Al-Qaead has extended their network to the big cities of Pakistan besides accelerating their actitivities in tribal areas sitauted on Pak-Afghan border. Intelligence agencies have foiled a plot to assassinate President Pervez Musharraf by arresting some members of Al Qaeda from Karachi’s Malir area, and seizing a large amount of ammunition from their possession. The sources said that Qaeda members told interrogators that they were plotting to kill Pervez Musharraf during his next trip to Karachi. The terrorists had planned to blow up the entire bridge on Drig Road at the precise moment when Musharraf’s convoy was to reach there while coming from the airport to Shahrah-e-Faisal, sources said, adding that two more attacks were planned in case Musharraf survived the first one. The terrorists also told interrogators that their plans would be carried out despite their arrest as the group had been divided into smaller groups to execute their tasks.
It is not yet clear whether the report is correct or not, but one thing is certain that Al-Qaeda has establsihed their network in the big cities of Pakistan. The Al-Qaeda activities have badly affected the daily life of the common people. Prices of essential items have increased manifold.
According to newpaper comment, President Pervez Musharraf, addressing citizens in Sialkot after inaugurating the Sialkot International Airport, expressed his concern over the escalating price of flour in the country and conceded that due to “the lowest prices in the region” Pakistani wheat was being smuggled to neighbouring countries. Therefore he was all for increasing the support-price of wheat this season to “encourage” farmers and to “discourage” its smuggling. He said that subsidisation of flour would continue through the Utility Stores Corporation to help people get it cheap.
Just before he spoke on the subject of wheat, a TV channel had shown a senior officer at the Pak-Afghan border saying there was no smuggling across the regular crossing points. On the other hand, bureaucrats in Islamabad admit that “we are sending some 1200 to 1400 tons of flour to Afghanistan on a daily basis”. People in Sindh are suffering the most as flour shortage has hit the province after lack of wheat supply from the government to the flour mills which are now closing at the rate of a dozen a day. TV reports show poor people brought to tears as they pay Rs 22 per kg for something that was priced Rs 12 per kg earlier in 2007.
The president said that a new, higher support price would be announced to encourage farmers to grow more wheat, but the truth is that the farmers are already determined to grow less wheat because the support prices have been late in coming and the sowing season is well under way. Private sector experts have already protested this callousness on the part of the government, saying that Islamabad has continued to ignore warnings. The flour shortage meanwhile has hit Punjab too. There were protesting citizens in Rawalpindi on Monday, bad-mouthing the government for dragging food out of their reach during the political season of the rich-poor gap.
This is the legacy of the PMLQ government which the president propped up and supported. It miscalculated the wheat crop estimates and allowed the crop to be partially exported; then, facing a shortage, it imported the same wheat at three times the local price. The other gift of the departed government is the distribution of cheap flour through the Utility Stores Corporation. The stores have brought a bad name to the country, being mentioned in the Transparency International report as one of the channels of high corruption in Pakistan. The flour retailed by the stores is sold in the first 15 minutes after the opening, not because the poor are waiting for it but because the price differential causes the flour to disappear through “proxy” buyers.
The outgoing prime minister, a financial expert, had admitted that Pakistan’s high inflation was food-driven months before the country was engulfed by a flour shortage. He had the mechanism in hand, including the option of sealing off export to Afghanistan, but he was not able to handle the situation. He let over a million tons of wheat be exported only to ban it when wheat estimates were proven to be false. Cheap food means getting a big crop without allowing the farmer to be hurt by falling prices, which in turn means getting state money to the farmer instead of the middle man. The rough principle is: subsidise the farmer, not the food. Support prices are a failed mechanism because the small farmer who produces most of the food loses his share of the subsidy to the middleman.
Pakistan has failed to alleviate poverty despite its recent high growth rates. This observation applies not to the cities but the countryside where poverty is rampant and is signalled by the movement of the peasant to the cities. TV programmes about this movement show migrants complaining of not getting the right prices for their produce. On the other hand, Pakistan’s high growth rates have depended, not so much on higher productivity in the industrial sector, but on good crops in the farm sector. Thus it is an irony that poverty grows in that part of Pakistan that posts high growth rates in terms of crops. As citizens protest, inflation has grown by 8.67 percent in the month of November because of high food prices. The December figures will be even more negative.
“Guard your food” has to be the caveat now because the prices in the neighbourhood remain very high. For instance, even after the levying of 35 percent duty on export of flour and wheat to Afghanistan, the commodity is still fleeing into Afghanistan, which then feeds the Central Asian markets. Unless Pakistan simply gives up cultivating wheat because of the rising input prices, there is nothing that it can do except guard what it produces. The news from the world market is not good either, which means that this is not a crisis that will go away next year.
In the period between 1974 and 2005, food prices in the world fell by three-quarters in real terms. Food was so cheap that human response to it was gluttony in the developed world. In 2007, the prices have doubled; since 2005 they have jumped by 75 percent. At $400 a ton, the price of wheat is the highest ever recorded. The rich are subsidising their prosperous farmers while most of the third world is now importing wheat. At the Doha Round of talks between the two, no one is in the mood to agree to removing the first-world trade barriers against agricultural produce. That is why Pakistan’s flour price hike may not go away soon. And that spells political trouble ahead.