By AMANULLAH BASHAR
Oct 29 - Nov 04, 2001
The terrorist attack of September 11 in New York and
Washington besides carrying the tragic stories of human killings,
bloodshed and destruction has opened some interesting chapters also
which may prove a windfall for the third world economies including
According to an estimate, the size of the drained out
money from Pakistan has risen to the level of $100 billion over a period
of time. A real follow up to get back this money to Pakistan would
certainly change the shape of the scathed economy of this poor country.
Pakistan has been a victim of the corrupt politicians
who plundered the country due to their access to the power corridors.
The corrupt bureaucrats, also the part of the ruling class, did not lag
behind and misused their powers for personal gains. The corrupt at the
top also made a sunshine for the drug traffickers and the gun-runners. A
large number of tax evaders from the private sector also grabbed their
share in connivance with the corrupt government machinery. It is a
national tragedy that all of them deprived the national economy
mercilessly and deposited ill-gotten money in huge sums to the foreign
banks responsible to provide a refuge to the ill-gotten money.
Though the flight of ill-gotten money has been an
open secret since everybody knows about the flight of national wealth
out of the country. However the rules of the international banking
providing a haven to such money were not in favour of the affected
countries, while the developed nations were also displaying an
indifferent attitude over this issue.
Now the circumstances have forced the developed
nations to change their views regarding the banking facility provided to
the corrupt depositors.
After the incident of September 11, the United States
and the European countries that never lent an ear to listen to the
grievances of the third world countries are now making laws against such
money, which they believe is being used for the terrorist activities.
The efforts being made in the US and the European
countries against illegal money include the making of stern laws against
laundering of illegal money drained out from various third world
countries into the banking channels of the developed nations.
The European Parliament is also dealing with a strong
legislation to prevent money laundering with very strong support from
European Ministers. The countries, which, will not cooperate in this
campaign against illegal money, will have to face financial isolation
the US and EU have decided categorically.
The changed scenario has risen the hopes of the third
world countries including Pakistan and the huge deposits of the illegal
money deposited with financial institutions of various countries is
likely to be reimbursed to the relevant countries.
The corrupt Pakistanis managed to take huge amount of
ill-gotten money out of the country to the safer havens in Europe and
America and other countries like Switzerland, Luxembourg, Cayman Islands
etc providing shelter to such clients.
The looted money was not only deposited in the
foreign banks providing shelter to such funds but quite a large amount
of this ill- gotten money has been invested in various businesses, real
estate properties and other running business abroad.
Under the new international banking laws all
anonymous bank accounts would be done away with. The laws being evolved
for an effective check on illegal flight of money and money laundering
will certainly help Pakistan to bring the money back to the country.
Dr. Mahbubul Haq, former finance minister had once
indicated that the size of the taken away money was in the region of $20
billion during his days. While a prominent industrialist had claimed the
size of that ill-gotten money abroad to the tune of $30 billion.
Dr. Ishrat Hussain, the governor of State Bank of
Pakistan in a published interview has said that the term of drug money
is obsolete now. The major concern is now about huge amount of tax
evasion and other illegal means, which may be $50 billion or $100
billion. These estimates he said could be guesswork, as nothing can be
said about the exact size of the ill-gotten money deposited abroad.
The national economy has a depth to pay taxes
estimated to the tune of Rs600 billion a year, however the Central Board
of Revenue (CBR) could collect only Rs400 billion last year which means
taxes worth Rs200 billion are evaded every year. In order to eradicate
the nuisance of money laundering through illegal resources, the
government of Pakistan has also decided to institute a task force having
representation from finance division, SBP, FBI and representatives from
NAB to deal with this issue.
Now is the time for Pakistan to seek support of US
and other Western countries for recovery of huge money drained out of
It is the right time to strike, as the iron is hot,
an effective follow up could produce positive results. Get the looted
money back; the poor of this country really need that money.