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analysis disaster “Every
government report Meltdown
or malfunction? issue Baggage of history
analysis It is ultimately always the wretched
of the earth that make history — the problem is that it is the rich and
powerful that write history By Aasim Sajjad Akhtar Following the WikiLeaks revolution, one need
no longer only speculate on the manipulations and simulations that In recent times, a number of ‘regime changes’ have apparently been effected by popular force in many former Soviet republics, and then just this past year in the Arab Middle East. The discourse doing the rounds vis a vis many of these ‘people’s uprisings’ has situated a vibrant and democratic ‘civil society’ in opposition to authoritarian and obsolete bureaucratic states. In Pakistan too, ‘civil society’ rose to the fore against the Musharraf dictatorship (and has continued to gain in prominence since the last general election). The credentials of many of these ‘civil society’
movements are now coming under scrutiny, as it has become clear Lest one think that I am singling out foreigners for special treatment, serious questions can be raised about the role of Pakistani state agencies and functionaries in our very own Pakistani ‘civil society’ revolution. There is now a fairly well-established narrative amongst critics of the so-called ‘lawyer’s movement’ which sees a segment of the security establishment as the movement’s primary patron. This narrative becomes particularly appealing in retrospect given the nature of the Chief Justice’s increasingly dubious disposition towards the elected government. If one moves away from the spectacular and towards the
mundane, the claim that there is more than meets the For the record, I find it utterly objectionable when the elite manipulation argument is taken to its logical conclusion because in such a world there is no agency — for relatively well-to-do people let alone the poor — and political events simply play out like a well-scripted stage production. Even those who rule the world cannot conduct it like an orchestra; I consider society to be an agglomeration of unexpected contingencies. Having said this, there can be no doubting that the
rich and powerful are always prepared to act upon these This then necessarily raises questions about the
extent to which ordinary people can make history in an era when the means
of subtle manipulation have become ever more sophisticated. The pessimists
will moan that agency is fast becoming a pipe dream as we head closer
towards a ‘1984’ dystopia. They will claim that there is virtually no
‘movem I do not think that things are nearly as bleak as the pessimists would have us believe. Indeed, returning to WikiLeaks and cyber space more generally: there is no doubt that it is impossible to regulate information in the manner of the past. Admittedly, control over the mass media entails the ability to manipulate massive flows of information that can only result in one form or the other of absolutism. However, there are also many, many undetectable spaces that can be used to encourage dissent and oppositional political action. Whether or not a Facebook or Twitter ‘revolution’
such as that which took place in Egypt will necessarily possess the
coherence to produce long-term structural transformation is another
question altogether. But even if there was some grand imperial strategy
behind the Tahrir Square protests that toppled the Mubarak regi It is ultimately always the wretched of the earth that make history — the problem is that it is the rich and powerful that write history. While I cannot guarantee that the latter problem will be resolved in favour of the wretched of the earth anytime soon (at least not until an explicit political project emerges to make this possible), I do know that the wretched of the earth will continue to make history. And if humanity is to save itself from a swift and irreversible demise, it will be in spite of those who write history, and because of those who make it. disaster Badin is
a clear example that we have not learnt from By Irfan Mufti Several parts of
Sindh received heavy rains that damaged human lives, property, crops and
essential infrastructure in at least 3 districts namely, Mirpurkhas, Badin
and Mithhi. Badin was the worst hit by torrential rains where the Understandably, the torrential rains created havoc. Ninety percent of the population has been affected and many have lost their homes, crops, cattle and other family assets. According to an estimate, about 6 people died and more than 600 injured. 150000 people are directly affected in Badin district. About 19956 houses and 81000 acres of cultivable land also damaged. Cotton and sugarcane crops have been the worst affected which will probably result in more poverty and starvation in coming months with people losing their livelihood and day-to-day sources of income. Infrastructure and communication systems have also been damaged. Diarrhea, malaria, and other waterborne diseases will need to be dealt with. 18000 families have lost their livelihood and hardly surviving. Out of 403 schools, about 300 are seriously damaged in tehsil Golarchi alone. 408 kilometers of roads link are also damaged in the same tehsil. About 2597 villages and crops over a large swath of land were flooded when more than 49 breaches occurred in the Left Bank Outfall Drain (LBOD) along with over 28 saline water drains and irrigation canals. Main Left Bank Out Fall Drain passes from Badin and brings agricultural and industrial drain water from left side of Indus River into the district and then discharges the same in the Arabian sea. During heavy rains, these drains overflow or breaches occur, forcing water flow to crop land and settlements causing population displacement, cattle and infrastructure. LBOD since its inception has done more harm than good to local communities in the district. Faults in design and poor construction quality of drain channels have backfired, damaging settlements in it catchment areas. The authorities concerned should look at this issue and find possible solutions. While it is true that events caused by nature cannot be controlled, it should be remembered that one can always prepare for the worst by taking pre-emptive measures. The presence of the LBOD aggravated the heavy rain into roaring floods. This human error factor cannot be ignored while we will be assessing other factors of such disasters. Thousands of people migrated to safer places after heavy rains lashed the area, compelling district administration to impose emergency. Camps were set-up by the district government in local school buildings and empty government offices. Most of these responses were slow and unplanned. Provincial and district disaster management authorities were nowhere to be seen. There are more than 150 relief camps set up in Badin only, in which hundred and fifty thousand people are housed. Conditions of these camps are very poor as most of them are without basic facilities like water, latrines and food, including baby food. An acute shortage of nutritious food for babies and children is also reported by local volunteers. Pregnant women were not provided proper food that increases risks of miscarriages or other pre-natal complications. Life-saving drugs and medicines are in short supply. Local philanthropists, humanitarian groups and active civil society organisations are supporting most of the camps but their support is much less than actual need of the displaced population. Large number of activists and voluntary organisations are doing a credible job in providing food, medicines, tents and other relief goods but need support that has not yet started coming to this forgotten area. Out of 150 relief camps, only 14 relief camps are provided water through tankers. These camps are located in towns and district headquarters whereas the rest of the camps are without proper hygiene conditions and facing acute shortage of water. In just seven days 21 children, seven male and five female have died due to gastro and other epidemic diseases. Many people were injured due to roof collapse in temporary camps. Thousands of people are still trapped in affected areas and no arrangements have been made by the local authorities to rescue them or provide food and drinking water. This is nothing new as reflections from last years’ flood and relief and recovery efforts tell similar stories of neglect and man-made factors of disasters. What is important here is that we are still not learning lessons needed for a better disaster management and relief rehabilitation work in the post-disaster phase. For the last two decades southern parts of Sindh have seen more than their fair share of natural disasters — the rains of 1994, the cyclone in 1999, the rains of 2003 and 2007, the floods of 2010 and the 2011 heavy rains, floods and cyclone. Ironically, local official systems are still not averse to dealing the basic needs of affectees in such disasters. Just one year after the floods of 2010 relief and disaster management systems again failed to provide respite to helpless people. In recent years, the country has witnessed a number of major disasters and humanitarian crises which have caused untold miseries. The impact of earthquake in 2005, cyclone in 2006 and 08, and floods in 2010 are still being felt by the affected communities. It must be understood that such disasters not only bring sufferings and miseries for people countries have to pay economic, social and political costs too. In case of these disasters the cost was heavy and systemic and the people haven’t yet fully recovered from those shocks. A serious debate is needed on the capacity of our disaster mitigation and management systems and structures. The last few years have been very turbulent facing disasters but every time the system fails to deliver. This discussion is also needed in the backdrop of the worst ever floods in the recent history in August 2010 which affected the lives and livelihood of over 20 million people. It is also a fact, on the other hand, that it is not easy for a government to cope with the challenges of management of disasters all by themselves. International agencies, educational and scientific institutions, the corporate sector, community-based organizations, and the civil society have an important role to play. The disaster in Sindh once again opens up discussion for a comprehensive disaster management policy in Pakistan. Such a policy should highlight a paradigm shift from the erstwhile relief-centric response to a proactive prevention, mitigation and preparedness-driven approach. The major thrust areas should be to mainstream disaster management, which means ministries and department should prepare plans which should result into measures both structural and non-structural. The writer is Deputy Chief of South Asia Partnership Pakistan and Global Campaigner irfanmufti@gmail.com
“Every government “Workers in Pakistan in general and Punjab in particular are the most oppressed lot in SouthAsia” By Salman Ali and Tayaba Kanwal Altaf Baloch has
lived an eventful life working and fighting for the cause of labour unions
and paying a price for it in The News on Sunday (TNS): Tell us something about your early life? Altaf Baloch (AB): I am from a small village near Sargodha, the village has been renamed as Kot Musa Khan. I belong to a middle class family. I received my early education from a local school and appeared in the matriculation examination but was not able to get through due to some problems in my family. Later, I came to Lahore and joined Technical Center Mughalpura but left the institution after some time and worked in a textile mill in 1960 but didn’t stay long. I joined a private company in 1966. That was a turning point in my life. TNS: How did you come to the idea of forming a labour union? AB: Ayub Khan was in power and labourers had started speaking for their rights. Workers also demanded increase in salaries and asked for other benefits from the owners and from the government but owners did not listen to them. We came out on the roads and protested against the Ayub regime. But, sadly, Yahya Khan took over and martial law was imposed. We had to call off our strike and also lost our jobs. After negotiations with the labour officer of the company where I was working, we eventually came back to our positions. After a few weeks, my labourer friends were arrested for staging protests. Different punishments were given to them and shoot-on-sight orders were issued against me. I was going to attend a conference in Layyah when my friends Professor Amin Mughal and Malik Shamim Ashraf came to me from Lahore and informed me that I was on the hit list of the regime. I didn’t attend the conference and came back to Lahore. It was election time and Zulfikar Ali Bhutto was running an election campaign. Bhutto promised to me that he would work for the rights of labourers if he comes to power. I consider it as my first step in labour union politics. TNS: What was your experience with the Sharifs while you were working at Ittefaq Foundries? AB: When I was arrested and released from jail after a month the company didn’t allow me to work there again. So, I found work at Ittefaq Founderies at Kot Lakhpat. Nawaz Sharif was the chief minister of Punjab at that time. Sharifs were against forming labour union. When I raised my voice and formed a union they beat me up and some of us were kicked out though our union had been registered. TNS: You remained in jail for fifteen years? What is that story? AB: It was a fake case registered against me. When I rejoined the private company with my friends I was heading the union and later we were divided into two groups as some misunderstandings had developed among us. Abdul Rehman, who was my friend and a union leader was murdered on 30th April 1974 at Ferozepur Road. Some of the comrades at that time implicated me and a case was registered against me and my friends. They charged nine other people who we didn’t know. So, FIR was registered against 19 people. The trial started on 30th April 1976. When the judgment was to be announced the Judge of Sessions Court gave a stay order. The next hearing was to be held on 8th May 1976 at Camp Jail. So, on 8th May 1976 I and Khushi Mohammad were awarded death sentence while other people were acquitted. I was being kept in Kot Lakhpat jail. The next day, a number of labourers staged protest in front of the jail. So, due to security reasons I was shifted to Sahiwal jail. The decision of Sessions Court was challenged in the High Court and then in Supreme Court. Eventually, my death sentence was abolished and replaced with imprisonment. The most important time in my life was when the people who had accused me of committing the murder said sorry to me for their actions. I was released from the jail in 1989. I thank those who supported me during my jail years, including Abid Hasan Minto, Tahira Mazhar Ali, Habib Jalib, and Mir Ghous Bakhsh Bizenjo, among others. TNS: Which political party, if any, supports labour unions and works for them? AB: In my view, there is only one political party which has worked for the rights of labourers and I will not hesitate in saying that it is the Pakistan People’s Party (PPP). I personally believe Zulfikar Ali Bhutto was a great leader who always worked for our rights in any situation. So, that time can be called an era of freedom for labourers. TNS: The Punjab government has recently introduced a new labour law (PIRA). Do you think the law truly represents labour rights? AB: The Punjab government has recently passed a new labour law which I personally believe is simply against labourers’ will. Some trade unions have met and they have decided that they will not accept this new law. As we study Section 3 (1) of the Punjab Industrial Relations Act 2010, which abolishes workers’ right to form a union in an establishment where less than 50 workers are employed, violates ILO Convention 87 and Article 17 (1) of the constitution. This section must be repealed. Workers of around 4,200 brick kilns in Punjab are likely to be excluded under this section from the ambit of law and from forming lawful unions. The new Punjab labour law reduces the number of ‘outsiders’ allowed in a union’s executive from 25 percent to 20 percent. This will harm the workers’ right to derive strength from the society wherever a union lacks expertise. The trade unions regret the failure of the Punjab lawmakers to define the role and obligations of ‘contractor’. We also protest against the fact that the law approved by the Punjab Assembly is less friendly to labour than the Ordinance it was asked to debate and turn into an Act. TNS: What effects the 18th Amendment will have on labour legislation in your view? AB: The Punjab Assembly passed the law after the right to legislate on labour was handed over to the provinces under the 18th Amendment. Labourers want a national labour policy. It was a demand of the time and we forced the government to pass 18th Amendment. But the government did not take other stakeholders into confidence while passing the 18th Amendment. Some trade unions have already challenged the provision of the 18th Amendment that abolished the system of labour legislation at the national level. They say that workers in major public sector enterprises had not been consulted in the legislative process that had a direct bearing on the terms of employment. Workers have serious concerns that funds for workers’ welfare, such as EOBI, which are now to be handed over to the provinces, are being squandered on excessive salaries and perks for bureaucrats. TNS: It is a perception that trade union movements have long lost their steam. Do you agree with the view? AB: I completely agree with that. Trade union movements are on the decline because of policies of the government. Today, the government has failed to deliver. Workers in Pakistan in general and Punjab in particular are the most oppressed lot in all of South Asia. Labour unions are a natural pressure valve for societies. Those who allow this valve to operate properly avoid bloodshed and social unrest. Great Britain is perhaps one of the best examples in this respect, where the labour class was co-opted and made a stakeholder in national progress, politics and governance. Proper labour laws should be introduced by the government and a good friendly relation should be kept. Labourers should also form unity in their ranks to be able organise themselves at regional levels. TNS: Do you think labour unions have been able to play any role in Pakistan? AB: As we know, labour unions have played a very vital role in many parts of the world. In Pakistan, trade unions have not been recognised as an essential component of society. Every government suppresses trade unions and imposes restrictions and sanctions on constructive activities of trade unions. It is my firm belief that had there been freedom to form trade unions there would not have been economic crises which we are facing. With the help and support of trade unions we can enhance production of the industrial sector. An analysis of interviews with 14 people belonging to the violence affected areas By Arif Hasan In the month of
August, I interviewed 14 persons belonging to the violence affected areas
of Karachi to get their I noticed the change between my conversations with some of the same people last year and in August this year. Last year, most people I spoke to were not willing to criticise the dominant political party in their area or the party that represented their ethnicity. In August this year, almost all of them criticised the parties that represented their ethnicity and other parties as well. It seems that the terrible conditions in their areas have forced them to take a bigger view of the situation. It has forced them to think differently and has made them comparatively free of fear in expressing their views. This is a positive sign and can be built on. People’s views The impact of violence The fear of kidnappings and killings have become real so one is afraid to leave home and does so only if absolutely necessary. Social activities have come to an end. People are afraid to send their children to school. Before sending them one has to listen to the TV, go and check the neighbourhood to see if the road is open. Younger children can no longer go and come from school alone as they used to before. As a result, many parents no longer send their children to school. When one is away one receives phone calls from the family all the time to check if one is safe. This raises the telephone bills considerably. Being held up in a bus and robbed has become normal. Also, young men and women (most of them in their teens or early 20s) are forcibly taken to public rallies. Those who dissent in anyway are threatened, roughed up and occasionally killed. Parents live in constant fear for their grown-up children. The banning of motorbike pillion-riding has had disastrous effects. It has doubled the transport costs of those who have motorbikes. For those who do not, it has meant a considerable increase of people using mini-buses. As a result, an increasing number of people have to ride on the roof of buses. Women are the worst affected since they cannot do this. There has been a considerable reduction of working women due to violence and transport-related problems. As a result, incomes have fallen. A lot of cheap artificial plastic weapons are available in the settlements for sale. Children play gang wars with them. Their idols are the gang leaders. As a result, there is a lot of bulling and violence among children. Many of the children are terrified and cannot sleep at night. Inter-ethnic friendships have gone. People look at each other, even at an individual level, with hatred and suspicion. Even mosques are divided on ethnic lines. Many people have stopped working in areas where their rival ethnicities are in control or in institutions and offices controlled by them. If they continue to work there, they live in fear. This has led to an increase in unemployment, poverty and further fragmentation of society. People no longer have any faith in the police or rangers. There are numerous cases where the relatives of the victims know who the killers are, the police also have registered their names in the FIRs. Yet, these assassins are roaming around free and without fear. This leads to revenge killings which are becoming common. Power now belongs to those who have and use weapons. These are young unmarried individuals 18–22 years old. As a result, use of liquor, drugs and sex-related crimes and prostitution have increased and so have forced conversions to Islam of religious minorities. As a result, family structures have collapsed and the father is no longer an authority figure. Cells in ethnic parties now settle community and family disputes regarding property, crime, marriage, divorce. As a result, government institutions dealing with these issues have become redundant and increasingly corrupt. Their “fees” have gone up as their “clients” have gone down. The politics of violence Much of the violence is for changing the demography of those constituencies where there is an unequal mixed ethnic population into a homogeneous one so as to guarantee an election victory. This changing is carried out through terrorising the population by indiscriminate firing, forcing them to leave and target killing a few of them. It is also done by purchasing properties (offering above market rates or coercing families to sell) on the main corridors of movement and then “suffocating” the population at the back. The transfer of 2 to 3 thousand votes from one area to another in many cases can change the election results in a number of constituencies. Various examples where this has already happened are well-known. The battle over the local bodies system for Karachi is less over the ideology of the system or its need and more about who benefits in an election process through which system. If the city is divided into districts (as it was before Musharraf’s system), then the PPP and ANP will be the beneficiaries. If two more districts are carved then, depending on the new demarcations, they may benefit even more. One party supports the completion of building of the Lyari Expressway while another party opposes it but not for technical reasons but for the fact that if the surviving trans-Lyari settlements are removed one party loses a large number of votes in two constituencies. Bhatta Bhatta has always been taken as zakat/fitra. Before it was as a religious obligation but now it is extorted. Voluntary chanda was given to the MQM in a big way in its early days. Some of the collectors became extortionists and are now part of a larger bhatta mafia. People became fed-up of giving chanda so perhaps extortion became necessary. Before the extortionists went personally and asked for bhatta. Now they send a parchi. Sometimes one receives more than one parchi from different sources. If you ignore the parchi, you are threatened with death or kidnapping of your near one. If you still ignore it, the kidnapping takes place or you are killed. More recently, failure to comply results in a hand grenade being thrown at your shop. As a result of this, small businesses belonging to those communities that were in a minority in certain neighbourhoods have moved to areas where their ethnic population lives. This is a process of ethnic cleansing and helps in determining election results. Lyari gangs also took and take bhatta. They had conflicts over it. Rahman brought the gangs together. As a result, there was comparative peace in Lyari. After he was killed, the gangs resurfaced. The Aman Committee has tried to bring them under its wing but Lyari has now become politically divided. Earlier in Lyari intercity transporters (passengers) used to come. Their adda was here. The local gangs used to charge them bhatta in exchange for protection and use of space. The police had a share in it and so protected this activity. The adda was shifted to Yousef Goth in 2006 after which the local gangs lost this lucrative access to bhatta. So they started to collect bhatta from the markets of the old town. Here, they clashed with MQM supported bhatta extractors. Cargo in the form of fruits, vegetables, Afghan transit trade items, Iranian petrol still come to the old city areas. Bhatta is charged from them and is a source of conflict between different groups. Market adjoining Lyari are a big bhatta market most of it controlled by MQM which is not happy that others should encroach on their presence in this area. Gangs also tax drugs, gambling dens and property transactions. They give no bhatta to the police as they are stronger than them but used to give it 6 to 7 years ago. Land and properties Revenue land and the Goth Abad scheme process is used through bribes and coercion to manipulate land records to an extent where on paper the location of Goths is changed making the actual Goths legally landless. The new settlements created through this process are ethnic in nature and are protected by the ethnic parties and are a part of the turf booty. In certain cases, people who claim to belong to political groups have told the local estate agents that if any property is up for sale, they should have the first right of purchase. Estate agents who have not followed this course have been warned and a few of them killed. Buildings under construction used to pay bribes to the Karachi Building Control Authority (KBCA) during construction to get approval for various stages of development. Now they pay the bhatta mafia as well and in an increasing number of cases only the bhatta mafia who “permits” them to violate rules and regulations. In the old town and in all areas where there is a possibility of profits, there is considerable pressure and coercion for house owners to sell their properties to developers. In addition, there has been large-scale encroachment on formally and informally developed properties, including houses and apartments. Money is asked for vacating them. Settlements of these disputes have been taken to political parties who have charged a fee for settling them. Even a property belonging to the High Court near Khuda-ki-Basti has been encroached upon with the help of political parties. Drug and car business money is being invested in this real estate business since it brings the largest profit in the shortest period of time and also increases the political powers of the groups involved in this business. In both businesses fraudulent documentation is used and people are regularly cheated in the process. Where do we go from here? What is given above are the views expressed by individuals whose lives have been disrupted by violence. Perhaps there are inaccuracies and misconceptions in them but this does not matter. Public sector and social reform cannot take place unless the causes and repercussions of violence and conflict are understood from the point of view of people who face and react to them. This reform can only be done through the holding of at least 5 to 6 hundred public hearings of various interest groups and on that basis developing broad recommendations which can be fine-tuned to create a new governance structure and societal values and to lay the foundations of institutions for providing the people of Karachi (keeping in view that it is also the capital of Sindh) with security, livelihoods, appropriate education, transport and recreation. Since the old institutions have collapsed, it is important to initiate this process. The broad parameters for it can be discussed. It is now increasingly acknowledged, both in India and Pakistan, that a major cause for the Partition of India in 1947 was the lack of generosity on the part of the Indian National Congress and a lack of trust on the part of the Muslim League. The same lack of generosity and trust was, to a great extent, responsible for the separation of East Pakistan from Pakistan, the Sri Lankan conflict and the Beirut civil war. It is also behind the failure of the Israelis and Palestinians to come to a settlement on the basis of justice and equity. On the other hand, Mandela was able to prevent a civil war in South Africa because of his immense generosity which led to the creation for trust between two communities that had between them a history of cruelty, hatred, intolerance and violence. The political protagonists in the Karachi conflict must take a lesson from Mandela and rise above their petty turf and election-related interests so that a sustainable peace for the city can be achieved. Such a peace cannot be manufactured through administrative tinkering or army action. The writer is an architect, planner, and social researcher based in Karachi Email: arifhasan@cyber.net.pk
Had there been a sound mechanism for keeping an eye on account books on the corporate sector of US, its financial crisis could have been averted By Syed Nazre Hyder The issue
regarding the role of external financial auditors in managing good
governance of the corporate sector by The whole process of auditing is highly demanding, as it requires careful scrutiny of the financial statements, according to the audit codes and procedures with full mental alertness and integrity. If the auditing standards and procedures are followed meticulously with alertness and integrity, the auditors’ role has overriding impact on not only establishing a sound framework of good corporate governance but also has deep implications for overall performance of the economy. The issue of audit quality, transparency and ethics has drawn again a fresh consideration regarding the rotation of audit firms after a specified period of engagement and not the audit partner, though among a very limited circle of legislators in developed countries, academicians and the auditors’ administering institutions, in view of the recent international financial crisis. It is believed that had there been a sound mechanism for keeping an eye on the account books in the corporate sector of US, its most serious financial crisis could have been averted. The same conviction may be noticed in the speech delivered by Jan. F Qvigstad, Deputy Governor, Central Bank of Norway in a seminar arranged by Peace Research Institute of Oslo (PRI). He was of the view that international financial crisis “has revealed weaknesses in the financial system” which lacked financial sector regulations to be observed by the accounting firms. On analysing the factors responsible for the recent global financial crisis, it may be concluded that besides a few other factors, non-observance of auditing standards and ethics was basically responsible for the worldwide meltdown which is considered next to the Great Depression of Thirties. Tracing down the causes of the international financial crisis, some considered the collapse of Lehman Brothers in US, as a major factor exacerbating this world wide phenomenon as result of maneuvering of its accounts books by its management to create misleading financial position of the firm in collusion with their auditors which led to their collapse. The Lehman Brothers were a global financial service firm, which was engaged in multifarious financial businesses such as investment banking, investment management, equity and fixed income sales, including its primary business of dealing with US Treasury security market. It was the fourth largest investment bank in the US with 25,000 employees worldwide prior to its bankruptcy in 2008. The report revealed that Lehman Brothers was practicing shuffling of bad assets by loaning to other firms in exchange for short term, at quarter ending. It was also further stated in the report that Lehman, which was unhealthy for a while, cooked its audit books in collusion with its audit firm for window dressing. By such means the auditors shed $ 39 billion at the end quarter of 2007 from its balance sheet, $ 49 billion in the first quarter of 2008 and $50 billion in the second quarter of 2008, to make it look impressive to the stakeholders, credit rating agencies and regulators. On the leakage of these facts, it ignited exodus of its clients on a massive scale resulting drastic losses to it in stock market and devaluation of its assets. It caused colossal financial losses to Lehman Brothers, marking the largest bankruptcy in the US history which shook the country’s financial system to the core. Its “collapse was a seminal event that greatly intensified the 2008 crisis. It is widely viewed as watershed moment in the global financial crisis contributing to the erosion of close to $ 10 trillion in market capitalisation from global equity markets in October 2008, the biggest monthly decline on record at the time”. The factor behind the failure of Lehman Brother was the accountancy fraud by its auditors which shook many sectors of a number of countries ultimately infecting severe recession in US and subsequently spreading it in a sizeable number of countries of the world. This most serious occurrence shaking the world makes us highly conscious to look afresh whether the stringent regulatory framework adopted by the US framed under commonly called Sarbanes-Oxley Act and followed by many developed countries, could avert audit fraud of such a high magnitude leading to corporate debacle. This experience draws attention to the adoption of the principle of rotation of audit firms in the code of corporate governance of countries. The issue seems to have greater significance in case of developing countries where the audit procedures, its rules and institutional arrangements are not as sound as in developed countries. The objective is to ensure the interest of the corporate sector and of the shareholders of the listed companies against any corporate debacle either on account of any financial scandal or accounting failure. There is no doubt that the major factor responsible for worldwide financial meltdown originated on account of most spectacular and shocking balance sheet manipulations by the auditors of the Lehman Brothers. The International Chamber of Commerce (ICC), which is against the principle of compulsory audit firm rotation, conceded that it had been adopted or was under consideration by a number of national governments. In a recent important move, the European Commission, while considering a radical structure of the audit industry expressed their plan to introduce mandatory rotation and caps on advisory services. Their Commissioner, Michel Barnier in his policy statement stated that “the demise of big five firm Anderson, following the 2002 Enron scandal, demonstrated that the risk of a large auditor collapsing was not academic”. He suggested that “with audit firms, as with other sectors, the status quo is not an option, the status quo will not be an option for the European Commission”.
The
bigger question is whether By Raza
Rumi Pakistan’s
state of free fall, as some observers are wont to note, is a result of its
engagement in the war on terror at the behest of Western ‘allies’.
Critics of Pakistan’s stated policy of cooperation with the US note that
since the The narrative so far has been stymied due to an excessive reference to our geo-strategic delusions of grandeur, the harmful impact of US’ policies in the region and the culpability of Pakistan’s civil-military elites in putting foreign interests before domestic priorities. Pakistan’s media, partly influenced by the security establishment, has also placed excessive premium on foreign policy and has, as a result, fanned conspiracy theories, an inevitable result of reducing national debates to partial and narrow concerns. The disproportionate focus on our geo-strategic location shows how effective the ‘national security’ paradigm as an intellectual endevaour is. Debates and op-eds (in English and the vernacular), books on Pakistan authored by foreign and local academics and journalists alike and other drivers of public opinion appear to be more concerned with the US pullout date from Afghanistan. Little or no attention is paid to Pakistan’s fragile economy or the abysmal performance of the state when it comes to delivering basic services, including security, as guaranteed by the country’s Constitution. Reform reversals: The current government has taken some major steps towards improving governance. The 18th Amendment and amendments (after 110 years) to the infamous ‘Frontier Crimes Regulation’ are commendable. At the same time, however, the federal and provincial governments seem uninterested in reviving the local government system, reorganising and training the police force and fostering better accountability mechanisms. There are also no signs of the government revamping the near-defunct prosecution services in the country. In addition a number of major reform reversals have taken place in the past three years. Packing up the local governments: The local government system initiated in 2001, at a hefty cost to the treasury, was unceremoniously abolished by the democratically elected government in 2008, without an informed assessment of its viability or effectiveness. The provincial elites, aggrieved by the manner in which the military junta had imposed devolution on Pakistan, undermined local governments in sheer haste. Evidence from around the world and especially from the Asia-Pacific region indicates that well-functioning local governments improve service delivery over time. In our case, we have uprooted what was achieved in a decade and have yet to devise an alternative. The bureaucratic control of local councils may serve short-term political interests of provincial politicians but in the long run the same politicians will face a credibility deficit due to the unmet public expectations on the delivery of basic services. Police reform undone: Despite all its flaws, the Police Order of 2000 attempted to replace an archaic, colonial law drafted in 1861. Ideally, the Police Order 2000 could have been improved and its flaws ought to have been corrected by the provincial legislatures. Instead, the provinces thought it wise to let the bureaucrats devise proposals which were only formally ‘vetted’ by the elected representatives. As a result, today we have a situation where the accountability mechanisms of the 1861 law are defunct and those enacted in 2000 seem to have been forgotten even before they could be tried and tested. Pakistan’s growing lawlessness and the increase in terrorism should have made enacting police reform top-priority of the rulers. Unfortunately, this has not been the case. Karachi has a shortage of Police personnel. Those available are not trained to deal with urban guerrilla tactics, increasingly employed by highly trained criminal gangs. In Punjab, Police was unable to handle the attacks on Sri Lankan cricket team and the Sufi Shrine of Usman Hajvery. Surprisingly, the police has not been held accountable for its failures either. Or if it has, the results have not been made public. Lack of accountability reinforces the common view that Police officials manage to evade accountability because of their political capital and patronage-based networks. In Khyber-Pakhtunkhwa (KP), Punjab and Sindh Police reorganisation cannot be delayed further unless the state has decided to outsource its writ to criminal gangs, militant outfits and terrorist-rings. Sadly, there seems to be no sense of urgency. There is an overall business-as-usual approach in Pakistan. Prosecution services? It has not been adequately highlighted that all provinces enacted new prosecution laws during 2003-2006. In summary, there was a move to make the prosecution services independent from the police and Home departments due to an inherent conflict of interest. Furthermore, resources were also allocated to hire more prosecutors given the abysmal state of prosecutorial services at the district level (where most litigation takes place). Subsequently, new prosecution departments or wings were set up to address this challenge given that no investments were made by the state in this vital area of criminal justice. The ownership of this limited reform was diluted due to political changes. It is tragic that such important issues of public interest are subjected to political contests and myopic concerns of the officialdom. KP’s Information Minister is on record for stating that only 2 percent of the suspected terrorists are actually convicted. Similar statements have been made by the executive while the senior judiciary has time and again reminded everyone that without effective prosecution and evidence they have no choice but to acquit the accused. This neglect of prosecution — historically willful (powerful interests want to keep the judicial outcome ‘under control’) — is allowing for dangerous terrorists, arsonists to roam free and is emboldening the ever-growing number of militant outfits. It is tragicomic to note that there are only a handful of forensic laboratories in a country of 180 million people with a real problem of crime and terrorism. Since the British left, the Pakistani state has paid little attention to developing its forensic capacity. Legal system and the courts: Pakistan’s robust movement to protect the superior judiciary from the excesses of a military ruler, have ignited hope for quick and inexpensive justice. The judges in all fairness came up with a national judicial policy (NJP), which has shown some good results in terms of case disposal. However, given that millions of cases are pending, there needs to be a radical reassessment of the NJP. Pakistan has to make immediate headway in implementing alternative dispute resolution (ADR) techniques, taking the example of Singapore, Malaysia and several other countries. Outdated civil and criminal procedural codes are treated as sacrosanct in Pakistan and other South Asian countries. In effect, they have proven to be incapable of delivering speedy justice. Trials still linger and innumerable injunctions define the judicial process. The lawyers, court clerks and in some cases judges of the subordinate courts are direct beneficiaries of this system, which is essentially anti-citizen and more significantly anti-poor. The lawyers movement of 2007-9 has not translated into an outcome oriented reform of the bar councils, lawyers’ conduct and the implementation of legal aid provisions under the statute. Pro-bono legal aid is rare and recent efforts to sabotage the legal aid centre created by the highly respectable Justice Nasir Aslam Zahid and his associates, has only exposed that political mobilisation of the legal profession was more to do with finding a space in the power-matrix than improving the legal system or achieving the much touted ‘rule of law’. If anything, the media has been reporting on the excessive use of violence and intimidation against judges, rival lawyers, police and revenue officials and media personnel. It is mind-boggling how rule of law can be achieved with the current state of the legal profession? Anyone for economic growth? There is now growing evidence that suggests that the rule of law and effective institutions contribute to higher levels of economic growth, participation and if tailored with enabling policy choices, higher employment level as well. Pakistan’s misfortune has been cited again and again. Its two neighbours — India and China — are moving towards the status of economic giants and our state policy has yet to focus on high economic growth. There are serious issues of poverty and inequality to be handled alongside the quest for economic growth. However, in our case growth has barely kept up with the pace of population increase. There is little or no discussion on how to change Pakistan’s institutions and structures for better economic performance. Instead, the populist media line that sells is how the Zionists are undermining Pakistan’s economic potential! The truth is that our military leadership has made it clear in recent days that ‘national honour’ is more important than ‘prosperity’. The civilians pay some lip-service to the cause of economic growth but have changed the governor of state bank thrice; and shuffling the Finance Ministry’s leadership is become a routine affair. A small effort has been made by the Planning Commission under its dynamic Deputy Chairman with the drafting and approval of an economic growth framework. However, there is not much public interest in it. Pakistan’s minuscule pool of economists and social scientists have either shrugged it off or refrained from generating a debate. Essentially, this framework also talks about reform and improving the institutional climate. Our savings rate is the lowest in the region and the investment rate has declined consistently. With the law and order situation worsening and increasing uncertainty, the economic situation may not improve. Reforming the justice system, the civil services and the way the public sector transacts business is an urgent priority. Our engagement in the war on terror can distract us but surely it should not lead to sideling the agenda for institutional change. The bigger question is whether Pakistan’s elites are interested in reform or not? In the past, they have displayed no real effort aimed at social change. But this time their existence is at risk given the apparent state of free-fall. Is it not time to rethink their historical mistakes and strive for a more secure and prosperous Pakistan? The writer is a policy adviser and journalist based in Lahore. His writings are archived at www.razarumi.com. Follow him on Twitter: @Razarumi caption In need of some real training.
There is no quick fix for Karachi’s problems but a beginning has to be made, now By Abid Qaiyum Suleri Karachi is yet
again on fire and the events have happened in quick succession.
Unfortunately, this is not happening for the first time in Karachi’s sad
history. The violence of the 1990s is widely attributed to General Ziaul
Haq’s policy of divide and rule. The echo of accusations against MQM
(then Mohajir Qaumi Movement) that it was being supported by General
Zia’s dictatorial regime to counter the PPP and other Sindhi nationalist
groups, keeps on Even today, many think that the level of peace in Karachi is directly proportional to MQM’s share in the power pie. In other words, any challenge to MQM’s power claim can leave Karachi blood-stained. This theory is quite powerful but again falls short in telling the whole truth. I keep on writing that perceived individual deprivation and marginalisation, when it gets a collective identity — be it ethnic, political, sectarian or any other — immediately creates two distinct groups: a group of victims who are being oppressed and a group of oppressors. In societies with ample resources of livelihoods, such as democratic values, sufficient fiscal cushion for social safety nets, and minimum standards of good governance, the basic needs of everyone are met to some extent. In such societies the deprived and privileged classes may mutually co-exist without violent conflicts. However, in a situation where resources are scarce, democracy becomes non-functional; state is lacking fiscal cushion to provide social protection and there is no concept of good governance or rule of law. In such a situation, a collective identity to individual deprivations would immediately lead to a class conflict that may turn violent at any time. The current violence in Karachi is a living example of this. The unprecedented violence has got ethnic, political, sectarian and criminal reasons. Karachi is ethnically diverse but still a major hub of native Urdu-speaking people. The competition for scarce resources between Urdu-speaking population and Sindhi-speaking, between Urdu-speaking and Pakhtoon population, and between Urdu-speaking and Baloch is a reality. The conflict between perceived marginalised and perceived oppressors has turned violent and is one of the major causes of recent “tit for tat” target killings. Karachi is also held hostage by the political conflict — MQM versus MQM Haqeeqi, MQM versus PPP, ANP versus MQM; and the love-hate relationship between MQM and PML-N. These have turned the situation extremely volatile. The power struggle is geared to not only monopolise the scarce resource-base of Karachi but also to control the administrative and law-enforcement machinery (through political postings and transfers) that would help in gaining access to those resources. No wonder, in order to protect the interests of their constituents, MQM has to remain part of the ruling alliances be it with PML-N, as “B” team of a dictator, or with PPP. By virtue of its access to power corridors, MQM has managed to put an unwritten ban on creation of new political parties in Karachi. MQM-Haqeeqi tried to emerge as an independent political group and the result was violence and target killings. Pakhtoons were welcomed in Karachi as long as they remained economic immigrants. However, their emergence as political power under the auspice of ANP led to violence and target killings between MQM and ANP. The PPP and MQM’s marriage of convenience seemed to work in the beginning but when PPP started interfering in transfers and postings in Karachi and when PPP’s People’s Aman Committee started challenging the street power of MQM, the result was bloodshed and violence. A deeper analysis reveals that the existing political set-up in Karachi is not only intolerant to creation of new political parties but it is also intolerant to any non-political player who has the potential to change the existing voting pattern divided along loyalties to MQM, PPP, ANP and other smaller but established players such as PML-F and PML-N. This is where the conflict and violence takes a sectarian twist. Killings of leaders of Sunni Ittehad and those of Dawat-e-Islami reflect sectarian root causes of violence. Attacks on Edhi establishments and its ambulances, though not sectarian in nature, highlight intolerance of existing power brokers towards emerging group that has the potential to challenge their political hegemony. The struggle for control of power in Karachi did not remain confined to ballot boxes. Most of these political parties draw their power and resources from non-political and criminal gangs involved in drug trading, land grabbing and extortions. There are areas and zones divided among gangsters. Any encroachment in their territory by an opponent group leads to bloodshed and violence. Even if these gangs are not being run by politicians, the latter do provide patronage and support to individual gang members belonging to their respective parties. Evidence produced by Zulfiqar Mirza against MQM, MQM’s diatribe against People’s Aman Committee, and tit for tat allegations of MQM and ANP against each other reveal that all three major players in this arena have some role to play in supporting and fostering criminal gangs that are threatening the very fabric of Karachi. There are also talks about involvement of either foreign (CIA, RAW) or/and domestic spy agencies in flaring up recent violence in Karachi. However, I am not very convinced of these theories (at least in the context of current crisis). The power seekers in Karachi are already self-sufficient in mutual destruction and don’t depend on provocation from any agency to put their city amid the flames. The fact that Karachi is threatened by multi-faceted violence necessitates multi-faceted solutions too. Karachi requires short, medium and long term measures and all of those measures should be implemented simultaneously without wasting more time. An over-simplistic solution like asking the army to restore peace in Karachi would never work in the medium to long term. Army or rangers may help in curbing gangsters and their activities but that would simply mask the symptoms which may reappear once the army hands over Karachi’s control to civilian agencies. One needs to wait and see the real impact of current surgical operations by rangers. However, these operations should be backed up by some medium and long term measures too. One should remember that army is not meant to clean the mess created by flawed political decisions. The political forces should adapt to a genuine political process to rectify the consequences of their short-sightedness. Dialogue with a view to understand each other’s point of view; a resolve not to support and patronise criminals and not to politicise the police and provincial bureaucracy; tolerance towards emerging political groups; and a political will to provide space to local leadership through local government elections are some of the steps that political forces should take to save Karachi in the long term. De-politicisation of Karachi police in particular and provincial bureaucracy in general is a must. Merit-based postings and transfers of officials should help achieving this objective. These institutions need to be reformed to remove the perceptions of social exclusion and marginalisation among diverse groups present in Karachi. The best way to de-politicise these institutions is through providing an assurance to public servants that their lives and jobs would not be at stake for following the rules and procedures. This assurance should come from the top leadership of all the political forces who have a claim in Karachi’s power corridors. This leadership should understand that prevailed violence in Karachi may be the last nail in the coffin and the whole democratic set-up may get wrapped up if they did not show political maturity. Another most important measure that would ensure durable peace is de-weaponisation of society. In short term, de-weaponisation would entail confiscating all weapons being used against innocent people. However, long term de-weaponisation would mean demilitarisation of our minds and attitudes so that we may strive for a society completely free from torture, violence and weapons. A durable solution to Karachi crisis lies in formulating and implementing policies and procedures that may reduce individual deprivations and marginalisation and, in turn, promote social justice. The writer heads Sustainable Development Policy Institute and can be contacted at suleri@sdpi.org caption Smokescreen. Home|Daily Jang|The News|Sales & Advt|Contact Us| |
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inform the business of ‘high’ politics. The inability of governments
and private corporations to censor the plethora of information that
circulates in cyber space has effectively changed the rules of the game.
Or has it?
that they are not as autonomous as once thought. In the cases of ex-Soviet
republics like Georgia and Ukraine, there is now not insignificant
evidence of Western government support for many ‘civil society’
initiatives. One is not taking refuge in conspiracy theories when pointing
out that the US government — to take the most prominent example — is
pursuing what its development assistance arm USAID calls a ‘democracy
promotion’ agenda throughout much of the third world. This agenda
entails the development of linkages and provision of funding to the media,
professional associations, and even political parties.
eye to political events appears to become even more compelling. Take, for
example, Zulfiqar Mirza’s recent ‘outbursts’ against the Muttahida
Qaumi Movement (MQM). Given how close the former Sindh home minister is to
President Zardari, and the fact that he decided to ‘break’ with party
policy a second time even after having been ‘disciplined’ by the
hierarchy, it is difficult to believe that there is absolutely no method
to Mirza’s (read: the Pakistan People’s Party’s) madness.
contingencies so as to perpetuate their agendas of domination. In the
post-Cold War world, a host of new strategies of domination have emerged
which rely less on the use of brute force and much more on subtle
manipulation and social engineering. Everything from ‘humanitarian
interventions’ to the afore-mentioned ‘democracy promotion’ has been
tried, both by superpowers in their pursuits of Empire and authoritarian
post-colonial states seeking to crush dissent.
ent’
that cannot be penetrated by the establishment, no cause that can remain
untainted by emergent contenders for absolute power.
me,
the point is that the Empire had no way of being able to programme exactly
how Egyptians would think and react once the ripple effect started.
rain started on 9th August and continued for 46 hours without a pause,
which disrupted normal life in the district. For consecutive two days, the
district received an average of 190mm of rain and Mithhi received 291mm of
rain in just one day.
the shape of spending many years in jail. He has supported working class
movements through his efforts, standing against martial law regimes and
never hesitating to speaking the truth for workers’ rights. The devotion
to his cause made him a prominent worker and labour leader in trade unions
in the 1960s and 70s. Baloch believes that labour unions are important
pillars of a society that can uplift the economy of a country and add to
the means of production. The News on Sunday sat with him a few days ago
and sought his views on the state of labour unions in Pakistan.
views on the situation in their neighbourhoods and their perceptions for
the reasons for it. These persons are not active in politics though a
number of them are social activists and CBO members. The persons
interviewed belong to different areas and ethnicities. I have removed some
of their biases to generalise their comments, although the specifics are
perhaps more important, but expressing them gives an impression of being
one-sided. A more detailed paper will hopefully follow with examples and
case studies.
maintaining high standard of auditing, has assumed importance again,
especially during recent years due to a number of audit scandals and
failures of serious magnitude at the international level.
policy U-turn in 2001, following the ghastly events of 9/11, we have
invited only anarchy and terror in the country. There may be some truth to
such rhetorical assertions given our peculiar history. Pakistan has been a
victim of its policy choices in the 1980s as well, when it became the
frontline state in its war against Communism and the ‘evil”
Soviet Empire at the behest of the United States.
revisiting us.