Enigma of the Defence Budget

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?

Is the author someone famous?

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.

#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``)

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

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)............

[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...

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.

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.

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

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

She`s got nice legs.Pak has a parliament???.I`ll be darned.

i couldnt agree with Ms. Rehman more! However, it`s interesting to point out two facts here:
1) Ms. Rehman wouldnt be a parliamentarian had it not been for the Mush government`s ``womens` quota``.
2) Ms. Rehman`s ex-husband Bari Mian made a fortune on the submarine deal. Ms. Rehman`s divorce settlement was financed by her ex-husbands` fortune made on defence deals. If Ms. Rehman feels so strongly about shady defence deals maybe she should have returned that money to the public exchequer and put her money where her mouth is.

R.

Re: # 21

Oh!!.She`s that kind of pak woman.Well, at least she maintains her figure.Ever take a look at what we got in our parliament in India??.Frump would be a compliment, i say.The likes of Margaret Alva, Najma Heptullah,Mamta Banerjee,Sonia Gandhi,Renuka Choudhary...I rest my case.God bless them though, they`re real MP`s having won their seats through blood , sweat and tears.The only fairly decent looking woman MP in the 14th Lok Sabha is Ingrid Mcleod from Chattisgarh state.

I totally agree with the writer. Pakistan army has destroyed every institution in the country. It has also hijacked the nation by taking self declared duty of scavenging every institution from corruption. No doubt it has taken shape of a mafia controlling not only almost all of the government institution but also many commercial ventures, while keeping itself immune from any kind of accountability or competition. In this way it is not only destroying the working structure of government sector but also depriving people of healthy competitive environment in the private commercial sector too. Every new move of the government is taking people further away from the dream of a free democratic culture. I will like to add some links that highlight the money-making activities of the army.

www.satribune.com/archives/oct7_13_02/LATIMES_story.htm
www.satribune.com/archives/sep23_29_02/P1_armylist.htm
www.msnbc.com/modules/new_battlefield/pakistan.asp
news.bbc.co.uk/2/hi/south_asia/4491541.stm
www.bm.com.np/bm/news/international.php?newsid=1838

#3 by HP

In India defence spending is handled by Defence Accounts Dept which falls under the Ministry of Defence. DAD is solely responsible for disbursing funds, salaries and pensions, maintaining accounts and conducting audits. Officers are completely civilian though they can avail benefits of military canteens for subsidised goods. Resident officers are also provided with army quarters within cantonment or military base. I wont say that there`s no corruption or financial misappropriation within DAD but the nature of the game is entirely unlike Pakistan`s.