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Oct 01 - 07, 2001

War which, is the science of destruction has started casting its formidable shadows on Pakistan's economy much before the action is taken by the US or allied forces against what it is being described as war against terrorism.

The suspension of flight operations by a majority of International Airlines to Pakistan, cancellation and hold up of orders by E.U. and USA mainly in the textile sector which is the mainstay of Pakistan's economy are going to have crumbling effects. Consequently, a drastic cut in the receivables of the government on account of revenue, slow down of production in the manufacturing sector and lay off of the workers in industrial sector seem to be the price of the current situation.

Leaving aside the economic losses, it will be from failure of human wisdom if war brings bloodshed and dislocation of hundred of thousands innocent people in Afghanistan having nothing to do with terrorism.

Zubair Motiwala, President of Karachi Chamber of Commerce and Industry told PAGE that the US Consul General has indicated in a meeting that the democracy related sanctions might also be lifted probably on coming Tuesday. The sanctions against Pakistan were imposed as early as 1987 with the Symington Amendment to prevent Pakistan from seeking nuclear military capability, followed by the Pressler Amendment and the Glenn Amendment aimed at bringing Pakistan's economy to a fix. There was in addition the Brooke Law in respect of arrears of payments, which Pakistan had to make to the US.

Finance Minister Shaukat Aziz and the ambassador Wendy Chamberlin have made it clear that Pakistan has made no demands on the US in return for providing unstinted cooperation against terrorism. But the finance minister has identified four areas where he would expect European assistance and US. They include full access to Pakistani goods to the US and European markets, larger bilateral assistance, western backing for larger assistance from multilateral aid agencies and generous rescheduling of repayment of loans instead the normal debt relief.

While negotiations in respect of larger economic assistance from the US are yet to begin, high level delegations from European Community and Japan have already visited this country to enlarge the scope of cooperation with Pakistan.

Pakistan's importance in the current escalated struggle against terrorism has been enhanced by the fact that it has become a frontline state in the US campaign against terrorism. With the increase in foreign aid to Pakistan and risk of being flooded by more and more Afghan refugees would also be on the increase coupled with drug trafficking and spread of illegal arms all over the country which provide fuel to street and politically backed law and order in this society.


Zubair said that there are indications that Pakistan may be allowed a 20-year interest free moratorium for repayment of foreign debt besides free access to EU and USA markets.

The incentives so far announced including lifting sanctions against Pakistan and rescheduling of US loans amounting to $375million seems to be an eye wash in the face of the magnitude of the economic hardships in store.

Commenting on the current situation, Abdul Razak Dawood, the federal minister for commerce feels that Pakistan had become "an unwitting victim to post-Sept 11 uncertainty" that could jeopardize the very objective of joining the US to fight against terrorism.

"We are currently looking into the details and volumes of export losses but this could be in the region of $1 to $1.4 billion, said the minister. Pakistan had been in discussion with the authorities in the United States, the European Union and Canada asking them to give equitable market access to Pakistan products so that more job opportunities could be created for local people. To maintain the momentum of trade liberalization it is absolutely important that major trading partners provide us equitable market access that will help creating new jobs. The economic strategy of the present government had been to create jobs for the people through structural reforms, fiscal discipline and market driven policies but the recent developments had created severe problems for Pakistan.

Razak feels the September 11 incident has really introduced a serious challenge to Pakistan's economic policies. The country seems to be becoming the unwitting victim to this uncertainty. Pakistan is facing severe consequences' the minister said and added that Pakistan was really concerned because of cancellation of export orders in the middle of buying season and because the rising cost of production.

Increase in freight rates, imposition of war risk insurance, high cost of imports and higher inventory's maintenance are causing problems for Pakistan, the minister observed. According to Qamar Baig, Secretary Commerce, the exact assessment of export erosion could not be ascertained at the moment. He however said that it was not the question of export orders cancellation but Pakistan's real concern was that main buyers were putting on hold new orders.


Iran's leadership has given mixed signals over a global war on terrorism with supreme leader Ayatollah Ali Khamenei blasting US plans to attack Afghanistan and Foreign Minister Kamal Kharazi saying "Washington had a right to self defence".

While arguing with European envoys over the nature of terrorism, Iran indicated it did not oppose action led by the United Nations, and called for the replacement of the Taliban. The Islamic Republic of Iran will not provide any help to America or its allies in their attack on Afghanistan, Khamenei said.

America does not have the competence to guide a global movement against terrorism and Iran will not participate in any move which is headed by the United States, state radio quoted him. Repeating Iran's call for any global movement against terrorism to be led by the UN, Khamenei said that in this way the United States and other powers cannot exercise influence on it.

The US government has decided just as it did during the Persian Gulf war to expand its influence in the region and on Iran's eastern borders under the pretext that some of the accused, whose guilt has not been proven are in Afghanistan, he charged.

Kharazi told a joint Press conference with a European delegation that if they can prove a certain group in a country perpetrated the attack, "certainly the United States has the right to self defence".

"Otherwise an attack against a country can lead to a humanitarian crisis and the death of innocent people which would be another disaster," he said.

Solidarity day

Pakistan's armed forces will not join any action against Afghanistan, said Interior Minister Lt. Gen. (retd.) Moinuddin Haider while addressing a gathering in connection with Solidarity Day held in Karachi on Thursday.

He said that President as well as the official spokesman has stated that armed forces of Pakistan will not join any action against Afghanistan and will not be a party in any land attack.

Moinuddin said that in collaboration with the international community, "our efforts would be that poor people of Afghanistan are saved from coming difficulties. For the search of those involved in acts of terrorism, the pinpointed targets should be pursued so that the entire Afghan nation does not suffer.

He said that out of three nations that had recognized Afghanistan, two have severed their diplomatic relations with the Taliban government as they differed from their policies besides not paying heed in their advice.

The minister was of the view that Pakistan the only country that still sticks to principles so that a window for negotiation remains open.

He pointed out that the Afghan nation has dispersed during the past two decades and you can find Afghans in any country around the world. A large number of refugees running in millions are present in Pakistan and Iran and tens of thousand refugees are feared to influx into Pakistan because of the prevailing situation.

We have also been asking them to adopt a moderate approach and keeping in view the gravity of the situation to save the country and the people. But their stance is hard. Gen. Moinuddin Haider added that although we have strengthened the western border of the country but the way is open for dispatching the food and also for the import of the fresh fruit which brings them some income. He said that he had talked to the International Red Cross Committee for medical supplies for the Afghans as well as representatives of the World Food Organization and the UNHCR so that difficulties of the Afghan people could be alleviated.

When we are doing all this then some people coming out on the plea that we are pursuing anti-Afghan policies which are not appropriate. The interior minister said that political parties should not take their differences to an extent where it may turn into enmity. The concept of tolerance and respect should be fostered and a working relationship maintained, he observed.

He said it is essential to create a democratic culture so as to move towards democracy. A Prime Minister should be a premier of the country and not a party. He maintained that solidarity could be attained through justice among the provinces, the people and rich and the poor.

The constitution of Pakistan he pointed out does mentioned that state religion would be Islam. He questioned the role a member of religious parties and organizations were playing. What service sectarian parties are rendering and in what shape they are presenting Islam before the world. He added that politics is a worship and not minting money or oppressing the other. He asked the religious parties not to pursue the policies of division and rather promote the message of love and understanding which in fact is the message of Islam.


Pakistan has turned down a UN request for immediate opening of its borders with Afghanistan and declared that the borders would remain sealed until forced by the situation arising out of possible US strikes against Afghanistan. Within Afghanistan, if the situation becomes untenable, or if there is an attack, purely for humanitarian reasons, we will contemplate the opening of border. The federal minister for frontier regions and Northern Areas, Sarfraz Khan stated this. He said Pakistan expecting the fresh arrival of refugees had drawn up a contingency plan in consultation with the UN bodies to accommodate one million Afghan refugees.

For one million Afghan refugees $122 million will be needed for the first six months, he said adding that the figure did not include food support. However, the minister said Afghan women, old men, children and the seriously sick stranded across the Chaman border might be allowed entry in due course and sheltered by government of Balochistan. Asked why Pakistan had been singled out to allow entry to the Afghans, the minister said the Pakistan government had taken up the issue with the UN and asked it to talk to other neighbouring countries like Iran and Central Asian states on the matter as well.

The minister said that only some 6000 Afghans were waiting on both the main borders i.e. Chaman and Turkham. He however did not rule out the possibility of striking of a large number of refugees through unfrequented routes.

Pakistan has made it clear that it was part of the global coalition against terrorism but can never be part of any hostile action against Afghanistan.

"Pakistan cannot and can never join any hostile action against Afghanistan or Afghan people" said Foreign Office spokesman Riaz Mohammad Khan.

"We are deeply conscious that destinies of the two people and two countries are inter-twined. There is no joint operation or contingency plans (by the US) which has been placed before Pakistan.

The spokesman said it was a fight against terrorism in which Pakistan was part of international coalition and we wanted the Afghan government to be responsive to what international community wants from it. It is not fight against any people or any country.

The spokesman said Pakistan had not asked the Afghanistan to close down its embassy in Islamabad. The spokesman regretted the torching of US-embassy in Kabul by an angry mob saying, "such acts are not in keeping with the diplomatic norms. Part of the abandoned American embassy was gutted in anti-US demonstrations in the Afghanistan capital last Wednesday. In response to a question he said there was no confirmation of the reports that Indian forces had landed in Uzbekistan. He said the US defence delegation was in Pakistan and was holding talks with its counterparts. He said the Afghan embassy in Pakistan was not being asked to close down.


Pakistan has opposed replacement of the Taliban with a government dominated by the Northern Alliance and the US has said it is sensitive to Pakistani concerns about the need for a broad-based government. The US government has however made it clear that it was not an American goal to overthrow the Taliban government.

On the part of the government in Pakistan, it is making all out efforts to save the situation. A 10-member Ulema's delegation from Pakistan to Kandhar was an effort of Pakistan government to avert US military strikes on Afghanistan. The Taliban however told Pakistan Ulema that they would not bow to US pressure to extradite Osama bin Laden. There was no question of handing over Osama bin Laden on moral or religious grounds, said Afghan government.

Pakistan has sounded a note of warning against the hazards of arming the Northern Alliance.

The warning came from Foreign Minister Abdul Sattar who has said Pakistan concerned about reports that some Afghan groups including the Northern Alliance were asking the US for military assistance. Any decision to arm them would be a recipe for disaster, plunging the country deeper into factional warfare and adding to the suffering of the Afghan people. Given history and its geographical location, Pakistan knows Afghanistan the way no other country does. For the last two decades especially Pakistan has been closely involved with happenings in Afghanistan, particularly during the Soviet occupation and the Afghan people's epic struggle for freedom. In the post-Soviet period also, Pakistan not only watched but also got involved in the infighting among Afghan factions for power. The vicious fratricide has resulted in the deaths of hundreds of thousands of Afghans. Millions have fled their homes and sought refuge in neighbouring countries mostly in Pakistan. The Northern Alliance came into being after the Taliban captured Kabul and then imposed a harsh brand of theocracy on their people. The Northern Alliance since then has waged a relentless struggle to recapture Kabul, in the process causing widespread death and destruction.


Pakistan is feared to face an unprecedented current account deficit and overall budget deficiencies at the end of the current financial year in the face of heightened uncertainty following present US-Afghanistan led political and economic crisis. This was an assessment of the economic conditions in Pakistan by an IMF official. However, an optimistic view suggests that one should look for an opportunity in every calamity.

Pakistan's cooperation with the US is based purely on humanitarian grounds and against the inhumanity of man against the man. The spirit showed by Pakistan and rest of the civilized world against the acts of terrorism in Washington and New York on September 11 deserves a display of the same spirit on the acts of state terrorism in the Indian held Kashmir and Palestine. Now is the time when all good men should come forward against injustice to human being. The real civilization is a movement and not a condition, a voyage and not a harbor.