Senators warn against IMF loan: propose better management of economy

[Naveed Yaseen]

ISLAMABAD, Oct 30: The Senate standing committee on finance observed here on Thursday that the Rs50 billion bailout package for the stock market announced recently should not benefit only a few big brokers.

The committee, headed by Senator Ahmad Ali, asked the finance ministry that the proposed support programme be carried out in a manner that protects the system and was not meant to bail out influential players.

Advisor to Prime Minister on Finance and Revenue Shaukat Tareen, among others, attend the meeting. Mr Tareen gave a detailed briefing on the over-all economic positions of the country’s economic indicators.

It was recommended that the government should ensure strict adherence to the announced policy of bottom up support.

The government has announced Rs30 billion “Put Option”, a sort of sovereign guaranty, for non-resident Pakistanis to retain their shares for one more year.

“The pricing of the put option must be worked out judicially and carefully as it was very essential for success of the whole scheme,” the committee observed.

The real problem faced by the country relates to the crisis in the economy, which was affecting the stock market as well. As such immediate effective policy was required to boost economy, particularly the production sector.

“Stock market can be stabilised only through better management of economy,” the committee observed.

The committee strongly emphasised the need to revisit the tight monetary policy. It also recommended lowering of interest rate and banking spread. These steps would not only enhance the production process but industry would also revive much rapidly. Mr Tareen informed the committee about the capital flight from the country but did not come up with any workable solution to control it.

On this, the committee expressed strong apprehensions about free float of the foreign exchange.

On the statement of the advisor on finance that Pakistan has no other option but to go for an IMF programme to bailout the ailing economy of the country, the committee recommended various policy measures to avoid recourse to the IMF programme.

The committee observed that there were alternatives to get the country out of the current crisis. These include—cutting in expenditures, control capital flights, ask influential Pakistanis to bring back their amounts from foreign accounts.

The government can also make appeal to the expatriates Pakistanis to send their money back to Pakistan, launch profitable projects for attracting investment, recommended by the committee.

The committee also recommend flexible exchange rate, reducing banking spread and initiation of viable projects.

http://www.dawn.com/2008/10/31/ebr6.htm

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Senators warn against IMF loan
Ask foreign deposits be brought back

By Asim Yasin
ISLAMABAD: Not only the opposition but also some sympathisers of the PPP-led government in the Senate on Thursday opposed loan from the International Monetary Fund (IMF).

They said that if at all such a step was unavoidable, the matter should be debated threadbare in parliament.However, all that fell on deaf ears as no one from the treasury cared to say a word on the issue. Similarly, urgings from different senators for bringing the money stashed in foreign banks back into the country went unheeded.

PPP Senator Enver Baig came hard on the “Friends of Pakistan” for its poor response to a friend who was indeed in need. “The time to break the begging bowl and learn to stand on our own feet has come,” he thundered.

Baig said Pakistan was the frontline state in the war on terror but “when we need the support of our allies, they throw cold water upon us. Rather than taking the begging bowl to donor agencies, we should stand on our own feet and exploit the connections with the Gulf States for sending Pakistani labour to these countries to earn billions through expatriate remittances,” he advised the government.

This was the seventh day of the Senate debate on the presidential address to the joint sitting of parliament. Majority of the senators warned the government to shun the IMF tentacles as this was bound to further burden the already crushed populace groaning under the rocketing prices and galloping inflation. The opposition once again reiterated its offer to support the government for repealing the Article 58(2)-b of the Constitution and doing away with the 17th Amendment.

The opposition protested over reports of privatisation of Qadirpur gas field, disinvestment of 25 percent shares of the National Bank of Pakistan and the Dadu Sugar Mills and sought reasons for the sale of national assets.

This protest led to an exchange of hot words between opposition leader Kamil Ali Agha and Minister for Housing and Works Senator Rehmatullah Kakar. Both accused each other’s governments of siphoning off money.

Another rowdy scene was witnessed when Information Minister Sherry Rehman lashed out at Senator Jamal Leghari while defending her government on criticism made by him. She reminded Leghari of the alleged ingratitude of his family to the PPP without mentioning that the party had made his father the president of the country but he dissolved the second government of Benazir Bhutto.

The opposition once again reminded the government of the delay being caused in formation of the parliamentary monitoring committee in the light of a joint resolution passed after the in-camera session.

Leader of the House Mian Raza Rabbani, however, claimed that the government was committed to implement the document in letter and spirit and all political forces would be taken into confidence. “We will take all political forces with us. There is no waiver for us on the abolishment of the 17th Amendment,” he stated.

Raza Rabbani said that the parliamentary committee on national security, as decided in the joint resolution, would be shortly constituted in consultation with all political leaderships. He said the government believed in the supremacy of parliament and it was for the first time that a threadbare discussion on foreign policy was held in the Senate and a joint session of parliament discussed the national security and adopted a consensus resolution. “We are not shy of parliament but believe in its supremacy. The government will seek guidance from parliament on all national issues,” he assured the members.

Rabbani said as per the commitment, the Foreign Office had summoned the US ambassador and told her about the Senate’s resolution on repeated border violations and the joint resolution. He said that this represented the sentiments of the people.

Regarding the murder of a girl in Khairpur, he said three of her uncles had been taken into custody for interrogation. The government has assigned the task of supervising the interrogation to Nafeesa Shah, MNA, who would submit a report within a day or two. “We have directed the provincial government to arrest the culprits as soon as possible and bring them to justice,” Rabbani added.

Meanwhile, Senator Saadia Abbasi also warned against the IMF loans and demanded that any decision in this regard should be taken with the consent of public representatives. She opposed the IMF facility due to its alleged negative impact on the national economy. She also opposed the privatisation of the Qadirpur gas field.

Senator Dr Malik advocated a change in the behaviour of politicians and said that sincerity should be their hallmark. “If we get sincere with our own people, we can get rid of corruption, social evils, financial and power crises,” he added.

Senator Prof Ibrahim criticised the government for not implementing the Charter of Democracy. He also called for nullifying all the unconstitutional steps by Pervez Musharraf, including against judiciary, and urged the government to implement the declaration of the All Parties Conference held in London.

Senator Enver Baig said the country should focus on export of manpower to friendly countries, which could double our remittances in one year. He suggested that youth from Fata and other backward areas should be sent to friendly countries, a step which would be helpful in fighting terrorism and extremism.

Senator Salim Saifullah deplored that while people were running from pillar to post for getting flour, incidents of terrorism in the country had increased. He said though the present government raised the slogans for provincial autonomy yet it had failed to appoint a federal minister for inter-provincial coordination. “Eight months have passed and the government has failed to complete its cabinet,” he added.

He also reiterated the cooperation offer of his government for repealing the Article 58(2)-b of the Constitution.He said instead of constructing an overhead bridge at Zero Point in Islamabad, the government should make payments to IPPs.

Dr Kausar Firdous called upon the rulers to bring back their deposits from foreign banks, cut their expenditures and let the members also forego their stipend for the days they availed leaves.

She also urged the government to come out with a clear stance on Kashmir. She also urged to redefine terrorism, and also declare bombing of innocent people by coalition forces as terrorism.The Senate was prorogued after a seven-day session. The debate on the presidential speech would continue in the next session of the Upper House of Parliament.

http://www.thenews.com.pk/top_story_detail.asp?Id=18085

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ISLAMABAD: The opposition in the Senate has asked the government to get a parliamentary approval for the proposed ‘bailout package’ it has been discussing with the International Monetary Fund (IMF). Before being prorogued, the House on Thursday witnessed verbal clashes over the financial crisis and the government’s reported plan to sell national assets to deal with it. The legislators called for the government to take them into confidence. muhammad bilal

http://www.dailytimes.com.pk/default.asp...2008_pg1_4