and robberies and other criminal acts. This will also reduce the imbalance in our balance of payments. If only this item is worked out squarely and strongly, half the battle is won.

Whatever may be our tall claims about foreign and local investment, yet its an admitted fact that investments are shy, the foreign investors are reluctant to invest in Pakistan for more than one reason, the top most reason being that the law & order situation is not conducive for any investment whatsoever. It is a talk of the town that nobody is safe. Let us ensure the safety. One window operation has been the promise of every successive government since the days of democracy, even they could not deliver the goods, the official rigmarole and running from pillar to post emanating from the corrupt bureaucracy makes the investment shy. The government must stem this ignoble factor in our national life in order to attract more and more investment leading to smooth running of the wheels of economic productivity.

All economic policies must have a stamp of stability, what has been happening in our unfortunate country is that a political government formulates a policy more for the benefit of the party in which the country is also benefited to some extent and at the end of the term this policy is reversed by the successor government. The investor is alarmed at this change, he is not sure where to invest, if the investor can not get the return on his investment the investment is not worth its while. This is the major obstacle to investment local and foreign.

All cultivable land must be brought under the plough and given to the tillers of the soil, as land belongs to the tiller of the soil. Extend Income Tax on agricultural income without any expediency. Abolish the rule of 2 % minority of landlords, Sardars, Vederas, Shaikhs and Chaudhris, so that the majority of Pakistanis and the tax-payers live in comfort and above the poverty line. The government should develop the National Tax Number (NTN) culture, which should be a bye word for every citizen of Pakistan as is the National Identity Card.

The stock markets instead of being the hand made of speculators should act as guide of the investors who are normally fleeced by the smart speculators. This tendency in the stock exchanges must be corrected by use of electronic and print media and through the policies enunciated by the stock exchanges to educating the masses and promote investment culture in Pakistan.

The government should take effective measures to stop Hawala culture in the foreign remittances. At the moment what happens is that the remittances for export proceeds have to be received within 120 days. Most of the time it happens that the exporter on account of circumstances beyond his control can not receive payments from foreign buyers within 120 days, then what happens is that he has to forgo the exchange rate difference of the time of its late receipt to the prevailing rate of exchange on previous 120th day when it was due and thus he is forced to fall back to hawala system through which he arranges his payment on 120th day and keeps the late payment out of the country for better returns. If the government gives some incentives for remittances received in Pakistan through banking channels. It will go a long way to improve the remittance position of Pakistan.

Over the years the position has been that the business class and the salaried class have borne the brunt of the taxes and therein also the discretionary powers of the taxation authorities have created wild riot in the tax administration and revenue collection. The Chief Executive is reported to have said very wisely that he is going to reduce the contact between the taxpayer and the tax collector, this will go a long way to minimize malpractice and corruption on the part of the tax authorities.

The interest on Export refinance is yet another agitating factor for the exporters who are the people to reduce the balance of payments widening gap, generate revenues, promote and utilize the utility services and also generate employment in the country. As a matter of fact the exporters are the orphan children of the economy of Pakistan, who work for themselves and earn for the country valuable foreign exchange without any assistance worth the name from the government in spite of a huge bureau of export promotion to boot. The interest rate on export refinance has been enhanced from 8 % to 10 % or more with an enhanced export target and that too with increase in utility charges, telephone charges, patrol charges and postal charges, as a matter of fact the postal charges have been doubled. Let not the government fix unattainable targets with back breaking loads of extra cost in input to enable the exporters to take part in the international markets at a competitive prices, then and only then the foreign exchange can be earned, export targets can be achieved and the balance of payment deficit reduced.

Pakistan should seek a moratorium on foreign debts for at least ten years and arrange low interest loan of five billion dollars to give a jumpstart to our ailing economy. It is our firm opinion that with a moratorium of twenty years or more Pakistan can not only use the debt servicing on nation building activities and reduce the government expenditure with austere hands. The foreign debts to pay off the installments of the previous loans. No nation can survive with this fiscal policy which has been followed by our rulers in the name of democracy. Moratorium would be a very bold and drastic step for the survival of the country, we need bold, drastic and revolutionary steps to save the country from a bigger revolution, which is knocking at our door. There is going to be a vast change in the economic policy all over the world, recession is on the anvil, let us prepare our selves, tighten our belts to face the International economic challenges.

Mr. Ali Ashraf Khan is a Pakistani Businessman and Ex-Politician who bid good bye to politics in order to concentrate on more useful service benefit of the political intrigues prevalent in the National Political life of Pakistan. He frequently writes for English and Urdu newspapers in Pakistan.


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