Showing posts from August, 2009

Farrukh Saleem's Analysis of Pak Sugar

Farrukh I one of Pakistan;s best economic and invetigative journalists.
He sent me the borad summaary of hsi sugar analysis. Here it is.
3.5 million production
average price last year Rs30
price this year 55
difference times production roughly equals Rs80 billion
a total of 80 mills
average profit per mill Rs1 billion
ruling party mills owned around 2 dozen
pml n mills onwed around 1.5 dozen
pml q mills owned around 1 dozen
Now do you see the political economy in the coutnry!

nice peice on USAID in pakistan

Bravo Shaukat—rethink aid build capacity!

We all know that the army is good only at usurping power but little else. They went looking for an economist and got a smooth suave private banker—Shaukat Aziz. So much for their intelligence (no pun intended).Our new Shaukat--Shaukat Tarin the Finance Minister of Pakistan-- has finally got it that even to obtain aid you must know your mind and negotiate.He has raised the all important issue of how donor funds never reach Pakistan or are intermediated away. Sadly no one in the media has picked it up. I feel particularly sad since I have been raising this subject for years.Let us look at the USAID figures (See table below) which I have got from their website. Of the 1.2 billion that they report their only about 20 are given to local institutions like the Khushali Bank and HEC. The rest are all awarded to American firms that none of know anything about. Even though some of these firms have been here for years, we still do not know of them or hear of their consultants or even see them. W…

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Political Economy of Pakistan

We readily blame feudalism for most of our problems. In my view, such knee-jerk analysis is flawed.Let me explain.Feudalism is a particular historical term that captures the obligatory relationships between a monarch (state), and the feudal lord on the one hand, the feudal lord, and the peasant on the other. The feudal lord supplied tax collector, administrator and supplier of soldiers to the monarch. In return, he got land and power over the peasant.This has never prevailed in Pakistan. The colonial government did leave some princely states behind but both India and Pakistan got rid of them fast! Much has been made of irrigation land grants given out by the British. These also included land for military supplies program!The result was that some prominent families accumulated large landholdings!Does this mean that they have had dominant political and economic power? To answer this question, recall that the colonial masters for their own administrative reasons had made their state infr…