The Sugar Coated Shaft

Although they are in this Bussiness .......for a very Long Time....

But only recently they have come into the limelight...

so Its a New Exposure...... Lets compare it to being say like a New Industry
and New Industries do need Protection...... don`t they... ??

Pakistani economy is taking off..... you nay sayers can go sit on a cactus!

The grandson of the dictator who ruled the 60`s shows such pride in what he`s doing. As if he`s continuing his grandad`s incomplete policies today. Such supply side economics sound so retarded. But they suit the grandsons of retarded freakin` dictators.

abay trickle down works.......

back during the rule of your beloved democrats, all you had to do get a mason (or plumber) in Islamabad was to drive to peshawar moRe and your car would be swarmed by literally hundereds of them (actually, that`s what you had to do to pick up gori gori afghan prostitutes too, but that is another story)

With all the construction going on now, it is almost impossible to find a skilled mason at peshawar moRe....... (again, the gori gori afghan chicks....... another story)

Shakir -

You are one of my favorite writers. I immensely enjoy reading your column in The News.

However, I do not agree with your assessment of the current budget. The fact that Pakistan’s economy grew by 8.4% and the Development allocation increased by 35% is nothing to sneeze at. There’s evidence to suggest that, as in China and India, a rising tide lifts all boats, that wealth is top heavy, and that money trickles down not up. Keep in mind, though, that economic results have a lag time and that cycle takes a lot longer than, say, the movement of a stock price. What we are witnessing in China today was initiated 25 years ago.

Based on historical data, can you cite an example of an economic model implemented in a country when the budget was poor-friendly that resulted in rapid economic growth for that country?

I agree with most of Shakir`s gripes...But there can be no fair budget presented unless the massive scams being purported by the housing schemes and real-estate business are documented and taxed....Most of the wealth being generated in the country is being invested in real-estate which is making the basic need of owning a house further out of reach from every middle class family (the lower class person is just SOL!)...This is compounding the gap between the haves and have-nots even more, creating ever-more dangerous class schisms in the country.

Why don`t Musharraf/Shoukat/Ayub tax real-estate transactions? Because if they did, then all the massive gains in property values, in which every civilian and military official worth their salt is involved, would come crashing down to earth. That is where they hide all their wealth, legal or illegal and they would never let go of this tax haven....If you don`t believe this then just try going to any cantonment or KBCA office and you will see how this scam of galactic proportions is being wreaked upon the people of Pakistan...No budget will be fair, and no real development will take root unless the billions gained from real-estate and stock transactions are documented and forcibly taxed....

By a gigantic margin, the most protected wealthy class in Pakistan, are the large landowners. Everything in Pakistan is taxed, and in many case taxed heavily, except large land holdings.

One can debate the reduction of tax on 1800 CC cars by a few percent, but at least the thing is taxed. What about the thousands of acres of, ``farmland`` that is concentrated in the hands of a few hundred families?

The day all that land is brought under taxation, is the day Pakistan will start filling its coffers, considering the fact the Pakistan is an agricultural country.............

The current financial team has done an excellent job, over the past five years. There can be improvements and vested interests always have some influence. But these guys are quite sharp. 8.4% growth is no joke; especially for an economy which was almost bankrupt, at one time...........

Interestingly, much of this budget actually caters to the Chowk crowd and the lifestyles they (we) enjoy.............large cars, cell phones etc......

Re: # 2

Yeah!.Only you paks keep bleating about it.Read this..................

India `tops for Asian investment`

India`s economy is growing fast
India has come out as a top Asian destination for investment in a survey of fund managers` top picks.
The survey, carried out by the Reuters news agency, found that over the next three months India tied with Taiwan as managers` favourite.

Over the longer timeframe of a year, India came second only to China as the best place to put clients` money.

China`s attraction, managers said, was growing consumer demand, while in India the prospect of solid reform appealed.

``We have been overweight on India... on all our portfolios for a long time,`` Alex Boggis, director at Aberdeen International, told Reuters.

India`s economy is growing at about 7% a year, while China is continuing to expand at about 9% a year - with Beijing keen to move the momentum of growth from asset investment towards consumer spending.

Reuters asked managers at ten institutions what their favourite destination for investment was over the next three months and over the next year.

On the short timeframe, India and Taiwan were each the top pick of 20% of the votes, while on the longer horizon China came top on 30% with India in second place with 20%.

http://news.bbc.co.uk/2/hi/business/4077026.stm

#5 by godot

“can you cite an example of an economic model implemented in a country when the budget was poor-friendly that resulted in rapid economic growth for that country?”

Way to go Godot!

Budgets don’t make or break a country. The economic and fiscal policies do. Budgets are a way to control those policies. May I ask the author or other folks what difference would it make for general population if real estate transactions were taxed?
How much revenue can be expected out of those transactions and how would that help the poor.

There are two sides of real estate transactions. One is the housing market in areas like Islamabad, Lahore or Karachi and the other is the whole country where transactions far exceed a few transactions that take place in selected areas of a few cities. Yes, a few transactions in big cities would take advantage of that but most of the advantage would go to people who buy and sell new and small homes. By not taxing real estate, the government has provided incentive to the real estate developers all over the country not just a few in Isloo.
I think criticism of a government should be constructive and not vindictive because you don’t like General Musharaf and his entourage.

#7
“The day all that land is brought under taxation, is the day Pakistan will start filling its coffers,”

Could you please enlighten us about the $ amount of Agriculture share in the GDP? And how taxing that share would “start filling coffers”

Taxing agriculture ``land`` would be an unmitigated disaster. Agriculture subsidies are being phased out and the poor farmers expect a reduced income already. If you tax now, the rate of return will go down even further. Why people forget that besides a few huge landowners, most of the rural population consists of poor farmers, day laborer, and landless peasants? It is easy to comment on Agriculture tax from a room in Toronto but think about the guy who spends most of his day in the scorching Multan or Sukker’s sun that turns a man’s skin into leather.

As I understand it you don`t bring ``Land`` under taxation you bring the Income under taxation.

Shakir Husain, the import duty on synthetic fibers use to be at 15% I believe. Now it has been slashed to 6.5%. We need to take all measures possible to make sure that our compartive advantage in the textiles industry stays with us and that the textile industry continues to create high-quality products and that their total costs are reduced. This will help the products our textile industry makes and it will also result in additional profits for them. The money saved can eventually be compiled with other resources to further enhance our capabilities and standard of quality by purchasing equipment from abroad.
Also, the abolition of the sales tax is a progressive step. It`s not like it`s honored any ways. The business community will have additional funds in it`s pockets to create more industry and hence that will directly and indirectly provide more jobs to the People of Pakistan.

Did the budget talk about the ginning sector at all? I was not able to hear the budget speech and I can`t seem to find a copy of the text on the internet. Would any one be kind enough to provide me with a link if they have one?

I think the intent of the article was more on berating the government as opposed to taking part in a constructive dialogue.

Also, I have taken into account that a great degree of factionalism and sectionalism exists in this country. As in, all countries suffer from those great ailments but perhaps Pakistan suffers the most from it. Is the author aware of the fact that so much economic activity has taken place by the land-development projects taking place in our country? Directly they have created so much labor and indirectly they must have created 10x more. the introduction of such a tax on the property prices would definately discourage the existing parties and deter other parties in the future from taking part in land development projects.

i have to agree with most of shakir hussain`s observations.. there is major bullshitting involved in this new budget..rich gets richer..poor gets poorer..and yes..the party does go on..

The prices of the domestically produced synthetic fibres are way too high and their quality is far inferior to their cheaper counter-parts. This will help us because we will be able to weave and spin better quality finished products! We need to do every thing possible to maximize our capabilities in the post WTO-quota regime!

real estate pricing are very interesting. mortgage banks have figured out that a family can own a home costing 3 times their annual clear income (i.e post-debt servicing) as a sustainable affordable cost. how does the per-squarefoot rate in islamabad etc compare? i can say that in bombay, a young prefessional 2-income family pulls-in about 2-10 lakh rupees, and aspires for 15-30 lakh apartment. the 2-lack folks put a larger down-payment. in places like gurgaon and bangalore, the real-estate is more exotic, with an IT family income hitting 10-50 lakhs. these real-estate deals are all white-money, bank-mortgage based...with post-tax down payments. how does real-estate pricing compare to incomes in isloo etc?

Haroon Ellahi.. what you talk is what every rich man would say to justify this budget as it is highly beneficial for your class of people. However, you are forgetting that your class of people even though is the ruling elite, it still is a very minute fraction of the total population of Pakistan.This minute faction does control most of the bureacracy,judiciary and politics of Pakistan and so to please them is to please Pakistan.But do not forget, where 5% of us benefit from this budget because we can buy the latest mercedes now , the other 95% have once again been left with nothing but increasing expenses and less employment.It is very easy for us to formally sit state that this budget is very `people friendly` while it is very hard for an average poor man to survive in this time where prices or everyday groceries are sky rocketing.We all need to get are priorities right. And my advice to you Haroon , please come out of your textile industry and try to maybe look at practical life from the eyes of an average Pakistani who does not have the privelage of posting at chowk.com because after he spends on tomatoes , potatoes , wheat , sugar and other basic necessities of life , he is left with virtually no money to educate himself or the people around him.

Jang, It`s Islamabad.

``Haroon Ellahi.. what you talk is what every rich man would say to justify this budget as it is highly beneficial for your class of people. ``

Well, as long as you look out for your interests without breaking the system it`s all good. It`s a capitalistic society isnt it? Besides, I enumerated why I felt most of the budget was a good idea.


``However, you are forgetting that your class of people even though is the ruling elite, it still is a very minute fraction of the total population of Pakistan.This minute faction does control most of the bureacracy,judiciary and politics of Pakistan and so to please them is to please Pakistan.But do not forget, where 5% of us benefit from this budget because we can buy the latest mercedes now , the other 95% have once again been left with nothing but increasing expenses and less employment.``

There is no dispute on the fact that a collection of families in Pakistan and the military heavily influence and control our instititions, that never was in dispute and it`s implied, so I don`t even see it as a point. I never spoke on the issue of the latest mercedes, since I felt that they should not have slashed duty taxes on cars assembled abroad. However, Mercedes, along with alot of other car manufacturers are considering on setting up plants in Pakistan ,that will definately be providing us with jobs and employment. BMW is doing that I believe and the government is pushing Honda and Toyata to now start creating their parts within Pakistan too, that is a great victory for our industrial base and production capabilities.

``It is very easy for us to formally sit state that this budget is very `people friendly` while it is very hard for an average poor man to survive in this time where prices or everyday groceries are sky rocketing.``

The removal of the sales tax will assuage their situation. Also, the government is supporting the creation of jobs at the mass level, just look at the pace our economy is growing. Jobs for the masses! I think you and the author fail to understand that changes in the socioeconomic landscape of a country do not take place overnight, it is a long, multi-step process.

``We all need to get are priorities right. And my advice to you Haroon , please come out of your textile industry and try to maybe look at practical life from the eyes of an average Pakistani who does not have the privelage of posting at chowk.com because after he spends on tomatoes , potatoes , wheat , sugar and other basic necessities of life , he is left with virtually no money to educate himself or the people around him.``

My sympathies for those Pakistanis who have not been blessed with the privileges I have been. But buddy, just READ what you are saying. ``We all need to get are priorities right. And my advice to you Haroon, please come out of your textile industry and try to may be look at practical life from the eyes of an average.........`` For the love of god, Do you know the fact that over 60% of our foreign earnings and revenue comes from the textile industry!?!?! How can you ignore the textile industry? Throughout history, the textile industry has been very important and we do indeed have a comparative advantage in it. Our archilles heel is that our ginning processing capabilities and stand of qualities have not upgraded and enhanced them selves at the pace the weaving and spinning sector has!
I always have, still am, and will always continue to look at our problems from the prism of massive industrialization of society.

The United States of America would never be where it is today had not the massive industrialization taken place there, coupled with the creation of an advanced railway network system. timmmmyyy, you have been owned. See you rath ko! :)
Jobs! Jobs! Jobs!