In Pakistan, the Social Clause is Finally an Issue
Whenever Pakistani NGO people have a chance to mingle with fellow Subcontinental, one question always comes up. Why are Pakistani NGOs so passive and mute about the effects of International Monetary Fund, World Bank and World Trade Organisation policies?
As the question is inevitable, the answer has also been immutable—a routine palaver of how elitist Pakistani NGOs are, and how they don´t take pains to reach out to the grassroots. No matter how valid the excuses, the fact is that this deafening silence on the part of the public, and especially the NGOs, has helped make the Pakistani government the most willing, unprotesting and uninhibited embracer of free market economy and structural adjustment programmes.
It has been successful in drowning out the feeble squeaks of dissent in a cacophony of slogans and rhetoric such as: "In one year Pakistan has attracted more foreign investment than in the last 20 years combined."
What is not mentioned is that most of this investment is still on paper and even if it comes it will use the country as a free-for-all joyride exploiting its already overburdened people. "When we talk of the multinationals , among ourselves we say they have come to their Dubai," says Amjad Ali Jawa, president of a domestic pharmaceutical companies organisation.
In fact, the government´s claim now borders upon the impudent and impolitic. During her recent tour of Sweden, Prime Minister Benazir Bhutto proudly declared: "Pakistan is the only country which allows 100 percent foreign ownership."
Mother Knows Best
It is not just foreign investment and trade issues in which the government has presumed it knows best. There is also the so-called Social Action Programme, an ill-disguised structural adjustment policy (it is interesting that both acronyms spell SAP) carried out as demanded by the IMF and World Bank, Under it, changes have been made without any debate inside or outside the parliament. The rupee has been devalued by over 12 percent within months, inflation is riding high—above 20 percent according to some readings—subsidies are being cut and utilities like electricity made increasingly expensive.
The latest is that rather than draw the ire of the feudals sitting in Islamabad by implementing the much-awaited Agricultural Income Tax, a General Sales Tax is being levied on all items which have long been exempt from them in view of their ´essential´ nature. Apart from the inevitable price hike, this will result in the local small manufacturer taking a giant leap towards his doom.
Garage Sale
Already Pakistan´s small industrialists are groaning under a discriminatory import policy which specifies a lower duty on finished goods than on raw material. Two immediate casualties will be the cycle and fan industries, both of which produce necessary items for the poor (the rich having other modes of conveyance, and air conditioning). Another grim aspect of the SAP is the privatisation policy of the government which, in actuality, is a garage sale of the country´s assets. Instead of privatising sick units, healthy units earning more than satisfactory profits are being transferred into private hands under extremely cosy conditions.
Even more distressing, the units and services being privatised are directly related to the basic rights and needs of the people. Fertiliser and telecommunication services are already in private hands, and electricity and water are next. Under World Bank directives, a study is being carried out on privatising the efficiently-run canal system of Punjab. This would be a momentous decision, if taken, in terms of the very future of the country and its people.
The Penny Drops
But things are changing on the activist front. Instead of self-flagellation at seminars at plush five star hotels, NGOs have finally begun to stir out of their donor-induced stupor. Early May saw a gathering of around 40 people from NGOs, trade unions and media people converge on a not-so-grandiose motel in Islamabad to hold an open debate for the first time on the issue of the Social Clause in GATT.
For two days, this group discussed and dissected the issue and came up with a statement which concludes: "Pakistan is a member of WTO but neither the parliament nor public interest groups were consulted before signing the agreement. Hence, the process was not democratic."
Other demands were made: a moratorium on all Pakistani laws which are being changed or have been changed under GATT or SAP requirements, and a comprehensive analysis of sectors being affected by GATT or SAP, involving sectoral and public interest groups under the purview of the parliament.
The government was urged to regulate the business practices of transnational companies since GATT does not regulate their activities. More ambitiously, the statement asked for renegotiation of all agendas of GATT which go against the public interest.
Now that the non-governmental sector is rising to the debate, one can hope that there will be more discussion among government, business and the public on critical economic issues.