mani shankar iyer on pakistani economy & India

[Guest guest]

Mani Shankar Iyer Pakistani Economy & India by Arindam Banerji, Ph.D, California.

 

Last week was nothing short of a disaster for Indian journalism –

according to my powers of observation, we pulled off at least 3 different

Jayson Blairs, all in the space of 1 short week. Three very visible

journalists/columnists published articles with random half-truths and lies,

with nary a rebuttal or nor a correction to follow anywhere. Facts are created

and distorted seemingly for political conclusions. Everybody of course has the

right to their opinions, but our veterans here seem to have their own version

of facts, too. Where cooked up facts will not do, some are audaciously hidden

while others are put in contexts that do not belong at all. All in the name of

making some obtuse, perhaps political point.

 

All right, all right, let’s not crucify them, before perusing their

stories. To read the full article titled 'Media Accuracies' click

http://www.vigilonline.com/news/whats_new/news_view.asp?plainSpeakId=69

 

 

Mr. Aiyar spreads some numbers around

 

First, let’s take the odd case of Mr. Mani Shankar Aiyer – on a

jaunt to Islamabad, he takes the time out to continue his lobbying efforts on

the behalf of Pakistan. He writes "Shaukat Aziz ... announces that the Pakistan

economy in the current financial year, July 2002-June 2003, has recorded the

fastest growth in South Asia. He does not say so but the sad fact is that they

have overtaken India as we slide downwards and they slither up. Per capita

income in the current fiscal year, he adds, has risen by a double-digit

figure...";

 

Note that he makes three claims:

Per capita income has gone up by a double digit figure

Pakistan recorded the fastest growth in S. Asia.

“have overtaken India as we slide downwards and they slither up”

 

The problem is that though none of them are strictly incorrect, Mr. Aiyar

deliberately shades the truth in each. The end result is pushing his political

interest in playing up the Pakistani economy, while at the same time

denigrating the Indian economy. So, once again lets look at the facts:

 

Per Capita Incomes

First, let us look at the pesky per capita income numbers. Reality is that

Pakistan's per capita income ($420.00) has declined to below that of Sub

Saharan Africa ($460.00). Mr. Aiyer's magic numbers that proclaim a $10.00 in

per capita income growth fails to take into account the re-evaluation of most

currencies against the dollar - thus, automatically, the Indian Rupee has gone

up by 4% and so has the Indian per capita income. [Parsuram, BRF]. So, most

everybody’s per-capita numbers have gone up somewhat, since Uncle Sam is

printing up dollars night and day - incorrect implications by Mr. Aiyer here.

In fact, if you look at income growth over 1990-2000, an average Indian was

fifty per cent more prosperous in 2000 compared to his (or her) situation in

1990, while a Pakistani gained only 13% in the same time. So, yes Mr. Aiyar

tells the truth, but at best half-the-truth about per-capita incomes.

 

Fastest growth in S. Asia

So, what about those great growth numbers brought about by Musharraf’s

policies. Taking a closer look at Pakistan's claims of growth, Dr. Assad Sayyed

(a Pakistani economist, not an Indian one) says "General Musharraf and his

economic mandarins generally highlight ...the military regime has been able to

reduce the fiscal deficit to 5.6% of the GDP compared to … 6.1% in the

1990s. As much as 41% of this reduction in the deficit was achieved through

slashing public investment.". Or in other words, Pakistan cut out critical

public investment to prop up the numbers. Mr. Musharraf in order to protect his

gaddi, has doomed the Pakistani public to many more years of minimal

improvements in living standards. So, in this particular case, Mr. Aiyar

without giving a source for his data, compared true Indian progress with

propped up numbers, resulting in a false politically motivated insinuation.

 

As we slide downwards and they slither up …

Finally, let us consider this canard of “have overtaken India as we slide

downwards and they slither up”. Explains Farrukh Saleem, a Pakistani

journalist by the way of background "America buys Rs100 billion worth of

Pakistani textiles a year. "Made in Pakistan" labels are available in some

5,000 retail outlets throughout the US. In Pakistan, 60 per cent of the total

labor force - some 25 million workers is employed by the textile

sector.”. In short, the textile industry is Pakistan’s largest

legitimate industry and in fact, the only legitimate industry of any

significant size.

 

Unfortunately, it seems this very industry is in a lot of trouble, as "American

Eagle Outfitters and Perry Ellis have stopped ordering Pakistani apparel

altogether. ...Orders from large American retailers are down more than 40

percent ...(or)... 64 percent reduction in orders for clothes that would be

made from December through February.". As a consequence, at least

“150,000 Pakistanis have already lost their jobs and some 177

manufacturers have closed down shop. .. Spill-over job losses would eventually

run into a million or so (when apparel workers don't have the money to buy eggs

poultry workers also suffer and so on).”. This trend is not going away

any time soon – just like countries do not want to play cricket in

Pakistan, they seem to be shying away from doing business in Pakistan.

The very same Farrukh Saleem talking about the state of the Indian industry says

the following: -“Mumbai is now home to at least three dozen American

companies including Kodak, Heinz, Monsanto, Warner Bros, Federal Express, Bank

of America, Bankers Trust, Parke Davis, Intel, JP Morgan, Kellogg, Pfizer,

Procter & Gamble, American Int’l Group, Exxon-Mobil, Delta and Boston

Consulting. Delhi has AT&T, GE, General Motors, Oracle, Pepsi, Unocal, Xerox,

Lockheed, Raytheon, Rockwell, Honeywell, Adobe, AES, Alcoa, American Express,

Northrop, McKinsey, Amway, Polaroid and Coca Cola. Bangalore has Caterpillar,

Dell, Sun, Texas Instruments, NCR, Hewlett Packard, Motorola, Lucent, IBM,

Novell, Ingersoll-Rand, American Data and MetLife. Hyderabad has Microsoft,

Cognizant, Chip Engines and Brigade. Chennai has Ford, Caltex, Tenneco,

Covansys, Diebold, Citibank, Ernst & Young and Price Waterhouse. A large

majority of US corporate giants are now dependent on Tata Consultancy, Infosys

Technologies, Wipro, Satyam Computer Services, HCL Technologies, Patni Computer

Systems, Silverline Technologies, Mahindra, Pentasoft, Mascot, Mascom, Mastek,

Polaris, L&T and Hexaware (all Indian software giants).”

 

The list goes on and on – in fact, now at least 77 MNCs produce

intellectual property (not sweat shops) in R&D labs in India. Mr. Aiyer, how

many companies have done the same in Pakistan in the last few years? On the

other hand, can you name any significant export products from Pakistan, other

than textiles, low-end sports equipment, drugs and terrorism – can you

name any intellectually relevant commercial products?? Nope. But, then why put

India down? What was the need for the half-truths and distortion, Mr. Aiyar?

 

Sarmila Bose, an assistant editor and columnist for Ananda Bazar Patrika and The

Telegraph newspapers in India, - ooh, that great Pakistani economy once again

 

Bose further claims "The reality is that in terms of these crucial issues, the

military dictatorship of General Musharraf from 1999 to 2002 arguably provided

better governance, not only compared to previous elected governments of

Pakistan, but also compared to the democratically elected government of India

during the same period". She further adds "Secondly, General Musharraf seemed

at least to try to deal with pressing policy matters including economic

problems. Some of his economic successes are directly related to his decision

to do a policy somersault in Afghanistan and become America's ally in its

'global war against terrorism' - a practical move most certainly in his

country's best interest. In India the economic reform programme is adrift while

issues of temple-building or 'cow protection' take centre-stage."Somehow, the

whole governance issue and Pakistan’s handling of their economy has made

both Aiyer and Bose gush and blush.

Of course, this period of governance has seen Pakistani editors regularly flee

the country due to risk to their families and witnessed open threats to the

life of one of the most visible editors in Pakistan. Almost all civilian

organizations are now run by military men. Bernard-Henri Levy's recently

published book says "Pakistan is the most delinquent of nations" and claiming

that Pakistan was the real key to all Islamic-led international terrorism, he

said that the US had solved only 1% of the problem by deposing Saddam Hussein.

This is about Musharraf's Pakistan.

 

Shaheen Sehbai says the following: "Last week the Inter Services Agency (ISI) of

General Musharraf kidnapped the Deputy Opposition Leader of Punjab Assembly,

Rana Sanaullah Khan, beat him blue and black, shaved half of his head and half

of his moustache and abandoned him on a deserted road, all for criticizing the

Army Generals. In another move the bold and brave Lahore newspaper "Weekly

Independent" was directly threatened with a senior official warning the

publisher: "Enough is Enough"." - SA TribuneFurther, Dr. Assad Sayyed writes in

May 2002, "This assessment of Pakistan's economy - based for the most part on

official data – shows that economic indicators pertaining to the lives

and livelihoods of the Pakistanis have performed dismally in the last few

years. In fact, some of them are even worse than those in the 'lost decade' of

the 1990s. More importantly this deterioration in the economy apart from the

drought - is in large part due to the policy framework adopted by the

government."India in the same time period, has done some of the following:Fact

#1. "Citing the 18.05 per cent rise in exports, Jaitley said, with this

India share in the world exports in merchandise goods has increased from 0.4

per cent in 1992-93 to 0.7 per cent in 2001-02 and 0.8 per cent in 2003. If the

present trend is maintained, we might even reach one per cent share in world

exports before the target year of 2007," he said." - IEFact #2. "Despite an

overall sluggish growth, many sectors in the economy are growing. And, growing

at very handsome rates too. According to an ET Intelligence Group study, a

large number of industries are growing at rates over 10%. Iraq or not, and SARS

be damned. Compared to the growth rate of the real economy, that's stupendous" -

TNNFact #3. "Auto part exports to rise over 100% to $2bn in 2 years" -

ETFact #4. "Agricultural and processed food exports rose 23% during

April-October 2002" - ETFact #5. "Electronics components' exports have

posted a 20.35 per cent rise in 2001-02 to Rs 2200 crore compared to Rs 1,828

crore in 2000-01, according to an estimate by Electronics and Computer Software

Export Promotion Council." - ETOf course, her agenda would not allow her to

"expose" the following truth about the adrift economic reform program:"The

winter session of India's 12th Parliament adjourned on Dec 21,2002 after

setting something of a record for the legislative business carried out. Lok

Sabha the lower house, had passed 42 pieces of legislation and Rajya Sabha,the

upper house had approved more than half of them. A few dead laws were repealed.

Some were fine-tuned. The reach of the legislators has been wide. Commentators

say that the bills passed will reform the markets, strengthen the economy and

make life a little more equitable." - goodnewsindia.com

 

Do we really want to compare Indian economic successes with Pakistan's terrorism

extortion-money based economic bubble? Do we really want to compare Indian

governance with Pakistani governance? From the above evidence, it appears not.

While I’m sure that the Indian economy could be handled more efficiently,

what was it that stopped Ms. Bose from giving a more factual description?

 

How does this happen?

 

The most important thing to note is that these are some of the columns that came

to my notice just within the last one week. I have clearly missed many more.

 

While, I have strong opinions on why these veterans chose to skate on thin ice

– I’ll not make them here. I’m sure folks on the right side

of the fence do the same too and others should look into them just as closely.

But, the upshot of all this is that the Indian readers’ opinions get

biased by things other than facts.

 

How much of this brain-washing happens every day in our media that goes

completely unnoticed? Why does it go un-challenged? Finally and much more

importantly, what overall effect does this have on the Indian readers? How many

false opinions of the Indian populace is based on such facts. You tell me.

 

Arindam Banerji, Ph.D.