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Pakistan Seethes Over Power, Sugar and Flour Crises

Source: Reuters
17/09/2009

Islamabad, Sept 17 - When Pakistani President Asif Ali Zardari meets aid donors in New York next week he will be seeking support for a country beset by problems from militant violence to food shortages and rising prices.

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While the 18-month-old civilian government has won praise from Western allies for efforts to quell a Taliban insurgency spreading across its northwest, ordinary Pakistanis have a strikingly different perception.

"All these politicians are self-centred and corrupt," said Muhammad Nawaz, a low-level government worker in Islamabad, as he queued outside a state-run discount shop to buy subsidised sugar.

"They only focus on non-issues and have no sympathy for the common people and the core issues that they are facing."

Such dissatisfaction may not be something to worry too much about for a government with a comfortable majority so early in its five-year term.

But the ruling coalition is fragile, institutions are weak and people's faith is shaken with every government mis-step.

The civilians inherited an economy on the brink of a meltdown when it came to power after nine years of military rule. They were forced to seek a bail out from the International Monetary Fund, but there has been one crisis after another.

Last week Finance Minister Shaukat Tarin, according to aides, nearly resigned in opposition to a cabinet decision to hire rental power units from abroad to reduce an electricity shortage.

Aides say Tarin believes the money would be better spent on upgrading existing facilities, and the cost of renting will be too burdensome. Government critics say another fear is the opportunity for corruption in rental power deals.

Donors, who are meeting at a "Friends of Democratic Pakistan" gathering in New York next week, worry that money earmarked for specific projects could disappear in budget support if given directly to the government.

Some analysts fear the army, which has ruled for more than half Pakistan's 62 years of independence, could eventually step in if the civilians fail to govern properly.

Accusations of government misconduct and mismanagement brought down civilian governments in the 1990s, paving the way for General Pervez Musharraf's coup.

Security analyst Nasim Zehra believes the generals are committed to staying out of politics, but fears other factors such as graft and the fiascos over sugar and flour will undermine democracy.

"Pushed to the wall people will now increasingly opt for anarchic ways to protest against democratically elected leaders who may, at this stage, be faulted both for not solving people's basic problems and and for filling their own coffers," she wrote in the News newspaper on Thursday.

HOSTILE MEDIA

Zardari, who rose to power after his wife, former prime minister Benazir Bhutto, was assassinated in 2007, has failed to win people over since taking over from Musharraf.

Dogged by old accusations of corruption, and under constant criticism from hostile sections of the media, Zardari's approval ratings are little better than his unlamented predecessor.

Frequent power cuts and an acute shortage of flour, the country's most important staple, have outraged the public.

Having peaked at 34 percent a year ago, food inflation has moderated to 10.6 percent by July, but analysts see the upward pressure building up.

The latest crisis is over sugar. The government has blamed millers for hoarding, and smuggling to Afghanistan.

But many Pakistanis believe the millers are protected by powerful vested interests among politicians.

The Lahore High Court took up the public interest, and ordered traders to ensure a retail price of 40 rupees/kg (50 U.S. cents), compared with a market price of 46 rupees and a peak of 55 rupees last month. The Supreme Court is deliberating over an appeal by millers and traders.

Flour shortages and price rises are another lightning rod for anger, especially after this year's bumper wheat crop.

"On the one hand we say we have a bumper wheat crop and we will need to export," said Ashfaque Hasan Khan, dean of the NUST Business School and a former government economic adviser.

"Yet the people can't find flour locally and are forced to pay so much to get it. This signals that there may be an element of misconduct involved."



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