In 2008 the people of Pakistan voted into office the PPP, hoping that this would bring genuine change, i.e. a real improvement in their living conditions. Instead we have a worsening economic situation, real suffering of the millions of poor, and warfare killing many innocent civilians. Meanwhile the PPP leadership is busying itself applying the IMF-imposed policies of cuts and privatisations. In these conditions it is not surprising that many are asking themselves what democracy has meant for them.
As the Pakistani official political scene was dominated by the debate on the 18th Constitutional amendment, which basically does away with the undemocratic provisions introduced by different military governments in the past, the majority of ordinary Pakistanis were wondering what democracy has really meant for them.
The country’s population is facing severe economic problems, prolonged power cuts (or as they are officially called “load shedding”), high inflation, cuts in public spending, etc. To this we have to add all the side effects of the US “war on terror” in Afghanistan: the killing of innocent civilians in Pakistan’s tribal belt, both by the Pakistani army and the CIA drone bombers and increased terrorist attacks in the country’s main urban centres.
Ever since it came to power the PPP government of president Zardari and Prime Minister Gilani made it clear that they were committed to continue support for the US war against “insurgents” and that its economic policies would not substantially change. The PPP government first a coalition with the country’s main right wing party, Nawaz Sharif’s Muslim League, and then just with the extreme right wing MQM went cap in hand to the IMF in November 2008 asking for assistance. The IMF has given Pakistan an $11.3billion emergency loan, which, as in the case of all IMF loans, comes with heavy impositions and conditionalities. These include very strict deficit to GDP ratios, the introduction of VAT taxation [tax on goods and services] and the phasing out of fuel, electricity and water price subsidies.
These measures have severely hit the population. With temperatures reaching levels of 45C, power cuts in Islamabad last at times 22 hours a day, in other places these are 10 to 12 hours, depriving people of the use of fans, air conditioning and even cold water. There have already been riots and demonstrations in several parts of the country in protest at these power cuts. We have already reported on the demonstrations in Islamabad (Islamabad protests show explosive situation) and the ones in Rawalkot which were led by the Marxists of The Struggle (Masses erupt against power cuts in Rawlakot). In Lahore, protesters blocked roads by setting tyres on fire, and chanted anti-government slogans. In the last few days alone, demonstrations have also been held in Khairpur Mirus, Murree and Quetta, amongst other cities.
Power cuts are also affecting basic economic activity as many industrial areas are also suffering 8-hour power cuts. Steel furnaces throughout the country were forced to close down for a few days this week, leaving 15,000 day workers without any income, as a result of Pakistan Electric Power Company’s decision to cut the power supply to them. There seems to be no solution in sight to this problem, as PEPCO Director General Muhammad Khalid reported that problems will easy in June-July, with the coming online of a number of power plants, which would reduce power cuts to only 6 to 8 hours, but that load shedding would continue for another three years! No one is likely to believe his promises, as last year he had already committed himself to putting an end to power cuts by December 2009.
Just to make sure everybody knows who is boss, the IMF has delayed the transfer of the fifth tranche of its emergency loan to Pakistan, as the country has not fulfilled all the agreed criteria. Zardari’s government begged for some leniency and a couple of amendments were agreed. The budget deficit will be allowed to reach 5.1% instead of the 4.9% initially insisted on, and the very important measure of lifting subsidies on the prices of electricity, water and fuel (originally scheduled for April 1) may be delayed until August. This measure on its own could cause a social explosion.
However, this was only a temporary retreat, as Prime Minister Gilani made clear when announcing the measure in November 2008: “The PPP will only take those steps, which are in the interest of the people and privatization of Qadirpur (gas fields) will be finalized only when there will be across the board consensus in the house”.
The government had in fact approved a list of companies for privatisation in the 2008-09 fiscal year including, "Hazara Phosphate Fertilizer Limited; Small Medium Enterprises Bank; Faisalabad Electrical Supply Company, Printing Corporation of Pakistan Press; Pakistan Machine Tool Factory; Larkana Coal Mining Project; Khewra Salt Mines; MORAFCO Industries Ltd; Sindh Engineering Co Ltd and Services International Hotel." In the end, only Hazara Phosphate could be privatised, but now the PPP-led government, having agreed with the IMF to cut the budget deficit, is speeding up privatisation plans again.
At the beginning of April, Minister of Privatisation, Waqar Ahmed Khan, announced privatization plans for 58 state owned entities, 23 of them to be fast tracked. Amongst those, the first ones to be privatized will be Faisalabad Electric Supply Companies (FESC) and Pakistan Petroleum Limited (PPL), but the list includes railways, postal services, oil and gas, mining, electricity and other utilities, banks, etc.
Furthermore, the government is "restructuring" all these companies in order to make them more attractive to foreign investors. In a press release on January 19, privatisation minister declared that, "prior to the privatisation of 80 State Owned Entities (SOEs) their financial remodeling would be conducted to double their assets and balance sheets and to improve their management structure for making them attractive for multinational companies for taking part in their privatisation process."
The Benazir Employees Stock Option Scheme (BESOS) through which shares in state owned and formerly state owned companies are given to workers is a preparation for this process. The calculation is that once the workers become share-holders they will feel that the interest of the company is their own interest and there will be less resistance to privatization. When this scheme was first announced, the reaction of the Islamabad Stock Exchange was clearly favourable. According to a report in the Business Recorder:
"Brokers claimed that the presence of SOEs employee on the board would provide support to the privatisation programme of the government. When the representative of the employees would be present on the board, it might facilitate the interest of privatisation process. It would also prevent any kind of agitation or negative campaign against the privatisation of state owned entities."
The handing out of shares to workers may be popular among those layers concerned. It appears to be free money and a share in the dividends. But we have seen these methods applied in the past. Thatcher boasted about having created a “share-owning democracy”. There was a “mad dash for shares” in British Telecom in 1984, when many of the company’s employees bought shares. Little did they know that soon their jobs would be on the line! Subsequently, as the company was privatised, many lost their jobs.
In Russia, after the collapse of the Soviet Union, the process of privatising much of the state owned enterprises began. The workers in these companies were clearly concerned that this might put in danger their jobs. How did the government get round this? They were offered free shares and discounts, with the idea of making them feel owners of the companies. Later, those same workers paid dearly for such a policy, although at the time the idea was quite popular among some layers.
It is the duty of Marxists to warn the workers against such schemes and strengthen trade union organization to fight against the privatization plans of the government. Even if the distribution of free shares can be popular among some, especially those who receive them, it is the duty of Marxists to always tell the workers the truth: the distribution of free shares today is part of the plan to privatise the company at a later stage, and if today you get shares, tomorrow you will be at risk of losing your job!
To underline its commitment to privatization policies, President Zardari has just appointed Hafeed Shaikh, the minister of privatization under the Musharraf dictatorship and former World Bank official, as the government’s chief economic advisor. His qualifications for such a position are excellent from the government’s point of view. During his previous period as minister he managed to sell off 34 state owned companies worth a total of over US$5bn.
There is one area which has not been touched by the government’s austerity measures and budget cuts, that of military expenditure. On the one hand the government, in order to maintain the loyalty of the powerful Pakistani army, needs to increase defence spending, and on the other hand the Army needs money to pursue its war against insurgents on behalf of US imperialism. Zardari has justified the austerity measures of the government by saying that the “war against militants had inflicted great loss to Pakistan’s frail economy” and that therefore “there was no option left for the government to take a number of unpopular decisions, even at the cost of its popularity, for the stability of economy”.
This is increasing even further the opposition of the Pakistani masses to imperialism. The war in Afghanistan has brought them not only increased terrorist attacks, but also austerity policies. But the war is being conducted not only in the neighbouring country but inside Pakistan itself, which by now has suffered more civilian deaths than Afghanistan itself. The killing of innocent civilians, both by US troops and the Pakistani army, runs into thousands, to which we must add 1.3 million internally displaced from the border areas. The latest offensive in Orakzai, which escalated a month ago, has pushed around 200,000 out of their houses (the total population of Orakzai is 450,000).
According to David Kilcullen, the Australian former adviser on counter-insurgency to General David Petraeus, the ratio of civilian deaths to “insurgents” killed is 98 to 2! This is creating a mood of widespread anger. In the latest incident of this kind at the beginning of April, 71 people, men, women and children, are said to have been killed by the Army in the Khyber tribal area. According to locals "there was no Taliban and no militants. All the people who were living there are government employees. One of them was an army man." The BBC reports that “the airstrike hit the house of a tribal elder, whose own sons fight against the Taliban, as part of the local paramilitary force.”
It is no surprise that the mood of the masses is becoming cynical about bourgeois democracy. They brought the PPP to power hoping to see policies which would improve their lot, inspired by the PPP’s traditional slogan of “Roti, Kapra aur Makan” (bread, clothing and shelter), but instead what they are getting are power cuts, bombings and privatization. Ah yes, but these are “democratic” power cuts, “democratic” bombing of innocent civilians and “democratic” privatization (in which workers get some shares).
Zardari and Gilani have already made their choice: with the IMF against the people, with Clinton and Obama against the people of Afghanistan and Pakistan. The ruling class in Pakistan is quite happy with this state of affairs. The PPP was brought to power in the aftermath of the mass movement after the assassination of Benazir Bhutto. The masses yearned for fundamental change. From the point of view of the ruling class this was the best government to carry out austerity measures. Once its support amongst the masses has been spent, the PPP leaders will be unceremoniously ditched by the ruling class (bringing out corruption scandals, pending court cases, etc) and replaced by the Muslim League (which conveniently abandoned the coalition early).
Only by breaking with the logic of capitalism (starting by breaking the coalition government) could the PPP really implement a policy to the benefit of the masses of workers, peasants and the poor which voted it into power. Such a move would bring forth the wrath of Obama, the IMF, the army and the capitalists, but would enjoy mass support amongst the downtrodden masses which form the backbone of support for the PPP.
The Marxists in Pakistan are implacably opposed to the policies of the PPP leadership, which is firmly in the pockets of US imperialism, in its economic policies and regarding the imperialist war in Afghanistan and the tribal areas. In this way they are connecting with the growing mood of anger amongst ordinary working people and preparing to play a key role in the revolutionary upheavals that are being prepared.
[Note: See this article on Geo Televsion Network Power crisis peaks; Balochistan plunges into darkness which gives a very vivid description of the situation regarding the power crisis in Pakistan.]