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8/8/2019 Focus on Pakistan
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A S I A N P E R S P E C T I V E S S E M I N A R
Focus on Pakistan
1 Introduction
3 Economic and Political UpdateShahrukh Rafi KhanSustainable Development Policy Institute
11 Legal and Judicial Reform in PakistanErik Jensen
The Asia Foundation; Transnational Business Law Program,Stanford Law School
15 Democracy and Pakistan’s Role in the International CommunityAhmed RashidFar Eastern Economic Review; The Daily Telegraph
19 Questions and Comments
30 Seminar Participants
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1
A S I A N P E R S P E C T I V E S S E M I N A R
Asian Perspectives: Focus on Pakistan is part of an
ongoing series of seminars sponsored by The Asia
Foundation. Convened on February 3, 2000, at the Carnegie
Endowment for International Peace Building in Washington,
D.C., the seminar focused on the current political situation
in Pakistan and its ramifications on civil society
development, economic and security issues, as well as
Pakistan’s role in the international community and the
future of its democracy.
Seminar speakers included Dr. Shahrukh Rafi Khan,
Executive Director for the Sustainable Development Policy
Institute; Mr. Erik Jensen, The Asia Foundation’s Senior Law
Advisor and former Asia Foundation Representative to
Pakistan; and Mr. Ahmed Rashid, Correspondent for the Far
Eastern Economic Review.
Introduction
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A S I A N P E R S P E C T I V E S S E M I N A R
My focus will be the economic and structural
problems facing Pakistan. First, I will give a brief
historical prospective, followed by a discussion of the state
of the economy and the December 16, 1999, economic
revival plan put forward by the government of General
Pervez Musharraf.
I will talk about what has been achieved to date and
then offer my prognosis regarding the military government’s
chances for success.
The Coup: Legitimacy versus Right Action
My view on the military government in power since the
October 1999 coup reflects my personal ideology on the
subject of military rule, the importance of the rule of law,
and the sanctity of the political process. At the same time,
my position takes into account the fact that I believe the
country regressed under the regime of Nawaz Sharif. I also
have concluded that at this point in time, most Pakistani
people are not as concerned about the way the current
government came to power as they are about the future of
Pakistan.
Consequently, my take on the Musharraf government is
a measured one. I believe in people having choices and once
they have that ability, they can be counted on to eventually
create the conditions that are necessary for stability. It may
take time, but stability will be the outcome.
I also draw on historical circumstances where power was
diminished once it was assumed. Clearly, history will be the
judge of those who do or do not abuse the power they seize,
and more times than not, usurped power is badly used. But
legitimacy here is not the result of a right action. Instead, it
is based on the law and the political process. This is my
personal view.
Still, the right action is always welcomed. And as a
member of the Sustainable Development Policy Institute in
Islamabad, I welcome the opportunity to engage in policy
that the current government affords me. I am a pragmatist.
At the Institute, we decided to engage with the government
provided the work was deemed to be in the national interest.
So far, it has been the Institute’s decision to engage the
government because its leaders have been quite open and
welcoming. In fact, we see our work with this government as
a policy opportunity.
The Economy: Foreign Exchange Reserves andFiscal Deficit
In his economic revival plan of December 16, General
Musharraf put his finger on the major problems that are
confronting the country. The first, he said, is a low foreign
exchange reserve — totaling $1.6 billion. On both an
absolute and relative level, $1.6 billion is very low. On the
absolute level, this amount of reserve will not buy very much
time if the country suddenly is pressed to cover the cost of
imports to sustain life and livelihood. On the relative level,
India sits just the other side of the border, holding foreign
exchange reserves of over $30 billion (as of six months ago).
Pakistan is a country in a fairly desperate situation. It
has a fiscal deficit — and a chronic inability to raise enough
taxes relative to its necessary expenditures. The tax effort is
about 10.4 percent of Gross National Product (GNP), which
is one of the lowest in the world.
The second major problem concerns the savings rate,
Economic and Political Updateby Shahrukh Rafi Khan
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4
which is very low at 11.1 percent of GNP. It also is one of
the lowest in the world. The country also has a chronic
balance-of-trade deficit — and as you know, deficits and
savings rates are interrelated.
Interest and Exchange Rate Liberalization
A historical perspective on how these problems started can
be instructive. For starters, the government has taken some
bad advice over a period of time. Clearly, each government
in the world’s economy is responsible for the bad advice
they take, but there was one bit of particularly bad advice,
namely that we engage the country in something called a
financial depression. This was clearly a mistake.
The solution was to liberalize, in particular, the interest
rate and the capital markets. It was decided that the interest
rate in Pakistan was too low — at 4 to 6 percent.
Liberalization of the interest rate would peg rates at 18 to
20 percent, it was argued. That was thought to be about the
right level. But when the government moved to liberalizeinterest rates and capital markets, suddenly they were faced
with a huge domestic debt problem.
When the government was asked to borrow from capital
markets instead of from banks, they found their domestic
deficit increasing. The government also started looking
abroad to borrow money. And it began to print money,
which meant that foreign debt and inflation both began to
mushroom. Through it all, no research was conducted.
Instead, only some very feeble evidence based on cross-
country analyses was gathered.
Another piece of bad advice that the government took
was to let the market determine the exchange rate. At the
time, the economy was operating on a fixed exchange rate.
The advice was to devalue the rupee, presumably because
inflation was causing our exports to be non-competitive.
The real problem, however, was little or no ability to
solve our economic structural problems on the supply side
and a lack of quality. Nonetheless, Pakistan was asked to
engage in competitive devaluations that ended up buying
little in terms of improving the balance of trade.
Where the advice did succeed was to sink Pakistan
deeper into a rather vicious cycle of inflation and
devaluation which had been going on for a while.
Fortunately, that cycle now has been arrested.
The devaluation’s impact on the debt was clear. During
the 1970-1971 devaluation, the value of the rupee to the
dollar was 4.2. This changed to 9.9 rupees to the dollar.
And debt as a percentage of GNP jumped from 1.3 to 3
percent — not including short-term interest rates — from
one year to the next.
Current State of the Economy
Now, consider the state of the economy today, but keeping
in mind that the debt problem remains one of Pakistan’s
major problems. Pakistan’s economy is small, amounting to
about $56 billion. But because the economy is small, theproblems are large. To provide a little more perspective, the
trade deficit alone in the United States is expected to be
$267 billion in fiscal 2000.
Tracking the economy forces one to rely on news reports
to some extent. And often, it can happen that a government
source reports statistics that are quite opposite from what
reporters say. Still, it can be the only recourse since there
frequently is quite a lag in reporting official statistics.
Another factor is that the administration currently in power
can be considered only partially responsible for the current
state of the economy. As of right now, General Musharraf’s
regime is only four months old.
That said, the debt as a percentage of Gross Domestic
Product (GDP) was estimated to be 3.9 percent in 1998-
1999 compared to 1.3 percent in 1971-1982 and about 3
percent in the mid-1980s. The related interest rate burden in
fiscal year 1999 was about 32 percent of total expenditures
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— for both local and foreign debt. Military expenditures
amounted to 22 percent of GDP, compared to 25 percent in
1991. Combined, today’s interest burden and military
expenditures total 54 percent of GDP.
Interest payments have mushroomed. In 1991, they were
19 percent. Today, they are 32 percent. The expected growth
rate is roughly 3 to 4 percent, whereas in the 1980s, the
growth rate was roughly 6 percent. So Pakistan continues to
be in a slowdown when today’s
economy is compared with the
economy of the 1980s.
Some fiscal discipline has been
exercised, however, largely
because of structural adjustment
loans issued to the country. The
discipline shows up in the low
inflation rate, which has been 3.4
percent — the lowest ever —
during the first six months of thecurrent fiscal year. This is the
result of the economy slowing
down, which, in turn, is caused by International Monetary
Fund (IMF)-imposed monetary and fiscal restraints.
At the same time, the cotton harvest is expected to be
decent this year. That is good news for a mono-economy. In
fact, the cotton crop can make quite a big difference when it
comes to how well the economy in Pakistan does. Sugar
cane and rice also are expected to do well. There are
indications, too, that the manufacturing sector will pick up.
Quantities are increasing and unit prices actually are falling.
Still, imports have risen by 11.7 percent, and exports have
declined by 7.4 percent. The trade deficit during the first six
months of fiscal 1999-2000 increased by an estimated 39
percent. But because of the expected rice and cotton crops,
the Minister of Commerce continues to expect that Pakistan
will meet the target of $9 billion for exports this year.
The decision to freeze foreign currency accounts after the
nuclear tests in 1998 also put a lot of pressure on
remittances and the in-flow of currency into Pakistan. Most
of that money has disappeared, and it is suspected that a lot
is going through informal channels — or what we call the
Hundi system. For example, there are payoffs in the Middle
East and corresponding payoffs in Pakistan. Because money
wasn’t coming through official channels, foreign exchange
also was not available through
the official banking system.
However, that has changed a bit.
In the current fiscal year, foreign
exchange reserves total $402
million — compared to $375
million during the first six
months of fiscal year 1998-1999.
Foreign direct investment of
$306 million represents an
increase of 25 percent during thefirst six months of the current
fiscal year, relative to $255
million last fiscal year. The tax effort also has gone up to
some extent — 27 percent relative to the first six months of
last fiscal year — because of the generalized sales tax.
The stock market is not that reliable of an economic
indicator because it represents a narrow and highly
speculative market. Nonetheless, it does reflect something
about the state of confidence in the economy. The stock
market actually has gone up relative to a decline to 800
following the freezing of foreign currency accounts. It now
has gone beyond 1800, which represents a big jump. Much
of this happened after the military government came into
power.
Economic Revival Plan
Economic revival plans are not new in Pakistan. In fact,
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A S I A N P E R S P E C T I V E S S E M I N A R
Pakistan’s economy is
small, amounting to
about $56 billion. But
because the economy
is small, the problems
are large.
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6
revival plans get announced again and again. So, there was
no novelty to the plan General Musharraf introduced last
December. Indeed, he addressed many of the same problems
that have been highlighted in the past. The key difference,
however, is how his military government proposes to
implement the plan. Already, some change is taking place
but we will have to wait and see on most issues.
General Musharraf’s revival plan has five aspects,
starting with poverty alleviation. Here, the initial intention
was to set aside money from a fund that has been used by
members of parliament to pay for patronage projects and to
earmark it for development projects, etc. Some $15 to $20
billion was set aside for district development advisory
boards, which were to be organized to allocate the funds.
Once the project was announced, local politicians were up in
arms, and there was widespread speculation that the project
was a thinly veiled attempt on the part of the army to build
a constituency for its government. So, the plan has been
shelved for the moment, and there is a search underway foralternative ways to distribute money for poverty alleviation.
Another approach involves streamlining the use of the
zakat , which are Islamic compulsory taxes applied on
savings. We still are waiting to see how this will be
accomplished, but there also has been a lot of talk about
corruption in this regard.
Another consideration is to set up a large micro-credit
bank along the lines of the Grameen Bank in Bangladesh.
We also are awaiting progress on proposals to allot state
land to individuals who are not landholders. And finally,
there is a food stamp scheme that now is being finalized.
These then, are the key elements of the government’s
poverty alleviation strategy. The intention also is to work
with nongovernment organizations (NGOs), especially those
that have demonstrated success in the area of development.
In fact, NGOs are expected to figure very prominently in the
strategy’s implementation.
General Musharraf’s revival plan involves ways to
encourage agriculture. There is interest in an import
substitution strategy, particularly with regard to edible oils.
The government hopes to raise the support price for wheat
and thereby encourage production and reduce imports.
There is also a plan to extend credit to small farmers. Better
water management is another component, with the military
already engaged in massive de-silting of canals.
Here, the intention is to find ways of ensuring the fair
distribution of water to small farmers and to curtail the
practice of high water capture on the part of large farmers.
With the increase in the support price for wheat, there is
also a greater urgency for direct subsidies, such as food
stamps.
Meanwhile, the economic revival plan promotes three
steps for exiting Pakistan’s debt trap. For short-term debt
relief, the government is engaged in talks to buy time and
reduce interest rates. The intention is to rectify the problem
of interest rate liberalization and its effect on ballooningdomestic and foreign debt. Already, interest rates have
declined by 2 percent.
The hope is that the lower interest rates will boost the
manufacturing sector also. Expenditures are to be financed
entirely by the tax effort. The privatization drive also will
continue, with all monies collected designated for debt
retirement under a plan that was drafted but never executed
under Sharif.
The Musharraf government also intends to put in place a
very active debt management system and to cancel the large
public sector projects that were announced by the Sharif
government. This is similar to the course of action followed
when Moeen Quereshi came to power in 1993. The
government also says it will encourage remittances, but here
it seems a bit confused. Remittances are a liability and not a
government asset. The government has to generate more
taxes than expenditures if it is going to buy and convert
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liabilities into assets.
Indeed, the last government froze foreign currency
accounts — considering them to be an asset rather than a
liability. This caused a great deal of damage to investor
confidence at the time, from which the economy still has not
recovered.
Tax reform is another goal. The new government intends
to continue reforms that were outlined by the Sharif
government but again never implemented. Measures include
an agricultural income tax, provisions to document the
economy, a generalized sales tax, a plan for broadening the
tax base, and procedures for improving government
administration. However, a key difference between this
government’s plan and that of the last is that this time, the
government has, as of yet, not announced a money-
laundering scheme — to whiten black money. There will be
no amnesty regarding this money — and this reflects a
welcome change.
In terms of a growth strategy, the Musharraf governmentis moving, as was indicated earlier, toward substitution for
agricultural imports; encouraging agriculture through a
market strategy that involves raising support prices and
credit; and shifting livelihood dependencies from large-
sector manufacturing to small and medium-size sector
manufacturing.
There is also a focus on the oil and gas sector. The
government is trying to resolve the conflict with independent
power producers (IPPs), which as some of you may know
has caused a lot of problems. The last government broke a
sovereign contract with the IPPs. Sharif used this issue to
derive political capital because the original contract was
concluded under his predecessor, Benazir Bhutto. It was
argued that kickbacks were involved and that the electricity
purchase rates that were contracted were too high relative to
those in countries like Bangladesh and Indonesia. In fact, the
breaking of this sovereign contract caused a number of
problems, starting with the disappearance of foreign direct
investment amid a serious crisis of domestic business
confidence.
Another point being advanced is that Pakistan could
have a comparative advantage in the information technology
sector. The country has the necessary human capital and at a
level that approaches India in this field.
So far, about 10 billion rupees in defaulted loans have
been recovered, and 20 billion rupees worth of debt has
been rescheduled. This has bought the government a little
time. The recovery of dodged taxes, on the other hand, is
much harder. Little has been said as to how much has been
recovered. There also have been re-negotiations with smaller
IPPs, which provides the government with something like
750 million rupees per year. This is a fairly significant
outlay.
Defense spending has been cut by about 7 million
rupees, and the money has been earmarked for poverty
alleviation. Also, the military’s work on de-silting the canalscosts half of what it cost the last time it was done and is
being accomplished in half the time.
There is hectic and feverish planning for decentralization
and the devolution of powers to the grassroots level. There
has been an increase in sales tax on the energy sector. In
addition, a 10-percent rise in the price of oil is explained in
terms of prices on the international market. The public
sector development program has been cut from 108 billion
rupees to 100 billion rupees, which is a problem when
economic growth has slowed.
Still, a lot of these measures, including an extension of
the generalized sales tax, raising oil prices and negotiating
with independent power producers are part of an overall
effort to meet the conditions that were set down by the IMF
for balance of payment support. About $4 billion in debt
has been rescheduled.
In summary, the Musharraf government seems to be
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A S I A N P E R S P E C T I V E S S E M I N A R
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going in the right direction. As I said earlier, the issue is
implementation. To that end, this government has focused
on the tax effort. They realize that they must ensure that
taxes exceed expenditures, particularly if they are going to
buy foreign exchange that comes as exports or remittances.
Overall, the strategy also is to help create sustainable
livelihoods for people, particularly in small and medium-size
industries and to build up the capital of the poor through
credit, land distribution, water,
education and improved health.
On the subject of education and
health, the government’s
intention is to devolve power to
the grassroots level to make
people more responsible for the
services that are delivered to
them. The idea here is that
responsibility at the grassroots
level will improve quality.Finally, a just peace is
essential. In my view, this could
mean bringing in the Kashmiri stakeholders if and when
talks resume. The Kashmiris have their own sense about the
right to self-determination, and they have to be major
players if there is ever going to be peace.
A Prognosis
Here, it makes sense to compare General Musharraf with
General Ayub Khan, who came to power in 1958. On the
surface, both are (or were) very well meaning. However, it is
fair to say that problems today are much more complex than
they were in the latter part of the 1950s. For one, there is a
much more bloated and corrupt bureaucracy in place. When
it comes to accountability and public sector reform, the
bureaucracy in Pakistan clearly is part of the problem. The
country needs a bureaucracy to implement solutions, but it
should be streamlined and made accountable.
Today’s politicians are much more serious players than
in the past, particularly the Jamaat-i-Islami. At the same
time, the judiciary is more of an unknown than before.
Despite the new oaths that judges were required to take
under the Provisional Constitution Order, many still claim
that they retain the right to entertain cases against the
October 12 coup. This is a looming problem.
In short, the scale of problems
today versus 1958 is much greater.
There is also the budget deficit, the
balance of trade deficit, and a huge
debt. Privatization also is an issue
that was not in the picture in 1958.
The problem back then had to do
with regulation and the lack of
competition. In fact, Pakistan
missed the bus on that one, which
is compounding the problems weface today.
People today also feel a greater
sense of urgency about the country changing than they did
under General Ayub Khan. There is less willingness to be
patient than there was 40 years ago. At the same time, this
government may be able to buy some time because they are
perceived as honest. It is this perception of corruption that
generates so much social disaffection.
The Musharraf government also seems serious about
devolving powers to the grassroots level and about building
participatory democracy. Similarly, they want to project the
practice of participatory democracy to the district and
provincial levels as well as at the national level. Still, at
present, there are few realistic approaches for making this
happen.
We have a problem in that power is concentrated in the
hands of landlords and district administrations. While the
8
The Musharraf
government seems
serious about devolving
powers to the grassroots
level and about building
participatorydemocracy.
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devolution of power to the grassroots level is an issue that
must be addressed, it is not clear to me that this government
really sees that need. In the meantime, however, land reform
is not off the agenda entirely. It is being talked about, but
there are no signs that warrant optimism.
Finally, the fact that the army increasingly is playing a
productive role buys the government some goodwill. A case
in point that was mentioned earlier is the military’s work on
de-silting the canals. So, this government may have more
time than was thought originally.
On the subject of a referendum, the holding of such a
poll is questionable. A referendum would determine whether
this government should continue with its reform programs
or not. It also would buy this government a certain amount
of time. However, a referendum instituted by a government
without legitimacy may not be viewed as legitimate, and
perhaps the military government knows that.
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A S I A N P E R S P E C T I V E S S E M I N A R
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It has been nearly a year since several of us at The Asia
Foundation first discussed a forum on Pakistan. At the
time, I thought my assignment would be relatively
straightforward and that I could build on a 900-page study I
had completed on legal and judicial reform in Pakistan. But
because circumstances have changed substantially in the
interim, I will focus my remarks on constitutional issues.
Let me add that my remarks reflect my five and one-half
years of experience in Pakistan and are my responsibility in
the event they do not represent a shared viewpoint with The
Asia Foundation. Three sets of issues form the basis for my
remarks:
What role governance, politics, and U.S. foreign policy
play in Pakistan;
What role the judiciary plays when it comes to political
change in Pakistan;
The current attitude in Washington as expressed in
published commentary, about prospects for returning
Pakistan to democracy and civilian rule.
Before beginning, I would like to provide some context
by way of offering a personal anecdote. It was spring of
1998, and I had just finished a rather long study on
governance issues in Pakistan. I worked very hard on this
study and then watched it land on a shelf somewhere in the
Planning Commission, collecting dust. I was tired. Indeed, I
was ready to leave Pakistan. At the time, I thought that I
had tried quite enough.
Then, I met a prominent human rights lawyer in
Pakistan. Over a three-hour lunch, she convinced me that
we should work together on a legal and judicial reform
project. When I said, ‘I am tired. I am ready to go,’ her
response was stunning. ‘That’s easy for you to say!’ she
retorted. It reminded me at the time and many times since,
of the words of Ashish Nandi, a wonderful Indian
philosopher. Nandi said and I quote, ‘Our inability to
imagine alternatives is the surest guarantee of oppression.’
And so I wish to stress at the outset that there are many
in Pakistan who are working tirelessly to ‘imagine
alternatives.’
Governance and Politics Today
As recently as last June, I was convinced there was not much
hope for the country. Indeed, the subject of a talk I gave in
July, focused on Pakistan as a frail, if not a failed state. Then
and now, five indicators of a failed state were becomingincreasingly apparent.
The first concerns a sovereign state’s responsibility to
protect its citizenry. In Pakistan, this responsibility is hardly
robust. Second, public goods are not being delivered. In fact,
Pakistan ranks about 145th on the human development
index of the United Nations Development Program. The
third indicator is the apparent failure to design and more
importantly, to implement policies for economic growth.
Fourth, there is a failure to uphold the law, which is a point
I would like to return to later. Finally — and this may be an
arguable point — there seems to be a failure on Pakistan’s
part to act responsibly when it comes to international
relations. As I said, the fifth indicator is a contested issue.
Another issue that could become an indicator of future
problems is the possibility of fractures within the Pakistani
military, as has been suggested in various newspaper
commentaries. If true, this is a very serious and strategic
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A S I A N P E R S P E C T I V E S S E M I N A R
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issue. Indeed, it could very well be the most serious threat of
all to stability, if not to the country’s very survival.
Again, if this analysis is on point, it raises the immediate
question of implications for U.S. foreign policy, in particular.
Here, I would suggest that support for the forces of
moderation, deliberation, and tolerance in Pakistan should
be an important U.S. objective. The dynamics in Pakistan are
very fluid, and one cannot just superimpose a vision of what
democracy is or should be divorced from those dynamics.
At this point, I would like to return to what it might
mean for Pakistan to return to democracy. I would contend
that we have to take democracy off its so-called theological
shelf and put it into practice. I will explain what I mean as I
go along.
The Judiciary’s Role in Political Transitions
The situation currently is that the High Court and Supreme
Court judges have been asked to take an oath. A total of six
justices have refused and left the court. Meanwhile, fivejustices have been appointed based on seniority for the most
part. There were no surprises with these appointments — or
with the resignations, for that matter. Indeed, it seems
legitimate to ask how any justices could continue to serve
following a military coup. The principled response has to be
that either they declare the coup unconstitutional or they call
for a constitutional convention.
The military government’s decision to ask the justices to
take the oath was a blow. But then, there have been many
blows over the course of Pakistan’s constitutional history. In
fact, it is fair to say that constitutional history in Pakistan is
peppered with accommodations. Just to put current
circumstances in perspective, there was the storming of the
Supreme Court in 1997 by party members and politicians
who were loyal to the then-prime minister. At the time,
political loyalists pressured the court to make certain
decisions and the court’s chief justice to step down. It was an
incredible moment of transition itself.
To date, the court has acted to validate the military
coups of 1958 and 1977. No constitution was in place
during most of the 1950s, and martial law prevailed in the
1960s. In the 1970s, the elected prime minister frequently
resorted to wielding emergency powers. And then there was
Dorab Patel, a former Supreme Court justice now deceased,
who characterized the court’s action regarding a military
coup. He asked, and I quote, ‘How do you expect five men
alone, unsupported by anyone, to declare martial law
illegal?’
Indeed, I think it would have been too much to ask this
Supreme Court to declare martial law illegal, in part because
that would have been contrary to Pakistan’s actual
constitutional history. And today’s situation appears similar
to the past. Also, it would be very difficult to find many in
Pakistan with whom the military coup of October 1999 was
unpopular. If you take into account the so-called doctrine of
necessity, public order can take precedence over political rule— and that is the point of view that has reared its head
again.
After the Supreme Court was stormed in 1997, I recall
remarking to a prominent Pakistani politician that the
country’s constitutional history seems to be based on this
doctrine of necessity — more so than any other country in
the world. The politician agreed, adding, and I quote, ‘There
has been too much necessity and not enough doctrine.’ I
found that a fairly telling response.
So, where are we today? Makdoom Ali Khan, a very
fine constitutional and commercial lawyer in Karachi, has
written, along with others, that it now may be time to
review the 1973 Constitution. He is saying essentially — but
not in these words — that the 1973 Constitution is a piece
of Swiss cheese. It is replete with internal conflicts. There is
a failure to connect what is in the Constitution with what
gets practiced on the ground. Indeed, this could be a very
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good time for Pakistan to consider calling a constitutional
convention to rework this document.
What we are seeing is, in effect, constitutionalism as
practiced under the doctrine of necessity by a judiciary that
is engaged in political transition. That is why there could be
a parallel activity to a constitutional convention —
something akin to a truth and reconciliation commission.
This is what I suggested in the governance study that I did
for the previous government in
Islamabad.
At the time, I suggested it
would make sense to drop
actions against the previous
regime and get on with the life of
the nation instead of patterning
themselves after the
accountability investigations or
ehtesab that raged under Benazir
Bhutto. It made sense to advocatethat the sitting government stop
flogging its predecessors. Political
persecution of the preceding
regime has been and continues to
be a very major part of Pakistan’s
political story. It also becomes an
excuse for government not to
deliver the goods.
In fact, when one democratically elected ruler comes to
power, there is every expectation that the opposition will
have to fight lawsuits throughout the entire time that the
other group is in power. That is exactly what has been
happening ever since 1988. There have been perpetual
lawsuits filed with the courts, which by extension, enhance
the judiciary’s role in a political transition.
So, when one tries to imagine alternatives to the present
day situation, one thinks fairly seriously about something
like a truth and reconciliation panel. It would seem this
would be a way to satisfy the need to strike a balance
between prosecution and punishment, on the one hand, and
forgiveness and forgetting, on the other. It would alleviate
any effort designed to victimize those who held power under
a previous regime.
Another model is to forgive but do not forget, which is
the South African model. The Chilean model and the
International Truth Commission
in El Salvador worked to lesser
extent. Still another model is
straight criminal prosecution,
which is the Ethiopian model of
filing lawsuits against 5,000
previous office holders. At any
rate, the alternative should not be
bringing criminal prosecution
across the board. If there is the
intention of prosecuting, it shouldbe done in a targeted way and
then every effort made to get on
with the life of the nation.
One more thought about the
state of the judiciary in Pakistan.
There is a lot that should be done
when it comes to institution
building, particularly among the subordinate judiciary. On a
historical note, it was no less than Alexis de Tocqueville who
argued that the local courts were the most important in any
judiciary. In Pakistan, local courts are in a woeful state of
disrepair.
The Return to Democracy or Civilian Rule
So, how does one get beyond authoritarian democracy in
Pakistan? Another way to ask the same question but from
this side of the Atlantic, is to ask how Pakistan gets beyond
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A S I A N P E R S P E C T I V E S S E M I N A R
... a truth and
reconciliation panel
would be a way to
satisfy the need to
strike a balance
between prosecution
and punishment, on the
one hand, and
forgiveness and
forgetting, on the other.
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the Washington policy discourse described as democratic
formalism?
Indeed, if killing or severely punishing your political
enemies is unacceptable in a democracy, then Pakistan fits
the description of a very weak democracy. On the other
hand, if power is dispersed and groups are permitted to
compete with one another, then conditions for the rule of
law are allowed to again emerge. These conditions have been
rather weak during the modern era in Pakistan. In fact, if
you look at how political parties have functioned and
consider how they would function if a national election were
called now, there is every reason to delay the election for a
period of time.
At this point, I would like to go back in history and read
a portion of a 1959 administrative order. It provides some
perspective on what democracy can mean in Pakistan:
‘Democracy is not merely concerned with the location of the
source of power — and not the form of organization for the
channelization of power. The concept of basic democracy isbased on the hypothesis that democracy is not an end in
itself, it is only a means to an end, the end being the welfare
of the people.’
Clearly, this is not a comprehensive definition, but it is
an instrumental definition. Likewise, the administrative
order is helpful when seeking historical grounding for
making recommendations, in this case for the Pakistani
government. It was issued when Ayub Khan was in power
and is quite a famous, yet basic program for democracy. In
fact, it seems to me that if you are capturing something from
the past, then this is something that is not all that bad,
especially when trying to move forward. However, even the
Basic Democracy program faces cynicism regarding its
implementation these days.
Four benchmarks and/or recommendations come to
mind when considering a move beyond authoritarian
democracy and away from democratic formalism. The first
is to hold local elections, which would be in step with the
interests of the Musharraf government. In fact, the regime
has considered doing just that this year.
There are some rather extraordinary Pakistanis who
have associated themselves with this regime in order to help
brace the country for survival and hopefully its future
revival. In this sense, local elections would be an opportunity
to begin the democratic experience anew. Clearly, there are
some who will look at this cynically and say, well, Ayub
Khan did something similar, and no democratic rule resulted
from it. But I believe there is a serious opportunity now and
genuine interest in holding local elections.
A second recommendation would be to develop a bona
fide truth and reconciliation process that moves beyond the
past and into the future. By definition, this process becomes
a device for achieving accommodation. For those of us who
have experienced the discourse in Pakistan over a number of years, victimizing the previous regime does nothing more
than deflect accountability within the current government.
A third and somewhat more difficult goal would be to
hold a constitutional convention. The 1973 Constitution
needs revision. Pakistan also needs a common understanding
of the nation’s legal and constitutional life. I have no
substitute recommendations on how that might be
structured. It’s a very difficult thing to do.
A fourth recommendation involves increasing social
sector spending and decreasing military spending. It seems
this is already being done to a certain extent. Pakistan needs
to start to seriously examine resource distribution as a very
important input into the democratic experience.
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My remarks will focus on the coup itself and less on
the last 10 years. Most of you already have some
idea of the kinds of problems Pakistan faced under Benazir
Bhutto and then Nawaz Sharif. By the same token, most of
you will recall that Pakistan has had three military coups in
its brief history. In fact, it can be said that Pakistanis are
great experts when it comes to military coups and are able
to execute them with considerable precision.
That said, the coup of October 1999 can be viewed in
light of four elements.
The Coup’s Distinguishing Factors
First of all, the October 1999 coup was not promoted by
the military, even though the military had been deeply
provoked. The army certainly was prepared to move against
Prime Minister Sharif and had gone so far as to warn the
prime minister that if he attempted to sack Army Chief of
Staff General Pervez Musharraf, that General Musharraf
would not go as quietly as had his predecessor. In October
1998, Sharif sacked then Army Chief of Staff General
Jehangir Karamat and appointed Lt. General Musharraf to
take his place. So, this was not an army-provoked coup.
Secondly, Musharraf did not assume power with any
intention of installing perpetual military rule as was the case
with Ayub Khan in 1958 and Mohammad Zia ul-Haq in
1977. Thirdly, the military took over essentially without a
clear-cut agenda. In fact, the wide-ranging speech delivered
by Musharraf after the coup was over-focused on the ills
that were felt by most Pakistanis in the country.
It was only after the fact of the coup that the army
realized the very deep crisis that faced all sectors of the
country. As a result, they are faced today with making very
serious decisions about structural reform, and that could
prolong their stay for a number of years. On the other hand,
they could do a patch-up job in important sectors, including
law and order and in the economy, and then go for
elections. On this score, my sense is the jury is still out and
will remain out. The army could make up its collective mind
three to four months down the road, but we will see.
The fourth element that describes this coup is the fact
that the Army Chief of Staff did not initiate it — unlike
previous coups in Pakistan. In Zia’s case, he never even
informed his fellow generals that he intended to stage a
coup. You will recall that General Musharraf was in the air,
flying back from Sri Lanka, when the army called the coup.
The decision was made by generals on the ground, largely as
a result of their fears that Sharif intended to sack the Army
Chief and several generals. They reasoned that if that
happened, it would divide the army irreparably. (Editor’s
note: General Musharraf was fired just hours before Sharif
ordered air controllers to refuse landing permission to
Musharraf’s Karachi-bound airliner, an order he
subsequently rescinded. The coup already was underway at
the time, according to the New York Times.)
This fear that the army would be divided irreparably
was very real. In fact, if those generals had hesitated in the
slightest, a very serious division in the army would have
occurred. Musharraf’s sacking amounted to the second
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sacking of an Army Chief of Staff in one year’s time and that
was considered totally unacceptable, particularly in light of
Pakistan’s history.
To sum up, the coup was undertaken to keep the army
united. Also, the circumstances of this coup were such that
they created a very ambiguous situation for General
Musharraf. There was then (and is now) a group of generals
who are beholden to the chief, and he to them. The Army
Chief is not necessarily a solitary, authoritarian figure with
authority to push through whatever agenda he likes. In
short, there is a junta in power in Pakistan today — and not
a single authoritarian chief and administrator of martial law
— as was the case in the past.
These factors not only demonstrate how different this
coup is from previous coups in Pakistan’s history, they also
illustrate why a different kind of analysis must be brought to
bear. Also, a kind of patience is necessary on the part of the
Pakistani public as well as the international community.
There is no doubt that the majority of Pakistanis supportedthis coup — overwhelmingly.
The international community, on the other hand, was
stunned by the lack of objection or outrage inside Pakistan.
But once they saw that not a single Pakistani stepped
forward to condemn Musharraf or the military, many began
to roll back their condemnations. The international
community realized that Pakistanis were fed up with the
regime of Nawaz Sharif.
Economic and Social Reform Agenda
In the aftermath of the coup, the Musharraf government has
made every effort to select a very imaginative cabinet. For
example, its entire economic team has been drawn from the
private sector and, so far, has been readily accepted as quite
good.
And for the first time, the military is not being described
as the enemy in Pakistan. This, in turn, is instilling a lot of
hope within the secular, liberal intelligentsia, the non-
governmental organization (NGO) community, the media,
and the business community. It is a sharp contrast to
previous times when a very conservative military
establishment worked hard to try to crush civil society, and
it is against this backdrop that the formation of the
government’s cabinet appears to be a very open sign.
Musharraf’s agenda also reflects the demands of the
public in three key areas. The first concerns the overall issue
of economic reform, which is a subject that Musharraf dealt
with immediately. The entire Pakistani population insisted
he deal with this subject as did the IMF and the World
Bank. In fact, an ad hoc consensus emerged throughout the
country on this very issue.
Reform, as it has been laid out so far, represents an
effort to deal largely with vested interests. At the same time,
it is quite apparent just how difficult it will be to implement
these kinds of reforms. There are two essential issues here.
There is the imposition of a fair and broad-based sales tax,which currently is levied for industry but not for the trading
community. And there is the agricultural income tax. As you
may know, a few landlords do not pay any income tax.
Resolution of these two issues will be indicators of just
how well this government deals with reform. My reason for
saying that is because the army retains huge vested interests
in both issues. Just how the government deals with them will
show whether it has the guts to push ahead with necessary
reforms. If it does push ahead, that should convince the
international community as well as the International
Monetary Fund (IMF) to come back on board with a
package to help Pakistan.
Indeed, these two issues, the general sales tax and the
agricultural income tax, will be crucial in determining
whether Pakistan gets a bigger package from the IMF in
January 2001. That is when the rescheduling of short-term
loans valued at $225 billion will take place. Without any
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further restructuring or absent a larger IMF package, the
regime faces paying $5 to $6 billion in repayments at the
time. The government is in no position to make these
repayments — and that makes implementation of these two
economic measures that much
more crucial.
The second area concerns
social reform: law and order, de-
weaponization, control over
fundamentalist Islamic schools,
literacy, and health — the usual
things that civil society has been
demanding for a very long time.
Here, there is virtually no
difference in opinion between the
junta and the civilian cabinet.
The only criticism so far is
that the army has been too slow
— that in three months nothinghas happened. Public expectations are very high. The public
expects and wants change. There is also a huge economic
recession that is driving their expectations. The army’s
answer to this is simply, ‘Look here, we’ve come in
unexpectedly. We need expertise. We don’t want to fall into
bad decisions that we will have to retract. We don’t want to
fall into not having taken people onboard or not having
consulted all sectors.’
I am one of those who think that the pace of change is
too slow. Things could be moving much faster in certain
areas, such as human rights. What has been done when it
comes to human rights is quite obvious to anyone on the
civil side. By the same token, issues like de-weaponization
are very critical, and it is my opinion that these issues have
to be worked out in much greater detail. The army should
be given time to do that.
There is also a dynamic between the military and the
civilian cabinet when it comes to both economic reform and
social reform. Here, the hope is that the clout of the
civilian-led cabinet will grow along with its influence over
the military.
By contrast, there are key
differences of opinion as regards
to the third issue, namely foreign
policy. A very conservative
element within the military
believes in the status quo on
Kashmir and as regards to the
Taliban. At the same time, there
are those who realize that
Pakistan’s domestic reform
agenda — or the military’s
reform agenda — cannot be
carried out fully unless there is
some kind of end brought to
Pakistan’s regional isolation.The West now regards Afghanistan and relations with
India as the two very crucial areas of Pakistan’s foreign
policy. For example, there is a huge controversy at the
moment over whether President Clinton should visit
Pakistan at the same time he visits India. One commentator
argues that Clinton should go. Another says, no, he should
not go. This is quite an absurd situation.
For President Clinton not to go suggests the
administration is not willing to engage the military
government that now is in power. Indeed, that would be a
true disaster for U.S. foreign policy. It would be extremely
foolhardy not to engage the government at its highest level
in this current atmosphere — shaped by recent violence in
Kargil, the airline hijacking late last year and the huge
buildup in Indo-Pakistan tensions.
A decision to skip Pakistan would say two things: It
would amount to doing exactly what the Indians want,
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The only criticism so
far is that the army has
been too slow — that
in three months nothing
has happened. Public
expectations are very
high.The public expects
and wants change.
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namely helping isolate Pakistan and keeping the country on
a sort of terrorist periphery. Second, it would fall into the
trap of the Pakistani fundamentalist opposition.
This fundamentalist opposition would very much like to
see the United States declare Pakistan a terrorist state. In
fact, it is quite clear that there are elements in the
fundamentalist lobby as well as in the military, who would
welcome a U.S. decision to declare Pakistan a terrorist state.
They see that as a way to cut the umbilical cord of 50 years
of relations between Pakistan and the West.
Not only would they like Pakistan to become another
Sudan or Somalia, they have the same vision for Pakistan
that they have for the Taliban and the Islamacized
territories. They see Central Asia as the new nexus of power
and as a place where Osama Bin Laden will lead them into a
new kind of salvation.
(Editor’s note: President Clinton did visit Pakistan in
March 2000 during his trip to the Indian subcontinent.)
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The truth and reconciliation commission model
suggested by Erik Jensen typically is set up in
countries that are trying to pull away from
widespread internal violence, including civil war. Would
Pakistan really respond to such a model? Or could such a
commission end up extending the witch hunt and ultimately
delaying this very difficult task of institutionalizing
accountability?
Erik Jensen: My purpose in suggesting the possibility of a
truth and reconciliation commission was not so much to
focus on the structure as on the intent. In Pakistan’s case,
the mechanism does not have to be a truth and
reconciliation commission. But whatever device is employed,its purpose must be to limit liability and draw the line by
way of a statute of limitations. It must bring a halt to
corrupt practices and a whole range of bad governance that
in fact has occurred over the years and not just recently.
A device such as this is necessary because no matter
what approach is taken, it will end up impinging on the rule
of law that is in place today. Such outcomes can best be
thwarted when a reliable and clearly defined structure is in
place.
Of course, whenever there is an attempt to limit liability,
the inevitable question is where the line gets drawn. But that
is a political question, and my purpose in this instance was
to provide a range of options, with one of those options
being a truth and reconciliation commission.
The liability issue is something that Pakistan has to
come to grips with. The country has to answer the question
of where to cut off liability. There have been so many
misdeeds in past years that the question now is how to get
on with the life of the nation.
My concern is with the relationship between
Pakistan and Iran under the current regime. How
much impact does Iran’s anti-Taliban policy have?
How much impact does its democratization and Islamic
credentials have on thinking inside Pakistan? Also, briefly
describe the country’s support for — or relationship with the
Taliban.
Ahmed Rashid: The main stumbling block is Shiite
Islamicization — where Iran backs one side and Pakistan the
other. In the case of Afghanistan, the conflict is exacerbatingthe huge confrontation between Sunni and Shiite extremism
inside Pakistan. This is something that has been developing
for more than a decade but which has become a major
factor in preventing any improvement in relations between
Iran and Pakistan. That is something that is very new and is
the result, in part, of the kind of extremism that developed
as a result of the war in Afghanistan.
So it is necessary for General Musharraf to tread
carefully. He is not going to jump into Iran’s lap. But he has
made an effort to go to Iran and make very positive
statements in regard to settling outstanding issues with Iran,
including Afghanistan. However, I want to underscore that
he must tread carefully because of this anti-Shiite, anti-Iran
lobby within the Pakistani establishment and in the
population generally.
The bottom line is that the military recognizes that they
cannot even hope to resolve the Afghanistan problem
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A S I A N P E R S P E C T I V E S S E M I N A R
Q
Questions and Commentsby Focus on Pakistan Panel
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without there being some kind of reconciliation with Iran.
That means that a strategic dialogue is critical with Iran,
dealing with issues that include: What are the two
countries’ interests in Central Asia? Will Iran and Pakistan
try to knock each other out in Central Asia? Should the two
countries be cooperating, especially regarding the
construction of a pipeline through the region? Regarding
Afghanistan specifically, the issues are: What are Pakistan’s
and Iran’s strategic interests, apart from one another as well
as together? Is it possible to define those interests and then
get on with trying to resolve the conflict between the two?
The same question would apply to the two countries’
relations with the Middle East.
As far as the Taliban and Pakistan’s policy is concerned,
most everyone here knows my position. I have been a long-
standing critic of the military’s policy — both during the Zia
period and today. I won’t go into this except to say that I
remain extremely critical of the policy that the military and
these two governments pursued and are pursuing. That said,I do not place all the blame on the military. I put just as
much blame on Nawaz Sharif and Benazir Bhutto.
For me, the issue is that Pakistan’s support for the
Taliban, including the military’s support, hinged on the
domestic politics that were played by both Sharif and
Benazir. That was the case for the last five years. The
military’s strategy may have been directed at winning the
Taliban’s support, but domestic issues should not drive that.
And now that the military is in power, it should not try
to justify its strategy based on domestic considerations if it is
being honest with itself. If the military is strong, it has both
the authority and the ability to crush any domestic
opposition that arises. And as long as that is the case, it has
the clout to change the policy regarding the Taliban and to
do a deal with Iran.
When it comes to Afghanistan, there are four players —
the Taliban, the anti-Taliban alliance (or the northern
alliance), Iran, and Pakistan. It would be a great service to
Pakistan and to the West, Afghanistan notwithstanding, if
the military government were to successfully promote a four-
way dialogue between these players. But again, the jury is
still out on this. There are foreign policy lobbies both inside
the military and outside. We will have to see how Musharraf
plays this one out.
My students would say that Pakistan should move
as quickly as possible to hold national elections;
that elections would resolve most of the country’s
problems. A decision to hold elections also would be in the
best interests of U.S. policy toward Pakistan. Tell me why
they are wrong or, in other words, why a delayed democracy
is better than an immediate democracy?
Mr. Rashid: It would be a total disaster if a national
election were held in the next three months. Before the
military took over, Pakistan was headed for a kind of Central Asian style of democracy — where a ballot is held
every five years but where a single candidate stands for
election. True, we had two candidates running against each
other, but the process of democratization in Pakistan had
been reduced to zero. Nawaz Sharif won in the balloting but
then basically set out to destroy the judiciary, the economy
and the bureaucracy. The ballot box became his means to
set up a dictatorship.
The public supported last October’s military coup
because they were fed up with this kind of balloting taking
place every five years and resulting in the kind of
government that is totally corrupt and in effect, destroying
institutions and misgoverning. So I have to say, Pakistan
should not be in any hurry to return to democracy or to
hold elections. Clearly, nobody wants a military state
forever. It is not disputed that everybody wants to go back
to some sort of democracy. But democracy as it has been
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practiced for the last ten years has been an utterly, total
failure.
Shahrukh Rafi Khan: As I said earlier, this was not a coup
that the military planned but something they were pulled
into. As regards the question, I would say it is important
that the military government undertakes electoral reform
and then lets people sort out the mess. Electoral reform still
should be the priority and, yes, there must be safeguards put
in place so the same kind of clowns as before don’t try to
destroy the country by misgoverning it. Pakistan needs to
undertake electoral reform and then get on with it.
Mr. Jensen: There are those stalwarts in Pakistan who
would urge letting elections go. They would say that
democratic habits will build up over time. However, there
were only a few who argued this position when the coup
occurred. That said, it is entirely speculative to try to equate
repeat elections with developing democratic maturity. In thecase of Pakistan, we may be seeing a case of what one
pundit described as, ‘You don’t need a democrat to build a
democracy!’ I don’t want to press that suggestion too far,
however. It is highly contingent on a number of conditions.
Dr. Khan: The key electoral reform has to do with the
question of constituencies for seats in Parliament. Pakistan
has undertaken a census, and if the allocation of seats is
redone based on that census, urban areas will get at least 20
to 30 percent more seats virtually right away. This would
bring in more representatives from the upper middle class
and reduce the representation of the rural feudal class, which
has dominated every Parliament since 1947. If the army
were to follow through here, it would have a much more
dramatic impact on behalf of sustaining democracy than
anything else.
Mr. Jensen: Another proposal that is out there would break
Pakistan into more than four states or provinces. There may
be some wisdom here. Pakistan needs to change its political
story, and one way could be changing the overall structure
before going through the election charade again.
At least, Pakistan should have a timetable for
returning to civilian democratic and constitutional
government. The timetable could be quite long,
leaving sufficient time for exactly the kind of electoral
reform that has been mentioned. That said, could panelists
focus more on the strength of the Islamic extremist and
fundamentalist groups in Pakistan?
Dr. Khan: The Jamaat-i-Islami party seems to be gaining
credibility. It has shown enormous organizational capacity
and discipline and is sometimes more moderate than other
fringe groups. It also attracts huge gatherings. In 1998, the
party succeeded in bringing close to one million peopletogether in Islamabad without any law and order incident.
My hunch is the party will continue to do better because it is
the only untried party at the moment. It also seems to have
the most credibility. Their leader repeatedly takes principled
positions on national issues.
Still, the situation is one of wait and see. As a liberal, I
am concerned with parts of the party’s mandate. Also, I am
reminded of the fact that it was Qazi Hussain Ahmad and
the Jamaat-i-Islami who rejected the last electoral vote in
favor of Nawaz Sharif. The party is returning to party
politics — and that is a welcome change. The process itself
has been a moderating one.
Mr. Rashid: Pakistan’s foreign policy in the 1990s has been a
jihadi foreign policy. In other words, it is a policy that has
been pursued not just by the military, but also by Benazir
Bhutto and Nawaz Sharif. This has damaged Pakistan’s
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relations progressively within the region and with the West.
Go back as far as the Zia period and the Afghan War, when
Pakistan and the West were together in their support of a
jihadi policy. Tens of thousands of Arabs came to Pakistan
to fight. But a certain residue was left behind, which then
had to be dealt with during the 1990s.
Still, the real dilemma as I see it, is that in the 1990s,
Pakistan was engaged in a 10-year-long struggle in Kashmir
at the same time the country was
dealing with the chaos in
Afghanistan. It was during this
time that both the civilian and
the military governments worked
hard to make sure that these
jihadi groups focused on the
Kashmir and Afghanistan
struggles and did not interfere
with domestic politics.
Both Benazir and Sharif didthis by agreeing to a tradeoff
with groups within the Jamaat-i-
Islamia. Now, I am not saying
that I see that kind of tradeoff continuing, particularly with
those groups that have been far more militant than the
Jamaat-i-Islami and far more crucial to the notion of a jihadi
foreign policy. These groups are not going to live by this
accord. They will fight in Afghanistan, Chechnya, and in the
former Yugoslavia, and they will not agree to avoid playing
a role in what the military government does at home.
For example, they recently put pressure on the military
to increase Pakistan’s Islamicization. They oppose Pakistan
signing the Comprehensive Test Ban Treaty. They are against
handing over Osama Bin Laden, and they oppose any
change in the policy toward the Taliban or on Kashmir. If
General Musharraf moves forward with a liberal agenda of
reform, you will see these same groups trying to position
themselves in the forefront of the opposition to such
liberalization. That, in turn, will trigger a very crucial test
for the military.
I also would stress that at this point in time, it is critical
for the IMF and anyone else who favors the reform agenda
now in place to support liberalization efforts. This support
will help this regime stand up to the demands of these jihadi
groups who already appear to be playing an increasingly
greater role in Pakistan’s foreign
policy and also in setting the
domestic agenda.
What about Pakistan’s
current relationship with
India? Secondly, mention
was made about the difficulty of
land reform and collecting the
agricultural tax. Most everything
on Musharraf’s agenda is difficult.How exactly will reforms play
out?
Dr. Khan: Regarding reform, there is a division of labor. The
National Reconstruction Bureau, which is a kind of think
tank, has been designated to look at medium- and long-term
reconstruction issues. The Bureau defines long-term as being
very short — and as a result, conveys a sense of urgency. To
illustrate my point, we have a 16-month research program
with The Asia Foundation to study decentralization and the
devolution of powers. The Bureau told us that 16 months is
much too long a period and to get back to them in a month.
The cabinet and the ministries that are fighting the forest
fires, are able to only make small innovations. They can’t
really look at the reconstruction issues in the way that the
National Reconstruction Bureau can. We have had dialogues
with General Naqvi, the head of the Bureau, on local
22
... it is critical for the
IMF and anyone else
who favors the reform
agenda now in place to
support liberalization
efforts.
— Ahmed RashidCorrespondent, Far EasternEconomic Review
Q
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government, decentralization, and the devolution of power.
Again and again, we have raised the issue of land reform,
and what we get back are the usual arguments. Why don’t
you nationalize industry again? And how would you feel if
we took over your house?
In some sense, vested interests are reflected in a cross-
section of society as well as within the Bureau itself. Also,
opposition to land reform is longstanding. We see land
reform as an anti-trust act because its implementation would
mean a real diffusion of economic and political powers at
the grassroots level. We’re also convinced that it is very easy
to gather data to prove the need for land reform. All we
need to do is to look at the land distribution data in the
1980-1990 censuses. Actually, if you look at the numbers,
the land concentration has increased during this period.
But you also could look at the distribution as
represented in Parliament and the average size distribution in
the country to see the problem as I’m describing it. That
said, all this is not cutting as much ice as we had hoped, andthat is why we are arguing that to have real devolution, you
are going to have to deal with power at the grassroots level.
The problem is that there are some who are affected
personally by devolution. Agricultural income taxes may be
more durable if they are left up to the provinces. This tax
will be announced in the next budget, as will the generalized
sales tax.
Indeed, there was a news item recently that said seven
military officers were appealing to the court, asking the
court to back up their refusal to pay the agricultural income
tax. There is a degree of inequality here in that the military
has been getting land grants for some time and is now a
vested interests that is refusing land reform as well as the
agricultural income tax.
Regarding India, here I am extremely worried. Ever
since the violence in Kargil and last December’s airline
hijacking, the Indian government has maintained that the
government in Islamabad is illegitimate. They also see now
as an ideal moment to try to bring Pakistan to its knees.
India would like to isolate Pakistan as much as possible and
to prevent any kind of economic bailout for the region. They
want tensions to remain as high as possible at least until the
March visit by President Clinton.
In fact, I would anticipate a major escalation of tension
up until the time President Clinton arrives. To illustrate my
point, the BJP (Bharatiya Janata Party) in Delhi has shown
no inclination to even talk to the Kashmiris or to Pakistan.
The Pakistan point of view is that the government that is in
place in Islamabad was responsible for taking Kargil. From
the Indian point of view, General Musharraf is identified
with the Kargil action and with betraying the Lahore
initiative that was put in place after the historic meeting
between the two countries’ leaders at the Pakistani-Indian
border.
So, there are problems because the BJP is trying to
absolve itself from mishandling the situation of the hijackedIndian airline. The airplane landed in Amritsar, and it was
allowed to leave for Kandahar without negotiations or
action. That said, I do not see the Musharraf government
wanting to take on India — or to escalate the problems with
India. This government already has enough on its hands. It
faces a huge economic crisis at home. The regime has been
isolated because of the past policies of Sharif.
By the way, I simply don’t see any justification for
accusations that the military was somehow involved with the
hijacking. At the time it occurred, the military was barely
emerging from the international isolation that occurred after
the October coup took place. It has tried to build bridges —
and it needs to build bridges. In the army’s view, the most
critical issue of all is getting the IMF’s bailout package as
quickly as possible. That requires appeasing an entire board
and a half dozen or so influential countries. It does not
allow for a military campaign that takes on India.
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Meanwhile, the Indians also are not showing any sign of
wanting a dialogue with the Pakistani regime. I don’t know
how this will play out but at the moment, the relationship
has hit rock bottom. And that is a very dangerous set of
circumstances.
It has been suggested that the jihadi policy toward
Kashmir and Afghanistan for both Nawaz and
Benazir was basically
one of expedience. In other
words, groups were allowed to
operate while conservative
elements within the military also
went along. Would it not have
been easier to turn the
government around on these
issues? Does it mean that now it
is much harder to make any
changes?
Mr. Rashid: Yes, even though
Benazir and Nawaz are no
longer around, an effort still
must be made to change the
mindset of the establishment. I would agree that this is an
extremely difficult thing to do. It cannot happen overnight.
However, I must say here that my whole criticism of U.S.
foreign policy is that there has been a kind of focus on a
single-item agenda, whether that concerns Osama bin Laden
or otherwise.
The Americans do not have an overall strategic policy
for the region, including peace in Afghanistan — and that is
a problem that is upsetting the entire region. For the
Pakistanis’ part, what is needed is a change in mindset in the
military, too. The military has to begin to believe that
Pakistan cannot be reconciled with Iran absent a strategic
dialogue between the two countries. This requires changing
the mindset about the entire region. If Pakistan wants
cooperation with Iran and Afghanistan in Central Asia and
the Middle East, then Pakistan has to change its own
mindset.
This is something I don’t see happening overnight. There
is going to be debate and discussion for some time to come.
Consider the situation with Afghanistan, where for the
moment, at least, efforts are being
made to tackle the problem at the
micro-level. For example, the
Finance Ministry is meeting with
the Taliban to try to stop the
smuggling. They also are trying to
stop the drugs. Meanwhile, the
Interior Ministry is trying to tackle
the issue of de-weaponization.
My point is that it is futile to
try to tackle these issues at themicro-level. First, there must be a
macro-policy. There has to be a
macro understanding before any
effort to find solutions can be
effective. So, let’s have a macro-
level discussion about policy and then let’s deal with the
micro-level.
The Taliban is telling the Pakistan government to forget
it, that they are not going to talk about the micro-level
because they think the government only supports them at the
macro level. I would ask for a little more patience because
any kind of macro policy will take time to develop.
Are there trained, experienced, talented, and
reasonably honest civilians who could step in and
do a decent job of running the country if given the
opportunity?
24
Q
If Pakistan wants
cooperation with Iran
and Afghanistan in
Central Asia and the
Middle East, then
Pakistan has to change
its own mindset.— Ahmed RashidCorrespondent, Far EasternEconomic Review
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Mr. Jensen: If the circumstances were right, there are any
number of Pakistanis now living abroad who would be
willing to return and serve in some capacity. That said, there
are also some very talented democrats — small d-democrats
in Pakistan today, who are trying to work with this regime,
first to consolidate Pakistan’s chances for survival and then
to begin working toward a revival.
Dr. Khan: This is also a question
of whether one views democracy
in a functional way or whether
democracy is an end in and of
itself. I happen to see it as an
end in and of itself. This is
because democracy is the result
of a series of choices that people
make over the long term. If they
make bad choices, then the
country suffers. People alsosuffer individually. Right now,
I’m prepared to live with the
suffering for as long as it takes
for people to fix the system. If
the political process is allowed
to work, then eventually the
people should be able to reform
the system.
But, I agree, it is a high price
to pay if the right kind of people
are not present right away. One can hope that in due course,
the process will turn up the right people to reform the
system.
Please elaborate on the status of the judiciary. Are
there efforts underway to build the institution,
particularly at the level of the subordinate courts?
Mr. Jensen: It is important to rebuild the judiciary from the
bottom up. And this is consistent with Islamic notions about
justice, by the way. I would say emphatically that the lower
courts are not serving the interests of justice at the present
time. And it would be a good thing if the current regime
were to support institution-building efforts within the
judiciary. It would make sense as a reflection of the regime’s
concern for rebuilding public institutions in the country
generally.
The symbolism here is very
important. To digress for a
moment, there are very few
resources allocated to the courts
and to the extent that funds are
allocated, the money is not
distributed very well. For example,
if you have a commercial case
being heard in Karachi, you can
expect to spend on average, 10years in litigation. If you have a
property case, you can expect to
spend seven years on average.
One consequence is that
structures are being put in place
which are based on an assumption
that the judiciary does not work.
Instead, the effort should be
directed at rebuilding the judiciary
as an institution. That is a difficult
task. There must be performance incentives within the ranks.
They must be willing to engage in appropriate disciplinary
proceedings. They need more resources, and salaries should
be tied to performance. Judges today receive poor salaries.
One consequence is their performance is poor. There is very
little dignity associated with being a justice.
An interim solution would be to make the funds
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A S I A N P E R S P E C T I V E S S E M I N A R
Q
I would say emphatically
that the lower courts
are not serving the
interests of justice at
the present time. And it
would be a good thing
if the current regime
were to support
institution-building
efforts within the
judiciary.— Erik JensenSenior Law Advisor, The AsiaFoundation
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available for at least a pilot project that is directed at trying
to stimulate reform process.
The October coup was described as being provoked.
However, during the months preceding the October
coup, rumors were rife that a coup was what was
going to occur. It was reported that Musharraf’s firing was
the last straw. How is provoked defined in this context?
Also, if the military coup was so popular, why is the
government unwilling to face voters in a referendum? And
finally, what is the practical solution to the situation in
Kashmir?
Mr. Rashid: By provoked, I mean Musharraf told the Nawaz
regime, ‘If you sack me, I will not go quietly.’ Nawaz was
taunting the military, and the military was taunting him. But
through it all, it was quite clear that the military intended
not to tolerate another sacking of a chief inside of 12
months. That was the bottom line.So, in one sense, the coup could have been prevented had
Nawaz moved. On the other hand, the military was not
willing to legitimize a coup by moving first. If the army had
moved first, the public would have had a much harder time
accepting the outcome. Public acceptance was possible only
if Nawaz moved first.
Concerning a referendum, I agree. Musharraf has said a
referendum could happen. Indeed, there were some very
strong rumors within weeks after the coup happened, that
the military government intended to go immediately for a
referendum. That still is very much an option, but one of the
problems Musharraf has is the team of loyalists and experts
who surround him. There is no one under the age of 80!
They should start to bring in some younger people with
a little more imagination and creativity. Instead, Musharraf
has advisors who basically advised the leaders of three
previous martial laws and who had totally different aims and
agendas from those of Musharraf. Meanwhile, the legal
advisors who surround him tend to represent a single
mindset. I hope that will change.
The idea of a referendum is very possible. However, one
downside is the disenfranchisement of a number of leading
politicians, which is what happened in the 1960s under
Ayub Khan. Again, there seems to be no public opposition
to such a move. I don’t think anyone would be particularly
upset if Sharif and Benazir were disenfranchised or if Asif
Ali Zardari (Benazir’s husband) were put away for life on
the basis of corruption charges. The public remains very
hostile toward these people at the moment.
Of course this raises the question about Pakistan’s
future. Is it going to be up to the military to create a new
generation of politicians? This could be a very dangerous
outcome and not one that is particularly helpful in a
democracy. This concern needs to be taken up by local
bodies, in local and provincial elections and then in national
elections.Pakistan needs to grow a new generation of politicians.
To do that, electoral reform is essential to first bring in the
urban middle class and to cut the feudal elite out of politics.
This is the main demand being made on the part of the
urban intelligentsia. Electoral reform needs to be followed
by tier elections — at the local and regional levels, and so
forth. Hopefully, this will bring about new political parties
and new politicians. It also would help avoid something I
would not like to see and that is a kind of new generation of
politicians who have been manipulated by the military.
Concerning Kashmir, I have no solutions. The best
course may be to put the issue on the backburner for the
time being. That is what the Chinese have been advising for
the last four years. Let the Indians initiate a dialogue with
the Kashmiris, if not with Pakistan. That is the bottom line
as far as India is concerned and that is arguably the only
solution. It is also a fairly long way off.
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Dr. Khan: On the subject of Kashmir, it strikes me that
whenever there are talks on issues such as this, they are
always bilateral. Quite naturally, the Kashmiris protest. It
may be time to bring the Kashmiris on board for trilateral
talks. The outcome has to be more than a land grab. To this
end, Pakistan also needs to understand that fundamental
rights of people who struggle for self-determination are
involved here. In fact, that could be the starting point for
breaking the current deadlock.
One analysis of the post-Kargil violence is that the
Americans had to force Pakistan to withdraw from
the heights of Kargil. What if I said that Pakistan is
spoiling its 50-year relationship with America?
Mr. Rashid: I do know that the military itself has democrats
within its ranks. They want to address the fact that the
whole madrassah (religious schools used to teach Taliban
fighting forces) culture is out of control. In fact, the Interiorminister has begun by making some serious commitments,
starting with de-weaponization.
But there has been an accumulation of bad policies over
the last 10 to 20 years, particularly in regards to
Afghanistan. Here the West supported the entire process,
including the distribution of millions of dollars worth of
weapons. The Indians did not confront a similar threat north
of their border. As the Indians tend to do, they put the entire
blame on the ISI, the military, and so forth.
My point is that it is necessary to see the situation
historically and as a result of an accumulation of things. Of
some importance here, too, is that it suited the West to
conduct itself one way with regard to Pakistan and then to
walk away after it changed its mind. The fact is that the
precise moment for dealing with the aftermath of the Afghan
conflict was when the conflict was winding down and when
Zia died. It was then that there was a sort of opening up.
But then Kashmir erupted. There is no serious Indian
analyst who believes that Pakistan provoked the Kashmiri
violence or that the Kashmiri uprising occurred because of
the direction of Indian policy on Kashmir. All in all, it threw
Pakistan into a kind of total mess, which was then
manipulated by Benazir and Nawaz to stay in power. That
said, I don’t think instantaneous judgements work. It is
much better to look at the situation historically and consider
the fact that Pakistan’s leaders made some bad political
decisions.
What would be a realistic timetable for electoral
reform and elections? And second, is it reasonable
to expect that President Clinton could jump start
negotiations over Kashmir?
Dr. Khan: Some think two years is the magic number. That
said, Musharraf thinks that he will have a timetable — and
he seems to be playing with this idea — of two years.Perhaps this was because when Moeen Quereshi was the
interim prime minister, he mentioned that the minimum
amount of time for the kind of reforms that had to be put
through then in the form of ordinances — most of which
were then never enacted — was two years. So perhaps that’s
the idea that the military is playing with. Certainly, this
referendum idea is very much a part of their active agenda.
In terms of using President’s Clinton’s visit (in March), I
think all that Pakistan warrants is an acknowledgment that
Kashmir is a very core issue. I think Pakistan simply is
looking for an acknowledgment on the part of India and
then just to get the process rolling, which may not be too
much to ask considering how much people are emotionally
invested in this issue. They really do need to get this out of
the way and get on with achieving prosperity.
Mr. Jensen: The time frame is a difficult issue because of the
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need for fundamental reform. Pakistan needs to hold local
elections and then build up from there. Such a constructive
politicization process means changing a very deep-seated
political culture at this stage. I would give it two and one-
half years to three years. The first six months is spent just
consolidating the chances for survival.
So I don’t think that three years is too much. The
important thing is to start with the benchmark process, then
to get a process going, and finally, to build confidence and
legitimacy. The end game doesn’t become quite as crucial if
there’s credibility throughout.
When Minister for Population and Welfare Begum
Abida Hussain was making a presentation at the
State Department recently, she said the movement of
the then Sharif government was toward allowing the sharia
courts to have far more authority on civil disputes. What has
happened on that?
Mr. Jensen: It has been six months since I was in Pakistan. It
does seem that there was a move prior to now to vest the
sharia courts with more power, but I cannot say what is
happening at this stage. My guess is that there continue to be
very serious jurisdictional issues between the civil courts and
the Islamic courts.
It seems to be assumed widely that both Benazir and
Sharif were not good for democracy in Pakistan. But
the jury presumably is out on General Musharraf.
Could he be someone who is not a democrat but in the
position of making a democracy?
Mr. Rashid: In my opinion, the army did not take over with
a personal agenda as regards to power. At the same time,
they realized they have to have power to accomplish what
they want to accomplish. Still, the question is whether the
army that suppressed civil society for so many decades
actually is able to reconstitute civil society, but there are
indications that this is actually what is happening.
I call attention to the way the cabinet was chosen.
NGOs were brought in and so forth. There are other
indications, too, perhaps not as much to the point as the
latter. But the bottom line is that the Musharraf government
is doing the right thing, even if it means they will not be able
to stay in power themselves.
The army’s self interest also has to be considered in this
light. We have the seventh largest army in the world — some
500,000 people. These guys have to have a salary. The army
has to have a budget. If the economy is going down the
tubes and the country to the dogs, it means that Pakistan is
facing a Soviet Union-styled situation where there is an army
but no country. It is in the army’s best interests not to let
that happen. The only way to prevent that is to bring the
country back to some kind of democratic rule and to insure
that there is an economic revival that turns things around.This is in the best interest of the country and also in the
army’s self-interest.
Dr. Khan: Notwithstanding my views on legitimacy, we
should give the devil his due. One of the things that General
Musharraf said after taking over was, ‘Judge me by my
actions, not by my words.’ For example, he said he would
make sure that he and his cabinet declare their assets both as
they came into power and when they leave. The first part of
that promise has been delivered on.
It is interesting here that what came to the surface is that
the military may have too much property. We now know
that this is something that has to be addressed and that we
need to stop making land grants to the military and other
senior civil servants. Instead, land grants need to be made to
those people who have no land.
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Mr. Jensen: In one sense, Pakistan is undergoing its own
kind of shock therapy from within. In the past, Pakistanis
have been concerned generally about the survival of their
country. Now, circumstances are different. I can’t say
whether this non-elected person will install democracy, but I
do think that some of the circumstances are right for
introducing democracy.
Mr. Rashid: The dilemma of democracy with a ‘big D’ in
Pakistan is a problem for both Pakistan and the United
States. It comes down to the ballot box every four or five
years versus genuine democratization. Basically, U.S. policy
centers on Central Asia. And what we saw in the early
1990s, is that anything with a ‘democratic’ label was
accepted as such in many countries in the Muslim world and
in Africa.
Today, the whole issue is much more complex and
Pakistan illustrates that complexity. This issue of democracy
in Central Asia will be a major foreign policy issue for the
United States over the next few years, namely what really is
democracy and what really counts as true democratization.
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Erik Jensen
Erik Jensen is a Senior Advisor for Law Programs to The Asia Foundation
and Director of Research at Stanford Law School’s Program in
Transnational Business Law. As a legal practitioner, he has designed and
written about programs in rule of law, civil society development,
economic reform, international relations, and governance. In addition to
his other responsibilities, Mr. Jensen is currently completing a research
project funded by the Ford Foundation surveying cross-border business
perceptions between Pakistan and India.
Prior to his current position with the Foundation, Mr. Jensen served
as The Asia Foundation’s Representative in Pakistan where he directed
and consulted on legal and judicial reform and governance issues. Before
joining the Foundation, Mr. Jensen was a Fulbright Senior Lecturer in
Law teaching international economic law and international trade in Asia.
He has written numerous articles and studies, including “Pakistan
2010: An Agenda For Effective Governance.” Mr. Jensen also authored
the book, International Law in Sri Lanka (Open University Press: 1989).Mr. Jensen received his undergraduate degree from Augustana
College and law degrees from William Mitchell College of Law and the
London School of Economics.
Shahrukh Rafi Khan
Shahrukh Rafi Khan is the Executive Director of the Sustainable
Development Policy Institute (SDPI). Through government briefs,
newspaper articles, and his work with nongovernmental organizations on
the NGO Bill, Dr. Khan is engaged in policy work and advocacy. Dr.
Khan’s current research addresses collective action in basic education,
rural water supply, sustainable development, and trade issues.
Prior to joining SDPI, Dr. Khan consulted for organizations including
the East-West Center, the World Bank, UNESCO, and
USAID/International Food Policy Research Institute. He served as
Economist and Head of the Public Policy Section at the Pakistan Institute
of Development Economics, and taught economics at Vassar College and
the State University of New York at Oneonta.
Dr. Khan has authored numerous books including Profit and Loss
Sharing (Oxford, 1987), Do IMF and World Bank Policies Work?
(Macmillian, 1999), and Reforming Pakistan’s Political Economy
(Vanguard, 1999). In addition, he has edited or co-edited numerous
books and monographs including Higher Education and Employment
Opportunities in Pakistan (UNESCO, 1988) and Fifty Years of Pakistan’s
Economy (Oxford, 1999).
Dr. Khan holds a doctorate in Economics from the University of
Michigan.
Ahmed Rashid
Ahmed Rashid is the Pakistan, Afghanistan, and Central Asia
correspondent for the Far Eastern Economic Review and London’s The
Daily Telegraph. He also writes for Pakistani newspapers and broadcasts
as well as international radio and TV stations including the BBC and
CNN. He has covered the civil war in Afghanistan and Pakistani politics,
economics, and foreign policy for 20 years.
Mr. Rashid is the author of numerous essays and books. His most
recent essays include “Talibanization” inForeign Affairs (November
1999) and “Pakistan’s Coup: Planting the Seeds of Democracy?” in
Current History (December 1999). He authored The Resurgence of
Central Asia: Islam or Nationalism? (Zed Books, 1994), and co-authored
Fundamentalism Reborn: Afghanistan and the Taliban (Hurst and Co.,
1998) and Contemporary Issues in Pakistan Studies (Gautam Publishers,
1998). His latest book, Taliban: Islam, Oil and the New Great Game in
Central Asia, will be published in April 2000 in the United States by Yale
University Press.
Ahmed Rashid was born in Rawalpindi, Pakistan, and was educated
at Cambridge University.
Seminar Participants
Asian Perspectives publications are produced by The Asia Foundation’s
Office of External Relations. Editing staff: Marsha Vande Berg,