Why Forex Reserves?
Ishrat Hussain September 9, 2002
#55 Posted by Puri on April 12, 2006 11:47:39 am
A Brief Happening of events:
Irfan Iqbal Puri, tortured to extract money, officials driven by greed of reward and appreciation. Irfan was subjected to a total six months of illegal arrest including two months of a 24 hours a day solitary confinement, which also contains a 14 days period at The Attock Fort, in a 4ft x 7ft dark death cell, Irfan was not shown day light for the 14 days at The Attock Fort, was physically, mentally and verbally abused to the limit, perhaps treated as an Indian spy (They are Kept in these cells).
Irfan, was victimized for pure pleasure and greed,
1. A businessman of repute carrying on businesses among others as a member of the Karachi Stock Exchange, Oil Trading, Tank Farms for Oil Storage, Software development, Property Development, etc... Prior to his arrest on December 15, 1999, the victim carried out businesses in Pakistan with Hard work, integrity and acumen, the victim at an age of 37 had earned irreparable reputation for honesty and fair play in all his dealings, national as well as international.
2. NAB without making any good faith investigation or inquiry, which was obligatory on them, arrested Irfan, on December 15, 1999 from his office at Karachi, (On the Jan 16, 2000, the victim was forced to sign some per-dated documents, at Malir).
3. The arrest was not based on reasonable grounds. The victim was never informed of the grounds of his arrest. He was detained at Malir Cantonment for about seven weeks until February 12, 2000, then was shifted and kept at National Accountability Bureau (NAB) Police Station at M.P.A. Hostel Karachi. On February 27, 2000, he was shifted to Attock Fort where he was confined until March 11, 2000 and on which date he was shifted back to Karachi.
4. At Malir Cantonment, he was interrogated several times by the Joint Investigation Team, which included army personnel, and F.I.A. members of the Joint Investigation team searched and collected extensive records of the Companies in futile endeavor to find evidences of corrupt practices on the part of Irfan Puri. The thrust of inquiries and investigation related to foreign currency accounts and evasion of income tax. Irfan, maintained and explained that in view of the Tax Amnesty Scheme announced by the Chief Executive, General Pervaiz Musharaf, on December 15, 1998 and in view of the provisions contained in the protection of Economics Reforms Act 1992 there was no warrant or justification on the part of the Joint Investigation Team to investigate and inquire about his foreign currency accounts and income tax matters. In course of this investigation, it further appeared that Irfan, was detained due to a malicious complaint by one Mr. Mohammad Taufiq El Khattani motivated by enmity and greed for extracting money from his ex-employer, Saudi Pak LPG. Mr. Khattani was pressurizing him to use his business influence on Saudi Pak LPG to which he did not agree.
5. During his confinement at Malir Cantonment, he was kept in Solitary Confinement with effect from January 15, 2000 until he was shifted to the NAB police station situated at M.P.A. Hostel Karachi.
6. Due to extreme agony and distress caused by his detention, both mental and physical health of his wife was gravely affected and his wife suffered a miscarriage.
7. Time and Time again his wife Naveen Puri through her lawyers requested NAB through letters, fax etc to inform of the grounds of arrest and to allow clarification of any alleged Corruption of which he may have been accused. But NAB never informed the grounds and substance on the basis of which the he had been arrested. NAB had no valid ground for his arrest and detention.
8. On February 12, 2000 he was shifted to Nab Police Station at M.P.A. Hostel Karachi where he was kept in Solitary Confinement without any facilities. He was not allowed to meet anyone and was neither provided with proper food or medical facilities despite requests, which were of utmost importance as he is suffering from heart problem since his childhood. Here too he was extensively interrogated and was threatened that his family members would also be arrested if he would not agree with them.
9. ON February 27, 2000, Irfan was flown to Islamabad and was then taken to Attock Fort. There he was confined in a solitary cell, measuring about 4 feet x 7 feet with 18 feet high walls. There was a yellow zero watt bulb on top of an extensively high ceiling and a flat sheet steel door. Light was such that he could not even read the Quran. he went through a series of interrogations at all hours of the day and night. As a form of torture he was forced to keep his hands above his head for hours and was manhandled, pushed/thrown from one to another with a sack covering his head, was subjected to the worst verbal, physical, mental torture. He was threatened with dire consequences, including risk to his life and his family members. Sleep deprivation methods were used upon him. He would be taken out of the cell at odd hours and his head covered with a black sack/hood and a band tied over the hood around his eyes and army men holding him by his arms for interrogation purpose dragging him to another room where he would be interrogated for hours on end. Time and time again he would be asked what his family members were willing to pay to save his life. They would threaten him that if he would not pay up his family members would also be arrested and brought to Attock Fort, the family received phone calls at odd times, also in the middle of the nights and by FIA/NAB officials giving threats, and calling for family members to visit the NAB office/FIA center.
10. After spending 14 days in this death cell without seeing light, Irfan was allowed to meet his father and wife in light and in presence of army men, where his father told him that the NAB officials have been making phone call to Irfan’s father asking him to come over to the NAB offices, that was the final breaking point where Irfan asked his dad to hold it for two days and that Irfan will try is best to settle one way or the other with NAB… if only one could imagine what this meant to Irfan…
11. Since his unlawful arrest he underwent extreme mental torture leading to a complete nervous breakdown and deterioration in his childhood heart condition. He lost more than 12 kg in weight.
12. He finally broke down under threat intimidation and coercion and it was in such a state that he agreed to make payment of sum of Rs. Three Hundred Million to the NAB.
13. After his verbal agreement at Attock Fort to arrange for payment of Rs. 300,000,000/-, he was brought to Karachi on PIA flight from Islamabad in handcuffs on March 11, 2000. The Plaintiff saw sunlight for the first time since he was brought to Attock Fort when he was taken out of his cell without any cloth covering his eyes.
14. At NAB Police Station in Karachi he was threatened, pressurized coerced to agree in writing to the payment of Rs. 300 million, of which Rs. 100 million had to be paid in advance before his release. He was told, “there is no law just pay up”.
15. The FIA and other staff of NAB started visiting the offices and house of Irfan from day to day and harassing the staff members and hindering work, rather making it impossible to run a business. The offices were surrounded by FIA, NAB, Rangers` officials and military personals demanding the remaining payment and threatening dire consequences otherwise. The abuse stretched to a point where some senior office executives were made to strip naked by removal of all clothes hence torture and harassment to unparalleled height.
16. He was also coerced to hand over property documents as “security” for payment of the remaining amount of Rs. 200,000,000/- (Rupees two hundred million). Hence, had to hand over original property documents over to NAB of five (5) properties which actually have an aggregate value of Rs. 400,000,000/- (Rupees Four Hundred Million)..
17. Even after all this, NAB did not release him, but kept him under house arrest / unlawful detention until June 14, 2000.
18. Whilst Irfan, was under house arrest two dozen Rangers were stationed around the clock in and around the house.
19. Irfan, ultimately released from house arrest on June 14, 2000 after 3 months. Total captivity being six months, had several meetings with General Amjad, and suggestions made by Irfan, resulted in savings of over a billion rupees in Oil imports.
20. General Syed Amjad made many promises/ commitments in the name of justice that money extracted from Irfan Puri would be returned to him. General Amjad appreciated and understood that grave injustice had been done, both in private and in presence of various individuals.
21. Irfan, in frustration filed a number of court cases against NAB, FIA, etc, giving the ordeal of the experience gone through, as a result, bogus Income tax/Wealth Tax demands have been issued by the department on the behest of NAB officials visiting the department forcing tax officers to issue demands.
22. Irfan, then also had meetings with General Khalid Maqbool the new Chairman of NAB for justice but regrettably no action was taken.
23. However, on the 17th of May 2003, General Munir Hafiz (as NAB Chairman) visited Irfan`s house in Karachi to meet with his family, Said ``all you have seen of NAB is tha hard side, I want to show the family the softer side of NAB``, during the earlier meetings that Irfan had with General Hafiz, Irfan was told a number of times by General Hafiz that he would arrange for a face to face meeting with General Amjad, Himself (to witness) and Irfan, however, when Irfan asked General Hafiz, as to when the meeting would happen, General Hafiz said ``The meeting can`t take place, I would not want to embarass the General (General Amjad)``.
General Hafeez, on his visit was Kind, straight fowrard, and honest, however, he asked Irfan to withdraw legal prodeeding against NAB, and that NAB would make sure Irfan benefits in other areas, or else.... you can`t fight us.
23. He also sought an appointment with Chief Executive General Pervaiz Musharraf, without success.
Still goes on...
Irfan Iqbal Puri, tortured to extract money, officials driven by greed of reward and appreciation. Irfan was subjected to a total six months of illegal arrest including two months of a 24 hours a day solitary confinement, which also contains a 14 days period at The Attock Fort, in a 4ft x 7ft dark death cell, Irfan was not shown day light for the 14 days at The Attock Fort, was physically, mentally and verbally abused to the limit, perhaps treated as an Indian spy (They are Kept in these cells).
Irfan, was victimized for pure pleasure and greed,
1. A businessman of repute carrying on businesses among others as a member of the Karachi Stock Exchange, Oil Trading, Tank Farms for Oil Storage, Software development, Property Development, etc... Prior to his arrest on December 15, 1999, the victim carried out businesses in Pakistan with Hard work, integrity and acumen, the victim at an age of 37 had earned irreparable reputation for honesty and fair play in all his dealings, national as well as international.
2. NAB without making any good faith investigation or inquiry, which was obligatory on them, arrested Irfan, on December 15, 1999 from his office at Karachi, (On the Jan 16, 2000, the victim was forced to sign some per-dated documents, at Malir).
3. The arrest was not based on reasonable grounds. The victim was never informed of the grounds of his arrest. He was detained at Malir Cantonment for about seven weeks until February 12, 2000, then was shifted and kept at National Accountability Bureau (NAB) Police Station at M.P.A. Hostel Karachi. On February 27, 2000, he was shifted to Attock Fort where he was confined until March 11, 2000 and on which date he was shifted back to Karachi.
4. At Malir Cantonment, he was interrogated several times by the Joint Investigation Team, which included army personnel, and F.I.A. members of the Joint Investigation team searched and collected extensive records of the Companies in futile endeavor to find evidences of corrupt practices on the part of Irfan Puri. The thrust of inquiries and investigation related to foreign currency accounts and evasion of income tax. Irfan, maintained and explained that in view of the Tax Amnesty Scheme announced by the Chief Executive, General Pervaiz Musharaf, on December 15, 1998 and in view of the provisions contained in the protection of Economics Reforms Act 1992 there was no warrant or justification on the part of the Joint Investigation Team to investigate and inquire about his foreign currency accounts and income tax matters. In course of this investigation, it further appeared that Irfan, was detained due to a malicious complaint by one Mr. Mohammad Taufiq El Khattani motivated by enmity and greed for extracting money from his ex-employer, Saudi Pak LPG. Mr. Khattani was pressurizing him to use his business influence on Saudi Pak LPG to which he did not agree.
5. During his confinement at Malir Cantonment, he was kept in Solitary Confinement with effect from January 15, 2000 until he was shifted to the NAB police station situated at M.P.A. Hostel Karachi.
6. Due to extreme agony and distress caused by his detention, both mental and physical health of his wife was gravely affected and his wife suffered a miscarriage.
7. Time and Time again his wife Naveen Puri through her lawyers requested NAB through letters, fax etc to inform of the grounds of arrest and to allow clarification of any alleged Corruption of which he may have been accused. But NAB never informed the grounds and substance on the basis of which the he had been arrested. NAB had no valid ground for his arrest and detention.
8. On February 12, 2000 he was shifted to Nab Police Station at M.P.A. Hostel Karachi where he was kept in Solitary Confinement without any facilities. He was not allowed to meet anyone and was neither provided with proper food or medical facilities despite requests, which were of utmost importance as he is suffering from heart problem since his childhood. Here too he was extensively interrogated and was threatened that his family members would also be arrested if he would not agree with them.
9. ON February 27, 2000, Irfan was flown to Islamabad and was then taken to Attock Fort. There he was confined in a solitary cell, measuring about 4 feet x 7 feet with 18 feet high walls. There was a yellow zero watt bulb on top of an extensively high ceiling and a flat sheet steel door. Light was such that he could not even read the Quran. he went through a series of interrogations at all hours of the day and night. As a form of torture he was forced to keep his hands above his head for hours and was manhandled, pushed/thrown from one to another with a sack covering his head, was subjected to the worst verbal, physical, mental torture. He was threatened with dire consequences, including risk to his life and his family members. Sleep deprivation methods were used upon him. He would be taken out of the cell at odd hours and his head covered with a black sack/hood and a band tied over the hood around his eyes and army men holding him by his arms for interrogation purpose dragging him to another room where he would be interrogated for hours on end. Time and time again he would be asked what his family members were willing to pay to save his life. They would threaten him that if he would not pay up his family members would also be arrested and brought to Attock Fort, the family received phone calls at odd times, also in the middle of the nights and by FIA/NAB officials giving threats, and calling for family members to visit the NAB office/FIA center.
10. After spending 14 days in this death cell without seeing light, Irfan was allowed to meet his father and wife in light and in presence of army men, where his father told him that the NAB officials have been making phone call to Irfan’s father asking him to come over to the NAB offices, that was the final breaking point where Irfan asked his dad to hold it for two days and that Irfan will try is best to settle one way or the other with NAB… if only one could imagine what this meant to Irfan…
11. Since his unlawful arrest he underwent extreme mental torture leading to a complete nervous breakdown and deterioration in his childhood heart condition. He lost more than 12 kg in weight.
12. He finally broke down under threat intimidation and coercion and it was in such a state that he agreed to make payment of sum of Rs. Three Hundred Million to the NAB.
13. After his verbal agreement at Attock Fort to arrange for payment of Rs. 300,000,000/-, he was brought to Karachi on PIA flight from Islamabad in handcuffs on March 11, 2000. The Plaintiff saw sunlight for the first time since he was brought to Attock Fort when he was taken out of his cell without any cloth covering his eyes.
14. At NAB Police Station in Karachi he was threatened, pressurized coerced to agree in writing to the payment of Rs. 300 million, of which Rs. 100 million had to be paid in advance before his release. He was told, “there is no law just pay up”.
15. The FIA and other staff of NAB started visiting the offices and house of Irfan from day to day and harassing the staff members and hindering work, rather making it impossible to run a business. The offices were surrounded by FIA, NAB, Rangers` officials and military personals demanding the remaining payment and threatening dire consequences otherwise. The abuse stretched to a point where some senior office executives were made to strip naked by removal of all clothes hence torture and harassment to unparalleled height.
16. He was also coerced to hand over property documents as “security” for payment of the remaining amount of Rs. 200,000,000/- (Rupees two hundred million). Hence, had to hand over original property documents over to NAB of five (5) properties which actually have an aggregate value of Rs. 400,000,000/- (Rupees Four Hundred Million)..
17. Even after all this, NAB did not release him, but kept him under house arrest / unlawful detention until June 14, 2000.
18. Whilst Irfan, was under house arrest two dozen Rangers were stationed around the clock in and around the house.
19. Irfan, ultimately released from house arrest on June 14, 2000 after 3 months. Total captivity being six months, had several meetings with General Amjad, and suggestions made by Irfan, resulted in savings of over a billion rupees in Oil imports.
20. General Syed Amjad made many promises/ commitments in the name of justice that money extracted from Irfan Puri would be returned to him. General Amjad appreciated and understood that grave injustice had been done, both in private and in presence of various individuals.
21. Irfan, in frustration filed a number of court cases against NAB, FIA, etc, giving the ordeal of the experience gone through, as a result, bogus Income tax/Wealth Tax demands have been issued by the department on the behest of NAB officials visiting the department forcing tax officers to issue demands.
22. Irfan, then also had meetings with General Khalid Maqbool the new Chairman of NAB for justice but regrettably no action was taken.
23. However, on the 17th of May 2003, General Munir Hafiz (as NAB Chairman) visited Irfan`s house in Karachi to meet with his family, Said ``all you have seen of NAB is tha hard side, I want to show the family the softer side of NAB``, during the earlier meetings that Irfan had with General Hafiz, Irfan was told a number of times by General Hafiz that he would arrange for a face to face meeting with General Amjad, Himself (to witness) and Irfan, however, when Irfan asked General Hafiz, as to when the meeting would happen, General Hafiz said ``The meeting can`t take place, I would not want to embarass the General (General Amjad)``.
General Hafeez, on his visit was Kind, straight fowrard, and honest, however, he asked Irfan to withdraw legal prodeeding against NAB, and that NAB would make sure Irfan benefits in other areas, or else.... you can`t fight us.
23. He also sought an appointment with Chief Executive General Pervaiz Musharraf, without success.
Still goes on...
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#53 Posted by arjun_m on September 15, 2002 8:10:02 pm
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#52 Posted by arjun_m on September 15, 2002 8:10:02 pm
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#51 Posted by hobbes on September 13, 2002 6:47:23 pm
Can these figures be disputed?
From Business Recorder dated today -
``Foreign investment interest picking up
EDITORIAL (September 14 2002) : According to official figures, foreign direct investment in the country registered 50 percent increase in the last fiscal year at $484.7 million over the previous year`s figures of $322.4 million.
Expectations are that foreign investment flows would rise to about one billion dollars in the current financial year as could be concluded from the on-going trend of foreign private investment interest both in the establishment of new projects and in the process of privatisation in the country.
In the month of July, the first month of the current financial year, foreign direct investment was estimated at $42.4 million, indicating a 74 percent increase over the amount for the corresponding month of 2001. This shows that foreign investment interest is picking up momentum steadily.
A clear evidence of this trend is to be found in the purchase of 51 percent strategic shareholding in United Bank Limited along with control of management by the Al-Falah, Bestway Group of UAE through open bidding. The induction of foreign investors in one of the larger state-owned banking institutions is undoubtedly a significant development which would definitely evoke further investment interest in Pakistan business groups of the Gulf and Middle East countries.
The new management in the UBL is expected to inject additional resources in the bank, thereby making it more dynamic and financially viable. In this process, not only additional investment from the Gulf is likely to flow into Pakistan but also greater participation can be expected from private investors of that country in Pakistan`s economic development.
While Pakistan`s financial sector is open to foreign investors as required under the WTO agreement, the majority ownership in UBL of a foreign group of investors would further testify to the country`s restriction-free policy to allow management control by foreign investors in the financial sector.
Foreign investment interest is also expected to show up for acquiring controlling interest in several forthcoming prominent estate enterprises such as KESC, PTCL, PSO, OGDC etc., in addition to the Habib Bank Limited. It may be expected that Pakistan`s privatisation programme would attract a improved level of response from potential foreign investors in the coming months in view of revival of guarantees from the US Overseas Private Investment Corporation (OPIC) to intending US investors in Pakistan`s development activities and fresh offers from the Exim Bank of USA of long term loans to finance projects in this country.
The concessional loan flows from the IMF, the World Bank and the Asian Development Bank make up a reassuring backdrop for any foreign private investors planning to make investment in Pakistan. The country`s credit rating has also been upgraded by Moody`s and Standard & Poors recently which is usually taken as a yardstick by private foreign investors and multinational companies to base their investment plans in a developing country.
The oil and gas sector along with mining has been found to be leading in foreign investment flows recently. In the month of July 2002, 40 percent of total foreign investment was absorbed by this sector.
The oil discoveries in the Sanghar district of southern Sindh, of which the latest one is Resham Well, are expected to accelerate the tempo of foreign investment interest in this sector. It may be mentioned here that during the past one year five wells were drilled with positive results in the district of Sanghar.
These wells, owned by joint ventures led by OGDC, are estimated to possess potential reserves of 8,000 barrels of oil per day and 600 million cubic feet of natural gas. The gas reserves in particular have been described by experts as the major addition to Pakistan`s natural gas wealth which would make it possible for the country to comfortably augment its gas utilisation over a long period.
The government`s policy to attract foreign private investment by large offers of maximum incentives and facilities such as ownership by foreigners to the extent of 100 percent, repatriation of original capital without any restrictions in addition to permission to remit profits without any limits and other liberal measures. The investor-friendly policy in oil and gas sector, particularly allowing the pricing of oil and gas on the basis of international trends, is beginning to pay dividends.``
#50 Posted by temporal on September 13, 2002 8:32:20 am
#43 by sameerJB on September 12, 2002:
[…Now this article will have far fewer hits because of being shelved on the back page….]
-- to the right of articles you will see two directional triangles…just click on them and you will get a new page with the latest twenty articles…find this more convenient…
#46 by sameerJB on September 12, 2002
[… Don`t let your deep convictions known on the record. Just an honest suggestion. My situation is different. I can afford to speak loudly…]
-- appreciate the concern you are expressing…but i disagree…first, what is any individual minus convictions?…i care deeply about my convictions and see no reason to shield them or be diplomatic about them…and am willing to be crucified for holding them dear…but then why would anyone want to crucify me for my convictions…of love and equality and justice?
… as a self professed buddhist you are as dear as other friends who are orthodox muslims, ‘un-orthodox’ muslims, jews, christians, hindus, atheists, whatever…
…and the ones who are not dear, and for whom have scant respect are those who generally foam at the mouth…
…who foment hatred and intolerance and are bigots through and through...
…enough about convictions…now, shall say something about my passions?…perhaps another time…
#47 by godot on September 13, 2002
[…I suppose it`s one of those things in life where what we see is what we want to see, however different the reality may be…]
-- precisely!…not only we see what we want to see, we hear what we want to hear too…and this happens on individual levels as well as collective and national levels…on my poem page sigalph235 blasted me for what he deems my insensitiveness…and in the past he has expressed similar views when it comes to US and Israel vs. Palestinians…and though i vehemently disagree with him and believe he views Palestinians with his zio-nazi blinkers on…yet on bina’s board he blasted romair for his views on my Karachi…saying something like he loves Karachi very much and attributes all ills in Karachi caused by ‘north’…so there…disagree with him some and agree with him some…
…then there are polite folks like hobbyty/hobbes…must confess this…had difficulty understanding him when he wrote long winded foggy diatribes and still have difficulty when he has reverted to short meaningless blasts…just kiddin’ hobbes!
…on national and international level...we have your dubya…the president in recent history with the lowest IQ…who seems hell bent upon involving the US again in a conflict without a clearly defined goal and end in sight…and he may actually believe in what he perceives as reality!…and then that bigot Sharon!…
…for those who want to resolve conflicts and crisis and want peace to prevail such distorted viewing/hearing are a nightmare indeed…
khair, enough said,
regards,
temporal
[…Now this article will have far fewer hits because of being shelved on the back page….]
-- to the right of articles you will see two directional triangles…just click on them and you will get a new page with the latest twenty articles…find this more convenient…
#46 by sameerJB on September 12, 2002
[… Don`t let your deep convictions known on the record. Just an honest suggestion. My situation is different. I can afford to speak loudly…]
-- appreciate the concern you are expressing…but i disagree…first, what is any individual minus convictions?…i care deeply about my convictions and see no reason to shield them or be diplomatic about them…and am willing to be crucified for holding them dear…but then why would anyone want to crucify me for my convictions…of love and equality and justice?
… as a self professed buddhist you are as dear as other friends who are orthodox muslims, ‘un-orthodox’ muslims, jews, christians, hindus, atheists, whatever…
…and the ones who are not dear, and for whom have scant respect are those who generally foam at the mouth…
…who foment hatred and intolerance and are bigots through and through...
…enough about convictions…now, shall say something about my passions?…perhaps another time…
#47 by godot on September 13, 2002
[…I suppose it`s one of those things in life where what we see is what we want to see, however different the reality may be…]
-- precisely!…not only we see what we want to see, we hear what we want to hear too…and this happens on individual levels as well as collective and national levels…on my poem page sigalph235 blasted me for what he deems my insensitiveness…and in the past he has expressed similar views when it comes to US and Israel vs. Palestinians…and though i vehemently disagree with him and believe he views Palestinians with his zio-nazi blinkers on…yet on bina’s board he blasted romair for his views on my Karachi…saying something like he loves Karachi very much and attributes all ills in Karachi caused by ‘north’…so there…disagree with him some and agree with him some…
…then there are polite folks like hobbyty/hobbes…must confess this…had difficulty understanding him when he wrote long winded foggy diatribes and still have difficulty when he has reverted to short meaningless blasts…just kiddin’ hobbes!
…on national and international level...we have your dubya…the president in recent history with the lowest IQ…who seems hell bent upon involving the US again in a conflict without a clearly defined goal and end in sight…and he may actually believe in what he perceives as reality!…and then that bigot Sharon!…
…for those who want to resolve conflicts and crisis and want peace to prevail such distorted viewing/hearing are a nightmare indeed…
khair, enough said,
regards,
temporal
#49 Posted by temporal on September 13, 2002 8:12:10 am
SameerJB and godot:
What else can I say?…thanks folks!
…t
What else can I say?…thanks folks!
…t
#48 Posted by hobbes on September 13, 2002 7:18:00 am
Can`t attack the message? Well, attack the messenger. Just attack, don`t discuss the merits of any proposition, just attack.
#47 Posted by Godot on September 13, 2002 6:34:12 am
temporal,
Thank you, t, for playing a peacemaker. You are probably dismayed to see two of your good friends at each other`s throat. It worked for me. I wish everyone was as nice and caring as you. This would be such a wonderful world then.
Sameer,
You are, no doubt, a very intelligent individual. The field of Chemistry is probably one of the most, if not the most, difficult disciplines. The fact that you have a PhD in it is a testimonial to your superior intelligence.
I think we got on the wrong foot and neither understood nor tried to understand each other. I suppose it`s one of those things in life where what we see is what we want to see, however different the reality may be.
As you may have astutely noticed, just like you, some people at Chowk stay away from me. I guess they don`t like me for what I appear to be. They are not necessarily wrong. I am like a book which not everyone understands or likes. It is not meant for everyone. Better not to read it. My characteristics do not appeal to everyone. There is only one problem with that: I like myself. I have looked deep inside me and have concluded that I need not change. I am good the way I am.
If you have nothing non-provoking to say to me, then don`t even mention me in your posts, let alone address me directly. You have maintained that strategy for a long time. Keep it up. I am a good friend, but a lot worse enemy.
Thank you, t, for playing a peacemaker. You are probably dismayed to see two of your good friends at each other`s throat. It worked for me. I wish everyone was as nice and caring as you. This would be such a wonderful world then.
Sameer,
You are, no doubt, a very intelligent individual. The field of Chemistry is probably one of the most, if not the most, difficult disciplines. The fact that you have a PhD in it is a testimonial to your superior intelligence.
I think we got on the wrong foot and neither understood nor tried to understand each other. I suppose it`s one of those things in life where what we see is what we want to see, however different the reality may be.
As you may have astutely noticed, just like you, some people at Chowk stay away from me. I guess they don`t like me for what I appear to be. They are not necessarily wrong. I am like a book which not everyone understands or likes. It is not meant for everyone. Better not to read it. My characteristics do not appeal to everyone. There is only one problem with that: I like myself. I have looked deep inside me and have concluded that I need not change. I am good the way I am.
If you have nothing non-provoking to say to me, then don`t even mention me in your posts, let alone address me directly. You have maintained that strategy for a long time. Keep it up. I am a good friend, but a lot worse enemy.
#46 Posted by SameerJB on September 12, 2002 8:49:48 pm
temporal: Don`t worry about our humor. I do not take it personally or seriously. Temporal you have family to worry about. Don`t let your deep convictions known on the record. Just an honest suggestion. My situation is different. I can afford to speak loudly.
Regards,
Sameer
Regards,
Sameer
#45 Posted by temporal on September 12, 2002 6:04:13 pm
godot #44 and sameerjb #43:
don`t know if it is too late...but in any case...here`s an appeal...PEACE!
godot: sameer displays an off-beat sense of humour...no need to take offense...perhaps you do not realise you two have more values in common than otherwise...
sameer: (shaking my head)...wish you had come to the rendezvous...again, godot is no bigot...he is not even a closet fundo...and again, you two have more in common...khair...speaking of your reasons not to appear in public...am penning something that will definitely put me on the ECL (Entry Control List) at any point of entry into Pakistan...perhaps then you`d have a change of mind?
rgds,
t
don`t know if it is too late...but in any case...here`s an appeal...PEACE!
godot: sameer displays an off-beat sense of humour...no need to take offense...perhaps you do not realise you two have more values in common than otherwise...
sameer: (shaking my head)...wish you had come to the rendezvous...again, godot is no bigot...he is not even a closet fundo...and again, you two have more in common...khair...speaking of your reasons not to appear in public...am penning something that will definitely put me on the ECL (Entry Control List) at any point of entry into Pakistan...perhaps then you`d have a change of mind?
rgds,
t
#44 Posted by Godot on September 12, 2002 1:25:23 pm
Sameer, #43
No, really, sweetheart, or should I say mf and bc, to use your own very colorful language, you Master of Universe, going around explaining to everyone how universe works and how deep and profound it is while thinking like a true jahil and spewing out words that would put Howard Stern to shame. The Buddha is turning in his grave thinking you claim to follow his philosophy!
Jealous cuz I`m not courting u? Yo`mama!!! Wanna smell me?
Yes, Sameer darling, get ready for the next round with me. But remember my motto: Don`t mess with me.
No, really, sweetheart, or should I say mf and bc, to use your own very colorful language, you Master of Universe, going around explaining to everyone how universe works and how deep and profound it is while thinking like a true jahil and spewing out words that would put Howard Stern to shame. The Buddha is turning in his grave thinking you claim to follow his philosophy!
Jealous cuz I`m not courting u? Yo`mama!!! Wanna smell me?
Yes, Sameer darling, get ready for the next round with me. But remember my motto: Don`t mess with me.
#43 Posted by SameerJB on September 12, 2002 11:48:14 am
It was good to have a meaningful discussion in the middle of divorce proceedings (arjun_m and others) and courtship (Urstruly and gdot). Now this article will have far fewer hits because of being shelved on the back page. Thanks to asaleh1, sac and faruk for their well intentioned and unbiased posts and also to Dr. Ishrat Hussain for writing this article. Let the coming days, months and years be a judge about the merits of forex reserves.
The two love birds were also courting nicely starting with mutual admiration, then appreciation and then expressing with least words count as in poetry. I was just waiting and hoping to see who takes the first step of saying: ``aap jaisa koi meri zindgi maiN aaye``. Oh well, hopefully they will learn from this experience. In this fast moving and changing world, slow desi-style courtship has its disadvantages of missing the train.
The two love birds were also courting nicely starting with mutual admiration, then appreciation and then expressing with least words count as in poetry. I was just waiting and hoping to see who takes the first step of saying: ``aap jaisa koi meri zindgi maiN aaye``. Oh well, hopefully they will learn from this experience. In this fast moving and changing world, slow desi-style courtship has its disadvantages of missing the train.
#42 Posted by sadna on September 12, 2002 8:51:08 am
This is a worrying comment on related matters. Any comments?
http://www.hinduonnet.com/stories/2002091202511800.htm
Counsel of despair
By Prem Shankar Jha
http://www.hinduonnet.com/stories/2002091202511800.htm
Counsel of despair
By Prem Shankar Jha
#41 Posted by Urstruly on September 12, 2002 8:12:55 am
Dear People
Please discuss the issues at hand and not my personality.... because that sets sacs and grandma temporals pants on fire.
Please discuss the issues at hand and not my personality.... because that sets sacs and grandma temporals pants on fire.
#40 Posted by sac on September 12, 2002 7:28:20 am
A lot of discussion here is delving into missing the forest for the trees variety. At the end of the day, the exchange rate for a currency is determined by good ole forces of supply and demand. Massive infusions of dollars by the US and other western creditors, remittances by overseas Pakistanis,relative stability in Afghanistan requiring Rupees for reconstruction, rescheduling of loans requiring little payment in the near term,global weakening of the dollar against all major currencies are all factors that make the flows to tilt in the home currency`s favor. Digging a little deeper, in the absence of any signals that speak of strong internal or external investment(which would require conversion of dollars into rupees and a corresponding drawing down in reserves) it is actually a contrarian indicator that tells us that entrepreneurs are wary of investing in Paksitan.
All this talk is taking away the focus from what should be the ultimate aim of any governmental economic policy. Uplift and economic betterment of the common man. If that is not being accomplished you can take your foreign exchange reserves and stick em where the sun never shines.
later
-sac
All this talk is taking away the focus from what should be the ultimate aim of any governmental economic policy. Uplift and economic betterment of the common man. If that is not being accomplished you can take your foreign exchange reserves and stick em where the sun never shines.
later
-sac
#39 Posted by Humsab on September 12, 2002 6:53:10 am
arjun_m
Keep it up and give back as hard as you can!
Regards
Keep it up and give back as hard as you can!
Regards
#38 Posted by shankar on September 12, 2002 6:53:10 am
godot,
#30
{{I don`t consider you a bigot; angry perhaps, but not a bigot. I know very clearly, just as you do, who the real bigots are at Chowk (and both of us know who the hypocrites are as well.)}}
Oooh that was beautiful!.....tears well up in my eyes... & please let me play my violin to that tune!
Urstruly is no bigot! Ofcourse not! In fact I credit that musalman for making me a better hindu AND a better brahmin! Before I had the honor of meeting urstruly, I was just your garden variety wayward brahmin coyote, castrated by the sins of my ancestors.
He reminded me that we hindus worship a penis god (among 33zillion odd gods).... , listen, you muslims have an advantage over us idolators. You guys have to remember only one God; OTOH, its pretty difficult for us banias to remember all of ours, OK!...not counting all the insects, rats, snakes,sticks & stones we worship.
Ever since his holiness reminded me of the penis god; I have become that god`s bakht. It been a miracle! My days of castration are over...it grew back! & functions like a bionic organ. My wife has a permanent smily expression.
Imagine that! a one-God fearing musalman, (an ultimate untouchable to a bigot brahmin butthead like me), changing my life for the better! Jeeze, I tell you, ever since that day I just love muslims ...I take that back... I love every single monotheist. My bigotry vanished!
No no sir, hazrat urstruly is a great man....i mean he is this close to the Prophet (pbuh). He has great respect for all religions. Yeah, he maybe pissed at times, but never once has he said a bad word about any single religion...I dont recall a single post of his where his anger has turned into hatred.
I mean he is so fair & impartial that he leaves Chowk in a huff, several times, promising never to return....he just cant STAND the viscious hatred of the venemous, parasitic, ex-commie Paki-bashing Pakistani hypocrites. During those brief abscences, he goes to the middle east & kicks some serious Arab butt. He is the only muslim I know who berates the damn Arabs for their very inhuman, unislamic & ungrateful blind eye to the plight of Kashmiri & Gujerati muslims. After his anger settles down, he comes back to Chowk to regale us with his charm & wit.
Dunno why, even though I`m a die hard fan of his, this Islam ka mashoor pehelwan, doesnt talk to me...sniff.
#30
{{I don`t consider you a bigot; angry perhaps, but not a bigot. I know very clearly, just as you do, who the real bigots are at Chowk (and both of us know who the hypocrites are as well.)}}
Oooh that was beautiful!.....tears well up in my eyes... & please let me play my violin to that tune!
Urstruly is no bigot! Ofcourse not! In fact I credit that musalman for making me a better hindu AND a better brahmin! Before I had the honor of meeting urstruly, I was just your garden variety wayward brahmin coyote, castrated by the sins of my ancestors.
He reminded me that we hindus worship a penis god (among 33zillion odd gods).... , listen, you muslims have an advantage over us idolators. You guys have to remember only one God; OTOH, its pretty difficult for us banias to remember all of ours, OK!...not counting all the insects, rats, snakes,sticks & stones we worship.
Ever since his holiness reminded me of the penis god; I have become that god`s bakht. It been a miracle! My days of castration are over...it grew back! & functions like a bionic organ. My wife has a permanent smily expression.
Imagine that! a one-God fearing musalman, (an ultimate untouchable to a bigot brahmin butthead like me), changing my life for the better! Jeeze, I tell you, ever since that day I just love muslims ...I take that back... I love every single monotheist. My bigotry vanished!
No no sir, hazrat urstruly is a great man....i mean he is this close to the Prophet (pbuh). He has great respect for all religions. Yeah, he maybe pissed at times, but never once has he said a bad word about any single religion...I dont recall a single post of his where his anger has turned into hatred.
I mean he is so fair & impartial that he leaves Chowk in a huff, several times, promising never to return....he just cant STAND the viscious hatred of the venemous, parasitic, ex-commie Paki-bashing Pakistani hypocrites. During those brief abscences, he goes to the middle east & kicks some serious Arab butt. He is the only muslim I know who berates the damn Arabs for their very inhuman, unislamic & ungrateful blind eye to the plight of Kashmiri & Gujerati muslims. After his anger settles down, he comes back to Chowk to regale us with his charm & wit.
Dunno why, even though I`m a die hard fan of his, this Islam ka mashoor pehelwan, doesnt talk to me...sniff.
#37 Posted by Faruk on September 12, 2002 6:53:09 am
Hobbes # 33
The reason for building up a foreign exchange reserve according to Dr. Hussain is to attract investment. Debt management is no doubt a good first step, but it has to be coupled to structural changes in your economy to spur growth. Economic growth, investment and exports should drive up your foreign exchange reserve. There is hardly a precedent for the opposite. But its no small task to bring an economy back from the brink.
Regards,
Faruk
The reason for building up a foreign exchange reserve according to Dr. Hussain is to attract investment. Debt management is no doubt a good first step, but it has to be coupled to structural changes in your economy to spur growth. Economic growth, investment and exports should drive up your foreign exchange reserve. There is hardly a precedent for the opposite. But its no small task to bring an economy back from the brink.
Regards,
Faruk
#36 Posted by Urstruly on September 12, 2002 6:53:09 am
Thank you Godot; your post had a soothing effect for my own OCD :)
I read this in the newspaper today, I hope you will like it:
apne apne baywafa`oN ne humaiN yakja kia
warna maiN tera nah tha aur tou kabhi mera nah tha.
I read this in the newspaper today, I hope you will like it:
apne apne baywafa`oN ne humaiN yakja kia
warna maiN tera nah tha aur tou kabhi mera nah tha.
#35 Posted by arjun_m on September 12, 2002 6:53:08 am
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#34 Posted by Asaleh1 on September 12, 2002 12:20:45 am
Sameer
I am not an insider, but i do work for a multinational bank in Pakistan. I do not believe in criticizing for the sake of criticizing. Not that I blame anyone on this forum on doing so. I do realize that there is lack of adequate information being put out by the State Bank of Pakistan which leads to erroneous conclusions.
There is no system of deposit insurance in Pakistan be it local currency or hard currency unlike those that prevail in the west like FDIC etc. Obviously the onus of managing depositors` demand is up to each individual bank. The depositor on the other hand has to evaluate the probaility of getting his money back just like the bank evaluates the borrow for return of its money. The currency of the deposit is irrelevent in this respect.
The rule related to hard currency deposits have not remained constant over the last decade. Initially, Pakistan, in order to diversify its lender base (for hard currency) allowed non-residents to open up foreign currency accounts which the banks in Pakistan were required to hand it over and receive PKR in return. So as long as the bank gave back PKR to State Bank it would get the USD back. Now this continued for 5 years and in 1991, State Bank of Pakistan allowed the resident Pakistan also to hold hard currency in Pakistan. This new regulation was brought in to stem the hard currency flows off-shore. In 1985 Dr. Haq had permitted banks to issue Foreign Exchange Bearer Certificates in exchange for hard currency which may be reconverted in hard currency at any time. The overseas Pakistanis instead of encashing their USD at the official exchange rate would purchase FEBC and sell it to those individuals and companies that were interested in protecting their value of wealth eroding as the PKR depreciated.
Now as all hard currency was with SBP and the objective of SBP was to maintain a relatively stable PKR against USD (it used to set the rates at which it would buy and sell the currency in the market. Banks were not allowed to hold hard currency). Given that Pakistan has been running a trade deficit, the only way of managing this was, in absence of any other participant accepting currency risk, was to borrow funds from whatever sources that would make it available. Mind you the government had a very successful policy in this regard as it paid a rate significantly lower than what it would have had to pay if it had borrowed the money from commercial sources.
As for the present, subsequent to 1998, new deposit accounts were allowed to be opened under new regulations 1998. These regulations allowed the banks to manage the funds themselves and would not be able to get PKR if they wanted to place the funds with SBP. On the other hand, they were free to use the funds to lend to companies in Pakistan or to invest in Investment Grade papers (BBB and better) or with banks with similar grades. While these regulations themselves have taken quite a few turns, where we stand today is that, banks, other than what is required to be maintained in the form of Cash Reserve Requirement and Statutory Reserve Requirements totally 20%, can use the funds prudently as they determine.
I am sorry to write such a long note to clarify the position but it is better to have a complete understanding of the issue to come to an informed position.
The answer to your question is that while the banks in Pakistan being subject to the laws of Pakistan (and therefore may be forced to hand over hard currency), it would not be in its interest to do so. The only reason it froze the previous deposits is because it had already used the funds. Today the funds are not in its control. It would have to requisition the funds before freezing them. Mind you, banks try to match the tenor of the deposits with those of the assets and as such would not be able to comply with the demands of the State Bank immediately and would only be able to hand over the funds as and when they mature.
I hope this clarifies your question.
Another issue that has been raised is the question of economic growth. Previously the growth policy that was being pursued was that nationalized financial institutions had a volume disbursement target and the enterpreneurs would take these funds import some machinery and put up factories without due considerations to the future revenues. Obviously, the steps the government has taken is giving rise to withdrawal symptoms similar to the ones faced by a junkie (the enterpreneur). Short of running budget and trade deficits to prop up the growth rate, it is trying to work with policy stability to attract rational investors back into the ring.
The deregulations in the hard currency trading has led the PKR to adjust to market conditions. We have seen this since 2000 when the USD shortage took the PKR from 52 all the way up to 65. But subsequent to 9/11 as the countries that were attracting flows from Pakistan became more strict on money laundering laws, we have seen that the capital flows from Pakistan have ebbed. The PKR has moved from 65 down to 59 and is continuing to appreciate as the remittance from overseas Pakistanis have doubled since 9/11.
These funds are now looking for an appropriate investment opportunity and with the stock market bucking the international trend would get businesses to take some new business risks.
Please note that buying hard currency by printing PKR does not necessarily translate into inflationary pressure. This is one of the monetary tools that are available to the Central Bank. If such a situation was true Bank of Japan instead of buying just 25 billion USD per quarter would double the amount. Note that Japan has faced deflation despite such purchases.
I am not an insider, but i do work for a multinational bank in Pakistan. I do not believe in criticizing for the sake of criticizing. Not that I blame anyone on this forum on doing so. I do realize that there is lack of adequate information being put out by the State Bank of Pakistan which leads to erroneous conclusions.
There is no system of deposit insurance in Pakistan be it local currency or hard currency unlike those that prevail in the west like FDIC etc. Obviously the onus of managing depositors` demand is up to each individual bank. The depositor on the other hand has to evaluate the probaility of getting his money back just like the bank evaluates the borrow for return of its money. The currency of the deposit is irrelevent in this respect.
The rule related to hard currency deposits have not remained constant over the last decade. Initially, Pakistan, in order to diversify its lender base (for hard currency) allowed non-residents to open up foreign currency accounts which the banks in Pakistan were required to hand it over and receive PKR in return. So as long as the bank gave back PKR to State Bank it would get the USD back. Now this continued for 5 years and in 1991, State Bank of Pakistan allowed the resident Pakistan also to hold hard currency in Pakistan. This new regulation was brought in to stem the hard currency flows off-shore. In 1985 Dr. Haq had permitted banks to issue Foreign Exchange Bearer Certificates in exchange for hard currency which may be reconverted in hard currency at any time. The overseas Pakistanis instead of encashing their USD at the official exchange rate would purchase FEBC and sell it to those individuals and companies that were interested in protecting their value of wealth eroding as the PKR depreciated.
Now as all hard currency was with SBP and the objective of SBP was to maintain a relatively stable PKR against USD (it used to set the rates at which it would buy and sell the currency in the market. Banks were not allowed to hold hard currency). Given that Pakistan has been running a trade deficit, the only way of managing this was, in absence of any other participant accepting currency risk, was to borrow funds from whatever sources that would make it available. Mind you the government had a very successful policy in this regard as it paid a rate significantly lower than what it would have had to pay if it had borrowed the money from commercial sources.
As for the present, subsequent to 1998, new deposit accounts were allowed to be opened under new regulations 1998. These regulations allowed the banks to manage the funds themselves and would not be able to get PKR if they wanted to place the funds with SBP. On the other hand, they were free to use the funds to lend to companies in Pakistan or to invest in Investment Grade papers (BBB and better) or with banks with similar grades. While these regulations themselves have taken quite a few turns, where we stand today is that, banks, other than what is required to be maintained in the form of Cash Reserve Requirement and Statutory Reserve Requirements totally 20%, can use the funds prudently as they determine.
I am sorry to write such a long note to clarify the position but it is better to have a complete understanding of the issue to come to an informed position.
The answer to your question is that while the banks in Pakistan being subject to the laws of Pakistan (and therefore may be forced to hand over hard currency), it would not be in its interest to do so. The only reason it froze the previous deposits is because it had already used the funds. Today the funds are not in its control. It would have to requisition the funds before freezing them. Mind you, banks try to match the tenor of the deposits with those of the assets and as such would not be able to comply with the demands of the State Bank immediately and would only be able to hand over the funds as and when they mature.
I hope this clarifies your question.
Another issue that has been raised is the question of economic growth. Previously the growth policy that was being pursued was that nationalized financial institutions had a volume disbursement target and the enterpreneurs would take these funds import some machinery and put up factories without due considerations to the future revenues. Obviously, the steps the government has taken is giving rise to withdrawal symptoms similar to the ones faced by a junkie (the enterpreneur). Short of running budget and trade deficits to prop up the growth rate, it is trying to work with policy stability to attract rational investors back into the ring.
The deregulations in the hard currency trading has led the PKR to adjust to market conditions. We have seen this since 2000 when the USD shortage took the PKR from 52 all the way up to 65. But subsequent to 9/11 as the countries that were attracting flows from Pakistan became more strict on money laundering laws, we have seen that the capital flows from Pakistan have ebbed. The PKR has moved from 65 down to 59 and is continuing to appreciate as the remittance from overseas Pakistanis have doubled since 9/11.
These funds are now looking for an appropriate investment opportunity and with the stock market bucking the international trend would get businesses to take some new business risks.
Please note that buying hard currency by printing PKR does not necessarily translate into inflationary pressure. This is one of the monetary tools that are available to the Central Bank. If such a situation was true Bank of Japan instead of buying just 25 billion USD per quarter would double the amount. Note that Japan has faced deflation despite such purchases.
#33 Posted by hobbes on September 11, 2002 6:58:38 pm
Faruk
Thanks for acknowledging that stopping the downward trend was no small feat - would you agree that the rescheduled debts serve to act as an rudder for the direction the international community hope the Pakistani state will take? And does it not also serve to signal a confidence that if that direction is taken that the Pakistani economy can be productive so the degree that the repayment is not painful?
Thanks for acknowledging that stopping the downward trend was no small feat - would you agree that the rescheduled debts serve to act as an rudder for the direction the international community hope the Pakistani state will take? And does it not also serve to signal a confidence that if that direction is taken that the Pakistani economy can be productive so the degree that the repayment is not painful?
#32 Posted by Faruk on September 11, 2002 3:53:47 pm
asaleh1, sameerJB,
No one is denying the importance of Foreign currency reserves. It is an important macro economic indicator. It is used by international investors and lending agencies to gauge the health of an economy.
I don’t believe it can be a goal in it self. It is one of the indicators that attracts investment and business. Pakistan has a lot of work to do in areas of GDP growth, business environment and general appeal as a business destination. Apart from that accounting private investment as foreign currency reserve is not right. Private investment are not available to the Pakistan govt. to repay their debts. The other methods of accumulating the foreign exchange used by your govt. are not exactly spectacular. They have rescheduled debts with no payments due for 15 yrs. They are not amortizing the cost of this debt n their debt liabilities today. This amounts to borrowing from your children. They have bought foreign exchange from the open market and paid for it by selling govt. assets and internal borrowing. This I explained earlier is inflationary. Its like borrowing from a credit card and putting the money in your checking account. If it gives you peace of mind fine, but its not a great investment strategy.
Having said that I must point out that turning Pakistan’s economy around in no small task and this can be a small step in that direction.
Regards,
Faruk
No one is denying the importance of Foreign currency reserves. It is an important macro economic indicator. It is used by international investors and lending agencies to gauge the health of an economy.
I don’t believe it can be a goal in it self. It is one of the indicators that attracts investment and business. Pakistan has a lot of work to do in areas of GDP growth, business environment and general appeal as a business destination. Apart from that accounting private investment as foreign currency reserve is not right. Private investment are not available to the Pakistan govt. to repay their debts. The other methods of accumulating the foreign exchange used by your govt. are not exactly spectacular. They have rescheduled debts with no payments due for 15 yrs. They are not amortizing the cost of this debt n their debt liabilities today. This amounts to borrowing from your children. They have bought foreign exchange from the open market and paid for it by selling govt. assets and internal borrowing. This I explained earlier is inflationary. Its like borrowing from a credit card and putting the money in your checking account. If it gives you peace of mind fine, but its not a great investment strategy.
Having said that I must point out that turning Pakistan’s economy around in no small task and this can be a small step in that direction.
Regards,
Faruk
#31 Posted by SameerJB on September 11, 2002 12:52:23 pm
Please read ``nobody suggests its uselessness`` instead of ``nobody denies its uselessness`` in line 4 of post # 29
#30 Posted by Godot on September 11, 2002 9:14:32 am
Urstruly #22
No, my friend, I am not going to distance myself from you. I don`t consider you a bigot; angry perhaps, but not a bigot. I know very clearly, just as you do, who the real bigots are at Chowk (and both of us know who the hypocrites are as well.) In fact, I think you are quite intelligent, and very funny at times. I may not agree with some of your thoughts, but good friends can disagree with each other without being hostile. That`s what a good friendship is all about. A true friendship transcends all.
At times you bring up good points, such as the problem of self-esteem. It is definitely a point to be pondered by an objective psychologist.
It`s very true, as you say, that a man is known by the friends one keeps. I`m a friend of yours. Let that determine how we are perceived by others. However, whatever the perception, it matters to neither of us. We both know who we are.
No, my friend, I am not going to distance myself from you. I don`t consider you a bigot; angry perhaps, but not a bigot. I know very clearly, just as you do, who the real bigots are at Chowk (and both of us know who the hypocrites are as well.) In fact, I think you are quite intelligent, and very funny at times. I may not agree with some of your thoughts, but good friends can disagree with each other without being hostile. That`s what a good friendship is all about. A true friendship transcends all.
At times you bring up good points, such as the problem of self-esteem. It is definitely a point to be pondered by an objective psychologist.
It`s very true, as you say, that a man is known by the friends one keeps. I`m a friend of yours. Let that determine how we are perceived by others. However, whatever the perception, it matters to neither of us. We both know who we are.
#29 Posted by SameerJB on September 11, 2002 9:12:00 am
asaleh1, #24: Thanks a lot for your well informed, well articulated and well meaning post. You seem to me as an insider of SBP. Whatever the case, I really appreciate your insightful effort to respond to my queries. No matter what the importance of forex, nobody denies its uselessness. For that reason alone, I wish Pakistan and Pakistanis to always have as much dollars as possible. Money may not buy all the happiness, but it certainly is better to have it than not having it.
since you mentioned that banks are free to handle 2.5 billion dollars of private forex accounts. Are these accounts insured to return forex on demand? And more importantly, what happened to forex money in private accounts after freeze in the wake of nuclear tests. Weren`t banks then free to manage private foreign currency accounts? How can it be possible to have banks freedom to manage their own forex and right of the government to freeze those accounts? I see a clear paradox here. If I have to open a dollar account today, I will be more concerned about government right to freeze than freedom of banks to manage my account because that freedom I can have everywhere else in the world too.
Regards,
Sameer
since you mentioned that banks are free to handle 2.5 billion dollars of private forex accounts. Are these accounts insured to return forex on demand? And more importantly, what happened to forex money in private accounts after freeze in the wake of nuclear tests. Weren`t banks then free to manage private foreign currency accounts? How can it be possible to have banks freedom to manage their own forex and right of the government to freeze those accounts? I see a clear paradox here. If I have to open a dollar account today, I will be more concerned about government right to freeze than freedom of banks to manage my account because that freedom I can have everywhere else in the world too.
Regards,
Sameer
#28 Posted by arjun_m on September 11, 2002 8:04:33 am
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#27 Posted by shankar on September 11, 2002 6:28:50 am
arjun_m,
re: #22
Nothing pisses me off more than when I agree with that frikking mullah. Whatever Hazrat Urstruly said about you is true.
re: #22
Nothing pisses me off more than when I agree with that frikking mullah. Whatever Hazrat Urstruly said about you is true.
#26 Posted by Asaleh1 on September 11, 2002 6:28:49 am
Re SameerJB
Every Central Bank in the world prints currency to support the economy. The Federal Reserve has been able to bring down the interest rates by buying Treasuy Bills and Bonds from the market. It does this by printing money using it to purchase the economy.
The Bank of Japan has been injecting money like crazy to stablize the economy (See M1 growth for Japan stands at 31.50% year on year in August 2002). This means that The money supply jumped by 79 trillion Yen.
So basically in order to maintain an orderly growth in money supply, the central bank has two sources. The first is to lend the money to the government in exchange for Government Securities (Treasury Bills; Bond). It is the same thing if they buy the same securities from the market. The second source is to give the government PKR in exchange for hard currency that they may have borrowed or bought.
This is the case with building up the foreign currency reserves. The State Bank of Pakistan has to ensure that there is liquidity in the market and it ensures this by not buying government securities but hard currency there by meeting two objectives instead of one (hard currency reserves and keeping money market liquid so that corporates may get a lower interest rate for loans).
The government is running a budget deficit and as such privitization of company enables it to borrow less money by issuing government securities and use the proceeds of the privitization. The government has not been given to Fauji Foundation. Now if we are talking about Fauji Jordan Fertilizer company, it should be clear that the government promised them some price guarantees for its products (similar to those provided to the IPPs), however as IMF said that these guarantees were not competitive the government withdrew the price support and in lieu of that has to pay damages to the company which has gone bankcrupt (lack of consistent policies of previous government).
In the USD 7.5 billion, the private savings are in the vicinity of 2.5 billion. These funds are managed by the banks themselves and are not in the hands of the government.
The policy of the government is not to contract foreign debt at commercial rates but it would maximise the opportunities of debt being given to it on concessional rates. These loans are not being squandered away by selling them at cheap rates to the importers but are being retained by augmenting the Foreign Reserves.
Every Central Bank in the world prints currency to support the economy. The Federal Reserve has been able to bring down the interest rates by buying Treasuy Bills and Bonds from the market. It does this by printing money using it to purchase the economy.
The Bank of Japan has been injecting money like crazy to stablize the economy (See M1 growth for Japan stands at 31.50% year on year in August 2002). This means that The money supply jumped by 79 trillion Yen.
So basically in order to maintain an orderly growth in money supply, the central bank has two sources. The first is to lend the money to the government in exchange for Government Securities (Treasury Bills; Bond). It is the same thing if they buy the same securities from the market. The second source is to give the government PKR in exchange for hard currency that they may have borrowed or bought.
This is the case with building up the foreign currency reserves. The State Bank of Pakistan has to ensure that there is liquidity in the market and it ensures this by not buying government securities but hard currency there by meeting two objectives instead of one (hard currency reserves and keeping money market liquid so that corporates may get a lower interest rate for loans).
The government is running a budget deficit and as such privitization of company enables it to borrow less money by issuing government securities and use the proceeds of the privitization. The government has not been given to Fauji Foundation. Now if we are talking about Fauji Jordan Fertilizer company, it should be clear that the government promised them some price guarantees for its products (similar to those provided to the IPPs), however as IMF said that these guarantees were not competitive the government withdrew the price support and in lieu of that has to pay damages to the company which has gone bankcrupt (lack of consistent policies of previous government).
In the USD 7.5 billion, the private savings are in the vicinity of 2.5 billion. These funds are managed by the banks themselves and are not in the hands of the government.
The policy of the government is not to contract foreign debt at commercial rates but it would maximise the opportunities of debt being given to it on concessional rates. These loans are not being squandered away by selling them at cheap rates to the importers but are being retained by augmenting the Foreign Reserves.
#25 Posted by arjun_m on September 11, 2002 6:28:49 am
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#24 Posted by arjun_m on September 11, 2002 6:28:49 am
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#23 Posted by sadna on September 10, 2002 9:20:11 pm
Re currency and where did it come from. How about the parallel economy? In India its called black money and rivals the legitimate economy in size though I doubt the Indian govt has easy access to the moeny floating around in it due to rules and regulations. That may not be the case with the Pakistani govt.
And how about the possibility that the deposing of the Taliban government might have required that a large quantity of narcotics to be hurriedly disposed of ?
#22 Posted by SameerJB on September 10, 2002 7:36:31 pm
sac: Thanks for your post. In the meantime, UBL has been sold to a group of bidders from UAE who actually defaulted previously on a loan of 300 million dollars from the same bank. Welcome to the reality Pakistan style. First take a big loan, defaul, and use the same money to buy the same bank. Long live Shaukat Aziz as Finance Minister. Lets see Habib Bank and PTCL are next for Saudis and Lebanese..............
Many more spicy and juicy stories in the latest issue of South Asia Tribune.
Many more spicy and juicy stories in the latest issue of South Asia Tribune.
#21 Posted by Urstruly on September 10, 2002 7:36:31 pm
Yaar Godot,
I think you will also disagree with me and distance yourself by calling me a bigot, but I am thoroughly convinced that Hindus have some serious self-esteem problems. I, for example, once called them Shiva Ji worshipers, about two years ago, and they still show me their wounded souls. I have absolutely no problem with what they say or how they say it because (no one can beat me in badtameezee, I am absolute), but I do have a problem when they start thinking that they can get away with it.
Take for example this Hindu; about a year ago, last September, Romair wrote something about Pakistani T-shirts and since then this Hindu is suffering from Obssesive Compulsive Disorder. He just cannot manage to write a single post without mentioning Paksitani T-shirts. Recently, an astonished interactor asked him how did he manage to write a couple of posts without mentioning Pakistani flag; did someone shove a Pakistani flag up his wazzoo? And he replied that you are shoving Paksitani flag up my wazzoo cuz you dont have Kashmir. One year is enough time to show that one is not suffering from OCD but....
Take for example another Hindu Jay. His wife ran away with Shabban doodhwala about a couple of years ago, and since then he can`t help but blame it on two nations theory.
This OCD is a serious indication of a broken self-esteem and lack of self respect. And I am the bigot?
There is a proverb in our language that a man is known by his freinds, and guess who come to the rescue of these OCDs....who else but ex-commie paki liberals. And I am the one who is a biggot.
I think you will also disagree with me and distance yourself by calling me a bigot, but I am thoroughly convinced that Hindus have some serious self-esteem problems. I, for example, once called them Shiva Ji worshipers, about two years ago, and they still show me their wounded souls. I have absolutely no problem with what they say or how they say it because (no one can beat me in badtameezee, I am absolute), but I do have a problem when they start thinking that they can get away with it.
Take for example this Hindu; about a year ago, last September, Romair wrote something about Pakistani T-shirts and since then this Hindu is suffering from Obssesive Compulsive Disorder. He just cannot manage to write a single post without mentioning Paksitani T-shirts. Recently, an astonished interactor asked him how did he manage to write a couple of posts without mentioning Pakistani flag; did someone shove a Pakistani flag up his wazzoo? And he replied that you are shoving Paksitani flag up my wazzoo cuz you dont have Kashmir. One year is enough time to show that one is not suffering from OCD but....
Take for example another Hindu Jay. His wife ran away with Shabban doodhwala about a couple of years ago, and since then he can`t help but blame it on two nations theory.
This OCD is a serious indication of a broken self-esteem and lack of self respect. And I am the bigot?
There is a proverb in our language that a man is known by his freinds, and guess who come to the rescue of these OCDs....who else but ex-commie paki liberals. And I am the one who is a biggot.
#20 Posted by Prem on September 10, 2002 3:40:26 pm
arjun_m
True, you don`t descend to religious name calling but you have used (and consistently do use) words such as condomistan and pakiland.
Here is a simple thing you might want to keep in mind: there are a lot decent of folks out there who call themselves Pakistanis. A whole young generation has grown up there that does not derive its identity from eternally fighting with or badmouthing India, but from the mere fact of being born in Pakistan. These people have a right that their national identity be respected.
That doesn`t mean that you should avoid all slug-fests. If you think certain policies have been disastrous, feel free to criticise them. Just that, degrading any country in its entirety constantly isn`t the wisest course of action.
True, you don`t descend to religious name calling but you have used (and consistently do use) words such as condomistan and pakiland.
Here is a simple thing you might want to keep in mind: there are a lot decent of folks out there who call themselves Pakistanis. A whole young generation has grown up there that does not derive its identity from eternally fighting with or badmouthing India, but from the mere fact of being born in Pakistan. These people have a right that their national identity be respected.
That doesn`t mean that you should avoid all slug-fests. If you think certain policies have been disastrous, feel free to criticise them. Just that, degrading any country in its entirety constantly isn`t the wisest course of action.
#19 Posted by Godot on September 10, 2002 3:17:26 pm
arjun_m (#16)
Arjun, first, I must give you credit for not responding in kind to me (it shows that you may actually like me.)
It`s not the Muslims you are attacking that prompted me to write what I wrote. You are attacking, in an exceedingly loathsome way, an entire nation and people who identify with that nation. You are attacking an identity. Now, if the shoe was on the other foot, I don`t think you would feel very comfortable, either.
You have every right to display your anger and criticize what you think should be criticized. But there is a civilized way to make yourself heard and a way that`s breads hatred. Unfortunately, you seem to have chosen the way of the philistines. It`s not going to earn you any respect (it`s another story if you don`t want to be respected.)
If you attack in a despicable manner, be prepared to be attacked as viciously. It`s your call.
Arjun, first, I must give you credit for not responding in kind to me (it shows that you may actually like me.)
It`s not the Muslims you are attacking that prompted me to write what I wrote. You are attacking, in an exceedingly loathsome way, an entire nation and people who identify with that nation. You are attacking an identity. Now, if the shoe was on the other foot, I don`t think you would feel very comfortable, either.
You have every right to display your anger and criticize what you think should be criticized. But there is a civilized way to make yourself heard and a way that`s breads hatred. Unfortunately, you seem to have chosen the way of the philistines. It`s not going to earn you any respect (it`s another story if you don`t want to be respected.)
If you attack in a despicable manner, be prepared to be attacked as viciously. It`s your call.
#18 Posted by sac on September 10, 2002 1:08:36 pm
re SameerFB,faruk:
Forex reserves by themsleves are but one indicator of a country`s economic health. Levels of foreign investment,GDP,Import/Export ratios etc. are all needed to get some idea about an economy. Even in the well-documented economies of the west, economists have a hard time figuring out whether their economies are on the right track or not because there is no single indicator for that. That`s what makes a market. People reading the same number sometimes draw opposing inferences.
Similarly forex reserves has been used by the military dictatorship in Pakistan to trumpet their economic management. They`ve failed to mention the plummeting levels of foreign investment,strong imbalance in imports/exports and a contracting internal economy that send opposite signals. Increased forex reserves are meaningful if they do not represent one time events such as increased levels of remittances after 9/11 or lavish reshedulings by creditors. They also fail to take into account the global weakening of the dollar against most currencies in the past few months.
The US has a well-pronounced interest in keeping Pakistan stable economically. Its like the stock market of the mid nineties. Stanford trained economists or Citibankers will do as well as monkeys in picking stocks that return astronomical returns. It would be a different matter when the internal hollowness of the Pakistani economy will rear its ugly head. It wouldn`t matter if the forex reserves are $5 billion or $15 billion. The mighty British pound was humiliated by some currency traders in 1992 when the chancellor of the Exchequer tried to use close to 10 billion pounds to defend it. Same thing with the Asian economies in 1997. The sad part is that the carpetbeggars would be long gone and safely ensconced in Connecticut(or Boston) when the indebted common man in Pakistan realizes they`ve been taken for a ride once again.
later
-sac
Forex reserves by themsleves are but one indicator of a country`s economic health. Levels of foreign investment,GDP,Import/Export ratios etc. are all needed to get some idea about an economy. Even in the well-documented economies of the west, economists have a hard time figuring out whether their economies are on the right track or not because there is no single indicator for that. That`s what makes a market. People reading the same number sometimes draw opposing inferences.
Similarly forex reserves has been used by the military dictatorship in Pakistan to trumpet their economic management. They`ve failed to mention the plummeting levels of foreign investment,strong imbalance in imports/exports and a contracting internal economy that send opposite signals. Increased forex reserves are meaningful if they do not represent one time events such as increased levels of remittances after 9/11 or lavish reshedulings by creditors. They also fail to take into account the global weakening of the dollar against most currencies in the past few months.
The US has a well-pronounced interest in keeping Pakistan stable economically. Its like the stock market of the mid nineties. Stanford trained economists or Citibankers will do as well as monkeys in picking stocks that return astronomical returns. It would be a different matter when the internal hollowness of the Pakistani economy will rear its ugly head. It wouldn`t matter if the forex reserves are $5 billion or $15 billion. The mighty British pound was humiliated by some currency traders in 1992 when the chancellor of the Exchequer tried to use close to 10 billion pounds to defend it. Same thing with the Asian economies in 1997. The sad part is that the carpetbeggars would be long gone and safely ensconced in Connecticut(or Boston) when the indebted common man in Pakistan realizes they`ve been taken for a ride once again.
later
-sac
#17 Posted by SameerJB on September 10, 2002 12:14:19 pm
faruk and hobbs: Thanks for your posts. I still do not understand why Dr. Ishrat did not mention the source of Pakistani currency to buy forex. Is it a state secret? I doubt it was done by printing more currency. The option of taking loans internally with ~10 percent interest (as pointed out by faruk) and using it to biy forex with low or no interest.
There is another serious development reported couple of weeks earlier. The privatization comission of Pakistan disclosed to General Account Office that some 70 billion rupees from the sale of public sector industries to private sector were transferred to Central Board of revenue / Ministry of Finanace. However, ministry of Finance refused to acknowledge such transfer. Nobody knows where this money is. Rumor has it that it was used to afloat sinking military welfare system like, Fauji Foundation. But it is possible that this money was used to buy forex. There was another unrelated story about the cost of privatization, ~11 billion rupees. This amount is too much for a small organization and they refuse to give detailed accounting of this money. Corruption is alive and well in Pakistan, thank you.
If 7 billion dollar forex is to convince foreign investors as guarantee money in case of pulling out: 1) They are not buying it: 2) It means to keep the higher level of forex or not using it to repay debt or debt servicing. What a silly logic just to lure foreign investment which depends on many other factors lot more than just fear of written off. Nobody would take interest in investing even in USA, if fear of losing dominate. No bank would lend money for the same fear. The risk is always measured against gains and not breaking even.
The 7 billion dollars forex, if includes private savings in dollar as suggested by many, is much less than the level of 11 billion dollars private money at the time of nuclear test and the freeze of foreign currency accounts. A large sum of that 11 billion dollars was forced into converting to rupees by small and medium account holders. The governments in Pakistan has always been using the private foreign currency holding. It is widely believed that at the time of freeze it was necessitated due to practically emptying of 11 billion dollars by the governments (on paying for arms and servicing the debt) rather than the fear of public withdrawal after nuclear tests.
Now Musharraf wants to buy 70 F-16s. Obviously forex will be used to buy them if USA agreed to sell.
The rescheduling is bad if the interest rate remains fixed at the earlier level. In private loans, as home mortgage, refinancing changes the interest rate. I wonder if the interest rate remains the same in rescheduling as it happens during rescheduling the private loans.
There is another serious development reported couple of weeks earlier. The privatization comission of Pakistan disclosed to General Account Office that some 70 billion rupees from the sale of public sector industries to private sector were transferred to Central Board of revenue / Ministry of Finanace. However, ministry of Finance refused to acknowledge such transfer. Nobody knows where this money is. Rumor has it that it was used to afloat sinking military welfare system like, Fauji Foundation. But it is possible that this money was used to buy forex. There was another unrelated story about the cost of privatization, ~11 billion rupees. This amount is too much for a small organization and they refuse to give detailed accounting of this money. Corruption is alive and well in Pakistan, thank you.
If 7 billion dollar forex is to convince foreign investors as guarantee money in case of pulling out: 1) They are not buying it: 2) It means to keep the higher level of forex or not using it to repay debt or debt servicing. What a silly logic just to lure foreign investment which depends on many other factors lot more than just fear of written off. Nobody would take interest in investing even in USA, if fear of losing dominate. No bank would lend money for the same fear. The risk is always measured against gains and not breaking even.
The 7 billion dollars forex, if includes private savings in dollar as suggested by many, is much less than the level of 11 billion dollars private money at the time of nuclear test and the freeze of foreign currency accounts. A large sum of that 11 billion dollars was forced into converting to rupees by small and medium account holders. The governments in Pakistan has always been using the private foreign currency holding. It is widely believed that at the time of freeze it was necessitated due to practically emptying of 11 billion dollars by the governments (on paying for arms and servicing the debt) rather than the fear of public withdrawal after nuclear tests.
Now Musharraf wants to buy 70 F-16s. Obviously forex will be used to buy them if USA agreed to sell.
The rescheduling is bad if the interest rate remains fixed at the earlier level. In private loans, as home mortgage, refinancing changes the interest rate. I wonder if the interest rate remains the same in rescheduling as it happens during rescheduling the private loans.
#16 Posted by arjun_m on September 10, 2002 10:25:32 am
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#15 Posted by Godot on September 10, 2002 8:41:37 am
Urstruly,
I wonder why you get lambasted left and right (Pakistanis and Indians) for saying bad things about Hindus. Yet...and yet...no one...mind you...no one...says anything when that arjun_mfkr and haramiu...spew words that come from their back-hole. I actually like it and take it as a compliment that you get lambasted. It shows that Pakistanis are held at a much higher level of decency and civilization than the Indians.
Romair,
You just degrade yourself by even mentioning arjun_mfkr`s name in your post, let alone address him.
I wonder why you get lambasted left and right (Pakistanis and Indians) for saying bad things about Hindus. Yet...and yet...no one...mind you...no one...says anything when that arjun_mfkr and haramiu...spew words that come from their back-hole. I actually like it and take it as a compliment that you get lambasted. It shows that Pakistanis are held at a much higher level of decency and civilization than the Indians.
Romair,
You just degrade yourself by even mentioning arjun_mfkr`s name in your post, let alone address him.
#14 Posted by arjun_m on September 10, 2002 8:24:15 am
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#13 Posted by arjun_m on September 10, 2002 8:23:52 am
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#12 Posted by Urstruly on September 10, 2002 7:03:13 am
Romair
You expect decency from a Hindu? Sir, such animal does not exist. When I say that, I am called a bigot, and I wonder why people like you ask these questions then in the first place?
You expect decency from a Hindu? Sir, such animal does not exist. When I say that, I am called a bigot, and I wonder why people like you ask these questions then in the first place?
#11 Posted by Urstruly on September 10, 2002 7:02:48 am
I fail to see the purpose of this article. Forex or not to forex, if that is the question then this article lacks the academic merit to prove a point. Comparisons with India and China are meaningless. A fair comparison can be made with Argentina. Please keep in mind that long before Argentina, Paksitan did what Argentina has done now; GOP committed the cardinal sin of freezing the assets (foreign currency accounts) of people of Paksitan- where people lost their savings and investment- the only investment which was considered safe from the vultures and scam artists of Cooperative banks. And GOP unleashes likes of these vultures on the people of Paksitan who are not even fully dead approximately every ten years.
If the point of this article was to prove that we have forex - then it is a naive attepmt by a person of the stature of Dr. Sahib. Yes, we know we have forex now, and we also know that it is the blood money that we earned from the murder of Afghanistan. If Dr. Sahib is trying to prove that we earned this money becuause this regime has somehow controlled their haram khori, and it is due to our internal growth because of the economic policies of this regime then I ain`t buying.
#10 Posted by Faruk on September 10, 2002 7:02:26 am
SameerJB, hobbes # 9
Building a foreign exchange reserve is an expensive necessity. Lets review what happened in the 1997 Asian crisis. Foreign investors withdrew large amounts of money from Thailand. As the Thailand reserves fell more investors withdrew their investments perpetuating a crisis. The Thai govt. tried to borrow from the IMF but could not get a deal and their currency went into a free fall. Western investors decided that if one Asian tiger can crumble all can and withdrew billions of dollars from the Asian countries creating the 1997 crisis. This crisis had no economic basis just sentiment. There were no economic underpinnings for this crisis. Two economies that survived this crisis were India and China, one because most of the investment in these countries was by their own nationals and two because of large foreign exchange reserves that allayed any investor fears. If Pakistan wants to attract foreign investment it has to convince foreign investors that they can withdraw their money at any time and hence the need for the reserve.
Now why did earlier govt. not buy foreign exchange from the open market for such an obvious need? What your current govt. has done is transfer international debt to local debt. along with some creative accounting. Let?s ignore the creative accounting for now and focus on the changing of international debt to local debt. The international debt was at 2 to 5 % in dollars, the local debt is in Pakistani rupees at 11 to 14%. This is generally a very inflationary action. You are borrowing at a higher rate of interest. This will increase the deficit and drop the value of your currency.
Regards,
Faruk
Building a foreign exchange reserve is an expensive necessity. Lets review what happened in the 1997 Asian crisis. Foreign investors withdrew large amounts of money from Thailand. As the Thailand reserves fell more investors withdrew their investments perpetuating a crisis. The Thai govt. tried to borrow from the IMF but could not get a deal and their currency went into a free fall. Western investors decided that if one Asian tiger can crumble all can and withdrew billions of dollars from the Asian countries creating the 1997 crisis. This crisis had no economic basis just sentiment. There were no economic underpinnings for this crisis. Two economies that survived this crisis were India and China, one because most of the investment in these countries was by their own nationals and two because of large foreign exchange reserves that allayed any investor fears. If Pakistan wants to attract foreign investment it has to convince foreign investors that they can withdraw their money at any time and hence the need for the reserve.
Now why did earlier govt. not buy foreign exchange from the open market for such an obvious need? What your current govt. has done is transfer international debt to local debt. along with some creative accounting. Let?s ignore the creative accounting for now and focus on the changing of international debt to local debt. The international debt was at 2 to 5 % in dollars, the local debt is in Pakistani rupees at 11 to 14%. This is generally a very inflationary action. You are borrowing at a higher rate of interest. This will increase the deficit and drop the value of your currency.
Regards,
Faruk
#9 Posted by hobbes on September 10, 2002 4:56:37 am
SameerJB
On your question as to why China and India do not accumulate foreign reserves in the way Pakistan has - If my understanding is correct, in the case of Pakistan, it represents an ability to repay. Though it may function similarly in China and india, the economies of both China and India are experiencing sustained growth, whereas the Pakistani economy, if trends remain, can look forward to a sustainable growth rate in the near future;,that is to say, while negative growth has been arrested, the economy of Pakistan is still fragile.
I recall reading this article in ``DAWN`` and see in your question (why didn`t they do this earlier) the awareness that many times, especially in Pakistan, economic management, has not been the primary criteria for decision making and seem influenced by short term political imperatives.
On your question as to why China and India do not accumulate foreign reserves in the way Pakistan has - If my understanding is correct, in the case of Pakistan, it represents an ability to repay. Though it may function similarly in China and india, the economies of both China and India are experiencing sustained growth, whereas the Pakistani economy, if trends remain, can look forward to a sustainable growth rate in the near future;,that is to say, while negative growth has been arrested, the economy of Pakistan is still fragile.
I recall reading this article in ``DAWN`` and see in your question (why didn`t they do this earlier) the awareness that many times, especially in Pakistan, economic management, has not been the primary criteria for decision making and seem influenced by short term political imperatives.
#8 Posted by Romair on September 9, 2002 2:37:53 pm
arjun_m: I have always wondered why you get so upset when someone says anything good about Pakistan. I can understand a Hindu Indian getting upset if someone says something bad about India. But why would a Hindu Indian get upset when no one is saying anything bad about India, and are only saying something good about Pakistan?
It is truly strange behavior. Has this behavior been taught to you? Is it taught in general in India? Or are you an exception? Or have you developed it on your own? Is it due to jealousy? Or a sign of an inferiority complex? Or are you just the type of person, who is so bitter towards himself, that he cannot see anyone else saying anything good about themselves, either?
If Pakistanis agree that you are a superior person, and India is the wealthiest nation in the world and has been an economic giant since 47, will that make you stop your behavior? If it will, then let me be the first to state, that India has always been the wealthiest nation in Asia, and had you been the finace minister of India, God knows how much more it would have progressed. Does this ease your hatred? Or will you continue?
It is truly strange behavior. Has this behavior been taught to you? Is it taught in general in India? Or are you an exception? Or have you developed it on your own? Is it due to jealousy? Or a sign of an inferiority complex? Or are you just the type of person, who is so bitter towards himself, that he cannot see anyone else saying anything good about themselves, either?
If Pakistanis agree that you are a superior person, and India is the wealthiest nation in the world and has been an economic giant since 47, will that make you stop your behavior? If it will, then let me be the first to state, that India has always been the wealthiest nation in Asia, and had you been the finace minister of India, God knows how much more it would have progressed. Does this ease your hatred? Or will you continue?
#7 Posted by Faruk on September 9, 2002 1:34:37 pm
RE: The Article
I would like to compliment the author on a well-written article and the foreign exchange reserve of Pakistan. I do have a few questions for the financial manager’s of Pakistan. There is no gainsaying that the reserve is important but how you achieve it is also important.
Pakistan includes the deposits by expatriate Pakistanis as part of its reserve. This money is not available to the Pakistan govt. to repay its debt. This is the kind of accounting jugglery that got Enron in trouble.
Second, others have alluded to this too. The growth in repatriations from expatriate Pakistani’s can be attributed to the adverse investment climate for them abroad post Sept 11 th.
Third what the author has claimed as a big achievement for the current Pakistan govt. the rescheduling of debt. This is a big achievement under the circumstances, it gives the Pakistan govt. a lot of breathing space. 15 years before the first payment is due. But it should be remembered that interest will accrue for those 15 years and if the Pakistani rupee sinks further it will become a very expensive debt. The previous military govt. of Zia ul Haq went down this road too. They piled up a lot of deferred debt making them look good.
Regards,
Faruk
I would like to compliment the author on a well-written article and the foreign exchange reserve of Pakistan. I do have a few questions for the financial manager’s of Pakistan. There is no gainsaying that the reserve is important but how you achieve it is also important.
Pakistan includes the deposits by expatriate Pakistanis as part of its reserve. This money is not available to the Pakistan govt. to repay its debt. This is the kind of accounting jugglery that got Enron in trouble.
Second, others have alluded to this too. The growth in repatriations from expatriate Pakistani’s can be attributed to the adverse investment climate for them abroad post Sept 11 th.
Third what the author has claimed as a big achievement for the current Pakistan govt. the rescheduling of debt. This is a big achievement under the circumstances, it gives the Pakistan govt. a lot of breathing space. 15 years before the first payment is due. But it should be remembered that interest will accrue for those 15 years and if the Pakistani rupee sinks further it will become a very expensive debt. The previous military govt. of Zia ul Haq went down this road too. They piled up a lot of deferred debt making them look good.
Regards,
Faruk
#6 Posted by arjun_m on September 9, 2002 11:51:40 am
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#5 Posted by arjun_m on September 9, 2002 11:51:40 am
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#4 Posted by arjun_m on September 9, 2002 11:51:40 am
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#3 Posted by Romair on September 9, 2002 9:53:47 am
I read this article earlier in a Pakistani newspaper. It is a very good read.
I am extremely impressed with the team that the current govt. has put in place. It is bright, articulate, credible, with international track records of success and most of all completely corruption-free. Dr. Ishrat belongs to this group. It is much-awaited change from seeing the Abida Hussein`s becoming S&T ministers and the Asif Zardaris becoming Minsiters of Investment.
Pakistan`s economy, according to nearly all international organizations which matter (accept the International Bank of Arjun_m Inc., as well as some of the PPP and PMLwallahs), has turned the corner. The credit for this goes to people like Shaukut Aziz and Dr. Ishrat. And to Musharraf for appointing these people and then not bothering them. Now it is just a question of how quickly the economy can grow. Pakistan averaged 6% economic growth for four decades. So we should be able to get back to that level of growth.
I think somehow or the other, positions like the Governor of State Bank, should be delinked from politics, if they already aren`t de-linked (like judges), and should be completely independent, perhaps through the Constitution, for fixed amounts of time.
I am extremely impressed with the team that the current govt. has put in place. It is bright, articulate, credible, with international track records of success and most of all completely corruption-free. Dr. Ishrat belongs to this group. It is much-awaited change from seeing the Abida Hussein`s becoming S&T ministers and the Asif Zardaris becoming Minsiters of Investment.
Pakistan`s economy, according to nearly all international organizations which matter (accept the International Bank of Arjun_m Inc., as well as some of the PPP and PMLwallahs), has turned the corner. The credit for this goes to people like Shaukut Aziz and Dr. Ishrat. And to Musharraf for appointing these people and then not bothering them. Now it is just a question of how quickly the economy can grow. Pakistan averaged 6% economic growth for four decades. So we should be able to get back to that level of growth.
I think somehow or the other, positions like the Governor of State Bank, should be delinked from politics, if they already aren`t de-linked (like judges), and should be completely independent, perhaps through the Constitution, for fixed amounts of time.
#2 Posted by arjun_m on September 9, 2002 8:27:59 am
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#1 Posted by SameerJB on September 8, 2002 11:15:08 pm
Excellent article although I doubt that author will be able to interact and respond to various questions raised by chowk interactors. I have learned quite a bit about forex and its effects on the economy. I do have few, perhaps silly questions.
1) Why did not current regime during the first two years or previous regimes thought of buying dollars from the open market at 2-3 rupees higher than the inter-bank rate? Was it a secret that nobody knew about it before the author? I am positive that corruption did not stop previous governments from following this route. Actually it provides another avenue for corruption, i.e., buying in the open market from favorite dealer.
2. Where did the money in Pakistani currency came from to buy forex, given Pakistan every year and still has budget deficit?
3. Are there any downsides to this magic trick of building forex and all the benefits outlined in this article?
4. I am highly doubtful of the extremely terrifying scenario presented for the case of not having such forex. Many times during BB and Ns governments forex fell to below one billion without the panic mentioned in this article.
5. Why do not China and India accumulate even more forex given China`s trade surplus and Indian high economic growth rate compared to Pakistan?
6. Do Pakistan get interest from anywhere by depositing 5 billion dollars? If not, over time the price paid for forex actually exceeds the suggested 2-3 above inter-bank rate because the rupees used to buy forex would have earned interest if placed in Banks.
Once again, thanks to Dr. Ishrat Hussain for presenting his take on fores reserve issue.
Chowk Staff: Shouldn`t this be a University Avenue article?
1) Why did not current regime during the first two years or previous regimes thought of buying dollars from the open market at 2-3 rupees higher than the inter-bank rate? Was it a secret that nobody knew about it before the author? I am positive that corruption did not stop previous governments from following this route. Actually it provides another avenue for corruption, i.e., buying in the open market from favorite dealer.
2. Where did the money in Pakistani currency came from to buy forex, given Pakistan every year and still has budget deficit?
3. Are there any downsides to this magic trick of building forex and all the benefits outlined in this article?
4. I am highly doubtful of the extremely terrifying scenario presented for the case of not having such forex. Many times during BB and Ns governments forex fell to below one billion without the panic mentioned in this article.
5. Why do not China and India accumulate even more forex given China`s trade surplus and Indian high economic growth rate compared to Pakistan?
6. Do Pakistan get interest from anywhere by depositing 5 billion dollars? If not, over time the price paid for forex actually exceeds the suggested 2-3 above inter-bank rate because the rupees used to buy forex would have earned interest if placed in Banks.
Once again, thanks to Dr. Ishrat Hussain for presenting his take on fores reserve issue.
Chowk Staff: Shouldn`t this be a University Avenue article?
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