Khaled Ahmed

Mr Khaled Ahmed (Pakistan)

4 Civil society and conflict resolution

Session 4 CONTENTS SPEAKER'S QUOTE

Free market is terrible for both India and Pakistan. It’s going to be very destructive. But both countries will have to decide what they want to keep. Is their nationalism worth keeping? Is their indoctrination, stereotyping of each other worth keeping?

And we have a Prime Minister who is a businessman, who will deregulate the economy, will privatise the economy, who will make us face the true economic reality of Pakistan and there will be suffering in that... labour will be exploited.

But India is willing to buy this expensive power which means that India in the times to come will have the same rates, at which it will sell electricity, as us. Otherwise, India will have load shedding.

We think that if we trade with India, the disputes will be forgotten and we will have to actually pull down our army budgets. If we pull down our army budgets, we will not be able to fight over the disputes that are outstanding between us.

And we are both vying for the same money . India and Pakistan are looking for these foreign funds floating around the world which cannot be invested in home countries because the costs are too high.

It also means that external finance will look at the conditions and those conditions may actually force you to change your religious attitudes. That is what the free market is going to destroy.

Journalism is a private sector thing. If I get my advertisements from the government, I am no longer free.

Prejudice will not go away because, somehow, we have not intellectually improved. I don’t think we will improve intellectually. I think the free trade market will force us to be careful.

Mr. Khaled Ahmed focused on the various aspects of privatisation and globalisation and its implications for both Pakistan and India. Free free trade between the two countries, as well as trade brought about by various treaties of SAARC and external finance provided by western agencies, was identified by him as one of the areas of special interest in this regard.

Mr. Ahmed observed that a strong state sector seems to be an ideological reality, that has been laboriously and gradually nurtured in India. In Pakistan, however, it was brought about by nationalisation – and therefore pretty weak to begin with – and never flourished to acquire a strong stature. Both the countries are now faced with the global trend to de-regulate and privatise. Although, Pakistan has embraced this economic reality facing the rest of the world, including ex-socialist powers like Russia and China, India is still going through its moments of hesitation and still has a long way to go in creating an even playing field. "The external aspect of free market is globalisation. That you don’t only create an even playing field within your own economy. Remove the subsidies, privatise the state sector organisations and allow the private sector to flourish as it should flourish."

While state sectors have their own sets of problems such as limits to growth, proliferation of bureaucracy i.e. too many bureaucrats interfering in the affairs of the entrepreneurs with unnecessary formalities like the permit system, globalisation is not without its sets of problems. Globalisation aspect bothers us all alike and that can be witnessed from the number of complaints that have gone to the World Trade Organisation (WTO). "If you look at the complaints that have gone to WTO, you will find that third world countries have complained more often against the third world countries and not against the commanding, bigger economies of the world"

Pakistan had to live with the perpetual fear of military coup for most of its life because it had a large state sector and hence it was very easy for the military to take over – a fear that is prevalent no more since the army has lost its interests following the huge losses incurred by the state sector. Although India had a very large state sector, it was also accompanied by a healthy private sector and a strong, free press and, therefore, never had to live with this kind of fear.

Both the countries have not yet been able to improve their trade ties and when one looks at it closely, the reason is more political than economic on both the sides. "I do not think reasons behind objections to trading with India are genuine. I think they are more political. The Pakistani mind is a very militarised mind. It concentrates very much on the disputes and jurisprudence of war between the two countries. Let me put it this way. Whereas in Europe or anywhere else in the world, war is considered an obstacle to trade, we consider trade as an obstacle to the prosecution of war." On the other hand, India may be wanting to trade with Pakistan but with the same sneaky political agenda in mind. "India wants trade with Pakistan because it thinks that the disputes will be forgotten. India is the status quo power and it doesn’t want to resolve these disputes". Since Pakistan is not the status quo power, its reluctance for trade with India is understandable.

India exerts a tremendous influence in the region due to it’s economic prowess. It makes 87% of value added in South Asia and comprises of 75-77% population in the region. It has, however, not emerged as a benign trading partner due to lack of concessions on its part. There exists a lot of uneven playing field in the form of subsidies provided by the Indian Government that give India an unfair advantage compared to other nations in the region. This unfair advantage is accentuated by cheaper labour and electricity. A case in point is the politically motivated kerosene subsidy which hurts Pakistan. "The subsidy is equal to our budget gap. The planned deficit of Pakistan is equal only to the kerosene subsidy in India" However, the speaker is of the view that these "uneven playing field" will hurt India eventually and they will have to do away with these subsidies. Pakistan has suffered a power crisis and India will follow. It, too, will have to enter expensive contracts with international companies and when that happens the difference in power rates across the border, and the accompanying unfair edge, will cease.

Both India and Pakistan, because of the state of their economies, require external finance especially to bring about privatisation. This money that enters their respective countries will exert certain pressures on both the countries trading practices and inefficiencies and unevenness’ will definitely will have to be done away with. The subsidies will have to go including subsidies like child labour in our region which has met with a extensive western media disapproval. "All these unevenness’ will have to go because there is no free lunch for either India nor for Pakistan"

The rise of the Private Sector can also improve freedom of the press on both sides by reducing the press’s dependence on government’s for advertisements. Although, it will not get rid of prejudices, it will at least make our opinions, about one another, more tolerable.

Mr. Khaled concluded with the proposition: "We don’t have opinions. We have prejudices. I don’t think those will be removed but I don’ t think those attitudes are worth keeping. Let me tell you, honestly, that I don’t see anything in India and Pakistan worth keeping. So why not allow this destructive thing called free trade to come in and sort us out?"