Posted by: Administrator | 23 January, 2005

President address at Seminar Human Development Forum

24 January 2002

President of Pakistan General Pervez Musharraf’s Address at the Seminar of Human Development Forum

BISSMILLA R REHMAN-IR-RAHEEM The Secretary General, United Nations, Mr. Kofi Annan: President of Islamic Development Bank, Mr. Ahmed Mohammad Ali Secretary of State for International Development, Ms. Clare Short

It is indeed my honour to welcome you in our midst. Secretary of State for international Development, Ms. Care Short, we are extremely grateful that you joined us today. We are especially grateful for your concerns and for your understanding of Pakistani environment and for the support that you have always been giving to Pakistan and to my government especially. We are extremely grateful to you. I also would like to welcome Mr. Ahmed Mohammad Ali, the President of Islamic Development Bank, we remain extremely grateful to you, Sir, for financing specially our science and technology projects and also your finding by the COMSTECH, Science and Technology Project and all the miscellaneous projects that you yourself have mentioned. Thank you very much, Sir.

It is our honour to have you in our midst. Besides that all other distinguished professionals who have worked extensively in the area of human development, human resource and development. It is my pleasure to have all of you here in Pakistan, trying to contribute, trying to understand our environment. This forum is taking place in a very turbulent time especially in the aftermath of 11th September, after the terrorist attack on the US. This act has cast dark shadows over the global economic environment.

The world economy is suffering through recession. The developing world, may I say, has suffered more on account of this terrorist act and Pakistan being a frontline state, has also been doubly affected, through disruption of its trading activity through loss in revenue generation, through reduction in foreign investment and through a setback to its privatisation programme. As it is with this setback we were in an environment where the government was deeply involved addressing the after-effects of the “Decade of Disaster”, as I call it, the decade of the nineties where loot and plunder was the order of the day, where governance was at its worst. where probably hardly there was any strategic direction evolved and given to the nation and, worse than that, there was no will to implement any direction that was, if at all, perceived, and may I also say there was quite an absence of focus on human development. So while we were grappling with all this environment, this catastrophic event of 11th September took place. So we have to address this reality and we are doing it. We are not daunted we will face the challenge. We are facing the challenge. We will face it boldly and with ingenuity.

Our concern remains how to keep course on the overall development strategy that we have formulated and, also, certainly, how to protect the allocation that we have made to all the development projects that we have planned.

Today now, I am going to take some time to give you an overview of the strategy that we evolved for our national development. Doing this at the fag end of the day after so many speakers and at a time which is past lunch time, my maim concern is certainly going to be to keep your attention focused towards me. May 1 also say that I haven’t timed myself but having this captive audience sitting in front of me I am motivated to speak my heart and mind out on the overall strategy at its over action level because that is where everything sources lies. So I would like to explain to you the over action strategy that we are following because then only, with all that is being done in various sectors, will fall in place.

First of all, let me tell you that it is my belief that in bringing about change there are three gradations. One is improving. The other is rethinking and the third is restructuring. I personally feel improving means that everything is going all right and you need to do a little bit of tinkering in improving an organisation. Rethinking, I mean when things are bad but you could do a denting and painting job and improve. But, restructuring is when the structure is decayed and collapsing. You need to create a new structure. Pakistan needs restructuring. That is my belief and we are involved in restructuring. Now, within this restructuring I lay a lot of emphasis on human development.

I would like to start with a quote: “Human development is the anchor of my economic revival policy which will focus on health, education and poverty alleviation.” this was given some time back and Zubaida Jalal has put my name under it. Yes. I did say this some time back and I mean every word of it and I am here to implement exactly this focus. In human development we have to alleviate poverty, we have to improve quality and develop capacity. So I would like to start by giving you an overall strategic focus.

Soon after taking over we focused on what is required for restructuring Pakistan and we identified four areas.

Number one: economic revival of Pakistan which is the basis of any activity. Nothing can proceed unless the economy gets revived. Then poverty alleviation we identified as the second area. It works hands in glove with the economic development, of course. The third is bringing good governance in its entire complexity. And all embracing sectors of education, health, law and order, corporations’ improvement, government functioning improvement was all inclusive in this improving of governance in Pakistan. And lastly, political restructuring, because I think it was political structure of the nation which needed a redo to eliminate whatever Pakistan was suffering from. So, these four areas from the basis of our strategy to move forward and I would like to explain to you that each one of these areas has a focus and it contribute directly or indirectly to human development.

Now I would like to give you our achievements and our future directions in each one of these four areas and that these four areas were visualized by us early in 2000 soon after my government came into place. So this is the strategy we had to start then. This is exactly the strategy that we are following even now. We have been developing our tactics on the basis of this over action strategy, and I will explain how exactly everything falls in line. I take on economic revival, first of all. As I said it is at the heart of all development activities. Real poverty alleviation is only possible through economic development. So, therefore, the source of human development is economic revival. We suffered, when we took over, from two dilemmas.

And I would like to tell you about these two dilemmas that the nation was suffering. ‘The Debt Dilemma’ and the ‘Investment Dilemma’. Debt dilemma; when we saw our economic financial condition we saw the debt servicing that we were doing and the debt trap in which we were, we saw that we must never borrow because it increases our debt liability. But, we must borrow to develop. So this was the dilemma. The investment dilemma was that we had to attract foreign investment to increase our foreign exchange reserves. But, the foreign investment looks at our foreign exchange reserves to come and invest in Pakistan. So these were the two major dilemmas that we were facing which needed to be addressed. And the very broad strategy, finance strategy that would evolve economic strategy in simplest way of putting it, we thought we had to acquire a breathing space from our debt liabilities and we bring this breathing space, acquire money, acquire fiscal capacity to invest in development activity which will give us greater returns than the debt service liability that we will incur on our servicing.

That was the overall economic strategy that we thought we must follow. We selected, then, the areas of focus for this economic strategy that we were supposed to follow. And in selecting the areas of thus we saw Pakistan’s requirements, requirement of the population or the distribution of’ the population.

If I may very briefly’ tell you that the majority of the Pakistani population. 65 to 70 per cent is rural. It’s an agrarian society, Land and villages. So they are affected by agriculture. The remaining is urban and we can divide urban into two groups. Urban educated, unemployed and second, urban uneducated, unemployed. So we have to address these three categories of the people, the rural mass, the urban educated unemployed and the urban uneducated, unemployed. So what was the area of focus that we developed, let me tell you. Number one, We thought agriculture has to be our focus in the immediate future. May be we change strategy in the long-term future. And within agriculture we thought ‘we had to concentrate on water resources. We need to concentrate on water reservoirs, distribution of that water and bringing more land under cultivation and irrigation. Through this we are addressing poverty at the rural level, 65 to 70 per cent of the Pakistanis. And not only that when we address the issue of making small dams and canals, we are talking of job creation. This is an activity where maximum jobs are created. And therefore, we undertook this intensive activity of building small dams and canals and through this we hope that in the next four or five years we will bring two millions acres of land under cultivation and irrigation. I don’t want to go into the details of the small dams and the number of canals that we have already initiated. I’ve performed their opening ceremonies and I know that they are going strictly on schedule. I keep taking feedback. And a number of projects I have still to launch within these doming few months which I will do myself. So this was in the area of agriculture which addresses the dual purpose of poverty alleviation in the 70 per cent of our population. It gives us the fastest economic returns. So this has the dual purpose and, may I say, that we are doing extremely well on this in spite of the drought by which we were affected last year.

 The second area we thought we should address is the urban educated unemployed. And we saw that information technology is, can be, the main focus to address this issue. And we took on this as the second area of our focus. In Information Technology, we thought this will create maximum jobs in shortest time period and we have a tremendous potential of growth in information technology and telecommunications which is included in it. I would like to tell you that in NADRA which is our database and registration authority at the moment there over 10,000 young boys and girls are employed who were unemployed and they earn about Rs.5, 000 to 8,000 per month which is an excellent achievement. There is immense potential and we are progressing very well on information technology.

This is just to quote a few.

I would like to commend the efforts of Dr. Attaur Rehman, my Minister of Science and Technology in this field. In this short time-frame of just over one year we have, extended Internet facilities from 29 cities to 550 town and cities, the smallest towns have Internet connection. We have increased the bandwidth capacity from 30 megabits to 265 megabits. We have reduced the cost of bandwidth from $ 85000 for 2 megabits per month to only $ 6,000. It is one of the cheapest in the world. We have given fiber connections increased from 100 cities to 200 cities of Pakistan; we have opened 7 universities of computer sciences, including one virtual university.

Last year we trained 25,000 information technology skilled children and this year we are going to increase this number to 50,000. And this figure is from the previous figure of 3 to 4,000 per year. Mobile telephones have risen from 235,000 in the last ten years. Last year we had 850,000, 400 per cent more. So this is the growth in information technology and this is addressing the area of urban educated unemployed. The third area was the urban uneducated unemployed and our third focus in economic revival then, after agriculture and information technology, is the small and medium industry. Because we thought this will address the unemployment of the uneducated also through labour. This is being done through revival of sick industries, through CIRC which is doing a good job and also, through new investment and opening new industrial units. We are trying hard in this field. We haven’t made big success as yet but I think things are looking far better and moving well now.

So this will address the issue of uneducated, unemployed in the cities and the fourth, the last area of focus is the Energy Sector. Other than exploring oil and gas, the strategic focus is to convert the thermal, oil- based power generation towards hydro-electricity, gas and coal. This would give us import substitution because furnace oil costs us about one billion dollar per annum and the ratio of thermal, oil-based electricity production is 70 30 hydro at the moment which is’ a lop-sided organisation. Because we have tremendous potential of hydro-electricity, in fact the total potential of Pakistan is double our requirement.

We have the biggest coal reserves in the world in Thar but we haven’t developed it and we have not managed our hydro capacity at all. We need to switch this ratio from 70 30 to a better proportion with the passage of time. We are concentrating on generating hydro-electricity through a number of hydroelectric projects. We are trying to generate electricity based on the Thar Coal and we are trying to convert our thermal oil-based power units to gas because we have gas. With this transformation we will improve the ratio and this will give us import substitution. And may I add here, from the human development point of view, this does generate a number of jobs because, again, specially in the hydro-electricity generation area and the coal development area our coal industry which involved hundreds of thousands of workers which was lying sick has got revived.

So this much for our economic revival activity that I spoke about, the four areas of focus and the rationale behind those four areas of focus because we were focusing on those deprived class of people who needed attention for development. At the macro-economic level I just want to say that I would like to express special gratitude to our bi-lateral creditors through the Paris Club for the complete stop of debt-rescheduling that they have given us.

I would also like to express our gratitude also to IMF for the PRGF that they have provided us. I would like to express gratitude to the World Bank and the Asian Development Bank for the enhanced financial support. I would also like to thank the EU especially for the market access that they have provided to Pakistan. At this has given us fiscal space and has made fluids available to Pakistan for executing the economic strategy that I initially enunciated, gaining space gaining time and generating the funds putting it into developmental activity which will give us more and faster returns than the debt service liability that we will incur. And we are doing this for the economic revival of the four areas, agriculture, information, technology, energy and small and medium industry.

 This is the economic revival plan, overall. Our foreign exchange reserves stand now at a record of $ 5 billion. It should be much more for a country of our size. But we never ever in our history achieved this. I would like to give credit to my Finance Minister. This is up from under $ one billion when we took over and if I may give some indicators, our fiscal deficit is at 5.2 per cent, reduced by over one per cent which is a great achievement because we showed fiscal discipline. We took a number of very bold and difficult decisions. We increased our oil prices five times and also the gas prices to improve the tariff structure of gas. We froze our defence budget, rather we reduced our defence budget. While our friend to the east increased its defence budget by 28 per cent one year, and 14 per cent, the other year. These were not easy decisions. We took them. Our Finance Minister even time used to say you have to bite a bullet. I used to ask him how many bullets do I have to bite you. So we have been biting bullets every now and then and we keep biting them as long as it is in the national interest. our savings. Through this Zakat strategy we evolved a new Zakat strategy where with all money that we collect and we have already in the bank. We have identified areas for focus of economic activities in various parts of Pakistan and we start distributing. 50,000 to an individual to generate his or her economic activity and let me give you a small feed back.

We have given an average of 20,000 Rupees to 100,000 people which mean multiplied by five, about half a million people have been affected because we issued this money to a house hold to one individual and one of the whom. I give 20,000 Rs. •I asked her what she is going to do with it. She said she is going to buy 5 sewing machines. She knows sewing and she is going to earn money. I asked weather she has a husband. She did not. She was having three children. So four people affectedly Rs. 25,000 that give her. This is not a single story.

This is given average 20,000. to 100,000 people and every year we are making the allocation 5 million rupees and we have the fund. We will be giving this money in about three years time to roughly one million people which mean 5 million poorest of the poor will be affected by this Zakat strategy The second is the Khushal Pakistan Project. We call it a poverty alleviation programme. This involves a number of project at the micro level identified by the people themselves, small projects of a few hundred thousand rupees may be one million rupees. At the movement 5,000 projects are going on generating jobs for about 500,000 people. These are going on in all parts of Pakistan at district and at the grass root level. Last year the same was done and we are increasing our allocations to this Khushal Pakistan Project. This has a tremendous contribution. We did not know what a big success it will be.

A small bridge constructed in the Northern Areas which I launched myself linked two communities because ibis was upon a stream that connected two communities. This small bridge costing a Rs.600.000 linked the two communities. This is our planning. A number of market-to-farm roads, dispensaries, schools and brick lining and sanitation projects. All these have been launched through Khushal Pakistan Project. Thirdly, is the Khushal Bank or the Micro Finance Bank which has been launched by us. This is going very well. This is going to the doorsteps of the poorest of the poor and giving them upto R. 3D.000 loans, debts and this has a very positives feedback.

The target we have set is 100,000 people per annum and we are on course doing this. I have got a feedback. I have met so man) people who took this money. They are all poor people and they are returning hundred per cent of these loans. The rich of the country who have plundered the country, never used to return their loans. So this is the Khushal Bank, Micro Finance Bank distributing money.

Food Support Programmes for the poorest of the poor there is a subsidy for food and lastly, of course, the job generation through the development projects. Rehman and the other under Mr. Shams Lakha who is sitting here, and these two groups did the wonderful job of presenting their strategy for grooming the higher education in Pakistan. I won’t go in detail but what that brought out was that we have to have a balanced approach to education and we have to develop appropriate linkages between the primary, secondary and higher education. You can’t do one at the cost of the other. In fact higher education is essential for capacity development and also improving primary education. Because improving the higher education will provide the staff and teachers for the primary and secondary education. So, therefore, there has to be deep interaction between them.

We have created a higher committee which is meant to improve the quality of education and develop focus on higher education. It will look after all the universities and focus on science and technology. We have decided to create linkages between industry and the university education through strengthening science and technology and we have also decided to concentrate on engineering sciences for value addition in industry, Bio-tech for agriculture improvement, information technology for job creation, and foreign exchange earning. These are the four areas that we have to concentrate on in the higher education at the university level.

We want to increase our PhDs from 60% per annum to 400 to 500. This is our plan. The conditions of health sector are also dismal. We were concentrating on core issue of health level. There is 70% of population in villages. That is not being addressed so far. Therefore, the focus on rural areas, we have worked out the organization and equipment for each hospital at the sub-division level. This is not enough. We have to implement it now. We need finds obviously and that is being done.

A very interesting, innovative idea by Dr. Attiyah, who is sitting right in front of us, is the nutrition programme for girls. She is one for maximum rights for women and girls and I really appreciate it and we all are with her, the whole Cabinet is with her. So in this I would like to say that this grand idea is again an idea of community participation and this will give money at school level asking the mothers to come to the school and, cook for their daughters who are studying in the school. Now this is going very successfully because had we given the money or the stipends to the father they would have squandered it. But the mother will never. Mother will feed their daughter. Obviously they will be very successful. This is going to be introduced in 20 districts and 5000 schools, girls should be healthier because then the generations will be healthy. This is the logic and Dr. Attiyah is following that.

We will like to expand the scheme. But I would like to highlight a special feature in this area and that is the task for of human development that we have established. This task has been established under Dr. Nasim Ashraf who is a Dr. from the United States. He brought with him the expertise and involvement of the number of other doctors from United States. I made him the Project Director asked he wanted me to be the Patron in- Chief so I am with him. We have created a National Commission on Women Development and the Chairman of this Commission is Dr. Nasim Ashraf, who will operate directly under me. We intend opening social or human development incubators in all districts. I have asked them to change the name of incubators, we have to decide for a simpler name for the public of Pakistan, but for the audience here incubator will be developed in each district. And the national Commission, infact will operate through these incubators at the district level. And will execute an integrated national programme for education, health, poverty alleviation and good governance at the grass root level. We have to generate government capacity at the grass root level and it is through these incubators, through this national commission interacting with th public sector, with the linked department. As you called them and ensuing capacity with development at the grass root level and focusing on, poverty alleviation, education and health that this would become possible. This is an extremely useful idea which we have to peruse with fill vigor.

Ladies and gentlemen, we have decided to set up a trust fund of the public-private partnership. The task force which has come with Dr. Nasim Ashraf has raised 100 million rupees as a feed property from all expatriate Pakistanis and local philanthropists into this trust fund that we have set up. The government is chipping in, we have decided to chip in Rs. 2 billion into this target fund. I have done this without informing the Finance Minister so I am presenting this as a fait accompli. This is emotional blackmail that I am doing. So lie has to give Rs. 2 billion in this fund. This fund will be totally transparent. It will be managed by an independent board of trustees of very eminent people.

 WI have to name them. Abdul Sardar Edhi. Begum Zari Sarfaraz, Mom Qureshi and a number of others. In my humble capacity as Patron-in-Chief of the board of trustees, I appeal to all Pakistanis through this forum, in Pakistan anti abroad, to donate generously to this fund so that you will be donating to a noble cause you will be a participant to this noble cause. I know they will contribute in this philanthropic cause. I am giving the focus to concentrate on this idea. I will also like to appeal to foreign donors to donate to this fund. And also may I say, allow us the flexibility of using this fund because my personal observation is that donation that conies to us is binding to the special project, but give us some flexibility to utile it. The assurance and guarantee, I am to give, is that, whatever is given in this fund will be utilized in education, health and poverty alleviation. This is my guarantee allow me and my government to utilize the fund. Briefly, the fourth area is the political restructuring. We are ushering in real democracy in Pakistan. Which was non—existing earlier, in essence. I will have elections and an elected government. We are lunctioning in the most decent manners, but I personally feel that more important to me is the ‘essence” that is the functioning of government, less important is the elections. However please do not misunderstand me.

Elections will be held in October, the democratic system has been put in place. through the Local Bodies System which has been done on August 14. This is a silent revolution. I give credit to General Naqvi. All development activities will start from bottom and village level and will not be decided in Federal/Provincial capitals. That, corruption and mismanagement which was being done earlier by the members in collusion with the bureaucrats will cease to exist. This is a revolution that we will bring. This is going well. This is a measure of upheaval. Let me add here that 30% seats have been reserved for women because I have found them more efficient than their male partners. This is the real empowerment of the people of Pakistan and is human development. We have also empowered and emancipated the women of Pakistan. In the national arid provincial assemblies we have tripled the seats. I will ensure the continuity .and sustainability of the reforms.

There will be checks and balances of the leadership and national interest will be held supreme. I would like to say, that democracy is not a constant feature. Every country has its own environment. I am a great believer in democracy. We need assistance of the world in this regard hearing.

I am thankful to Kofi Annan and all the delegates for their patience.

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