Enigma of the Defence Budget

Sherry Rehman

Welcome to Chowk.

The rest...

... While I agree with the points raised by Godot... I must disagree with the ``conclusion`` drawn by others... PPP as a political force is not opposed to several of Musharraf`s initiatives... including the women`s seats... It is opposed to Musharraf`s backtracking on several issues including the uniform issue... I don`t see a contradiction between Sherry`s criticism of Musharraf and her membership of the parliament. An objection on this count is akin to saying South Asians shouldn`t have joined the legislatures under the British rule....

The real contradiction is in MMA`s stance which is opposed to women`s seats but still occupies them.

-YLH

re: godot # 9

Bravo! I second your questions to Sherry Rehman, and I too, would like an answer.

re: romair # 14

Excellent points; the hypocritical nature of Pakistani politicans is unbelievable.

Ciao

romair has raised some valid points. here is my response:

1. there is a big difference between (a) armed forces retirement/welfare fund running companies and (b) the army running those businesses directly. (b) is a strict no-no and cannot be justified in any situation and is not the case in pak. (a) is however a perfectly legitimate activity and other large public institutions such as wapda and railways should be encouraged to adapt this model to mange retirement benefits for their employees. the caveat to this should be that companies controlled by welfare funds should not receive any special treatment from the government. i do think that there have been instances this principal has been violated in pak but that is to be expected given our society. i also think welfare fund needs to maintain an arms length relationship with the army which is not the case right now. problem however is not as serious as it is made out to be by politicians and liberal press. btw, public pension funds such as calpers are huge players in the u.s. financial markets

2. businesses controlled by retired army officers such as fauji fertilizer operate far more efficiently than public sector entities whose workforce is populated with flunkies of politicians. entities in the second category include, wapda, pia and steel mills. subsidy to institutions eats up huge chunks of the pakistan budget. restructuring of these entities will free up huge amount of money from the budget besides improving the quality of services for the awam.

3. the reason for rapid growth of army related entities was that bhutto’s nationalization created a huge vacuum. businessmen obviously refused to put up investments after the theft of their property and fauji foundation was able to benefit from this vacuum. fauji foundation should not be penalized for the wrong decision of politicians.

overall, i think its in the army’s interest to make its welfare operations as transparent as possible. i think army is moving along those lines.

as JS Mill said, `a benign dictatorship is worse than a brutal one`.

today we can clearly see why. when there exists a fantastic disconnect between the social, economic and political, it reflects the collapse of civil society. and thus reinforces the fact that this country is a failed state.

[I know them from the inside. And I can tell you its all a big fraud, with huge conflicts of interests.............]

... only senior staff officers are privy to the shenanigans in the forces...what was the rank you retired as...lt. general, major general, brigadier, colonel, lt. colonel, major or was it the lowly captain...

Stuka #10: ``Is the author someone famous?``

Sherry Rahman was the editor of Pakistan`s most famous English monthly, called Herald. When Musharraf created reserved seats for women, in the Assembly, she got in on a PPP ticket. Now she argues for women`s rights etc. Which is a good thing. As is getting the Army`s business concerns out in the open. All these businesses should be privatized.......I know them from the inside. And I can tell you its all a big fraud, with huge conflicts of interests.............

Having said that, she faces the same dilema, which so many urban PPPliyas face. She is in a party, which is led by the most regressive feudals. Amin Fahim the head of her party, has four sisters married to the Quran. Benazir and Zardari, the exiled heads, have been convicted of corruption in Switzerland and face a six month jail sentence. And her party has a lifetime chairperson, and thus never holds elections...........

Everytime she comes on TV, pushing her agenda (much of which is good), she is faced with the above comments. And like most PPPliyas has no answer...............Not to mention, that she, herself, would not be in the assembly, had Musharraf not created so many reserved seats for women. Yet she is his big critic (quite ironic)............

http://www.pbs.org/frontlineworld/stories/pakistan/f.html

#10

she`s a member of the Pak Legislature (ha ha). She was one of the early visitors on the Lahore Delhi bus (mushy boy likes to push the pretty faces out to prove his ``en mo``)

actually, this might be an unfair comparison to fox news given the success it has achieved but the similarities between fox news and chowk are remarkable. both entities claim to have no specific agenda. both entities exist to push lies to lend credibility to their agenda.

the lies mentioned in the article above can be uncovered by anyone who has access to a broadband connection, excel spreadsheet and twenty minutes of free time.

details of fauji foundation`s operations can be found on the entity`s website:

http://www.fauji.org.pk/

here are some lies mentioned in the article are as follows:

1. the author says military`s foundations ``pay no direct taxes on their corporate activities``.
fauji fertilizer (ffc) is a core holding of fauji foundation. financials of fauji fertilizer shows that it tax expense amounted to 37% of its pre tax income in 2004. here is the link to the financials:

http://www.ffc.com.pk/contents/annualrep.htm

details of taxes paid by other commercial army linked entities (ALE) such as askari bank can be verified from their websites. also according to information on fauji`s website, ``The Foundation and its associated companies paid PKR 24 billion in taxes/ duties to the Government during the year 2004.``

2. author says that fauji related entities operate in a monopoly environment. this claim is absolutely hilarious. there is no sector where an ALE has a monopoly and fertilizer is the only sector where an ALE has dominant market share. foundation`s fertilizer companies however are publicly listed and traded and its operations are subjected to the same degree of scrutiny as other publicly listed companies. btw ffc trades at a dividend yield of around 9% and is an absolute investment steal in my opinion.

3. author insinuates that army linked entities survive due to subsidized operations. according to investment analyst, fauji fertilizer has the most efficient operations in the country. i can post those research reports if requested.

4. author claims that there is a ``creeping militarization of the mainstream economy``. actually the only thing ``creeping`` in the pak is arab control of the economy. arabs now completely control the telephone sector (land and mobile), and have huge stakes in the refining and banking sector. also in terms of influence, mansha is the dominant businessman in pak. his influence far outstrips that exercised by the army. mansha controls the largest textile concern (nishat) and the biggest insurance company (adamjee) and the fourth biggest bank (mcb). its widely known in pak that mansha business fortune got a boost because of his relationship with the sharifs.

waisay i am not surprised to see sherry rehman resorting to such lies. she does after all represent a party controlled by a murderer. one of my best friend`s khaloo was appointed the head of steel mills by zardari. in return, he funnled huge amount of cash to zardari. when n.s. came to power, he had my friend`s khaloo arrested who then agreed to sing against zardari. before the case could go to court, zaradri had the guy murdered. here is the reference to the murder. before the murder, zardari`s goon had been threatening murder to my friend`s family:

http://72.14.207.104/search?q=cache:7ExQBqZl1LUJ:www.dailytimes.com.pk/default.asp%3Fpage%3Dstory_6-8-2003_pg7_46+pakistan+steel+murder+zardari&hl=en

Asif Zardari indicted for murder

KARACHI: South Additional District and Session Judge (ADSJ) Abrar Hussain Memon on Tuesday formally indicted Asif Ali Zardari, accused in the murder case of former Pakistan Steel Mills (PSM) chairman Sajjad Hussain.

Mr Hussain was shot dead in September 1997 by unidentified gunmen and a case against unknown attackers was registered. The former chairman was accused of corruption in the PSM and was being investigated by Ehtesab Bureau officials. Mr Zardari was booked after an alleged confessional statement by Muhammed Khan Chachar, on death row for some other case in the Punjab. Mr Chachar allegedly told investigators that Mr Hussain was assassinated at the behest of Mr Zardari.

Is the author someone famous?

Dear Ms Rehman:

You’re brilliant writer and I’ve admired your writing for a long time. It’s so good to see you at Chowk.

However, I do have a question for you before you call the kettle black...

Why your party, the PPP, does not hold inter-party elections, something like the “primary” elections in the US where candidates compete and the voters decide which candidate they would like their party to represent as a leader of the country? Would not that process start a debate on critical issues facing Pakistan and set a standard? Would not that process throw up fresh candidates and force them to come out clean? Is that not a “true” democracy when an individual is not the Party itself? Would it not make the Party outlast the candidates? Would it not give the Party an ideology and a platform to stand on firmly and convincingly?

If you interacted at Chowk to answer questions, you’d prove that the PPP is a true “People’s Party” and that you are a politician of integrity, honesty and principle. Is it and are you?

#7 by Romair on June 29, 2005 5:30pm PT


At the same time, there are people in their mid-40s who have gone onto become entry level pilots, because the military placed them there!! Which airline of the world hires entry level pilots in their mid-40s, when there are so many available, in their 20s, who are qualified?

When I retired, I seriously thought of joining PIA.


Well they hired NHK after he got out of the PAF....and he`s a real fighter jock, not a grease monkey like you...If you`re picking things they do wrong, that`s probably the worst example.

In any case, Pakistan`s loss(gain) is Canuckistan`s gain(loss?)....I`m sure the canuckistanis need your fantastic IT business skills more than the PIA needs pilots...after all, the PIA already had(or had) people like NHK...what does canuckistan have?

The more I research into the Pakistan military (read Army`s) business holdings, the more amazing it gets. They are truly unbelievable. Pakistani generals must be amongst the richest in the world. Perhaps I should have stayed in the military!!

Someday, time permitting, I will try to write about it. People`s jaws will drop, when they find out how much, and how quickly these guys make money. People have made close to a crore ruppees in a day (seriously speaking). Other(s) have gotten plots allocated in green areas and forced banks to finance them..........

Then there is another racket, where every retired guy ends up in PIA, or PIDC, or CAA or somewhere, simply through military placement. Even when they are not needed and someone else can do the same job. When I retired, I seriously thought of joining PIA. I had the licenses, the degrees and the age. But did not have the contacts. At the same time, there are people in their mid-40s who have gone onto become entry level pilots, because the military placed them there!! Which airline of the world hires entry level pilots in their mid-40s, when there are so many available, in their 20s, who are qualified?

Nearly every organization run by the Army is in a loss. I have it from the horse`s mouth. There are only one or two that keep the whole Fauji foundation running. There are unbelievable hostile take-overs of privately owned companies, through arm-twisting.

The PAF`s Shaheen Foundation just got into the call-center busines. While the Army recently got into the software business. Now why are these business set-up. If the Army needs an organization to run its computer systems, why doesn`t it just form a group, inside the Army, under Signals? Becuase it needs to employ retired Generals and their kids in civilian companies...........

Quite a few of the expats on Chowk have dads who were in the Army. Including quite a few, who now criticize it.............

The big saving grace of the Pakistan military is that all of the above is limited to Brigadiers and above. Lt. Cols. and below are still fighting for flag and country, at meagre salaries, in the boondocks of Pakistan, against much much larger armies. People of these ranks, and specifically the jawans, retire as paupers, in many cases..........

I think the author may have missed the biggest financial problem, related to the Army. It is a crisis. There are now more retired Army personnel than serving. And the pension bill for the Army is larger than the salary bill now............

There is a simple solution to this:

- Cut the General Staff by 2/3rd
- Get the military out of the business sector completely
- Raise the salaries of the qualified young military officers manifold, to at least bring them, in line to some extent, with the public and private sector

Stuka,

I am not comparing budgets. All I am pointing out that she should have researched this piece instead of writing childish stuff.


I know what the Pak army is doing and people who oppose the army w/o the accurate knowledge actually end up helping the army.

The army in Pakistan has developed its own interests and it will protect them no matter what.

Bombing the tribals in the NWFP and dropping bombs on the baloch isn`t cheap?

who`da thunk?

HP:

The Indian defence budget includes pensions which is actually one of the higher components. Also, the Armed Forces in India do not have commercial interests outside the miniscule Army Wives Welfare Association etc which handles things like melas etc.