Pakistan Needs A Better Business Environment

A Guest Post by Majyd Aziz

 

The economic prosperity of any country is largely due to the initiatives of the private sector and fully supported by the government thru demand-oriented facilities. The government has to introduce a laissez-faire mode of relationship with regard to industry and trade. In Pakistan, there has always been a yo-yo style relationship between the government and the business community. The over-employment in the government bureaucracy has led to abnormal increase in governmental interference, harassment, and corruption. This has come to a point where about half of the industrialist’s time is wasted on government matters such as inspections, audits, correspondence, reports, filling forms, and visits to government offices. The government must reduce the plethora of taxes, must minimize punitive measures, must lessen the visits of petty officers of myriad agencies, and must slash the tax rates if there has to be increased investment in the country.

It is essential that the government seriously revisit the General Sales Tax regime (whether it is Value Added tax or Reformed GST) and transform it into an acceptable and workable form. The present backbreaking 17% rate is criminal, it leads to temptation to evade, and is keeping traders and industrialists from registering under the system. If the VAT has to be enforced then it must be with determination and must be broad-based with all links in the chain covered. But, more importantly, it is imperative that the rate is not more than 5%, otherwise, this scheme will be difficult to implement and will remain hostage to the corruption syndrome. The present uncertain thinking by the government in GST matters is the root cause for the vicious campaign against VAT.

Furthermore, the industrialists, and more importantly, the traders would become prisoners of the discretionary, arbitrary, and coercive powers of the concerned officers. There would be frequent squabbles with the tax staff, there will be continued visitations by all kinds of agencies who will keep on demanding information which the Collectorate will already have, and there will be so much discomfiture and dejection that the industrialists and traders would be forced to cower and grovel into succumbing to the eventual and highly popular "muk-muka".

The government can become more involved in bringing about a comprehensive documentation system in the economy if it affirms its determination to continue with the process. The trend towards dilly-dallying on important issues has brought about a negative response to various governmental measures and has fortified the resolve of those who do not agree with the government’s scheme of things. It is imperative that the administration provides a sustainable solution to the process of documentation and that can only be done if the government can establish its writ but at the same time bringing about a kinder, gentler tax regime. The high-handedness of tax collectors must be checked and those elements in the tax collecting agencies that are bent upon creating a polemic condition must be removed from the scene. The government must understand that the pragmatic way to bring forth universal documentation is to provide an enabling environment.

The government must begin efforts to strengthen local bodies and this can be done by finalizing the date for local bodies’ elections and a systematic devolution of power down to the local level. The balance sheets of District Governments must be published and must be made transparent so that the citizens can get an opportunity to know what they are earning and spending and in which manner. There is immense amount of corruption in these local bodies. Fly-by-night companies are given contracts for city projects, etc. It is proposed that the government, in the first instance, target five cities, i.e., Karachi, Lahore, Peshawar, Rawalpindi, and Quetta, and divide them into zones. The road construction project, for example, could be given to one construction company for every zone, and that this company should be wholly responsible for the construction of the roads in that zone. If then the roads condition deteriorates, that company must repair it and must be penalized for shoddy work. These companies should be well-established ones, and that one-deal companies are not entertained at all. A bank guarantee could be a pre-condition to keep these companies in check.

It would not be out of place to quote the example of SITE Ltd. There is a total collapse of infrastructure in the largest industrial estate of the country. SITE Ltd needs an immediate and complete overhaul. The organization is still in the dark ages and continues to act like a mean, vicious, and demanding landlord. So much so, even the Supreme Court had to intervene and order the setting up of effluent treatment plants and a general clean-up of the estate. Of course, even today it is dirty, unorganized, encroached, and getting worse by the day. Remember, it is this same estate that provides nearly 30% of the total revenue of the government.

It is important to mention the need for an encouraging environment for textiles too. There are no two opinions that all the components of the textile sector should be confident and should be appropriately satisfied that they have been adequately backed by the government. The relevant ministries and agencies must resolve on priority basis the residual issues that still impact negatively on these constituents of the textile sector since these actions would ensue into more employment, more exports, and more industrialization.

A better and more enabling environment could be created if the government is serious about controlling the rampant under-invoicing, smuggling, and mis-declaration. The Afghan Pakistan Transit Trade Agreement is another deterrent. Labor is unmotivated and thus productivity, efficiency, and quality still haunt the industrialists. It would take years before water, gas, and electricity is available on demand. And, the less said about the monetary policy of the State Bank of Pakistan, the better. All these are impediments and roadblocks. The recent floods and the havoc it generated have formidably pushed the country’s progress. Billions would be required to bring sanity into the country. There is no political stability, there is no quality of life, and there is no continuity of policies. In spite of the oft-repeated mantra that “all is well”, the sad fact is that the road towards prosperity is full of pot-holes, it is dark, and it is under constant attack.

The solution lies in seriously and sincerely taking the industrial and business community on board. Policy making without intensive deliberations and without ascertaining the needs and demands of the industrialists and businessmen would be just another ad hoc measure. The time to change is now. The global marketplace is already becoming saturated with competitors from other nations. Pakistan cannot be a bystander or an isolated soloist in the world today. But, for now, "Le plus ça change, le plus c’est le même chose" (The more things change, the more they stay the same).

August 11, 2010

 

Majyd Aziz is a Karachi based Entrepreneur and a senior leader of the business community. He is a former Chairman of SITE Association of Industry, former President of Karachi Chamber of Commerce & Industry and has held posts on the board various public organizations and companies. 

Pakistan Floods (PKFLOODS 2010) – Update on Flood Operations with Videos from Charsadda

A few days back I posted A Relief Worker’s First Hand Report from Charsadda. Tahir Farooqui sends this update (with videos) of the Charsadda Operation and further efforts being done. If any one would like to donate to this cause contact me and I will get you in touch with Tahir and his team Insha’Allah.

 

 

 

Bismillah..
Dear Brothers, Sisters and Elders, Assalamu Alaikum>

We hope this email finds everyone in the best of eman and health. Alhamdulillah, We (Team-Karachi) have been working for flood relief operations since the past 3 weeks now. Here are few videos which were developed with the help of our brothers at Kohat University of Sciences & Tech. These videos give a basic idea to the viewer about how we drove the overall effort:

Team-Karachi in Charsadda (as we reached there)

 

The Destruction as we saw it – Charsadda

 

The Relief efforts and the Distribution Process – Charsadda

(Stretch the video marker to 4:00 minutes to see the actual description of the effort)

 

Currently our team is operating in the areas of Interior Sindh and Southern Punjab. In Sindh, we have created strong alliance with highly trusted relief organizations which are giving us hour by hour updates about the relief operations. To be more specific, we are focusing on Khairpur Meerus, Sukkur, Pano Aqil, Khanpur, Thul and Shikarpur areas and for Southern Punjab the focused areas are Muzaffar Garh and adjoining areas of Rahim Yar Khan. Our teams are actively providing the following services/items to the flood effected people:

• 35 Days/5 weeks food package.
• Delivering cooked food (to those who have not evacuated)
• Drinking Water Supplies for families.
• Medicines via Mobile Medical Camps.
• Tents.

More updates regarding Sindh relief works will be posted as we move on Insha’Allah. Our team member, Brother Abdul Latif Bhanger (elder brother of Ali Raza Bhanger) who is an Electrical Engineer by Profession is already busy in relief efforts in Interior Sindh. He has reached Sukkur on Saturday, 21st Aug and will be traveling through the areas to verify the surveys done by other teams after which the distribution process shall start. Another Team lead by Mufti Zahid Sangharwi & Omar Javaid will be reaching Khairpur Meerus and its adjoining areas tomorrow afternoon (22nd Aug) Insha’Allah.

We request our readers to pray for the whole nation especially for the millions of families who have been badly hit by this flood and left homeless. The intention of this email is not to pose that other relief organizations are unworthy of donation. Please donate generously to any relief organization that you feel is trust worthy. Find out a channel to donate and take care of one family, Allah will take care of yours.

May Allah SWT bless everyone who has contributed to this small relief effort. Ameen.

Tahir

Pakistan Floods (PKFLOODS 2010) – A Relief Worker’s First Hand Report From Charsadda

Pakistan is currently facing one of the worst crises in recent history, significantly more than the massive Earthquake in 2005. In fact the United Nations has declared this disaster as being worse than the 2005 Earthquake AND the 2004 Tsunami combined! With official figures quoting above 1600 dead, over 12 million homeless, and nearly a fifth of the country submerged in water, this is a grave time for the nation.

Many relief operations are being carried out by the various organizations and our own Dr Awab Alvi (of Teeth Maestro) and Faisal Kapadia (of Deadpan Thoughts) were in Sukkur carrying out relief operations. (See Pictures posted by Dr Awab and Faisal’s report on the trip).

Below is an account received via email from an acquaintance, Tahir Farooqui, who along with some others was organizing relief efforts in Charsadda.

The extent of relief we need can not be quantified. The immediate scenario calls for food, water, shelter, clothes, medicines, but in reality the extent of the damage these floods have done will be far-reaching as the economy is in tatters with crops, livestock, supplies, roads all washed away. Countless will need to rebuild homes, several major bridges will need to be re-built, our dams and barrages are filled to the bursting point with water and the fear is that if they overflow many more people will suffer from this calamity. If you are not already out there and doing something to help, wake up and start. Whether it is raising money, collecting goods, going out in the field, organizing medical camps, we need more participation in this. The response to the Earthquake was overwhelming but this time round the general populace seems to have lost their enthusiasm for helping.

I hope the below account of Tahir Farooqui and his friends will help motivate some more people. If anyone wants to contribute to Tahir and his team please contact me and I will get you in touch Insha’Allah.

 

 

 

Bismillah..
Dear Brothers, Sisters and Respected Elders, Assalamu Alaikum>

I hope this finds you in the best of Eman and health in the month of Ramadan.

By the Grace of Allah Swt, We (Tahir Farooqui, Ali Raza and Danish Qaiyoum) have returned from Charsadda villages after successfully completing the first round of relief efforts in the flood hit areas. We got to witness pain, anguish, disaster, hunger, misery, violence and above all Allah’s anger in the form of rivers flowing way out of control. I simply go out of words when trying to express the feeling. This email contains some details which will give the reader a basic idea about how we drove the overall effort. May Allah accept this little effort and contributions from everyone who stepped forward. Ameen.

What were our areas of focus..?

Our main camp of “Hunermand Pakistan” was based in NavaKilla Charsadda. Navakilla is a village which is about 4-6 Km away from main Charsadda City Adda. This small town is surrounded by many other small villages. River Kabul and River Sawat flowed across these areas which caused massive destruction. Our main focus remained on these 12 small villages around NavaKilla which were shattered by the flood. Little relief efforts came to these places since accessibility to these areas was tough. Alhamdulillah we were able to gain access to these areas.

We have been also coordinating with our friend’s/relief workers in Bisham of District Shangla. Let me tell you that Shangla has the lowest Human Development Index in the province and second lowest in the country! Hundred of families have been badly affected by the flood, land sliding followed by heavy rain in the surroundings of Shangla were also witnessed.

What was the destruction like..?

As I mentioned before, no words can express. You should have been with me to feel the pain and misery that these people were going through. Broken bridges, destructed houses, tearful eyes silently communicated the message “We have lost everything but hope…who will help us now..?” Attached with this email, you can find images which can give you a little idea about the destruction we witnessed. I have added short description next to each image. Shortly I will be releasing a full YouTube video that we made which will give you a more clearer picture about what was going on.

The situation in remote areas of Bisham is quite different to other flood hit areas. There is no road access to the remote areas of Shangla, as all the connecting bridges have been broken. I will be sharing pictures of that area as soon as we get them inshAllah.

What did we do to help these shattered souls..?

Alhamdulilah, we managed to provide 800 flood hit families with a 5 weeks Ramadan Food Package in Charsdda and around 300 families will be covered next week in Bisham of District Shangla inshAllah. This Ramadan Food Package was designed to help an average family of 7 people to spend the Holy month of Ramadan with a little ease. Each package included:
40 Kg Atta (Flour)
4 Kg Chawal (Rice)
Rooh Afza Sharbat (1 bottle)
10 Kg Sugar
1.5 Kg Masala (Spices)
5 Kg Oil (Ghee)
1.5 Kg Tea Powder
3 Kg Lobia (I don’t know what we call this in English)
2 Kg Chana Daal and 2 Kg Moong key Daal
1 Kg dates

What was the process that we executed during this relief effort..?

My friend, Dr. Abdullah is a trained relief worker who has actively played his part in Sawat Region during the IDP disaster with me. He is also the coordinator of the Disaster Management Unit at University of Kohat. With a PhD in Social Works, he is the person responsible for Hunermand Pakistan which ran us through the following process of relief effort:

• Formation of flood impact survey teams and assignment of these teams to different villages.
• Collection of information with respect to flood impact caused to each home in these villages.
• Dissemination of flood impact information to brothers and sisters across Pakistan who then came to help. This information contained details about immediate bare minimum needs of the victims which were required for their survival.
• Verification of the documented impact. This verification was done by us (Tahir, Ali and Danish)
• Devising the relief packages, purchasing food supplies and conversion of supplies into well defined packages. 
  Distribution of Ramadan food Package to flood hit families. The distribution process in Shangla is slightly different as there is no road access to that area. Mules are being hired for the distribution of the food supplies.

What’s next..?

As I write, the relief efforts initiated by our team still continue to operate in the mentioned areas. With disaster striking in Sindh, we are creating alliance with a highly trusted relief organization which has already started providing relief operations (medical and food supplies) in Sindh. More details will be revealed very soon inshAllah. For those who are interested, kindly contact myself or brother Ali Raza (arbhanger@gmail.com).

JazakAllahukhair for all your prayers and support!

 

Some Photos of the Trip

A view of the destroyed crops. The poor farmers have no place to work for….

These were 5 small houses in the village of Rajjar. Can you find them…

This was the street which had houses on both sides…

Another view of a street in a village of Charsadda. 12 feet water stood here for more than 7 days….

A 3 story school on main GT road which was fully submerged in water for few days….

An iron bridge on main GT road. This bridge was fully covered with water and was finally swept away. We provided relief efforts just few kms away from this location….

From left to right Ali, Danish, Dr Abdullah and Tahir discussing the distribution process in our storage room.

Our storage room: We spent the night converting supplies into separate bags for Ramadan Packages. More than 50 people worked all night long to perform this job.

 

A view of our storage room after the food supplies were converted to separate Ramadan Package (Bags)…

Our food supplies kept on coming in finding its way in the storage room and then finally landing in the hands of deserving flood victims.

In view of the upcoming Ramadan we added 1 Kg of dates to each Ramadan package. The team is working in full swing at night time in order to meet their deadline…

One of our loaded mini trucks is moving ahead while our distribution staff is using a van from Maymar Trust….

Distribution taking place in one of the effected villages. Around 1000 houses were destroyed in this small village called Rajjar.