4th BRICS Summit: Playing Crucial Role at World Level

The BRICS (Brazil, Russia, India, China and South Africa) is a grouping of the world’s emerging economies, representing five continents. The BRICS countries together account for 40 per cent of global GDP ($18.49 trillion). Intra-BRICS trade is worth $212 billion, and is growing at 28 per cent a year. It has set itself a trade target of $500 billion by 2015.
The importance of BRICs in the world economy has increased manifold since the acronym was first coined approximately seven years ago. Few could have imagined then how the US economy would collapse and bring down with it much of the rest of the world. It is worth revisiting the original formulations on the significance of these four major countries that were made by representatives of a major US investment bank
Some member countries in the organization are among the fast emerging economies in the world. At the same time, the world has come to realize that to bring an end to the unipolar world and to maintain the power balance, the importance of Russia cannot be ignored. Countries such as China and Brazil not only want to maintain close relations with the United States, but with Russia as well.
However, the aim of the BRICS is to enhance cooperation among member countries and working together at the international forums. Clearly, it is an opportunity for India to improve and strengthen its relations with China and strive to get their disputes resolved.
The fourth BRICS Summit was held in New Delhi on March 28-29. The summit’s theme was “BRICS partnership for Global Stability, Security and Prosperity.” The participants included Presidents Hu Jintao of China, Dmitry Medvedev of Russia, Jacob Zuma of South Africa and Brazil’s Dilma Rouseff. Prime Minister Manmohan Singh hosted the summit, and also held a series of bilateral sessions with his guests, including China’s Hu Jintao.
The summit held against the backdrop of continued profound and complex changes in the international situation, uncertain prospects in world economic recovery and the steadily rising status and role of emerging markets and developing countries in international affairs. It was yet another important event in the ongoing BRICS cooperation. India has worked effectively in preparing for the summit. China tried to work with other BRICS members to push for positive outcomes. On the summit’s eve, the five nations resolved to resist protectionist tendencies worldwide.
The leaders of five emerging economic powerhouses affirmed not just their growing economic clout but also their impact on the global political order.
Delhi Declaration
At the end of the summit, BRICS leaders issued a Delhi Declaration. The Declaration hinted at backing an alternative candidate for the World Bank president's post which has always been appropriated by an American and exhorted the Bank and the International Monetary Fund (IMF) to quickly realign their priorities and approach to the needs of the developing world. This is an agenda the five countries intend pursuing at the coming G20 meeting in Mexico as well.
The leaders also weighed the consequences of setting up a “BRICS Bank” and opted for a more contemplative approach by asking their Finance Ministers to examine its feasibility and report back at the next summit in Russia. They agreed that the bank should in no way emerge as a competitor to the World Bank and the IMF but provide funds for projects that do not find favor with these institutions.
In line with their professed commitment to multilateralism in economic and political problem solving, the leaders agreed to invest more in the United Nations Conference on Trade and Development (UNCTAD) which played a major role in catering to the interests of developing countries in the run-up to the setting up of the World Trade Organization (WTO).
Seeking to reinforce their growing economic heft with diplomatic clout, the BRICS grouping pitched for a bigger say in global governance institutions, including the United Nations and the IMF, and told the West that dialogue was the only way to resolve the Iranian nuclear issue and the Syria crisis.
The leaders of BRISC’s formulation on Iran came close to condemning the West's pressure tactics to make other countries obey their latest restrictions on trade ties, especially in the energy sphere. Saying that a conflict would have disastrous consequences, it wanted the two antagonists to resolve suspicions over Iran's nuclear program through talks on multilateral fora.
On Afghanistan, BRICS exhorted the international community to stay the course on the development front for 10 years after the West withdraws most of its combat troops by 2014-end and, on Russia's insistence, made a mention of checking narcotic trafficking.
In a fresh assertion, BRICS asked the West to implement the 2010 governance and quota reform before the 2012 IMF/World Bank annual meeting, as well as the comprehensive review of the quota formula to better reflect economic weights. They asked for enhancing the voice and representation of emerging market and developing countries by January 2013, followed by the completion of the next general quota review by January 2014.
In a signature step, the BRICS decided to create their first institution in the form of a BRICS-led South South Development Bank that will mobilise "resources for infrastructure and sustainable development projects in BRICS and other emerging economies and developing countries." The leaders directed their finance ministers "to examine the feasibility and viability of such an initiative, set up a joint working group for further study, and report back by the next summit."
The development banks of the five countries signed two pacts, including a master agreement on extending credit facility in local currency and BRICS multilateral letter of credit confirmation facility agreement, which could help scale up bilateral trade from $230 billion to $500 billion.
India’s Major Points
Addressing the summit, Prime Minister Manmohan Singh also said that the grouping has agreed to examine in "greater detail" a proposal to set up a South-South Development bank, funded and managed by BRICS and other developing countries.
Singh also urged member countries to speak in one voice on key issues such as the United Nations Security Council (UNSC) reforms. He suggested that BRICS countries should speak in one voice on issues such as reforms of the international body.
On UNSC reforms, Singh suggested that BRICS countries should speak in one voice on issues such as reforms of the international body.
He also said in their restricted session, the grouping also discussed the ongoing turmoil in West Asia and agreed to work together for a peaceful resolution of the crisis.
Touching upon the issue of terrorism, Singh said the countries should enhance cooperation against terrorism and other developing threats such as piracy, particularly emanating from Somalia.
UN Millennium Development Goals
BRICS nations are the defender and promoter of the interests of developing countries. In their cooperation, BRICS countries have committed to promoting South-South cooperation and North-South dialogue, endeavored to implement the UN Millennium Development Goals, worked for early realization of the goals set out in the mandate for the Doha development round negotiations, strived to secure a greater say for developing countries in global economic governance and fought all forms of protectionism.
Cooperation among BRICS countries is made necessary by the ongoing economic globalization and democratization in international relations. It is consistent with the trend of the times characterized by peace, development and cooperation, and fully conducive to building a harmonious world of durable peace and common prosperity.
Role of China
An impression is sought to be created that with its massive monetary reserves and political clout, China may exert undue influence in this bank. This is unlikely. Such a bank will not require too much paid-up capital (relative to the average size of respective sovereign reserves) if intelligent financial engineering can help sequester foreign reserves. This would mean that the smallest BRICS economy, South Africa, could easily commit an amount similar to that of China in the capital structure. Such doubts could be further allayed with the institution of a rotating Presidency of, say, a two-year term that could initially be restricted to the BRICS countries alone.
India-India Strategic Ties
The China-India strategic and cooperative partnership has made all-round progress in recent years. A sustained, sound and steady growth of relations between China and India, the two large developing countries sharing borders with each other, will serve not only the well-being of the two peoples but also peace, stability and prosperity in Asia and the world as a whole.
The Delhi Summit will be remembered forever for one major achievement, at least. Its expected decision to set up a BRICS bank on the lines of the World Bank may change the course of economic activity in the member-countries. The setting up of this new financial institution by the bloc that has brought together half of the world’s population may speed up infrastructure development programs in the BRICS countries and serve as a second line of financial defense in times of economic crisis as is being faced by Europe today.

Power Crisis in Pakistan

Power crisis in Pakistan has taken a horrible form. In such a situation, voices are being raised from every side whether there is any solution to these problems. If yes, why is it not being implemented? The answer to this question is quite long, and terrible as well.
There are three types of natural resources available in Pakistan in such abundance that if they are exploited, the need for several coming centuries will be fulfilled. One of them is water, which is to some an extent being used in Pakistan. The other two resources are wind and coal, which have not yet been even touched.
China’s Support
Pakistan's eternal friend, China, has expertise on these two technologies. During the last one decade, it has overcome the power shortfall up to the level Pakistan is facing several times within months, not years. In Pakistan also, efforts are being made to do this, and China is also helping Pakistan in this regard. However, the World Bank is standing like an obstacle in the way. It neither implements that project, nor does it allow for it. It is a project of generating power through coal in Thar.
Until five years ago, it was not practicable to produce power through coal in Thar. However, the new technology of gasification has made the crude coal reservoir in Thar gold. Under the new technology, there is no need to dig the coal out of the earth nor is there any need to make stoves. Experts of the entire world agree that 50,000 MW power can be generated from the Thar coal in the next five centuries. Work had been commenced on the project a few years ago. The World Bank objected that if Pakistan produced power there, it would have a negative impact on India. However, India itself is a big country of producing power through coal.
Major Hurdle
In this research report, we have focused on as to why the World Bank has become a hurdle in Pakistan's way to produce the world's cheapest power. What types of plans are formed to meet the growing need of power in the world and how much time they take in implementation? We studied China as a model because it is a friend of Pakistan and also willing to help. In this report, we will also explain what is the cheapest and alternative energy in the entire world? What are the possibilities for it in Pakistan and if work is started on it in Pakistan, how time it will take? Besides talk with Pakistani scientists and experts on energy and economy, research reports carried in world journals were also consulted in preparation of the report.
If you travel along the rough road while moving from Islamkot to Seti Dera village near the Indian border Sindh's Thar desert, you will see official vehicles of the workers busy at the wells of Block 5 moving around. These people belong to the staff of Pakistan's distinguished scientist Dr Samar Mubarakmand and are striving to install 600-ft deep pipe in TP 9 well near Megi Jotar village. Digging of the well has been completed. As the work to put the pipe into the earth is completed, coal in the underground surface will be put on fire through the pipe. The coal reservoir will start burning fast, and from another pipe, gas will still start blowing out. And through this gas, Dr Mubarakmand will start producing power at a small power house established there. Hopefully, production of 100 MW power from that station will start within a few months.
Subsequently, 21 more wells will be dug in Block 5 and every well will produce gas. This would be the cheapest power produced in Pakistan. As for the per unit cost of this power, there are available reports of Planning Commission of Pakistan, Sindh Mines and Minerals Department and Dr Mubarakmand; but, these are Pakistani organizations, and we will refer to an impartial report, leaving these reports aside.
Oracle Coal Fields is a subcompany of Australia's biggest company, Regency Mines, which produces power through coal. It had expressed desire to work on the Thar coal reservoirs, and on getting permission, it got conducted a survey through its engineers. The feasibility report released by Oracle Coal Field explains that the power is generated by getting fire erupted under ground in Thar through the new technology of gasification, the project will take nearly one year in completion, and then power will be generated. It will cost four rupee per unit.
It merits a mention here that the power being used by us in Pakistan costs 10-12 rupees (PRe)per unit in average. This includes hydro power of WAPDA (Water and Power Development Authority) and Karachi Electric Supply Company (KESC) and also the power generated from gas and oil. However, the cost of the power generated through rental power houses is up to PRe 15 per unit.
The coal reservoirs in Thar Desert are 30 percent more than the gas resources in Pakistan. They had been discovered several decades ago, but it was almost impossible to bring them out. According to the report prepared by Dr Mubarakmand for the Planning Commission, the reason was that these coal reservoirs in Thar were 600-ft deep under ground. First, there is 150-ft deep sand and then sea water for another 150-ft, followed by 40-ft soil and again water for another 150 ft. Then, coal starts. Owing to the nearby Run of Kutch and the sea, water is available with so much quantity that it was not possible to dig out the coal. Five years ago, the Australian scientists introduced gasification technology to exploit such sort of reservoirs in the world, and the same technology is being used in Thar.
However, the question is whether Pakistan will succeed in producing power from these coal reservoirs. There does not seem any hurdle in the way technically. However, the World Bank is obstructing Pakistan to work on the project. It says that if Pakistan generates power from coal in Thar, it will harm India. In addition, it is compelling Pakistan to work on a long and costly project worth $6 billion. This project relates to changing of gas pipelines and upgradation of Tarbella Dam. It will not benefit considerably in power generation and Pakistan will come under the debt burden of another $6 billion. In addition to Dr Mubarakmand, the World Bank itself confirms it. We will give its detail in the coming lines.
How can the World Bank prevent a company to establish a power house in Thar? It is an interesting question, but prior to understand this, it is necessary to learn about the nature of the war being fought for power generation in Thar. A detailed information about the vast coal reservoirs in Thar had surfaced in 1990. Later, efforts were again made to dig out coal from these reservoirs, but in vain. The third and successful effort began two years ago in 2009. By that time, power generation from the coal under sea water had started in Australia. China was drilling at large scale in such neglected reservoirs, and the United States had also kicked off aggressive efforts towards this direction. This trend started in 2006, and the Pakistani scientists also became alert at that time. When the gasification technology turned mature, the Planning Commission of Pakistan also submitted its proposal about it to the Pakistani Government. It was immediately approved and work was started under the leadership of Dr Mubarakmand.
When we got information about it from the people in Islamkot and the nearby areas, they said that the government and some foreigners again started moving at the Coal Fields in late 2008 after a suspension of several years. This suggests that work on the Thar Coal Fields had been started in 2008. However, according to Sind Mines and Mineral Department's documents available to us, Thar Coal Field was divided into eight blocks and five of them were given to different companies on contract. The plan was that work will be carried out on the project at a fast pace and within a year, work will be completed on at least 400 wells. It was not very difficult. The exact location of the coal reservoirs had already been identified in a survey. Even over 700 points had also been marked to dig wells in the eight blocks.
Divided Blocks
As we said above that the Thar Coal Field had been divided into eight blocks in the early 2009. The Block No 2 was given to Sindh Coal Mining Company and Engro Chemicals Company. These two companies were to complete the drilling process there in a year and generate 1,200 MW power. These were preliminary tasks, which had to be completed in one year. And for the purpose, 10 percent wells had to be dug in every block, and the remaining wells were to be dug in the coming years. And in this way, the power production would continue increasing, as Oracle Coal Field while making a reference to Karachi has written:
On acquiring the Block 4 in Thar, Oracle signed agreements with Chinese companies so that the drilling process could be started at a fast pace. These companies are already working on such coal wells in China. Second, we have also signed an agreement with KESC, which is facing a shortfall of 500 MW in Karachi at present. According to the agreement singed with the KESC, we will provide it with 300 MW cheap power. Under this accord, it would present us a feasibility report of 300 MW power plant. This plant would be established in Thar. In order to take the power to Karachi, grid line already exists there. In the next phase, as we dig more wells, we will continue increasing power production.
By the end of 2009, everything was moving on rightly in accordance to the schedule. All the companies had started creating their respective environment to work in every block. Dr Murtaza Mughal, president of Economy Watch think tank in Pakistan, conducted a thorough research into it in order to know as to what is the significance to generate power under Thar coal project and if the government can complete this project with its resources. According to Dr Murtaza's report, as it was a mega project and it was being implemented with the foreign collaboration, the Pakistani Government and the Sind Government had allowed all companies to seek funds from foreign agencies with the Pakistani Government's guarantee. Projects of big dams, power generation and related to digging out coal or producing power from it are completed with the loan from the world loan lending agencies in the entire world including Pakistan. So on the survey for the Thar Coal project too, the companies and the Pakistan government spent their resources; however, for project production, decision was taken to acquire funds from the World Bank.
International Aid
Earlier also, the World Bank and the Asian Development Bank had been investing on big energy projects in Pakistan, or at least they give guarantee for it, on which basis, investment on these projects is made. The total required funds for power generation through gasification at the Thar Coal Field are PRe 600 billion.
To collect this amount, a conference was convened in Islamabad in late 2009. In addition to the World Bank, representatives of other world financial organizations and companies working on Thar Coal project also participated. When the conference started, the Pakistan officials got surprised, as the World Bank representatives had taken a U-turn.

Deepening International Economic Crisis

The crisis of capitalist system is rapidly increasing. The US economy is the backbone of the capitalist system. The United States is feeling it difficult to maintain this system. The economic rating of the United States has declined for the first time in the history. I will not try to make difficult my point of view through statistics and terminology. It is a simple thing that now the United States as state has nothing. The national growth and state loans have become equal. The annual national growth of the United States was $14.8 trillion and loan was $14.6 trillion. It means that the United States as leader of the capitalist system of the world has become debtor. The state has nothing to provide to its masses.
Obama’s Efforts
US President Barack Obama has struck a deal with Republican Party and decided to increase volume of state loans but the growth could not protect to the extra state loans. Although China has gathered lots of dollars yet the internal differences in the Chinese economy and like capitalist countries, Chinese development benefits are limited only to the upper class.
During the past three years, there were a large numbers of strikes in the history of China. A major part of Chinese foreign exchange income has been due to trade with the United States. However, now, the United States may not be able to purchase a large number of items which put direct impact on Chinese exports.
State of Allied Countries
The condition of the allied countries of the United States, which have capitalist system, is not good. The western media has always tried to hide the demerits and weakness of the capitalist system but now it has become impossible to conceal news in this regard as the disease has worsened. The economic condition of Greece has also become worst. There is shortage of resources with allied countries to steer Greece out of this economic crisis. This situation would also affect United States to a greater extent since it is not a welfare state.
The so-called reliefs to the common people which was being provided has become just nominal after the 80s decade. The welfare states of the Europe are facing problems to provide facilities to their people. For the first time, the demonstrations were held against economic problems in the United Kingdom. The capacity of the people to pay loan of the banks is declining day by day. The source was found to boost the industries through banks loans and plastic money, which now has put greater burden on the people and now they are unable to pay it. So, the demand is increasing in Britain that the banks should share the burden of the loans as they get so much income and the people have little capacity to pay it. Italy is sinking in the economic problems and it will be the next European country to become target of the economic crisis after Greece.
Impact on India
India which was being considered a fast growing developed country has failed to introduce practicable capital distribution system although the middle class achieved opportunities of growth in capital productions which helped in the running of trade and industries there. However, the majority of Indian population is quickly going down the line of poverty and more than 800 million people are living in a very miserable condition. The ruling circles of India are involved in corruption. At the moment, not only the governments are under pressure but all the political parties are also facing crisis.
The opposition pressure is mounting on the government of Congress in India. No one could object to the honesty and character of Indian Prime Minister Manmohan Singh but now he too is facing demands of resignations on account of allegations of corruption. The opposition is not leveling any allegation against his personality and they are saying that he is responsible for the corruption committed by his cabinet ministers and thus he should resign. The Bharatiya Janata Party (BJP) has forced one of its chief ministers to step down to increase pressure on the Congress government as he was involved in a big corruption scandal. The BJP is also not different from others with regard to corruption. The BJP ministers were involved in corruption, which was unearthed after the Kargil war. But then the pressure of the masses was not so strong against the corruption.
However, now, keeping in view the pressure of the people, the BJP has sacrificed one of its chief ministers to justify launching of campaign against corruption and making preparations to put Congress under pressure. The chief ministers of Tamil Nadu and Uttar Pradesh belong to regional parties and their governments were badly involved in the corruption whereas the situation of other states is also not different.
Declining Pakistan’s Economic Resources
The Pakistani economy is depending on capitalist system and the United States, its allies and their controlled financial institutions are providing most of our economic resources. However, the United States and its allies which themselves are facing crises could not provide any more help to Pakistan. Britain itself is failing to satisfy its people and its top priority would be its own people and it is not in a position to provide loans and aid to Pakistan. The United States already is avoiding to provide two-third of the assistance allocated for Pakistan. Similarly, it would be wastage of time to expect more aid from the United States. The International Monetary Fund, World Bank and Asian Development Bank can provide loans on strict conditions and their strictness would increase for the return of the loans. The war on terror has been imposed on us. No other power of the world is ready to share with us the burden of the expenditures of the war against the terrorism. The resources would not allow if any government will want to help Pakistan in this regard. The foreign reserves which are being maintained through loans have become doubtful now after the declining rate of the dollar and this fund of reserves could not go along with us for a long time.
Moreover, there is very little chance to increase income through exports. The Pakistani staying aboard could not save more in this present circumstances as their expenditures would increase to reduce the amount which they are sending to their kith and kin in Pakistan. Recently, a delegation of Pakistani traders had warned the government to avoid holding of foreign exchange in the shape of dollars and transfer the foreign exchange in other currencies, if it is possible, as the crisis of dollars would not be affordable for Pakistan.

China To Emerge as World Power To Take up Stakeholder Responsibilities

According to a publication entitled '2010 China Urban Competitiveness Blue Book' which was released by the Chinese Academy of Social Sciences two days ago, China may become the world's most important economic decisionmaking center after 10 years. The publication also said that after a period of 40 years, China can expect to become the world's second most powerful country after the United States.

World's Influential Power
When Prof Wang Yukai, of the Chinese National School of Administration, accepted Lianhe Zaobao's interview, although he held reservation over the two forecasts about China as mentioned by the '2010 China Urban Competitiveness Blue Book', nevertheless, Prof Wang did acknowledge that it was an undeniable fact that China's influential power in the world community has expanded gradually. He cited some important events that happened recently to prove his point. He said the most convincing example is that China's voting weight in the World Bank has jumped to third place, a place that is only after the United States and Japan.

The World Bank's main task is to assist countries, particularly to help reduce poverty in developing countries, and to improve living standards of people in different countries. Over the years, the World Bank has indeed played a major role in these areas. However, since developed countries have taken up high share of voting weight in World Bank for a long period of time, such development has led to majority of World Bank members, which are the developing countries, having to subject to developed countries' control.

Using the World Bank voting weights in 1 November 2004 as an example, the United States has a high 16.4 percent voting weight as a single country. According to the World Bank regulations, any important resolution must obtain more than 85 percent voting weight to get through. In this regard, as a single country, the United States can easily exert its veto right to kill World Bank decision or resolution. Therefore, the World Bank has been accused by many countries as an execution institution formed to help the United States or western countries in the implementation of policy deemed beneficial to their own economic policies.

New Adjustment of Voting Weight
In this round of re-adjustment of the World Bank voting right and voting weight, although the voting weight of the United States has been reduced to 15.85 percent, but such reduction in voting weight still will not affect the United States' unilateral power to veto World Bank's decision. Overall, the greater disadvantage in the round of World Bank's voting right adjustment is Japan because its voting weight has now been reduced to 6.84 percent. On the other hand, China's voting weight has all of a sudden increased from the previous 2.77 percent to the present 4.42 percent.

Such increment has surpassed that of Germany, Britain, France and other developed countries. This new adjustment of voting weight on China has allowed China to rank in the third position in term of voting right and weight. From this recent adjustment of the World Bank's top three countries with highest voting weight percentage, one can clearly observe China's international influence, or at least its influence in the World Bank, is on the rise. Relatively speaking, Japan's influence in the World Bank is on the decline.

Striking Feature
However, what made China's voting right and weight right different from Japan and the United States is that China is only a developing country. As a matter of fact, when developed countries made a shift of 3.13 percent voting weight toward the developing countries, China on its own as a single country has obtained 1.65 percentage voting weight. This has accounted for more than half of the voting weight meant for developing countries.

As the world's largest developing country and as the biggest beneficiary among developing countries in this round of World Bank voting weight adjustment, we trust that from now onwards, China has the duty and responsibility to speak for the developing countries in World Bank's decision making process. This is a venue China can help to maintain the benefits and welfare of the people of the world's majority countries.

However, such development for China in the World Bank does not mean that within the World Bank framework, China must take confrontational stance with the developed countries led by the United States. Rather, China should unanimously accept the rule of game observed by both developed and developing nations within the World Bank framework to, through negotiation method, fight for right and benefit for the developing countries. In fact, in this round of adjustment in voting weight, the World Bank has to adjust the voting weight of the developing countries because all World Bank members have gone through many rounds of negotiation and consultation to reach the present compromised adjustment.

Emerging Current Economic Big Power
After three decades of reform and opening up, China has from the past populous country emerged as the current economic big power. We trust that if without any unexpected event that can happen along its path of development, China will not only become an economically strong country, China will also become the world's strong power positioned to lead the world in politics, economics, military, education, culture, science and technology, and arts. In other words, this ancient civilization with five thousand years of history and culture behind it will now play a stronger and stronger influential role in this modem world and in really, China's influential power has already been felt by the world community.

Nevertheless, unlike those western powers that have emerged one after another to dominate the world scene in the past few centuries, China has taken the path of peaceful emergence. China should continue to stick to this doctrine of peaceful rise and shoulder the international responsibilities that befit its status as a world power. China cannot subvert the existing international order, but should only constantly perfect the international order under the premise that it has accepted such a world order. China should feel happy to shoulder international responsibilities as stakeholder that commensurate with its national strength. Such status of China as a world power will obviously do more good than harm to the world nations.

Nile Water Sharing Agreement Talks Collapse

The stream of articles on the Nile Basin Initiative has been negative, pessimistic and even somewhat abrogating. The saving grace of this faultfinding exercise is that it draws attention to the prerogative of the Nile Basin countries to tackle seriously the mounting challenges the mighty river they share hurls at them and the opportunities it presents. The extraordinary Nile Council of Ministers (NileCom) Conference in the Red Sea resort of Sharm El-Sheikh is no exception.

Unfortunately, matters took an ugly turn at Sharm El-Sheikh with participants failing to reach agreement. The gloves came off, Egypt insisting on veto powers over any new irrigation projects undertaken by the other nine riparian nations. After a marathon 15 hours of deliberations, the only agreement that was reached was on minutiae in order to avoid the pitfalls of the past.

Cornerstone of Nile Basin Cooperation
And so it is with the region's embryonic 1959 Nile agreement between Sudan and Egypt, which remains to this day the cornerstone of the Nile Basin cooperation projects, much to the consternation of some upstream nations. Egypt and Sudan insisted on safeguarding what they see as their national interests with the seven upstream countries threatening to go it alone. 'The Nile Cooperative Framework Agreement must clearly acknowledge Egypt and Sudan's historic share of Nile water,' Minister of Water Resources and Irrigation Mohamed Nasr El-Din Allam reiterated in Sharm El-Sheikh, in reference to the 1959 agreement.

The core problem is the perceived 'unjust and unequal distribution of Nile water resources' by upstream riparian nations and the reluctance of downstream ones -- Egypt and Sudan -- to concede concessions. Sudanese Irrigation Minister Kamal Ali appealed for calm, urging the upstream countries to continue negotiations to secure a comprehensive cooperation agreement. Egypt backed him. But there are changes afoot.

Political and Economic Realities
Globalization opens the door to fresh political and economic realities. The most momentous and consequential of such groundbreaking events, is the rapprochement in recent months between Egypt and Ethiopia, the country that supplies 85 per cent of Egypt's water. Egypt, the primary user of Nile water, traditionally felt its interests threatened by Ethiopia's ambitions to construct dams to generate hydroelectric power. Yet there are tremendous transformations in the offing. Egypt no longer has an agriculture dependent economy, and Ethiopia has to date an inadequate hydraulic power and enormous hydroelectric potential.

It is against this backdrop that the Egypt-Ethiopia Council of Commerce was established on 30 December 2009, which turned the bilateral Egyptian-Ethiopian relation from 'distrust to a friendly cooperation,' as Ethiopian Prime Minister Meles Zennawi so succinctly put it. Of the four major tributaries of the Nile, three originate in Ethiopia -- the Blue Nile (or Abbai), Sobat and Atbara. Be that as it may, Nile Basin nations need to start talking more about employment, food security, agricultural and manufacturing industries and stop obsessing about water and tributaries.

Yet, those habits persist. The challenge is to make this week's Sharm El-Sheikh conference qualitatively different. Ethiopia in particular and other upstream nations are resentful of the lack of the financial support by international financial institutions such as the International Monetary Fund (IMF) and the World Bank for their Nile projects. They are also peeved that Western donor nations have supplied Egypt with billions of dollars -- the US government has provided $60 billion of assistance to Egypt compared to less than $4 billion to Ethiopia since 1950.

Water Sharing System
Certainly the system of sharing Nile water as it stands looks dysfunctional. There is a plethora of duplicating and overlapping organizations and initiatives concerning water sharing in Nile Basin nations. There is the Nile Technical Advisory Committee (Nile-Tech) as well as NileCom. There is also the International Consortium for Cooperation on the Nile (ICCON) as well as the Nile Basin Initiative. The goal of the Sharm El-Sheikh conference was to work out a comprehensive agreement on the allocation of Nile water resources among the Nile Basin states.

It was not a bad idea by any stretch, although the Nile Basin Initiative is not the liveliest of regional organizations and the going is sometimes laborious. Certain countries still have a knack of sticking the boot good and proper to their neighbors. What is the best and brightest thing about the contemporary Nile Basin region? The traditional reticence of some of the African delegates was tested when four African delegates at the Sharm El-Sheikh conference reportedly withdrew from the talks in a huff and a puff.

Critical Point for Egypt
Control of the utilization of the waters of the 6,670-km river, the world's longest, has long been a bone of contention in the Nile Basin. Egypt will not sign any deal before its conditions are met. The requirements include the commitment to the early notification mechanism before the construction of any projects in upstream countries and that all decisions are to be finalized unanimously and not through majority voting. This last point is critical as far as Egypt is concerned because the upstream riparian nations tend to concur on issues that Egypt objects to. The Nile Cooperative Framework Agreement must clearly recognize Egypt and Sudan's historic share of the Nile Waters. The other seven upstream nations bitterly disagree.

Nile Basin nations are called upon to put aside differences in order to secure the Nile Basin Initiative for the sake of enhancing sustainable development in the region. Egypt in its capacity as current chair of Nile Basin Executive Council is pulling no punches. Assistant Foreign Minister for African Affairs Mona Omar disclosed that Egypt is calling for a 'consensus formula.'

Meanwhile, she also announced that Foreign Minister Abul-Gheit is scheduled to visit Ethiopia later in the month for the Egyptian-Ethiopian Joint Committee. The 1,530-km Blue Nile (Abbai) is key to Egypt's national security, and the Ethiopians understand the strategic importance of their country to the Egyptians. The River Nile Cooperative Framework Agreement (CFA), International Consortium for Cooperation on the Nile (ICCON), the Nile Technical Advisory Committee (Nile- Tech) and the Nile Council of Ministers (Nile Com) will survive the altercations at Sharm El-Sheikh.

Walkouts and Bitter Disputes
The debate about who should get what and when will go on for years. Participants were hoping that the days when the problems of quibbling about sharing the waters of the Nile are over. The countries of the Nile Basin might be locked in a bitter dispute over sharing and harnessing the waters of the Nile, the world's longest river, but they at least are still willing to meet on a regular basis to iron out differences.

The walkouts and bitter disputes sadly show that this week's Extraordinary NileCom meeting was not qualitatively different to earlier meetings. 'Ten years ago there was an atmosphere of mistrust, suspicion and doubt. Today the Nile Basin countries are open to each other and ready to collaborate more closely together. This is an achievement to be cherished, nourished and nurtured all the way,' noted Tanzanian Vice-President Ali Mohamed Shein. Wish that was true. The Nile Basin Initiative might yet metamorphose into something more meaningful only by harnessing tremendous political goodwill. Whose water is it anyway?

Greece and Iceland Financial Crisis Pose Warning for Vietnam

Vietnam should study seriously the experiences of two European countries which are Iceland and Greece although at the moment our situation is better. We have Official Development Aid (ODA), which means long term loans with low interest, and the total debit balance is not too high.
A company will go bankrupt if it can not pay off all its debts at the deadline, and so will a country. In 2009, Iceland fell into that situation. This year, Greece is also facing the possibility of bankruptcy.

If a company faced with bankruptcy is not bailed out by creditors or third parties, it can go bankrupt, be forced to sell its assets to clear its debts, and liquidate. It is hard for a country to be liquidated, but there is a high possibility of having to sell properties and selling concessions for lands and mines to clear its debts, or future generations will have to work their hands to the bone, and tighten their belts to pay off the debts.

Greek Syndrome
The Greek government had to raise taxes and reduce expenses to pay the interest and one part of the principal on its national debt of over 400 billion euros. People took to the streets to protest against the policies of tax increases and reduction in welfare programs.

Sixteen European finance ministers seemed to agree on the Greek rescue plan in a meeting in Brussels on 15 March, although the detailed plan has not been revealed.

Fell Into Bankruptcy
It is as simple as a family or a company. A government has to spend money to maintain the government apparatus, national security and defense, and development. Balancing the expenses, the government has receipts. If the expenses surpass the receipts, the government has to ask for loans inside or outside of the country. Printing money to settle will cause immeasurable inflation, which is another form of tax on everybody.

The domestic receipts of the government come from taxes, fees, sales of natural resources such as oil and coal, and other sources such as domestic loans and bond and treasury bill sales.

Foreign receipts include nonrefundable aid, which is not significant, foreign loans (ODA), and commercial loans, for example issuing bonds on the international market as Vietnam has done recently to raise $1 billion.

Ineffective use of loans, corruption leading to loss, loose tax collection and tax evasion, or insufficient taxation can cause debts to pile up and can easily lead to bankruptcy.

The press has said that Greece went bankrupt because of corruption and tax evasion. The credit rating of Greece fell from A- to BBB+, the lowest rating of European countries. A low credit rating makes it even more difficult to get new loans, and interest rates will be high.

Common Condition
Based on the experience of Iceland and Greece, the increasing debt, and the uses of the funds in Vietnam is cause for concern. The credit rating of Vietnam has just been lowered to BB- by Fitch, a global ranking organization providing data, research, and credit forecast independently for the international credit market. Vietnam's trade deficit has been continuously high for many years. Domestic and foreign debts of the government have increased rapidly, although they are reported to be at a safe level (less than 40 percent GDP is considered safe).

According to the Ministry of Finance, as of 30 June, 2009, Vietnam's foreign debt Vietnam equaled 29.8 percent of the Gross Domestic Product (GDP), $23.6 billion. After June 2009, Vietnam signed loans and loan guarantees worth nearly $4.5 billion in total - $1.205 billion with Asian Development Bank (ADB), $927 million with the World Bank, $1.33 billion with Japan, not including $290 million the Japanese loaned Vietnam at the beginning of March this year, and issued $1 billion of international bonds.

If all this money is disbursed, the foreign debt of Vietnam will increase to 35 percent of GDP, not to mention that the total domestic debt of the government is unclear. The concern is that the returns on spending and investment are not high, corruption and the thirst for investment on the part of state agencies have not been reduced, so debt will increase rapidly if there is not strict control.

Perhaps the National Assembly will discuss the bauxite projects, the high speed railroad project, the nuclear power project, and many other mega-projects. The Finance Ministry has just taken a decision on supplementing authorized capital for Agriculture and Rural Development Bank (Agribank) for an amount of more than 10.2 trillion Vietnam dong. All these mega-projects and financings of corporations and state units need huge amounts of money. The federal government is in debt, corporations are in debt, and localities are also in debt.

Diagnose and Treatment Needed
Ho Chi Minh City has just established the Ho Chi Minh City Financial Investment Company (HFIC) to mobilize capital from organizations and individuals inside and outside of the country, issue bonds, raise funds from financial and credit organizations, accept financial assistance, and managed-account funds.

Hanoi City is also developing a proposal for a foreign loan of billions of dollars. Perhaps Hanoi will also follow the example of Ho Chi Minh City to establish its own financial investment company.

Unclear About Other Provinces Activities
Not even mentioning that these state financial investment companies will prevent banks from mobilizing capital, I note that if local state financial investment companies and corporations are not under strict control, and make extensive loans for extensive investment at higher interest rates than the central government pays, it can push the country into debt and lead to the possibility of bankruptcy in the future, and our descendants will have to work hard to pay off the debts.

The thirst for investment can be the condition of any government if there is not strict control and supervision. There are many temptations and apparently good reasons for loans and expenses, but please do not put the burden on future generations.

We must identify clearly what the country must do, and invest in the army, the legislature, law enforcement, and infrastructure, for example, but the government should not do business, nor invest in business.

Spat Between China, US Over RMB Value Will Not Help Resolve Trade Disputes

The spat between China and the United States over the appreciation of RMB (Renminbi) exchange rate seems to have the tendency to heat up and expand. The US Treasury will release its annual report on 15 April. In this report, whether China will be blacklisted as a currency manipulator country might decide the future international trade direction.

As the date of the release of the US Treasury annual report approaching, the pressure coming from all directions in pressuring China to raise its RMB exchange rate has also intensified. Recently, 130 members of the US Congress have collectively sent letters to US Treasury Secretary Timothy Geithner and US Commerce Secretary Gary Locke, requesting that the United States should list China as one of the countries that manipulates its currency. In addition EU Trade Commissioner De Gucht also felt that China's RMB is undervalued and that China should allow its currency to appreciate. Then came the World Bank and International Monetary Fund (IMF) that followed through and exerted pressure on China to appreciate the value of its RMB.

Revival of Global Economy
Facing overwhelming pressure coming from the western society, Beijing's tone has also been raised. In his work paper for the "two sessions" this year, Chinese Prime Minister Wen Jiabao announced that the Chinese Government would not yield to external pressure and the RMB exchange rate will remain "basically stable." At a public forum held on 21 March, China's Minister of Commerce Chen Deming also said that if China was listed by the United States as a currency manipulator and if China suffered trade sanction, China would take retaliatory measures against the United States. He made this remarks in response to US corporate executives' questions on this issue at the public forum.

Issue relating to the currency rate of RMB has tremendous impact on the world community. As the world's two largest trading countries, if a trade war really breaks out between China and the United States, it will affect all other countries in the world and it may lead to the gradually reviving global economy back to the valley of economic setback again. Objectively speaking, the RMB exchange rate issue is not without a solution.

However, using high profiled propaganda measure to resolve the issue is not the best way to end the trade conflicts between China and the United States. It is obvious that the policy makers in Washington and Beijing are forced to take their respective stand on the RMB exchange rate issue because both governments are confronted by their respective internal situation and pressure.

US Health Care Reform Bill
Although the Obama Government has had its health care reform bill passed, the effort taken by the Obama administration to get it through has already consumed considerable political capital of Obama. Since becoming the US President, Obama has been actively promoting rational public affairs. But now his bipartisanship appeal has also fallen apart.

However, the unemployment rate in the United States has remained high. With the mid-term congressional election approaching, the White House has no choice but to pay more attention to the public opinion and value the feedback from the public opinions as well as to attend to the pressure coming from the opposition party and the pressure from within the ruling party.

The US public opinions attributed the US unemployment problem to the exchange rate of RMB. They said the RMB was unreasonably depressed by the Chinese authority and that as a result it has become a setback to the US export industries. At this very moment, the US domestic political scene is such that the Obama administration is n the defense side when facing the US public. As such, in dealing with the RMB issue, the weaken US Government has subtly reflected its intention to diverge its domestic pressure onto China's RMB by raising its voice sternly.

Economic Transformation
Similarly, on diplomatic front, China also cannot afford to show its weakness. This is because within China, its economic transformation has been slow, its employment situation is grim and its societal tension is on the rise. Voices coming from China's civil society demanding for societal structural change are continued to be heard. The Chinese Government is now faced with a populist movement. At this period of time when the Chinese Government has to pay full attention to handle domestic challenge, China really cannot afford to show its weakness in public diplomacy.

International pressures can only force the Chinese government to hold firm to its position and will not give in an inch. In other words, policy makers in Washington and Beijing were forced out of the internal situation to demonstrate a strong stance. However such situation will not help to solve the RMB exchange rate issue, but would further weaken each other's room for maneuver.

Trade Problem and RMB Issue
In fact the US-China trade problem and the RMB issue are not as insoluble as reflected on the surface. China's gradual accumulation of inflationary pressures will eventually prompt the Chinese Government to let the RMB to appreciate (but the appreciation rate and speed may not be what the United States intends it to be).

To this end, the Chinese Government has also sent a signal. Chinese Prime Minister Wen Jiabao said that China advocated free trade. He said China would not go for the pursuit of trade surplus. In response to the US concern, he also stressed that China would make effort to expand imports. He said maintaining China-US trade balance should be a long-term efforts and direction.

Earlier, China's central bank governor Zhou Xiaochuan also said China's current exchange rate policy was a temporary strategy in response to the global financial crisis. He said that adjustment of the value of Chinese currency was but a matter of time.

Exerting Pressure on China
Past experience has shown that if the United States publicly and openly exerts pressure on Beijing, it will be counterproductive. EU Trade Commissioner De Gucht has also pointed out that on dealing with China's RMB issue; the US Congress should adopt a cautious approach.

De Gucht believed that exerting pressure on China publicly and openly would only lead to negative and counterproductive result. As such he said he would not recommend that EU and Euro zone should adopt such an open approach to deal with China's RMB issue.

Vietnam To Overcome Weaknesses

Looking back at the last decade, we continue to achieve growth quantitatively from what nature has bestowed on us but too little change in term of quality and we have not been able to create any base for a breakthrough in the future.

In the sacred transitional moment of the year when we see off the old year and welcome the new year, each of us should spare a some time to reflect and reminisce on the last year deeds, what we have achieved and what we have not and to think of the new year with all the previsions, intentions and aspirations for the country, for the people and naturally for oneself.

Creating Realistic Changes

We must think before acting, as everything will start with action before creating realistic changes. The Year of the Tiger (2010), the last one of a decade, is also an opportunity for us to look back at the last ten years and our plan for the next ten years.Following the first years of reform and integration of the nineties, during this decade (2001-2010), Vietnam continues to obtain definite achievements praised by the World Bank and the United Nations Development Program (UNDP) that often cited us as a model for poor and less developed countries for our economic high growth and rapid hunger elimination and poverty alleviation work. Some people use the allegory of the "good child" score card of a kindergarten child to describe this praise.From 2008 onward, we have passed the gate of "low income countries" ($935 per capita) -- a superlative to designate poor countries -- to join the group of middle income countries, even though we have not reached the lowest level among this group. These are real laudable progresses though still not at par with the potential of the country and of the Vietnamese people.

Sicknesses and Weaknesses

Maybe there are not many people who can remember that the World Bank, in its book The Miracle of East Asia has spared no words to praise Indonesia and took the Indonesian economic model for us to study in those first days of Doi moi (Renewal), until this country tumbled into the financial crisis of 1997. The one who praises is not held responsible when the praised succumbed. The praise is sweet for the ear but will not help to discover our sicknesses and weaknesses.Any people responsible for oneself must create a democratic mechanism to discover in time its shortcomings and has enough courage to correct itself and move forward. And all the more we should not take other's praise to gloss over or to hide our shortcomings.Looking back at the last decade, we continued to achieve growth quantitatively from what nature has bestowed us but too little change in term of quality and have not created any base for a breakthrough in the future.The structure of our export commodities is slow to change and after ten years, it was still mainly crude oil, textiles and garments, leathers and shoes - all of which are labor intensive products made under processing arrangements to benefit from the low cost workforce. The percentage of high-tech products has increased from two percent in 1999 to eight percent in 2008 thanks to the foreign invested businesses.According to the evaluation of the World Bank (2006), 76 percent of our gross national assets are natural resources (land, forest, timber, and so forth), 20 percent are tangible assets already built (roads, bridges, ports) and only less than 7 percent of the assets come from knowledge, trained people and institutions while in the countries of the Organization for Economic Cooperation and Development (OECD) with per capita income over $10,000 the ratio is 2 percent for natural resources, 17 percent for physical assets and 80 percent for knowledge. Particularly, in Japan natural resources only account for a little bit over zero percent.In the last ten years, we have made very little progress on education and training, on the fight against corruption and on the reduction of traffic accidents while environment pollution, traffic jams, water logging and flooding have increased dramatically.From 20 06 to this date, Vietnam has fell 11 ranks on the classification of global competitiveness while China, South Korea and other economies have made headway progress based on knowledge, institutions and human creativity.Facing the danger of climate change, our natural resources are threatened to be seriously reduced and the vision of growth based on natural resources exploitation is really sinister and obsolete.

Changed Situation

We must candidly asked ourselves why we are so slow in progressing in areas that we already knew the issues as we have used eloquent words such as "national disaster" or "internal aggressors" to describe corruption; and how many times we are "resolute" or "determined to fight" but the results in reality are still minimal and basically, the situation has changed much.When we have made every possible effort for so many years but without any success then we should reconsider the way we carry out these efforts and see the real causes of those diseases.Former Prime Minister Pham Van Dong often said: "All of us are at the same time the victim, the culprit, the prosecutor, the judge and the defendant". Maybe, on the spiritual aspect, as a patriotic Vietnamese, nobody would have the heart to excuse one's responsibility before the people, but the responsibility of a farmer in Mu Cang Chai village and the responsibility of the ruler of a country over these problems are quite different.It is still better to light up a match than to sit lament in the darkness. In these spring days when we make offerings to our ancestors and reminisce about the heroes who have sacrificed their lives to save this country for the people, each of us should think and act more than just lighting a match.

Indian Economy Poised For Fast Development After Recession

Amid all indications of improvement in the Indian economy, the World Bank has also estimated that the country's economic growth rate, between financial years of 2010-11 and 2011-12, could be from 7.5 to 8-percent. The point to be noted is that the average growth rate of the economy between 1995 and 2005 had been 6.4-percent. From this viewpoint, the World Bank's estimate is also presenting a rosy picture of the country's economy on lines of other estimates and is confirming that India's economy has come out of recession and is well on the way of progress.

Improvement in Economies of High-Income Countries
There are strong possibilities of further development of the Indian economy. It would continue to get stronger with foreign demand. Improvement in the economies of high-income countries would also benefit the country's economy, because this would increase demand from these countries and the flow of foreign investment would increase, which would further strengthen the country's economy. The commendable thing here is that the country would achieve this even when the stimulus packages, given for recovering from the economic recession for the next year i.e. 2010-11 are withdrawn.

Impact of Global Recession
One more noteworthy thing would be that while the Indian economy surges ahead in the years 2010-11 and 2011-12, the pace of global economic growth would be quite slow. Continuous growth of our economy is confirmed by the export figures for December 2009. An increase of 9.3-percent was registered in exports in January. This is the second consecutive month registering growth in export. There had been a fantastic growth of 18.2 percent registered in exports in November 2009.
After falling continuously for 13 months, exports had registered increase for the first time in November 2009. The global recession had been the reason for continuous fall in exports, but with satisfactory growth registered for a second consecutive month, it is proved that our export sector is emerging from recession.

Export Growth
With improvement in industrial activity, there has been increased import of raw material for export trade. This means that exports are growing. There is hope of 10-percent growth in exports in the year 2010-11.
The export sector of the country would become stronger after price rise comes under control, as it would make our goods more competitive in the international market. There is hope that price rise would soon come under control with other measures being taken at the government level, along with increase in the Cash Reserve Ratio (CRR) by the Reserve Bank of India.

ASEAN Seeks To Establish EU-Like Asian Grouping

The summit of leaders of the Association of Southeast Asian Nations (ASEAN) with six dialogue partners (China, Japan, South Korea, India, Australia and New Zealand), which was host by Thailand has recently been concluded. Following the summit, there is a question as to how much successful the summit has become.
Agreement Signed
To get a clearer picture of the success of the summit, I would like to sum up the agreements reached during the summit as following:
1. China agreed to grant $10,000 for the promotion of investments between China and ASEAN. It also agreed to provide a soft loan worth $15,000 for ASEAN countries for the developments of basic infrastructures and trades. The loan will be spent for building roads to link ASEAN nations to China to facilitate trades, transportations and traveling among citizens of these countries.
2. UNESCO estimated that it requires an investment worth $14,000 to build roads to link all Asian countries.
3. The ASEAN reached an agreement with the six dialogue partners to establish a free trade area among them. They also agreed to unite Asian countries into a union because Asia has over 3.3 billion citizens and its total trade value is higher than $14 trillion. And all Asian countries have combined foreign reserves of $39 billion.
4. The ASEAN agreed with three dialogue partners (China, Japan and South Korea) to set up a multilateral fund under the so-called Chiang Mai Initiative Multilateralization (CHIM).
Chiang Mai Initiative Multilateralization
The plan is known under the initial of CHIM. The fund will have $120,000 for providing help to Asian countries, which are affected by liquidity crunch. The fund will begin its operation late 2009.
What matters most about these four points is their possibility. And when these points materialize, Asia will receive huge benefits. It is a new and joyful era because China and Japan, which are super economic powers, can cooperate to turn Asia into a powerful grouping with enough power to bargain with the super-power European Union and the United States for the first time.
Influence of Western Countries
If everything is carried out smoothly as planned, Asia will no longer have to be under influence of western countries. Asian countries will no longer have to borrow from the International Monetary Fund (IMF) and World Bank. And when the Asian grouping is developed up to a point, Asia may have the same nature with the EU.
That is, there will be no longer borders dividing citizens of Asian countries. Asian people will be able to travel across their countries without visa and they will use the same currency like the euro. The investment funds, production bases, work forces and raw materials will be moved among the Asian countries freely. Asian countries will also use the same or similar customs codes.
Economic and Other Cooperation
And consequences of such grouping will also be very important. The Asian countries will help one another to develop technologies and upgrade their education and skilled labors. They will cooperate on heath care services and exchange culture. Such cooperation will turn Asian into a strong region with stable economy. Their social system will get developed with good standard and this will make it hard for westerners or any group to try to destroy the Asian societies.
However, before Asia can rise to be a powerful grouping like the European Union (EU), each and all Asian countries must first do away with their weak points and must create their strong points in all respects -- political, economic, and social respects.
In particular, leaders of Asian countries must be outstanding with their ability and they must win trust from people both inside and outside their countries. They must not be leaders who have no tangible achievements but still boast that they have become successful and that they enjoy working in politics.

Pathetic Economic Situation in Pakistan

According to a report, the electricity rates are expected to be increased by 40 percent during the year. According to a report by an English journalist, this is necessary due to the agreements done with the International Monetary Fund (IMF). It has been further stated in this regard that an agreement took place between the Pakistan government and the World Bank and the Asian Development Bank (ADB) on 21 May 2009 that the electricity rates will be increased by 26 percent. While, according to the country report published by the IMF in August 2009, Pakistan Electric Power Company (PEPCO) has suggested an increase of 17.5-41.5 percent in the electricity rates.

Increase in Electricity Rates
In addition, it is being stated in this regard that because of the rental power plants, an increase of 41.5 in electricity rates is necessary instead of a 26 percent increase. In addition, a subsidy worth 55 billion will be removed and the electricity rates will be increased in three different phases. Whereas, Prime Minister Yousuf Raza Gilani has said that price determination of electricity and gas rates is the job of the National Electric Power Regulatory Authority (NEPRA) and Oil and Gas Regulatory Authority (OGRA). He further stated that the government is providing a subsidy of 55 billion rupees on electricity. In the future, will these subsidies stay or not? This decision will depend on the conditions.

According to a second report, there was fighting between the ministers on the issue of increase in electricity rates. State Minister for Finance Hina Rabanni Khar said that because of an agreement with the IMF, it is important to increase the electricity rates. Whereas, Interior Minister Rehman Malik believed that if the electricity rates are increased it would create a law and order problem.

Providing Public Service
These are the reports of the institutions which have been entrusted with the task of providing public service. The basic purpose of presenting these reports was to present the situation in front of the public regarding the state of these national institutions and the people who are at the helm of affairs in these institutions. In addition, what are these people entrusted with the responsibility of running the affairs of the company doing to resolve the problems facing their respective companies and the way in which they are handling the affairs of the company. Also, what is their vision regarding their respective companies and how have the companies changed as a result of the implementation of their policies. If we take the example of the electricity companies, we can easily see how serious our rulers are in addressing the electricity problems. In addition, what policies have they made to address the problem of electricity.

From this situation, it has become evident that the masses or the public are not the real stakeholders in this scenario, instead all these things are being decided on the recommendations and suggestions of the World Bank, ADB and IMF. In reality, these are not recommendations or suggestions, they are the orders given by these economic institutions. What are the conditions of these agreements and are these suitable for the Pakistani people and our nation. The answer to this should be given to the nation by the president and the prime minister. In addition, they should also tell the benefits that will accrue to the masses from this or is this a program to snatch all the benefits or luxuries available to the masses.

On 18 February, the public elected this present government into power so that they at least hold/cease the country in the situation that was created during the Pervez Musharraf and Shaukat Aziz regime. Lawlessness, inflation, unemployment, closure of businesses, worsening of the economic situation, and the continuous load shedding problem and as a result of all this is a continuous pattern of difficulties and problems. In addition, the news that there will be a meteoric rise in the rates of electricity and gas coupled with this news that the prices of petroleum products will be increased after an average of 15 days.

Grim Political Situation
These are certain highlights of the performance of the present government. Leave the political situation in the country aside, which includes the continuous presence of 40 NATO troops on the Pak-Afghan border and the continuous series of suicide attacks, bomb attacks and drone attacks and the general helpless of the government in this regard. This includes the preparations by India of a civil war in the country. This situation has been prevalent in the country since the Musharraf rule, which the public was expecting that the newly elected government will pay attention to these matters upfront. Now after an experiment of two years, the only change or addition that has taken place in front of the eyes of the nation is that there has been an increase in the number of foreign visits. This gives an impression that they have been elected for foreign visits and their lottery has come out in this regard. A debate on other issues is not going to be fruitful.

Various groups of people on this situation comment that the only change that has taken place in Pakistan is that instead of Musharraf and Shuakat Aziz, Asif Zardari and Gilani have taken their place. Otherwise, if the performance of the government is analyzed in the above given categories then one can easily say that no significant change has taken place even the first step towards development and progress has not been taken in these respective sectors. The only difference that has taken place is that notable people like General (retired) Aslam Beg have started saying that drones responsible for carrying out attacks in Pakistan are taking off from the Pakistani soil.

Whereas, in other matters, the pattern of "increases" is taking place whether it is an increase in the prices of daily necessity commodities, increase in the prices of petroleum products or in the rates of electricity and gas. As if the only work given to the incumbent and the past government was to increase the prices of the daily commodities for the common man. We can talk to the president in this regard when he would prefer to come back to his home country. The Prime Minister has already clearly stated that determination of rates for electricity and gas is the job of NEPRA and OGRA.

Declining Industrial Output
It should be remembered that the Prime Minister Gilani had given an indication to the public to prepare themselves about impending electricity, gas and other crisis. Is not this the job of the government to stop this meteoric rise in prices? The electricity has become so expensive that every person from an ordinary citizen to an industrialist is fed up with it. The 40 percent increase in electricity rates is done in one go or in three phases, the impact will be the same in both these cases. The Rental Power Plants (RPPs) are being purchased on rent at the same cost as if they had been formally acquired in one go. Then, why are they being purchased on rent? The Prime Minister should tell the nation about it. In addition, the electricity that will be produced from these rental power plants will be available at the rate of 30 rupees per unit, which will also be a burden to bear for the industrialists and as a result the remaining industries will also be forced to close down. In answer to this Madam Hina Rabbani Khar is saying that due to the agreements with the IMF this increase is necessary. This proves that our rulers are more concerned about IMF and ADB, while they are not even concerned about the general public.

While presenting the current budget, she criticized the previous government which she was a part of. The economic and financial policies of the current government, recently presented by her, are also in front of us. Being the state minister for finance, her statements cannot be considered to be her personal opinion; in fact her statement was a representation of the official stance on this issue.

Increase in the Inflation Rates
From this situation, it is pretty clear that no change that has taken between the past and the present government except that it is a mere change of face, increase in the inflation rates, and the surrender of the nation and the public in front of the IMF and the World Bank. In addition, those groups that say that the present government is merely a continuation of the past government, and the present government like the past one are the commission agents of the IMF and the World Bank, their point of view is quickly turning into a reality in the light of these facts. Whether it is the president, prime minister or the economic advisors of the government, all seem to act as the spokespersons of the IMF and the World Bank. This is also pretty evident that the nation and the public will be on the losing end as a result of these deals and agreements. These people are the persons assigned with the task of protecting the national interests and it is their duty of providing the public with the basic necessities of life. So, whom should we complain in this scenario?

At least, the increasing inflation in the country and the general worsening situation in the country should be addressed; otherwise, analysts say that if the government persists with such policies for another one and a half year then such a civil uprising and unrest will take place in the country which the government will be unable to control. The place in history that our current rulers shall have will be determined by their own decisions.

Advent of G-14

The decision of Group of Eight (G-8)--the United States, France, the United Kingdom, Germany, Italy, and Japan--leaders to turn it into G-14, made in L'Aquila, Italy, is a historical step in many respects. If it does materialize, five countries with a growing economy, namely India, China, Brazil, Mexico, and South Africa, will join the world's eight leading industrial countries.

If Egypt is also included in the group, it will be a forum representing almost 80 percent of the world's population. This is an indication of the rapid changes to be introduced in global governance.

Emerging Economic Powers
Before Russia joined G-8, it used to be an organization of the world's seven most prosperous capitalist countries. They were regarded the deciding factor in world economy. They wielded the power to direct it, and took full advantage of this situation. As long as the erstwhile Soviet Union existed, they faced some challenges in pushing their agenda of a capitalist market.

However, with its disintegration, they had their way. Russia, bearing the mantle of the Soviet Union, itself opted for capitalist economy. China had already moved fast toward a market-led economy. With Russia joining the G-8, the organization seemed to be all-powerful. With rapid changes in global balance of economic power, it, however, soon turned into an anachronism. Rich countries were forced to reach out to emerging economic powers.

To endorse their professed intention for a developed world, invitations were extended to them gradually. These countries known as G-5 hold their meetings regularly. Their decisions also have an impact on the decisions made by the G-8.

Strong Case for G-14
Italian President Silvio Berlusconi has now made a strong case for G-14. This came as no surprise. Yet, this development could hardly be imagined one-and-half decades ago. What of treating them on equal footing, rich nations even refused to take their demands seriously.

The US President Barack Obama says in reply to a journalist's question that a solution of the economic crisis problem was unthinkable if a country like India remained outside the group. The world has really undergone a vast change!

Present Realities
According to reports received from there, the global system will be reviewed. That implies that the governance of the international organizations will have to be changed. The World Bank, International Monetary Fund (IMF), and other global financial institutions, and also the WTO will have to be reconstructed.

The process of political decisions must also change in accordance with the present realities in the world. In other words, the structure of the United Nations has to be changed. The alterations in global governance suggested at the G-8 summit can, therefore, be expected to prove to be a more suitable format to show a new world economic way.