Talibanomics

TALIBANOMICS- A SATIRICAL EXPOSE

The subject of economics, perse and Economists have captured my imagination for decades. I am neither familiar with the former nor the latter and hence have been trying to make sense of Macro/Microeconomics so that I am ready to face the awkward questions posed by my Grand children. A recent article that Pakistan is seriously considering lifting the ban on transportation of US and NATO goods to Afghanistan, after the ban imposed to retaliate for the Drone operations against “civilian” targets; took me back to my days in Pakistan.

President Zia was busy with the Soviet occupation of Afghanistan and the rather generous Military and economic aid received from the USA.He had in fact rejected the first package which he titled as “Peanuts”. That peanut can be converted to cashew or almond through manipulation of events was the first lesson that I learnt in economics. It was not written in books but practised by the creators of Taliban. That Billions of dollars flooded Pakistan during the next decade was proof enough. Apart from the official aid which is quantifiable, a number of ancillary industries stood to gain within Pakistan. In the mid and late 80’s,one had to merely visit Peshawar and beyond to buy any weapon of choice in the “chor Bazaar”. It included the state of art shoulder fired surface to air missiles. What about stores, communication equipment, clothing, blankets ,small arms etc, which could be bought at subsidised prices if paid for in Dollars?

Although American or NATO troops were not present then and were not even welcome in Pakistan,  shipping in Karachi registered a very healthy growth. Carrying goods to be offloaded at Karachi, thence to the border areas with Afghanistan was a profitable business, with the veterans of Pakistan running transportation as a core business. US naval ships began to visit Karachi for R&R despite liquor not being available in the open market. Suitable measures were invented to accommodate US naval personnel to drink to their hearts content in five star hotels of Karachi. Carpets and onyx sold like hot cakes. Our estimation of dollars earned during such visits to Karachi ran into millions (A million dollars was a humongous amount in the 80’s). This of course included bunkering, catering, fresh vegetables and fruits etc. A collapsing economy was rejuvenated. No questions were asked on how the money was spent and how staggered repayments were to be executed. During many off --the record discussions with knowledgeable Pakistanis, the same punch line was heard. “Americans can be conned in many ways. Who is going to repay any money? Don’t you understand simple economics? You Indians claim to be banias-but learn from us” This a second lesson in economics which proved to be right two decades later when the economy was about to collapse and was promptly rescued.

In the early 80’s Indian roads were filled with Ambassador and Fiat cars. Telephones were rare, infrastructure was archaic (it still is) and license Raj was at its pinnacle. In Pakistan however, modern cars were plying, roads were in good condition at least in the larger cities, piped gas serviced most homes. The middle class and above were enjoying the privileges of a dollar funded economy. President Zia was accessible to many who wished to meet him, especially Indian luminaries who were received at the door of the Presidents house and seen off too. They would cackle away for the rest of their lives on how humane a man he was. But then few knew about his plans to “Bleed India through a thousand cuts” That is another story. Lesson 3, "Investments must be made in visible sectors which in turn invite not only more investments but good will too. Suitable gifts to visitors presented in a discrete and  humble manner pay rich dividends." Ask the many US congressmen and high-profile visitors from round the world when  Zia ruled Pakistan

And now let us fast forward to Zardari and his Pakistan. Operation Enduring Freedom in Afghanistan is a better business deal. The beneficiaries of this business are many organizations, no matter how disparate they may be. This segment extends from Veterans of Pak Army who control 30% of the tanker business to many who run the 8000 to 10000 truck consignments. The withdrawal of US troops would increase heavy lift loads. The next lesson in economics kicks in now. “Do not let a productive business wither away”. In other words how to keep the Americans and NATO engaged in the general area? The stakes are too high. The entire tribal belt lives on protection money paid to them for the safe passage of the convoy. What is more they are kept busy and quiet.

The immediate worry for Zardari is the 1.3 Billion$ with held from the Coalition support fund. The route has to be opened forth with. So what if the Americans do not apologise? The parliament merely expressed their sentiments. Here is the next lesson in Talibanomics ,-“do not let sentiments and emotions come in the way of funding support of reasonable proportion. Delays  in decision making and noise levels in public should be directly proportional to the size of foreign aid”

A lesson or two to our mandarins in the finance ministry. Why disturb the status quo in the telecom sector with such high stakes? Ask the Pakis for some advice on killing a goose that lays golden eggs- before confabulating with the Norwegians and the Russians.

We could add TALIBANOMICS to SWAMINOMICS-perhaps?