05-17-2008, 07:53 PM
On the deteriorating economic situation as a result of fudging of figures and concealing the correct facts from the nation, many economists and people of rank have recently put up their views to the new Government for improving the conditions. Though immediately after elections and till early days of the present collation government the masses had some good little hope which by now has of course faded out. Intellectual Dr. Aysha Siddiqa in her article talking about economy generally suggested that Overseas Pakistanis (OPs) be encouraged to invest in badly needed agriculture sector which will not only improve the economy but also food supplies locally and more exports particularly when there is going to be the food crisis world over as cautioned by UN.
2. Ms. Akram Khatoon a very senior and highly respected economist in her last week article on home remittances says it is time the Government concentrates and pins its main efforts on home remittances by encouraging easy inflow of remittances by offering incentives. She says home remittances during the last 7 years have outstripped both Foreign Direct Investment and other funding received from world over.
She quotes however that how while for Overseas Pakistanis (OPs) it is becoming more difficult even to open an account and save in Pakistan the countries like India and Bangladesh have encouraged home remittances by offering medium and long range saving products to their low paid workers abroad. In case of Pakistan, none, repeat none such product is available. The new Overseas Pakistanis Minister stated the investment of OPs was safe and guaranteed. Is it practically true? No, sir, No. As today a piece of paper as Warranty/Guarantee supplied with purchase of a TV or a refrigerator is as worthless as one Rupee note in its purchasing power, likewise the word Government Guarantee on investment has no material value whatsoever. I invested in my National Savings Account on the basis of repeated newspaper advertisements from National Savings/Ministry of Finance that its schemes were "guaranteed' by the Government of Pakistan. The rate of profit quoted in those advertisements then was 11% as far as I remember. I took it as Government guaranteed. Just through one word the rate was reduced to 4% even then advertisements still saying "Government Guarantee". Sometime early 2007 through my human rights petition I appealed to My Lordship Chief Justice Mr. Justice Iftikhar Mohammad Choudhary that National Savings/Ministry of finance may be stopped to include words "Government Guarantee" in their advertisement. Every Friday I pray for his health and for his coming back from his ânon functionalâ to âfunctioningâ.
3. Another economist the other day expressed his reservation on the government's intention to issue new international Bonds. He is of the view that after all these Bonds are another shape of additional Debit which one day all will be repatriated with profits thus then creating a new deficit. He also says why not to get the funding from OPs.
4. No body had ever been and is ready to get this badly needed funding as "loan" from their own nationals/Overseas Pakistanis who have tremendous savings abroad. I do remember about 8-10 years back a SBP delegation visited Dubai in search of new funding. The Pakistan Association there suggested the Delegation that the Government was negotiating loan on 18% interest with harsh terms instead it should take this loan from OPs in shape of their saving deposits with 12% interest which suggestion was declined. Foreign investors money whether in shape of stock exchange, purchase of industrial units on doubtful prices all one day is to go back abroad. OPs investment is mostly to remain in Pakistan.
5. During Ayub Khan period the Government had a bonus voucher scheme. On every arrival from abroad of Rs. 100/- it used to pay additional Rs. 6/-. From 1983 to 1992 while I was working abroad I arranged from middle class and labour class Pakistanis opening of their bank accounts in Pakistan [Habib and United bank about 4500 plus National Savings about 2500 accounts). Getting an account opening Form was an impossible task then. Despite being myself a low paid employee I spent a lot asking my family in Pakistan to collect account opening Forms, mail me and after filling up all those for concerned persons, at my own expense I sent those back to concerned Branches in Pakistan. After 1992 I stopped this hobby as then due to uncertain and ever reducing investment returns I did not feel fit to insist these poor people who trusted on my advice.
6. For the last 12-15 years I must have addressed at least 150 communications at different levels whenever the Government raised its concern about economy. Against these I never received even a single proper acknowledgement. My suggestion was that instead of ever increasing unnecessarily free baggage allowance limits to Ops practically meant for commercial khapia only, they may be offered to send their remittances through legal channels. On receipt of every Rs. 100 the government pays Rs. 10 extra. I further suggested that instead of putting any strain on national exchequer the government takes out and pays Rs. 5/- each from existing separate funds with Overseas Pakistanis Foundation and Community welfare fund with Ministry of foreign Affairs. Both these organizations have millions over millions lying idle in these two funds. How much are these funds and where these are used, it has never been disclosed. However once the press disclosed that out of Community Welfare Fund with Ministry of Foreign Affairs a costly watch was purchased for the then visiting PPP Minister in its second tenure. On the other hand the "interested' circles a few years back in the wake of privatization fever floated a novel idea to privatise OPF. It was as a windfall purchase as the stopped deal of Steel Mills. I wonder why Shaukat Azizâs attention did not go to this idea. In these two funds there is not a single Rupee from the Government. All money in the funds are from personal pockets of OPs who mandatory contribute in these funds. My suggestion was that while Rs 100 home remittance may be paid by the bank concerned immediately on demand as is practice, this additional Rs 10/- the Government may retain in a special portfolio with National Savings. On each Rs. 100 remittance this circle of additional Rs. 10s keeps running. After 10-15 years when the concerned worker permanently comes back to Pakistan all his accumulated Rs. 10s with profits accrued during all this long period may be paid to him then. I further suggested that even all these accumulated Rs. 10s plus accrued profits could further be retained but current monthly profits on such collected amounts may start going to the returnee which will be a sort of small pension for him.
7. Knowing well after having lived abroad for 20 years I know how people would run for such a scheme because on one hand the OP will have an attraction in shape of free Rs. 10, on the hand every Rs. 100 sent directly invested in National Savings or fixed deposit would fetch extra direct profit. I knew then that due to ever changing terms of deposits like new levies like deduction on cash withdrawals, withholding tax and reducing profits how people started preferring keeping their savings with them abroad where there was no change in terms of deposit. During my last years abroad I saw a new trend that even many people started going back to Pakistan on expiry of their service contract leaving their gratuities funds abroad with banks to get regular profits remitted to them in Pakistan.
8. Is the Government really interested that OPs invest in Pakistan? Of course the Government is but the issue is are those who are to implement this wish of the Government really interested in OPs keeping their savings home? No, certainly not. On ever decreasing profits, new and new deductions, so called service charges, blanket "azadee' to banks, the learned Economist Sultan Ahmad once stated that under some deep planning all these steps were to kill and discourage real domestic savings which are a real back bone of a country's economy.
9. Each and every government of the time since 1971 has raised slogans for the welfare of Overseas Pakistanis (OPs) but except for keep raising the personal baggage limit for some obvious interest practically did nothing. The biggest ever slogan in this regard was raised by Nawaz Sharif in 1996-97. He boosted so much that he even offered OPs to run Pakistani Embassies. His exact words in the 1997 Overseas Pakistanis Convention in Islamabad were that whether the OPs hold Pakistani passports or have adopted foreign nationalities they are all Pakistanis and our family members. He added since these Pakistani origins are at par with their brethren in Pakistan, hence they can come any time to their homes (Pakistan), purchase any thing, invest in any form. If people do not have short memories, they would remember it was the same Nawaz Sharif who immediately after those words introduced a separate Pakistan Origin Card for Pakistanis holding foreign nationality. The cost of this Card was very high (perhaps US$ 500 if my memories are not misguiding me) to be renewed yearly or two yearly. He introduced separate ID Cards for Overseas Pakistanis for no reason at all. This was the first occasion in Pakistan history that our Ministry of Foreign Affairs the very first time and the only time in the history rose up officially to protest over introducing this scheme. The Overseas Pakistanis Foundation established wholly on money of we the Pakistanis, as ever, did not âprotestâ or resist this unnecessary heavy âtaxâ on its shareholder owners (members). The senior writers termed this scheme as money minting scheme. The senior economist S. Ahmed termed this a scheme to pickpocket the Ops. It was only Zafarulla Khan Jamali who during his middle east tour seeing the frustrations of OPs reduced the fee of this Pakistan Origin Card. This was the practical side of welfare love of Nawaz Sharif for the OPs.
10. The Pakistan Origin Card (POC) was introduced on the domain that holder of this card will be treated at par with his local brethren Pakistanis and in all respect he would be a Pakistani for eg his bank account, shares, property, investment etc. Raising such slogans is something different from implementing those slogans.
11. When this POC was introduced I raised a very logical question to the Overseas Pakistanis Foundation that were POC holders really at par with local Pakistanis? I quoted some specific questions on some points. For example one was that as a Pakistani national suppose I had shares of ABC Limited. The company as is usual offers me Right Shares which I decide to subscribe. There is a clause in the Right Shares Subscription Form under which I declare âI am a Pakistani national holding Passport No. work permit so and soâ. But in fact by now I hold US or Saudi nationality. I questioned can I still sign as âI declare that I am a Pakistani nationalâ which in legal term is wrong. The Overseas Pakistanis Foundation which has at least to my knowledge so far never ever done even a remotest thing beneficial collectively for OPs at large and where there sits merely a large army of postmasters, instead of reading the question seriously and taking up to higher level just sent it to its subordinate Karachi Office saying âattached herewith is a complaint received from Muhammad Javed for your necessary action under reply to usâ. What a non sense. The point raised was a policy matter answer to which was known only to higher level hence needed to be dealt with by MD OPF himself but it was forwarded to a junior Regional Manager level. As was expected that since OPF MD had just in a postman way not caring even to know the sensitivity or importance of the question, the junior level regional manager too forwarded it to the Karachi Stock Exchange. The reply from KSE to OPF was really what from a serious commercial oriented organization is expected. The KSE replied that the citizen has raised a very important and meaningful question hence OPF may find proper legal answer to it and KSE may also be apprised of that. After this as is usual OPF never moved any further because the army recruited therein has practically no interest in matters like this except for those on which it may kill the time acting as a post office or of course in dubious housing schemes.
12. Amongst others, another very important point I raised was that can a Pakistani origin having obtained a foreign nationality say of Saudia, on the basis of his POC purchase property in Pakistan and what about his already existing property. The answer from the Ministry of the Interior as far as my memories are concerned was that under the law such a person would first need a permission from the competent authority. Unfortunately this record February this year I lost as my neighbour house got fully in fire which also engulfed my house damaging half of my assets and most my record. These and similar legal aspects I raised needed serious attention and answer but no one could give me definite answers. Even OPF did not give me a definite answer if a POC holder can apply for a plot in OPF Housing schemes and what was the legality under the Pakistani Law.
13. A month an old colleague of mine met me who worked with me abroad. He has got foreign nationality and holds a POC on basis of which he invested a big amount in Behbood Certificates with National Savings. Last month, according to him, he received a communication from officer incharge of National Saving Center concerned that only Pakistani nationals can invest in the Behbood scheme and since he is a POC holder he is now no more entitled for month profits. The Centre has asked the account holder to immediately come to Pakistan to withdraw his investment. My harassed friend came from abroad to withdraw the amount and he would now take back his Rs. 40 lacs from Behbood Certificates and some from other scheme because he has lost his confidence. He verbally told me to whomever he knew have invested like him he has passed on his story and every one was in agony.
14. We are vehemently advised by the imported wizards that other nations were also privatizing their units. In this regard most example is given of British Telecom and British Gas but these wizards do not tell us that British in order to privatize distributed share application forms even on petrol stations, supermarkets stressing their nationals to buy these shares. The privatized shares were sold to their locals whereas in our case our lucrative shares we prefer to sell to foreigners. On the OGDC highly lucrative shares I suggested that these shares instead of offering to foreign investors may be given to retired persons through their pension funds, to employees drawing less than Rs. 6000 a month by giving them installment recovery loans to buy these so that the good annual dividends on these shares may give them annually some relief.
2. Ms. Akram Khatoon a very senior and highly respected economist in her last week article on home remittances says it is time the Government concentrates and pins its main efforts on home remittances by encouraging easy inflow of remittances by offering incentives. She says home remittances during the last 7 years have outstripped both Foreign Direct Investment and other funding received from world over.
She quotes however that how while for Overseas Pakistanis (OPs) it is becoming more difficult even to open an account and save in Pakistan the countries like India and Bangladesh have encouraged home remittances by offering medium and long range saving products to their low paid workers abroad. In case of Pakistan, none, repeat none such product is available. The new Overseas Pakistanis Minister stated the investment of OPs was safe and guaranteed. Is it practically true? No, sir, No. As today a piece of paper as Warranty/Guarantee supplied with purchase of a TV or a refrigerator is as worthless as one Rupee note in its purchasing power, likewise the word Government Guarantee on investment has no material value whatsoever. I invested in my National Savings Account on the basis of repeated newspaper advertisements from National Savings/Ministry of Finance that its schemes were "guaranteed' by the Government of Pakistan. The rate of profit quoted in those advertisements then was 11% as far as I remember. I took it as Government guaranteed. Just through one word the rate was reduced to 4% even then advertisements still saying "Government Guarantee". Sometime early 2007 through my human rights petition I appealed to My Lordship Chief Justice Mr. Justice Iftikhar Mohammad Choudhary that National Savings/Ministry of finance may be stopped to include words "Government Guarantee" in their advertisement. Every Friday I pray for his health and for his coming back from his ânon functionalâ to âfunctioningâ.
3. Another economist the other day expressed his reservation on the government's intention to issue new international Bonds. He is of the view that after all these Bonds are another shape of additional Debit which one day all will be repatriated with profits thus then creating a new deficit. He also says why not to get the funding from OPs.
4. No body had ever been and is ready to get this badly needed funding as "loan" from their own nationals/Overseas Pakistanis who have tremendous savings abroad. I do remember about 8-10 years back a SBP delegation visited Dubai in search of new funding. The Pakistan Association there suggested the Delegation that the Government was negotiating loan on 18% interest with harsh terms instead it should take this loan from OPs in shape of their saving deposits with 12% interest which suggestion was declined. Foreign investors money whether in shape of stock exchange, purchase of industrial units on doubtful prices all one day is to go back abroad. OPs investment is mostly to remain in Pakistan.
5. During Ayub Khan period the Government had a bonus voucher scheme. On every arrival from abroad of Rs. 100/- it used to pay additional Rs. 6/-. From 1983 to 1992 while I was working abroad I arranged from middle class and labour class Pakistanis opening of their bank accounts in Pakistan [Habib and United bank about 4500 plus National Savings about 2500 accounts). Getting an account opening Form was an impossible task then. Despite being myself a low paid employee I spent a lot asking my family in Pakistan to collect account opening Forms, mail me and after filling up all those for concerned persons, at my own expense I sent those back to concerned Branches in Pakistan. After 1992 I stopped this hobby as then due to uncertain and ever reducing investment returns I did not feel fit to insist these poor people who trusted on my advice.
6. For the last 12-15 years I must have addressed at least 150 communications at different levels whenever the Government raised its concern about economy. Against these I never received even a single proper acknowledgement. My suggestion was that instead of ever increasing unnecessarily free baggage allowance limits to Ops practically meant for commercial khapia only, they may be offered to send their remittances through legal channels. On receipt of every Rs. 100 the government pays Rs. 10 extra. I further suggested that instead of putting any strain on national exchequer the government takes out and pays Rs. 5/- each from existing separate funds with Overseas Pakistanis Foundation and Community welfare fund with Ministry of foreign Affairs. Both these organizations have millions over millions lying idle in these two funds. How much are these funds and where these are used, it has never been disclosed. However once the press disclosed that out of Community Welfare Fund with Ministry of Foreign Affairs a costly watch was purchased for the then visiting PPP Minister in its second tenure. On the other hand the "interested' circles a few years back in the wake of privatization fever floated a novel idea to privatise OPF. It was as a windfall purchase as the stopped deal of Steel Mills. I wonder why Shaukat Azizâs attention did not go to this idea. In these two funds there is not a single Rupee from the Government. All money in the funds are from personal pockets of OPs who mandatory contribute in these funds. My suggestion was that while Rs 100 home remittance may be paid by the bank concerned immediately on demand as is practice, this additional Rs 10/- the Government may retain in a special portfolio with National Savings. On each Rs. 100 remittance this circle of additional Rs. 10s keeps running. After 10-15 years when the concerned worker permanently comes back to Pakistan all his accumulated Rs. 10s with profits accrued during all this long period may be paid to him then. I further suggested that even all these accumulated Rs. 10s plus accrued profits could further be retained but current monthly profits on such collected amounts may start going to the returnee which will be a sort of small pension for him.
7. Knowing well after having lived abroad for 20 years I know how people would run for such a scheme because on one hand the OP will have an attraction in shape of free Rs. 10, on the hand every Rs. 100 sent directly invested in National Savings or fixed deposit would fetch extra direct profit. I knew then that due to ever changing terms of deposits like new levies like deduction on cash withdrawals, withholding tax and reducing profits how people started preferring keeping their savings with them abroad where there was no change in terms of deposit. During my last years abroad I saw a new trend that even many people started going back to Pakistan on expiry of their service contract leaving their gratuities funds abroad with banks to get regular profits remitted to them in Pakistan.
8. Is the Government really interested that OPs invest in Pakistan? Of course the Government is but the issue is are those who are to implement this wish of the Government really interested in OPs keeping their savings home? No, certainly not. On ever decreasing profits, new and new deductions, so called service charges, blanket "azadee' to banks, the learned Economist Sultan Ahmad once stated that under some deep planning all these steps were to kill and discourage real domestic savings which are a real back bone of a country's economy.
9. Each and every government of the time since 1971 has raised slogans for the welfare of Overseas Pakistanis (OPs) but except for keep raising the personal baggage limit for some obvious interest practically did nothing. The biggest ever slogan in this regard was raised by Nawaz Sharif in 1996-97. He boosted so much that he even offered OPs to run Pakistani Embassies. His exact words in the 1997 Overseas Pakistanis Convention in Islamabad were that whether the OPs hold Pakistani passports or have adopted foreign nationalities they are all Pakistanis and our family members. He added since these Pakistani origins are at par with their brethren in Pakistan, hence they can come any time to their homes (Pakistan), purchase any thing, invest in any form. If people do not have short memories, they would remember it was the same Nawaz Sharif who immediately after those words introduced a separate Pakistan Origin Card for Pakistanis holding foreign nationality. The cost of this Card was very high (perhaps US$ 500 if my memories are not misguiding me) to be renewed yearly or two yearly. He introduced separate ID Cards for Overseas Pakistanis for no reason at all. This was the first occasion in Pakistan history that our Ministry of Foreign Affairs the very first time and the only time in the history rose up officially to protest over introducing this scheme. The Overseas Pakistanis Foundation established wholly on money of we the Pakistanis, as ever, did not âprotestâ or resist this unnecessary heavy âtaxâ on its shareholder owners (members). The senior writers termed this scheme as money minting scheme. The senior economist S. Ahmed termed this a scheme to pickpocket the Ops. It was only Zafarulla Khan Jamali who during his middle east tour seeing the frustrations of OPs reduced the fee of this Pakistan Origin Card. This was the practical side of welfare love of Nawaz Sharif for the OPs.
10. The Pakistan Origin Card (POC) was introduced on the domain that holder of this card will be treated at par with his local brethren Pakistanis and in all respect he would be a Pakistani for eg his bank account, shares, property, investment etc. Raising such slogans is something different from implementing those slogans.
11. When this POC was introduced I raised a very logical question to the Overseas Pakistanis Foundation that were POC holders really at par with local Pakistanis? I quoted some specific questions on some points. For example one was that as a Pakistani national suppose I had shares of ABC Limited. The company as is usual offers me Right Shares which I decide to subscribe. There is a clause in the Right Shares Subscription Form under which I declare âI am a Pakistani national holding Passport No. work permit so and soâ. But in fact by now I hold US or Saudi nationality. I questioned can I still sign as âI declare that I am a Pakistani nationalâ which in legal term is wrong. The Overseas Pakistanis Foundation which has at least to my knowledge so far never ever done even a remotest thing beneficial collectively for OPs at large and where there sits merely a large army of postmasters, instead of reading the question seriously and taking up to higher level just sent it to its subordinate Karachi Office saying âattached herewith is a complaint received from Muhammad Javed for your necessary action under reply to usâ. What a non sense. The point raised was a policy matter answer to which was known only to higher level hence needed to be dealt with by MD OPF himself but it was forwarded to a junior Regional Manager level. As was expected that since OPF MD had just in a postman way not caring even to know the sensitivity or importance of the question, the junior level regional manager too forwarded it to the Karachi Stock Exchange. The reply from KSE to OPF was really what from a serious commercial oriented organization is expected. The KSE replied that the citizen has raised a very important and meaningful question hence OPF may find proper legal answer to it and KSE may also be apprised of that. After this as is usual OPF never moved any further because the army recruited therein has practically no interest in matters like this except for those on which it may kill the time acting as a post office or of course in dubious housing schemes.
12. Amongst others, another very important point I raised was that can a Pakistani origin having obtained a foreign nationality say of Saudia, on the basis of his POC purchase property in Pakistan and what about his already existing property. The answer from the Ministry of the Interior as far as my memories are concerned was that under the law such a person would first need a permission from the competent authority. Unfortunately this record February this year I lost as my neighbour house got fully in fire which also engulfed my house damaging half of my assets and most my record. These and similar legal aspects I raised needed serious attention and answer but no one could give me definite answers. Even OPF did not give me a definite answer if a POC holder can apply for a plot in OPF Housing schemes and what was the legality under the Pakistani Law.
13. A month an old colleague of mine met me who worked with me abroad. He has got foreign nationality and holds a POC on basis of which he invested a big amount in Behbood Certificates with National Savings. Last month, according to him, he received a communication from officer incharge of National Saving Center concerned that only Pakistani nationals can invest in the Behbood scheme and since he is a POC holder he is now no more entitled for month profits. The Centre has asked the account holder to immediately come to Pakistan to withdraw his investment. My harassed friend came from abroad to withdraw the amount and he would now take back his Rs. 40 lacs from Behbood Certificates and some from other scheme because he has lost his confidence. He verbally told me to whomever he knew have invested like him he has passed on his story and every one was in agony.
14. We are vehemently advised by the imported wizards that other nations were also privatizing their units. In this regard most example is given of British Telecom and British Gas but these wizards do not tell us that British in order to privatize distributed share application forms even on petrol stations, supermarkets stressing their nationals to buy these shares. The privatized shares were sold to their locals whereas in our case our lucrative shares we prefer to sell to foreigners. On the OGDC highly lucrative shares I suggested that these shares instead of offering to foreign investors may be given to retired persons through their pension funds, to employees drawing less than Rs. 6000 a month by giving them installment recovery loans to buy these so that the good annual dividends on these shares may give them annually some relief.