DAWN 2-12-2011


HOWSOEVER one refers to it — `a petrol bomb` or `adding fuel to fire` — the problem remains the same: the government decision to raise domestic oil prices for December will put pressure on an already overburdened public. Media reports suggest that the Oil and Gas Regulatory Authority has recommended that the finance ministry keep oil prices unchanged at last month`s level for fear of loss of revenue under the head of petroleum levy. Another reason for the decision is the deteriorating exchange rate over the rising current account gap. In any case, government intervention in the determination of the price of oil has defeated the very purpose of an earlier decision in June to deregulate domestic prices as well as limit the role of Ogra. The hike in oil prices indicates a future trend, and consumers should not expect oil prices to stabilise, at least in the foreseeable future.

First, global crude prices are again creeping up to the $100-a-barrel level on expectations of an economic recovery in the United States and political tensions in parts of the Middle East and Iran. Second, Pakistan`s economy is showing signs of a renewed downturn. Macroeconomic risks have increased during the last two months. The current account has widened to $1.6bn on rising trade deficit over severe energy shortages. The budgetary deficit is estimated to go up to 5.5 per cent of GDP from the estimated figure of 4.7 per cent for the current fiscal year. This is forcing the government to borrow heavily from domestic resources to plug the gap between its income and expenditure as external official and private capital inflows continue to dry up. The rupee is slipping to historic lows. Prices of food and other commodities are resurging, and the inflationary trend is showing no signs of dropping to single digits in the near to medium term. These factors have already forced the State Bank of Pakistan to reverse its policy of monetary easing for the sake of ensuring price stability to the chagrin of businessmen and investors.

But can the oil price hike stop the economic rot? Bluntly put, no. Raising prices to collect indirect taxes is bad policy. It always has negative far-reaching implications for the people and the economy. A better, though tougher, option would have been to implement the long overdue tax reforms. The implementation of tax reforms has assumed even more importance because no one in the international community is ready to proffer help unless we ourselves begin to clean up the economic mess we find ourselves in.


THE Election Commission of Pakistan needs more than financial autonomy. On Wednesday, the ECP decided to send a summary to the prime minister in this connection and sought “full financial autonomy”. While we hope the executive will satisfy the commission on this score, what the body charged with the task of holding transparent elections needs is greater control over the state`s administrative machinery. In some countries, the moment a general election is announced, the state`s administrative apparatus is placed under the control of the election authority. This prevents the ruling party or parties from using state machinery for campaigning or for influencing the electoral process. In Pakistan, even if elections are fair — there have been quite a few of them where the ruling parties were routed — ECP officials are often subjected to pressure by the government and traditional political families. In rural areas, the militias a number of feudal lords keep browbeat opponents and bully electoral officials. Also, governments transfer the `wrong` bureaucrats and police officers to sway voting. As experience shows, even caretaker regimes have undertaken large-scale transfers of police officers and bureaucrats in selected constituencies to make the electoral exercise anything but transparent.

The constitution does indeed declare that it is the duty of “all executive authorities” in the federal and provincial governments to “assist” the election commissioner in the discharge of his duties (Article 220). But this does not arm the ECP with enough powers to stand up to well-entrenched feudal and clan power that resists, if necessary by force, any attempt to erode its traditional base and deny it what it considers its right — to manipulate elections. What the ECP needs is a higher degree of control over the state bureaucracy if all of its functionaries throughout the country are to perform their duty in an atmosphere free from violence and coercion. With the general election due in 2013, there is still time for the prime minister to get in touch with the opposition and devise a mutually acceptable formula to give more administrative powers to the ECP to make it a truly independent organisation.


RULES and regulations may exist on paper but they are not always implemented in letter and spirit. Take the case of our fast-deleting marine resources. The blame here lies not only with large foreign trawlers but also local fishermen who continue to use small-mesh nets even though they are proscribed. This illegal practice results in catches that produce a high percentage of juvenile and other `waste` fish that are set apart from the primary catch and are earmarked for uses such as poultry feed. Some of the areas hardest hit by small-mesh fishing are the creeks and mangrove forests of Sindh which serve as natural hatcheries for marine life. Countless shrimp that are barely a few days old are caught along with mature varieties and are then treated as little more than refuse. The natural cycle of birth and future generation is thus broken in this callous manner that causes the depletion of breeding stock. We could, one day, face a situation where our creeks and harbours have been so stripped of their biodiversity that they can no longer meet the needs of the food chain and the survival of any number of species.

We need a serious overhaul of the fisheries industry. According to a report in this paper, nearly “60 per cent of the total catch … that lands at the Karachi fish harbour constitutes trash fish”. This figure is simply unacceptable if our marine ecosystem is to thrive, even survive. A policy review is also in order about the activities of foreign trawlers that have been granted fishing licences by the local authorities. It is widely alleged that these trawlers do not respect their territorial limits and also offload part of their catch to accompanying vessels in the deep sea before sailing in for quota-weighing purposes. Such practices must be put to an end.