Daily Archives: May 26, 2023

Instead of choosing the winners and losers which was the case with the industrial policy 1.0, the thrust of the new policy that is still evolving is to align the pattern of production to meet the future requirement of the economy, integrate in the global value chains, invest in research and development of technologies that give an edge and spurt to the economy, and invest in human capital formation throughout the lifecycle right from early childhood development to social protection.

Academic literature and experience of successful countries in East Asia, China and Vietnam no longer consider the state and market as a binary but as self-reinforcing and complementing each other. A capable and effective government with competitive and well-functioning markets will produce optimum results. Governments should invest in research and development, a skilled and trained labour force, and develop symbiotic public private collaboration, digital infrastructure and core data capabilities.

The private sector should be engaged in production, distribution and exchange of goods and services, pay their due taxes and curb anti-competitive practices such as collusion, cartelization and contrivance. The 2019 pandemic showed that business and government can’t be really disentangled; they rely on each other more than the partisans care to acknowledge. The Pfizer vaccine is based on insights into chemistry and molecular biology developed in government and university labs over a long period of time. State-funded basic research enforced patents and safety regulations, and industries turned raw ideas into a marketable product.

In recent years, a perceptible change in attitudes has been observed. The forceful advocates of globalization – the US and other Western powers – who used to preach quite forcefully to developing countries to open up their economies have gone into retreat. The main champion of globalization at the World Economic Forum a few years ago was none other than President Xi Jinping whose country has tasted the elixir of globalization. US President Trump was conspicuous by his absence at the forum that year.

The US has assumed the leadership role in steering a new type of industrial policy. President Trump’s campaign was based on the premise that as a result of globalization, American people had become sharply divided into two distinct groups – the well-off highly educated people living in thriving places and the less educated who lived in places that were left behind.

Trump concluded that liberal trade and free flow of capital and technology, outsourcing of manufacturing facilities and tradable services to other countries, and absorption of a large number of migrants had made the lives of this latter group miserable. They lost their jobs but were not trained to take up alternate occupations. He therefore introduced tariff and non-tariff barriers to thwart the inroads of Chinese goods and services in the US. His migration policy was quite tough and technology transfer from and to the US was firmly controlled.

US President Biden has gone even further and given more impetus to the industrial policy for the US. The CHIPS and Science Act 2022 gives the government a primary role in deciding which chip makers will benefit from the funding of $52 billion worth of subsidies and tax credits for manufacturing firms setting up new or expanding existing operations in the US. The Act has also allocated $200 billion towards scientific research in AI, robotics and quantum computing.

The infrastructure bill has tougher ‘Buy American’ rules, provision for reindustrialization, big innovations in technologies competing with China. The Foreign Direct Product Rule has also tightened export controls on technology transfer to China. Russia was cut off from the US technology supply chain globally.

Under the Inflation Reduction Act, an amount of $400 billion would be allocated as subsidies to adopt green technologies, to boost clean energy and reduce dependence on China for batteries for electric vehicles.

Sixty-three per cent of investment flows in the US are subject to the screening regime – up from 52 per cent in 2020. Sixty per cent of the value of stock markets fall under the potential review of the Committee on Foreign Investment in the US (CFIUS). US capital is not allowed to enhance the technological capabilities of the competitors.

The European Union (EU) is far ahead of other countries in pursuing an active industrial policy. Germany plans to subsidize power to industries up to 80 per cent. EU farm subsidies amount to $65 billion annually in addition to hefty budgetary grants to backward regions in the member countries. Governments help companies invest in green technologies and cut reliance on dominant suppliers and boost industry. They have also signed on to long-term contracts with the firms within the EU for supply of crucial raw materials such as lithium, rare earths and also fixed targets for domestic industries for domestic production of strategic technologies.

According to policymakers, climate change, disruptions during Covid-19, Russia’s invasion of Ukraine underline the need for a more interventionist state. Subsidies among the G7 countries have risen sharply from 0.6 per cent of GDP in 2016 to 2.0 per cent in 2020. Some proponents of the new industrial policy have justified the competition between the US and the EU as a valid tool for combating the risks of climate change which is an existential threat.

These subsidies and interventions are, unlike the past, not aimed at accelerating economic growth but protecting the future generations from calamities, disasters and disappearance. However, export controls, screening of foreign investment, ban on transfer of technology to competing nations and relocation of some industries within national jurisdictions in the name of avoiding supply disruptions do smack of old protectionist tendencies.

According to the UN, more than 100 countries accounting for over 90 per cent of the world’s GDP have adopted formal industrial strategies. Around $371 billion has been earmarked by seven countries for the semiconductor industry. Clean energy and batteries would cost 3.2-4.8 per cent of global GDP.

India is offering $26 billion of production-linked incentives for promoting electronics, semiconductors, electric vehicles, and mobile phone manufacturing over the next five years.

An IMF paper in 2022 justified the industrial policy by the presence of sector-specific externalities where the benefits of addressing them outweigh the costs and risks of the proposed intervention. Coordination failures and learning externalities imply that firms do not fully internalize the gain from potential activities. The emergence of new modern sectors hinges on the presence of effective government institutions, a favourable business environment and investment climate, and credible macroeconomic policies. Policy failures may include a burdensome regulatory framework, high tariffs on critical inputs, an overvalued exchange rate, inadequate infrastructure or an insufficiently skilled workforce.

Whether Pakistan should pursue an industrial policy or not is a question that has not yet been debated seriously. There are clear ideological divisions between those who believe that the state should have a better control over the generation and allocation of resources and others who are of the view that the state should set the direction and incentives structure and let households, private firms, businesses and farmers make the choices.

The important questions that need to be addressed are: (a)what is the end goal of such a policy; (b)what would be the nature of policy interventions by the state; and (c) what would be the main ingredients of the policy which should be used to achieve the end goal?

To be continued

The writer is the author of ‘Governing the ungovernable’.

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Piecing together an accurate picture of reality is a demanding exercise, both in terms of hard work and in keeping with rigours required for objectivity.

The pursuit of truth, unadulterated by any shades of conscious or unconscious bias, while necessary and noble, is often cast aside by many for whom relying on truth can be an inconvenient option. Perceptions, cocooned by conspiracy-theories, half-baked ideas and blatant lies uttered with perfection over and over again, reign supreme and truth is derided. After all, why allow a small thing as the truth to get in the way of forming an opinion?

As a country, we have reached a state where reliance on perceptions, and a dogged avoidance of the pursuit of truth, is threatening everything. It is threatening the very principle that governs the fundamental right of freedom of association whereby citizens-led political parties engage with citizens to be elected to govern. It is threatening obedience to the constitution and the law which is an inviolable obligation of every citizen. It is not just threatening the security of person, life and liberty but also the dignity of every citizen and privacy of their homes.

The painful events of hooliganism, violence, destruction, and at many places desecration of national monuments that were unleashed across the country on May 9 after the arrest of PTI Chairman Mr Imran Khan were rightly termed as a “dark chapter” in Pakistan’s history.

Pakistan is no stranger to public display of anger leading to damage to public life and property before. While we cannot always take pride as a country known only for civilized and peaceful public protests, we have witnessed successful non-violent movements and protests in the face of bigger national crises and tragedies. But never have we ever seen such gratuitous display of violence by orchestrated and organized mobs fuelled on a targeted hate propaganda. What has also left the entire country shocked and distressed in equal measure is the unrestrained way the mob inside otherwise fortified cantonments recognized as symbols of safety and security in Pakistan behaved.

Both the unleashing of this organized violence and the apparent inability to contain it in time have raised serious questions worthy of a thorough, independent and objective investigation. A befitting response bringing to justice all the perpetrators of this heinous event must be based on the constitution and rule of law and should be determined only after conducting an inquiry.

What transpired behind the manner of the arrest of Mr Imran Khan from the premises of the Islamabad High Court is a subject of another objective inquiry. The manner of the execution of the arrest order by the chairman of the National Accountability Bureau has already been declared by the Supreme Court as “invalid and unlawful.”

The Supreme Court order of May 11 has also highlighted the reasons of declaring it so by saying that the execution of NAB’s warrant from the premises of the Islamabad High Court “violated the petitioner’s right of access to justice and the sanctity and safety of the court as he had already surrendered to the court for seeking judicial relief against the action taken by NAB in the Al-Qadir Trust case,” declaring the manner of arrest as an infringement of Mr Khan’s ‘fundamental rights.’

What led to this ‘manner of arrest’ is another question that requires delving deeper into facts behind it. While the average citizen tries and finds a nexus into the volley of statements issued to and from Mr Khan and institutional spokespersons a day before, is it not the responsibility of the federal government to investigate the truth and present it before the citizens? After all, the arrest order was issued by NAB and initially the interior minister maintained that he had no knowledge of it and the law was taking its course. Why did the federal government change its tone after the production of Mr Khan into the Supreme Court on May 11? Political motivations aside, how is this position maintainable based on the facts stated earlier?

In this entire disaster – since confusion alone wouldn’t cover the depth of it – what were the considerations at play before the public posturing adopted by each side? The opportunity to ascertain the truth appears to have been tossed aside. Instead of facts, we are offered fiction. Instead of scrutiny, there is outrage. Instead of condemnation in earnest, there is false negativity and propaganda. On every side, there is a superimposition of a narrative.

The events of May 9 and their aftermath have intensified and reinforced the existing battle lines. The hope for continuation of a result-oriented political dialogue, that had been initiated on the nudging of the Supreme Court to find consensus on general election to the national and four provincial assemblies, has all but fizzled. Before May 9, Mr Khan refused to agree to an earlier negotiated date for a same day general election and provincial election. In the tense environment where his party leaders and workers are being rounded-up and put behind bars, would his party now even be asked to return to the dialogue table on the date of general election?

But is there any other valid choice except to hold a general election? A general election that is held on the same date for all assemblies. It can even be the date of October 8 if no political consensus is initiated or achieved for an earlier date? Why should the citizens be condemned to live with a bad or a worse choice that they are not even allowed to choose from?

Only the constitution of Pakistan provides the way forward in a time even as dark as this. It is a fact worth remembering for all — even though the parties to the compounding crisis appear to be quite blasé about this. To ignore this would amount to being delusional in the continual.

The federal government, with all the political parties represented in its coalition, must realize the dangerous precedence they may set by ignoring the requirements of the constitution. No matter how hard it may appear to wrest their focus away from the intense game of survival at play, the duty of the federal government is to learn from the catastrophic blunders made already to find a strictly constitutional way out now.

The writer is an analyst working in the field of politics, democratic governance, legislative development and rule of law.

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These attacks signal a fresh wave of violence against girls’ education

Despite the belief that the war against girls’ education in Pakistan had ended, recent events have proven otherwise. Last Sunday, two government schools in Mir Ali town of North Waziristan were blown up forcing 500 female students out of education. Unfortunately, these students will be unable to enrol elsewhere due to a dearth of female schools in the area. Although no loss of life was reported in the attacks, the same cannot be said about the attack in Swat’s Sangota area where a policeman posted outside of a private school opened fire killing a seven-year-old girl and injuring five other female students and a teacher. These attacks signal a fresh wave of violence against girls’ education.

Recent attacks have renewed memories of the heart-wrenching Army Public School attack in 2014 and attacks on girls’ schools in 2018. Once again, many families will be compelled to take their children out of school to ensure their safety and well-being. Thousands of female students in Waziristan and adjoining areas will be deprived of their right to education and the opportunity to enhance their futures because of a few wayward elements. In recent weeks, several law enforcement personnel have lost their lives during encounters with terrorists.

The rising frequency of these attacks demonstrates that Pakistan is losing ground in the fight against these movements. This will not just be a major blow to the country’s efforts to eliminate terrorist outfits but also impede Pakistan’s overall progress and development. Evidently, more needs to be done to eradicate the roots of these movements against girls’ education. It will take more sacrifices and negotiations to overcome this issue. The country must take swift action to ensure that every child, regardless of gender, has access to education.

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A HUNDRED years ago, the Legal Practitioners (Women) Act, 1923, was passed in British India, with a preamble that read: `An Act for the removal of doubts regarding the right of women to be enrolled and to practise as legal practitioners.` The tortuous wording may seem strange. Yet, it was necessary. The legislature was not taking any chances, not with the dubious jurisprudence emanating from the high courts of India at that time. In a valorous effort to refuse to read the clear text of the law, the esteemed judges had held that women were, in fact, not persons at least not in a `conclusive` manner.

In 1868, the General Clauses Act was passed, providing that words denoting the masculine gender also included females. Eleven years later, the Legal Practitioners Act laid out the rules and procedures for enrolling qualified `persons` into the legal profession. Since the General Clauses Act predated the Legal Practitioners Act, there was the added presumption that when crafting new legislation, the legislature is aware of all existing laws and circumstances. Reading these two acts together, no other interpretation seemed possible. Women were included in men, and even if not, surely they were persons? Right? Wrong. As the first generation of women who fought for their right to practice law discovered, the road to equality was fraught with obstacles.

The first among these was Cornelia Sorabjithe first female graduate from Bombay University and the first woman to study law at Oxford. Advocating for women`s rights to practise law in India, she argued for the necessity of female lawyers to represent women in purdah, who faced restricted access to legal counsel. In 1897, she cleared the LL.B examination, which should have allowed her to enrol as a vakil.

Vakils were indigenously trained lawyers who were considered a rank lower than barrister in the colonial legal hierarchy.

However, due to the lack of precedent, Cornelia`s application for enrolment as a vakil was denied. The then chief justice of the Bombay high court had reportedly said that a woman should not have anything to do with the law. A similar outcome resulted from her application to the Allahabad high court which was split on granting her the right to practise. But with the chief justice`s casting vote, they decided it wouldbe `impertinent for an Indian high court to admit women before England had set the precedent`.

Next, Regina Guha and Sudhansu Bala Hazra, both armed with law degrees, applied for enrolment as pleaders in the Calcutta and Patna high courts respectively. The challenge in the `Guha` (1916) and `Hazra` (1921) cases stemmed from the fact that the General Clauses Act preceded the Legal Practitioners Act. Consequently, there was no logical reason to argue that parliament hadn`t intended for women to be considered persons. Nevertheless, the judges in both cases engaged in extensive deliberations, ultimately reaching unanimous decisions that women were not, in fact, persons. Ignoring the time-tested legal maxim of just-read-the-text-of-the-law, thejudges insisted that the legislature could not have intended to include women, even though the word `person` was explicitly used in the Legal Practitioners Act.

The persistence and tenacity of women like Sorabji, Guha and Hazra eventually led to the passage of the Legal Practitioners (Women) Act, 1923, which finally granted women the right to practise law.

A hundred years later, the promise of true equality in the profession remains unfulfilled.

Women make up less than five per cent of the higher judiciary and bar representative bodies in Pakistan. Only 4pc of Supreme Court advocates are women. Women lawyers have been demanding greater representation at the bar and bench, yet the usual response ranges from the inane (`Asma Jehangir did it, why can`t you?`) to the trivialising (`But what about men`s rights? Men get harassed in courts too`) to thedownright insulting (`appointments are meritbased, not token seats`). Such reactions are designed to erase women`s fight for equality by not `seeing` the inequality in the profession.

The lack of maternity leave and childcare support is not considered inequality, despite its unequal effects on the career progression of male and female lawyers. The absence of sexual harassment policies at law firms, in courtrooms, in bar rooms, or other legal workplaces is not seen as discriminatory practice, although its consequences on the lived experiences of men and women are unequal. The failure to appoint a woman to the Supreme Court for 75 years is not seen as a deprivation of the rights of half the population,yet provincialrepresentation on the Supreme Court is taken to be a self-evident and inviolable truth. We do not need signs blaring `No women allowed` if we can achieve the same result by sidestepping these inconvenient realities.

The underrepresentation of women in the legal field is not unique to Pakistan but our insistence on ignoring it as a problem definitely is. While other jurisdictions have invested in researching, debating, and implementing gender-inclusive reforms in the legal profession, our bar councils and judiciary seem unperturbed by our position at the bottom of all gender parity tables.

The flurry of legislative activity in the past few months including the Lawyers Welfare and Protection Act and the (now suspended) Supreme Court (Practice and Procedure) Act would have been great opportunities to address some of these shortcomings. Provisions similar to the ones allowing for compensation to advocates who are victims of terrorism could have been enacted for setting up a fund for maternity benefits for female lawyers. While the chief justice`s powers in relation to the constitution of benches were being curtailed, a requirement for the chief justice to ensure gender diversity in judicial appointments could have been enumerated.

It is crucial to address these ongoing challenges, whether through legislation or judicial reinterpretation, and work towards fostering a truly inclusive legal profession and guaranteeing meaningful participation of women in law. • The writer is a lawyer based in Lahore.

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