Wordfall, by Kaleem Omar

A key element in the formulation of a feasible long-term path of development is a national marketing strategy aimed at optimal economic performance.

Four major problems continue to plague many developing nations: low levels of living; the problem of population growth; a lack of jobs; and a deteriorating plus inadequate infrastructure.

There is a huge per capita income gap between rich and poor nations. Switzerland, one of the world’s richest nations in GDP per capita terms, has over 400 times the per capita income of Ethiopia, one of the world’s poorest countries. Japan’s GDP per capita, at $ 34,715, is 40 times higher than Pakistan’s, at $ 850 (the latest government figure). Read the rest of this entry »

KARACHI: Pakistan’s electricity tariffs are the highest in the world. The problem is compounded by the fact that successive governments have continued to impose a variety of duties, taxes and levies on imported furnace oil used by oil-fired thermal power plants, which now generate more than 50 per cent of the nation’s power.

In order to accelerate economic growth, the government, among other things, needs to do away with all these imposts to reduce the cost of electricity generation. This reduction in generation cost should be passed on to industrial consumers and farmers in the form of mandated lower electricity tariffs. Read the rest of this entry »

President Musharraf’s offer at the SCO summit in Shanghai to provide an energy corridor to Western China and the Central Asian Republics could yield billions of dollars in economic benefits for Pakistan.

Addressing senior executives of the All China Federation of Commerce and Industry (ACFIC) in Shanghai on June 14, and later addressing a summit meeting of the six-nation Shanghai Cooperation Organisation in the same city on June 15, President Pervez Musharraf said his government was trying to convert Pakistan into an energy corridor for Western China and the landlocked Central Asian Republics, through the seaport at Gwadar and new rail and road networks. He also offered to extend the proposed Iran-Pakistani-India (IPI) gas pipeline to energy-deficient Western China. Read the rest of this entry »

With no significant additional generation capacity due to come on stream for at least another two years, the fast growing demand for power is likely to exceed the country’s total installed generation capacity by the middle of next year.

According to the latest Pakistan Economic Survey, which was released by the Ministry of Finance just before the June 5 announcement of the federal budget for fiscal 2006-07, the economy has grown at an average rate of over 7.5 per cent per annum in the last three years, thus positioning itself as “one of the fastest growing economies of the Asian region.” Read the rest of this entry »

The budget to be announced today by Minister of State for Finance Omar Ayub Khan is likely to be motivated, at least in part, by certain political imperatives that have to do with the fact that 2007 is an election year, when elections will be held not only for the National Assembly and Provincial Assemblies but also for the office of the President of Pakistan.

Although President Pervez Musharraf has not yet formally declared that he will be a candidate for re-election, all the indications suggest that he intends to run. It remains to be seen whether he will take off his uniform before announcing his candidacy or continue as the chief of the army staff. Again, however, the likelihood is that he will choose the latter option. Read the rest of this entry »

KARACHI: At a pre-budget briefing for journalists in Islamabad on Monday on the performance of the national economy, Dr Salman Shah, Adviser to the Prime Minister on Finance, Revenue and Economic Affairs, said that the country’s economic growth had been “internationally acknowledged” and that all the economic indicators were showing a “positive trend.” Read the rest of this entry »

President Musharraf wants the forthcoming budget’s Rs 415 billion Public Sector Development Programme to focus on the common man. That’s a good idea. In an era of sharply rising prices, however, what budget makers have to figure out is how to translate this idea into reality.

Reviewing a presentation on the forthcoming budget’s Public Sector Development Programme at a meeting in Islamabad on May 25 at which Prime Minister Shaukat Aziz was also present, President Pervez Musharraf directed the government to concentrate all its resources on making a “visible improvement” in the life of the common man. “We must utilise all available resources on bringing a qualitative change in the lives of people and ensure wider distribution of economic benefits,” Musharraf said. Read the rest of this entry »

There is hardly any area where the US government’s penchant for double standards does not apply. The latest example of this came on Tuesday when the US Defence Department, headed by Donald (“Weapons of Mass Destruction”) Rumsfeld, in its annual report to Congress warned that the pace and scope of China’s modernisation of its strategic forces and other surprising military developments could pose a credible long-term threat to the United States. Read the rest of this entry »

The JF-17 Thunder jet fighter aircraft was jointly developed by Pakistan and China in only five years at a cost of only $ 500 million, and is being manufactured by the Chengdu Aircraft Industrial Group located in China’s southwest province of Sichuan and the Pakistan Aeronautical Complex at Kamra north of Rawalpindi. The fourth prototype of the JF-17 completed its maiden test operational flight in Chengdu on May 10. The first batch of JF-17s is expected to be inducted into the Pakistan air force in 2007. The PAF plans to induct 150 JF-17s into its fleet over the next few years, at a cost of about $ 15 million per aircraft. The Chinese air force is also considering inducting 250 JF-17s into its fleet. This would reduce the per-copy cost of the aircraft to about $ 12 million, making it an even more attractive proposition for other countries to buy. Under the terms of the joint venture agreement between Chengdu Aircraft and the Kamra Aeronautical Complex, Pakistan would get about 40 per cent of the sale proceeds of JF-17s sold to other countries.

By contrast, the Indian equivalent of the JF-17, the Tejas (Sanskrit for “Radiance”) light combat aircraft (LCA), which was jointly developed by the Aeronautical Development Agency of India’s Defence Research and Development Organisation and Hindustan Aeronautics Limited (HAL), took nearly 20 years to develop at a cost of over $ 2 billion. The much delayed Tejas LCA, derisively known in aviation circles as the “Last Chance Aircraft,” flew for the first time on January 4, 2001. But the programme has faced further delays since then, and the Tejas LCA is now not expected to be inducted into the Indian air force until 2010.

About 250 LCAs are expected to replace the Indian air force’s MiG-21s and MiG-27s, at a per-aircraft cost of $ 22 million. Thus, the total cost of the LCA programme will work out to about $ 5.5 billion.

The armament load planned for the 5.5-metric ton LCA includes a 23mm gun, air-to-surface missiles, anti-ship missiles, cluster bombs, conventional bombs, drop tanks, electronic warfare pods and sensor pods.

The LCA was conceived in 1982 by India’s state-owned Defence Research and Development Organisation (DRDO). Since then, the target date for the introduction of the aircraft into the Indian air force’s fleet was pushed back from 1998 to 2005, then to 2006, then to 2009 and now to 2010, first due to lack of funds and now software problems.

Since 1982, the Indian government has spent about $ 2.0 billion on the project. The DRDO’s Aeronautical Development Agency, 33 research and development organisations, 60 private-sector companies, and 11 academic and scientific institutions are involved in developing the light combat aircraft.

The first LCA prototype has a fly-by-wire system made by Lockheed Martin Corporation, Bethesda, Maryland, USA. The system was customised by India’s state-owned Bharat Electronics Limited, which is manufacturing the digital flight control computer for the LCA. Lockheed Martin received a $ 20 million contract in 1994 to develop the wire system and flight-control systems for the LCA.

However, the fly-by-wire integration is problematic. According to DRDO officials, the fly-by-wire system obtained from Lockheed Martin in 1994 was supposed to be integrated and tested on an F-16 at a Lockheed Martin facility in Binghampton, New York, in 1998, but that plan was abandoned due to US sanctions that were imposed that year on India following the latter’s nuclear tests.

Lockheed Martin has been the manufacturer of F-16 fighter aircraft since 1992, when General Dynamics Corporation sold its F-16 plant at Fort Worth, Texas, to Lockheed Aircraft Corporation, which in 1993 merged with Martin Marietta Corporation to become Lockheed Martin.

In 1999, the fly-by-wire system for the LCA was taken to Russia’s flagship fighter manufacturer, VPK MAPO in Moscow, but the system could not be integrated and tested there either. The DRDO then undertook the fly-by-wire integration and testing itself on an aircraft simulator in Bangalore.

According to a DRDO scientist, the so-called control-law software, which runs the fly-by-wire system and helps the pilot keep the aircraft on course while in combat, even in turbulent weather, was not performing up to requirements.

According to DRDO officials, the high point of the LCA project thus far has been the protoype’s operational reliability, which they claimed was “95 per cent during a one-hour sortie.”

Meanwhile, the Indian parliament’s standing committee on defence has directed the government to review all major indigenous defence projects undertaken by the DRDO. The agency has consistently failed to meet programme deadlines, leaving the military scrambling for vital equipment, the committee said.

About $ 5 billion has been spent on DRDO’s 50 key defence projects in the last 15 years, many of which are more than 10 years behind schedule. The projects include the light combat aircraft; the Arjun main battle tank; the Akash, Trishul and Nag short-range missiles; unmanned aerial vehicles; electronic warfare systems; a nuclear submarine; surveillance systems and radars.

In early 2000, India’s three defence services drew up an import acquisition wish-list for fiscal 2000 worth $ 15 billion spread over five to 10 years, noting that the DRDO and India’s state-owned ordnance factories “are not able to supply the needed equipment on time.”

In a report released in April 2000, the standing committee on defence said the DRDO’s activities should be made accountable. The report directed the Indian ministry of defence to report on the delays caused by DRDO. Press reports quoted committee member Kaipl Sibbal as saying, “There must be transparency in all activities of DRDO.” Delays in key projects such as the light combat aircraft, caused by huge cost overruns, “are major concerns,” Sibbal was further quoted as saying.

The DRDO subsequently sought permission to make a presentation on the matter to the standing committee, and all project delays are being reviewed.

The committee’s report followed the Indian government’s decision in principle to seek off-the-shelf procurement of weapons from other countries. The government’s decision came after Indian military forces ran low on advanced equipment and material during their May-June 1999 conflict with Pakistan in the disputed Kargil region of Indian-occupied Kashmir.

One critical example was the weapon locating radar system, said the standing committee report. The system was about to be imported when DRDO said that its own Rajendra radar could be converted into a weapon-locating system. However, DRDO failed to provide the radar on time.

Following that fiasco, the Indian ministry of defence ordered procurement of 20 Searcher II unmanned aerial vehicles at a cost of $ 20 million from Israeli Aircraft Industries, Lod, Israel, to provide reconnaissance in lieu of other suitable radars to track the movement of Pakistani forces in the Kargil region.

The standing committee’s report criticised the Indian defence ministry for “not having shown any sense of seriousness” in buying the weapons locating radar for the Indian army, although “inquiries in respect of the item had been made since 1989” – the year that saw the beginning of the campaign by Kashmiri freedom fighters against Indian troops in occupied Kashmir.

Other delayed projects cited in the committee’s report include short-range missiles, tanks, the light combat aircraft, and naval ship refitting. The Indian ministry of defence has been forced to procure short-range missiles from foreign manufacturers as indigenous developments remain in the final trial stages, while induction is still several years away. The Arjun main battle tank, too, is still not operational after 30 years of work by DRDO. The Indian army is now buying 100 T-90 tanks from Russia at a cost of $ 1.75 million each.

India’s light combat aircraft is already 13 years behind schedule, and the Indian parliamentary standing committee wants the government to provide a timetable for its acceptance by the Indian air force. On ship refitting, the committee’s report cited delays in refitting the INS Virat, the Indian navy’s sole aircraft carrier.

The DRDO’s missile development programmes include the Nag anti-tank missile, the Trishul and Akkash surface-to-air missiles, and the medium-range Astra air-to-air missile. With the exception of the Astra active radar-guided air-to-air missile project, the other programmes are reportedly in the final trial stage.

Press reports quoted Indian defence ministry officials as saying that though the missiles’ in-service dates have repeatedly changed, the Naggm, Trishul and Akash by now should have been in service with the Indian armed forces. Yet none has been fielded operationally. At the current pace, all three systems could enter service as late as the end of 2006 or even later.

A “sense of urgency” within the Indian government has grown, however, since the Kargil episode, according to press reports. Reports say the skirmishes prompted the Indian defence ministry to review its equipment programmes. Following this review, the Indian government reportedly reached a decision in principle to procure off-the-shelf equipment from foreign manufacturers in areas where there is no indigenous deployable system available in the short-term.

We are now into that pre-budget time of year when tall promises tend to become the order of the day and official spokesmen get busy painting rosy social-sector and economic sector development scenarios that often end up being honoured more in the breach than the observance. And even when they don’t end up that way and things do get done, they frequently tend to get done at a much slower pace than visualised by the government. In T. S. Eliot’s words, “Between the reality and the response, falls the shadow.”

That shadow, in our case, is made of a number of elements, including the limited absorption capacity of government agencies to utilise budgetary allocations for development spending within the stipulated time frame, bureaucratic inefficiency, procedural red tape, and a lack of the kind of political will that is needed to translate development goals into concrete results on the ground. Read the rest of this entry »