JPRS ID: 10619 SOUTH AND EAST ASIA REPORT

• Document Type: CREST
• Collection: JPRS
• Document Number (FOIA) /ESDN (CREST): CIA-RDP82-00850R000500070065-8
• Release Decision: RIF
• Original Classification: U
• Document Page Count: 23
• Document Creation Date: November 1, 2016
• Sequence Number: 65
• Content Type: REPORTS

APPROVED FOR RELEASE: 2007/42/09: CIA-RDP82-00850R000500070065-8
.
FOR OFFICIAL USE ONLY
' ~PRs Ulosl9
29 JurvE 1982
~
So~th and E asfi ~,sia Re ort
p
= c~ouo 4~g2~
Fg~$ FOREIGN BROADCAST INFOl~MAYION S~RVICE
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000500070065-8

APPROVED FOR RELEASE: 2407/02/09: CIA-RDP82-00850R000500470065-8
210TE
JPRS publications contain information primarily from foreign
newspapers, periodicals and books, but also from news agency
transmissions and broadcasts. Materials from foreign-language
sources are translated; those from English-language sources
are transcribed or reprinted, with the original phrasing and
other characteristics retained.
Headlines, editorial reports, and material enclosed in brackets
- are supplied by JPRS. Processing indicators such as [Text]
or [Excerpt] in the first line of each item, or following the
" last line of a brief, indicate how the original information was
processed. Where no processing indicator is given, the infor-
mation was summarized or extracted.
- Unfamiliar names rendered phonetically or transliterated are
enclosed in parentheses. Words or names preceded by a ques-
tion mark and enclosed in parentheses were not clear in the
original but have been supplied as appropriate in context.
Other unattributed parenthetical notes with in the body of an
item originate with the source. Times within items are as
- given by source.
The Contents of this publication in no way represent the poli-
cies, views or at.titudes of the U.S. Government.
COPYRIGHT LAWS AND REGULATIONS GOVERNING OWNERSHIP OF
MATERIALS REPKODUCED HEREIN REQUIRE THAT DISSEMINATION
OF THIS PUBLICATION BE RESTRICTED FOR OFFICIAL USE ONLY.
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000500070065-8

APPROVED FOR RELEASE: 2407/02/09: CIA-RDP82-00850R000500470065-8
JPRS L/10619
2Q June 1982
SOUTH AND EAST ASIA REPORT
~ c.~!ouo 9/.s21
CONTENTS
BANGLADESH
Ershr~d Pledges Return to Barracks After ~Political C1ear~-Up~
(THE TIMES, 2 Jun 82) 1
KAMPUCHEA
Information On P~ a2'1C~ ?~v M3.1.1,~ia~, U111~'i$ 3
I,AOS
Tnformation 021 Ti$O Ml~.lti'd~ UIZlt'is 6
PAKISTAN
Elections Imminent; Time Said To Be Running Out
(Joh,~ Fullerton; FAR EASTERN ECONOMIC ~tLGTEW, Jun 82) 9
Jamaate IslaYni. ~ s Power, Polic3es Ua.scussed
- (John ~zllertan; FAR EASTERN ECONO~NlIC REVIEW, 4 Jun 82) 1!~
Nusrat Bhuttofs Bitterness Described
(John Ftiillerton; FAR EASTERN ECONONIIC REVIE"~J, 4 Jun 82) 16
Cotton and Textile Industry's Problems Discussed
(Moharmned Aftab; FAR EASTERN ECONO~C REVIEW, 7 May 82 ) 19
~
- a- LIII - ASIA - 107 FOUO]
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000500070065-8

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000500070065-8
- FOR OFFICIAL USE ONLY
BANGLADESH
ERSHAD PLEDGES RETURN TO BARRACKS AFTER 'POLITICAL CLEAN-UP'
PM021517 London THE TIMES in English 2 Jun 82 p 8
[Trevor Fishlock report on imdated Dacca interview with Lt Gen Hussa3n Ershad~
chief martial law administrator of Bangladesh: "General's Pledge to Bangladeshis:
Back to Barracks After Political Clean-up"]
[Text] A wry smile crossed the face of Lieutenant-General Hussain Ershad.
"Unfortunately, yes, Bangladesh3s are a very political people. They now
realize politics did not pay them much, that they were taken for a ride.
They never saw so much chaos. It was anarchy.
"ThP poJ~ticians were fossils, unable to lead. But politics will come back.
The question is: What sort of political system? I say, whatever people
decide. The government will be elected. We shall have new politics, new
men, a new system," he said in an interview at his headquarters here.
The general's promis e keeps alive a potent 3ngredient in the power struggle
in Bangladesh.
;
The army took over four months after the presidential election because it
wanted a say in running the country. General Ershad responded to pressure ~
from officers who saw only indiscipline and corruption among bureaucrats and
businessmen, and were attracted by ideas of an Indonesian type of regime.
Mr Abdus Sattar, the president, stubbornly said the army's place was in
barracks. Considering the army's ambitions, its view of its rights and
importance, and its contempt for politicians, the president's i~lsistence
made a coup inevitable. ~
Now that the officers have what they want, the effect on them of talk about
elections can only be speculated on.
But General Ershad safd his army is united as it goes about the task he calls
_ "a b ig clean-up, putting th e house right." When stability and order had
been achieved, he said, "We will go back to our own job."
General Ershad's style is low-key and earnest. He talks of not having much
time for golf, his great passion, and for his minor hobby, writing poetry.
- He insists he has no personal ambition, "for as army chief I already have
the highes t honour. What more could I want?"
1
, . FOR OFFICIAL USE ONLY
i
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000500070065-8

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000500070065-8
FOR OEFiCIAL US~ ONLY
He could hardly expect to be popular, but many Bangladeshis say they are
impressed by his sincerity. His demeanour is of one convinced of the virtue
of an almost holy war as he sets his men to clean up the Augean stables.
He is enthusiastic about the regime's plans for devolving administration to
- the clusters of villages known as th~~.nas.
"Nine-tenths of our people livc in villages and wzre previousl.y left out of
things. Thanas will coll ect taxes, plan their own development, have all the
important services at ~he ir doorstep.
His regime works by agreement. He is careful to involve ~unior officers and
men, to give them jobs, and to h ear their views, ~ahich are fed into the
13-member ciV~ilian and military advisory council.
The army is an institution that needs a good deal of attention, the general
- said.
He has worked hard to mend the damag3ng bloody feud in the army between the
"freedom fighters" whd fought in the liberation war in Bangladesh and those
who, like himself, were interned in Paki;stan and later repatriated. "The
unfortunate division betw een rreedom figh~ers and repatriates is no more."
The future, of course, is uncertain. The army extols its administrative
plans and its drive again~t corrupt3on, appearing to bel3eve that much else,
including the appalling economic problems of one of the w~rld's poorest
countries, with one of the~fastest growing populations will be more easily
handled in "the new system."
Meanwhile, General Ershad, the respected chairman of a coterie of senior
officers, has to watch a nunber ~f pots to see they do not boil.
- "Yes, th ere is uncertainty. There is fear. Martial law is very...but I
have not imposed harsh martial law. You don't see soldiers, do you? I have
not done so because th e aim is di�ferent. And the people are cooperating
because our objective is noble."
CUPYRIGHT: Times I~ewspapers Limited, 1982
CSO: 4220/52
~ ~
2
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000500070065-8

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000500070065-8
. FOR OFFICIAL USE ONLY
KAMPUCHEA
I~vFORMATION ON PRK AND SRV MILITARY UNITS
[The following information has been extracted from Phnom Prnh Domestic
Service at 1200 CMT unless otherwise noted on the dates indicated, or from
Vietnamese materials as indicated. Unit signators and locations are as
given. The remarks include a brief sutmnary of the information a~ailable
in the s~urce.] ~
Unit Remarks
4th Battalion in Kampot Province Helped people in daily life.
(15 Jun 82)
; "KOR" Brigade's 24th Battalion Successful combat conducted against a
~ Oddar Meanchey Province group of Pol Pot remnants at (Prey Nam Tao)
' (21 May 82)
t
~ 31st Regt, B.79 Corps [Binh Doan] Serving in Kampuchea. A mobile ur.it.
i Includes three battal~ons.
' (QUAN DOI NHAN DAN 13 May 82 p 3)
H.89 Engineer Gp Serving Kampuchea. (QUAN DOI NHAN DAN
13 May 82 p 3)
7th Battalion of Brigade "KOR" An outstanding unit growing up rapidly
- through training and self-discipline.
(12 May 82)
% 5th Brigade,~ Sithor Kandal Article introducing Vietnamese cadre
, Uistri.ict,. Prey Vang Province (Nguyen Van Tien) assigned an armed task
I group conducting propaganda work among
people. (6 May 82)
?3.1 Regt Serving in Kampuchea. Subordinate units '
include infantry companies. Dasperaed
in small units. (QUAN DGI NHAN DAN
14 Apr 82 p 3)
;
' 3
' FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000500070065-8

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000500070065-8
FOR OFFICIAL USE ONLY
Song Thao Engineer Gp Photo of floating bridge constructed by
unit. (QUAN DOI NHAN DAN 14 Apr 82 p 3)
- 2d Gp Located at Takeo, Rampuchea. (QUAN DOI
- ~ NHA_N DAN 12 Apr 82 p 2)
91st and 2d Battalions of Station correspondent 3eacribing his visit
Koh Kong Province to cadres and combatants, noting progress
, of training,success of sweep operations
and development of these uni*_s 3n training
. as well as work performances. Al:so notes
close cooperation between Kampuchean
soldiers and Vietnamese volunteer troops.
(12 Apr 82)
Command of 4th Brigade In March political course opened for
115 ~unior and medium-rank cadres to expose
enemy's psychological tactics. (9 Apr 82)
- Battalion A of Svay Rieng Cited as model unit outstanding in mass
' Province ag3tation work in 1981. (7 Apr 82)
i
Battalion A of Svay Rieng Successfully assisted peop~.e in production.
Province (6 Apr 82)
24th Battalion of Brigade Kor Crushed 19 enemy elements 27-28 May,
48 enemy elements surrendered to authorities
in Srei Snam and Kralanh districts.
(5 Apr 82)
3d Company in 4th Battalion of Article describing outstanding feats made
~ Kampot Province in mass persuasion work. (5 Apr 82)
296th Division Statement to station correspondent by
Siem Reap-Oddar Meanchey (Chan Supheahtra), depuCy commander which
Province is�~fn~cha~ge of defetiding northwestern
border, on his division's feats that enable
~ it to win DPfense Ministry's medals, people's
trust, rapid development of his unit, good
_ leadersh ip, constant training, grasp of tasks
to defend country, care for subordinates.
(5 Apr g2 1230 GMT) .
91st Battalion alo~zg Helped people to harvest 15 ha of rice and
Kampuchean-Thai border build 3 houses. (Z9 Mar 82)
,
H.69 Engineer 6p Serving in Kampuchea. (QUAN DOI NHAN DAN
24 Mar 82 p 3)
~
- 4
- FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000500070065-8

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000500070065-8
FOR OFFICIAL USE ONLY
Division [no designatorJ Corm�ander: Senior Colonel Nguyen Minh Quang
[NGUY~EPIX MINH QUANG?. Presently serving in
northwestern Kampuchea. Prior to early 1979
served in Tay Ninh Province. (I'HAN DAN
- 22 Mar 82 p 3)
, 20th Battalion of Siem Reap Model story carried by revolutionary army
- paper describing a clash between battalion
- and a group of Pol Pot remnants which resulted
3n 18~.enemy casua.lties and large arms haul.
(19 Mar 82)
~ Pursat Province's 37th Battalion Shines in tra3ning. (12 Mar 82)
980th Gp Serving in Kampuchea. Providing training
on gntiaircraft guns to Kampuchean army.
(QUAN DOI NHAN DAN 2 Mar 82 p 1)
_ Tra Khuc Gp Serving in northeastern Kampuchea. (QUAN DOI
NHAN DAN 22 Feb 82 p 2)
B.56 Gp Photo of unit patrol at Cheom Ksan,
_ Preah Vihear Province, Kampuchea.
(QUAN DOI NHAN DAN 23 Feb 82 p 2)
Tra Khuc Gp Located at Chep Village, Preah Vihear
- Province, Kampuchea. (QUAN DOI NHAN DAN
24 Feb 82 p 2)
~ Binh Tram M.79 aka M.79 Gp, Commander: Lieutenant Colonel Huynh Cao
Transportation Depar~ment~ Son [HUYNHF CAO SOWN]. LocaCed within
Rear Services General 40 kilometers downriver from Phnom Penh
_ Department on the Mekong River. (QUAN DOI NHAN DAN
24Feb82p3)
_i
_ CSO: 4212/21

~
- 5 .
- FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000500070065-8

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-04850R000500070065-8
FOR OFFICIAL USE ONLY
LAOS
INFORMATION ON LAO rIILITARY UNITS
[The following information has been extracted from Vientiane Domestic Service
broadcast~ at 0400 GMT unless otherwise noted on the dates indicated, or
from Lao press material as indicated. Unit designators and locat3ons are as
oiven. The remarks include a brief summary of the inf~rmation available in
the source. ]
Unit Remarks
Battal ion "E" in Savannakhet Effective~y fulfilled task of mainta3ning
Province peace and public security while boosting
production early this year. (16 Jun 82)
Tank Battalion "A" in Southern Scored outstanding achievements in carrying
Region out tasks including rice farming, repairing
houses and vehicles, studying politics and
military sub3ects, and implementing army
regulations during past 2 months.
(16 Jun 82)
Ground Artillery Battalion "B" Opened specialized training course for
in S~ uth ern Region officers and men attached to battalion
~ b etween March and May, (16 Jun 82)
Air For~e Battalion A Held ceremony 7 June to present certificates
to graduates of basic technical course.
(15 Jun 82)
Battalion G under Northern Emulating to improve their units and repair
Division b uildings. (19 May 82)
Northern Battalion B Repaired dozens of veh3c~es and built barracks
and other offices. (19 May 82)
Infantry Battalion "A" Combatants operating to defend fatherland.
Luang Namttia Province Gives battalion commander Ma3 Khamphan's
- report on batta~.ion's past achievements, saying
combatants took part in 979 ma~or or minor
attacks during which 312 enemy men were
captured or forced to surrender, seized 372 guns
and large quantity of other equipment. Also
points to consolidation and building of
companies attached to this battalion. (25 Apr 82)
6
FOR OFFIC[AL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000500070065-8

APPROVED FOR RELEASE: 2447/02/09: CIA-RDP82-00850R000500474465-8
FOR OFFICIAL USE ONLY
Army Battalion "A" in Vientiane Party comm3.ttee held plenary meeting in
April to review past work and adopt new plan
~ ~ for 1982. (19 Apr 82)
Army Logistics Trainirig School Cadres and combatants have, s3.nce early March~
competed in studying culture and specialized
. subjects while carrying out activities to
mainta3n security to score achievements to
welcome Third Party Congress. (19 Apr 82)
Air 'Pransportation Battalion "E" Party connnittee members and combatants have
scored outs`anding achievements in transport-
ing supplies and carrying passengers and in
boosting production. (19 Apr 82)
Regiment E in Southern Laos Leading coimnittee held meeting to publicize
success af conferencz of army party committees
_ and to launch emulation campaign to welcome
Third LPRP Congress. (14 Apr 82)
Anti-Aircraft Battalion "F" in Joined in expanding acreages for sugar cane
Vientiane plantation. (7 Apr 82)
Battalion "A of Northern Region Pr3mary medical students began practical
Military Command training at command hospital on 3 March. '
~ (5 Apr 82)
Battalion "H" of Phong Saly Has stepped up activities to consol3date
Province organization. (5 Anr 82)
~ Major Battalion "C " of On 28 March held meeting to hail success of
Savannakhet Provincial Military army party committee conference. (4 Apr 82)
Command
Anti-Aircraft Battalion "F" Held meeting on 31 March to hear report on
success of conference of party comm3ttees with~
in army, confer medals on outstanding cadres
and combatants for achievements in past
5 years and launch short-term elulation cam-
paign to welcome forthcoming Third LPRP
Congress. (3 Apr 82)
Army Brigade "A" in Vientiane Held meeting of party cadres members to
_ hail army party committee conference.
(1 Apr 82)
" Regional Armed Forces Battalion "P"Organized political and military training'
of Houa Phan Province courses for cadres and combatants attached
to battalion between early January and
20 March. (31 Ma.r 82)
~
7
FOR OFF[CIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000500070065-8

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000500070065-8
FOR OFFICIAL USE (
~
Battalion "B" in Vientian~ Enthu~iastically performing task of consoli-
dating their units. Their achievements
in building living quarters cit~d.
(22 Mar 82)
Army Foo d Processing School Fulf illed plan for past 3 months. Achie~re-
ments in transporting supplies, b uilding
kitchens, growing vegetables and sn
forth cited. (22 Mar 82)
Army Battalion No 2 in Vientiane Harvested 10,300 kg of crops and raised
some.animals during 1981 harvest season.
(20 Mar 82)
~ Army Battalion No 1 in Vientiane Harvested 11,890 kg o~ crops and 1,359 kg
of veget~ ~les in 1981. (20 Ma.r 82)
Army Battalion "E" in Vientiane Scored excellent achievemente in food
production and public service in late 1981.
(19 Mar 82)
First Battalion of Army Brigade Attended political study 15-20 February.
"A" in Vientiane (18 Mar 82)
Army Transport Boat Building Fulfilled production plan by 87 percent
Factory by late 1981. (18 Mar 82)
! Battalion No 1 in Vientiane Company "B" has successfully fulfilled task
of maintaining peace and public order in
- Hatsa3fong District during past 2 months,
capturing four reactionary subordinates.
(17 Mar 82)
Combined Military Training School Women's union held celebratf.on ceremony
in Xieng Khouang Province 10 March to mark interr~ational women's day.
Lt Col (Khamkhouang), deputy director of
school and member of provinc3al party
committee, addressed rally. Unidentified
Sov iet experts working in this province also
attended ceremony. (16 Mar 82)
~ First Battalion in Vientiane Improves discipline an~ army procedures.
' (13 Mar 82)
. Armored Battalion B in ~:ientiane Held ceremony on 4 March to confer. ranks on
offic:ers and men. Attending were Brig Gen
Ki Thoummala, deputy chief of arnry general
political department. (6. Mar 82)
N.92 Gp, POL Department, Rear Commander: Ha Khac Thuan [HAF KHAWCS THUAANF].
Services General Department Serving in Laos. (QUAN DOI NHAN DAN
21 Feb 82 p 3)
CSO: 4206/55
8
j FOR OFFICIAL USE ONLY
~
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000500070065-8

APPR~VED F~R RELEASE: 2007/02/09: CIA-RDP82-00850R000500070065-8
FOR OFF.CIAL USE ONLY
: ' PHKISTAN
ELECTIONS IMMINENT; TIME SAID TO BE RUNNING OU'~
' Hong Kcng FAR E~,STERN ECONOMIC REVIEW in English 4 Jun 82 pp 23-26
[Article b~ John Fullertnn]
[Text] Islamabad: July 5 will mark the fifth annivers:.~y of the generals'
takeover ir~ Pakistan which put President Zia-ul Haq in power. And informed
sources in both government and moderate oppositian circles expect the anniver-
' sary to produce the fir~st si:ep towards a return to a degree of civilian rule.
They forecast that the authorities will anrounce regulations governing nation-
al elections to be held within 18 months.
Zia could announce non-party elections, a policy to which most banned opposi-
- tion leaders would be expected to object. But, in the final analysis, these
= leaders would probably not boycott elections by preventing tl?.eir respective
! followers from standing as candidates. However, there are risks in this n~n-
~ party approach--a last-minute boycott by the Pakistan People's Party (PPP)--
I still the mainstay of the seven-party Movement for the Restoration of Democ-
~ racy (MRD) s~ekinq an immediate end to martial taw--would put the validity of
the exercise in doubt.
As some oppositic~n spQkesmen of both t.he Left and Right have said, a aon-
party election would mean in effect 300 new political parties in the national
assembly. Parochial political interests would dominate the assembly arid the
ver.y consensus which Zia seeks would be lacking. Alternatively, rules could
- be drawn up governing the adoption of candidates,for an election, barring those
who had held office in previous administrations and others lacking what the
fundamentalists would regard as suitable Islamic qualifications. This apQroach
seems ~~o have the backing of conservative political groups,such as the Jamaat-
~ i.-Islami Pakistan.
I The elections would undoubtedly be held on the basis of proportional represen-
' tatifln, which would help to er.s~se that no sinqle opposition party obtained a
clear majority. Only political gartiee ra~ich agreed to register with the au-
thorities as required under a military regulati.on would be allowed to partic-
= ipate and that could shut out the radicals. So far the PPP, the National
Democratic Party, the Pakistan I3ational Party~ and the Pakistan Dpanocratic
' Party--a11 members of the MRD--have refused to submit the details of inember-
_ ship and organisation required ~or registration.
9
; ' FOR OFFICIAL USE ONLY
, '
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000500070065-8

APPROVED FOR RELEASE: 2447/02/09: CIA-RDP82-44850R444544474465-8
FaR OFFICIAL USE ONLY
- Would Zia succeed thereby in splitting the MRD? Would he be able to tolerate
a consensus of conservative and centrist elements only too relieved to contest
- an election without rivals from the socialist PPP and other smaller parties,
some oi which champion the cause of provincial autonomy? Or would he face a
- re-run of 1979 when the PPP's refusal to comply with goyernment directiveS in
the run-up to a general election and the oppositi~:~~n's charge that the election
process was being rigged led to an indefinite postponement of the voting?
Then, as now, it was a gamble by both sides with the authorities believing
- that the PPP could not afford, as a broadly-based movement, to continue its
- semi-clande~tine existence without losing support and the PPP believing that
Zia could not survive a postponement of his plan for a return to representative
government. Each underestimated the resolve of the other.
Whatever the decision on the elections, the drawing up of a new Islamic con-
stitution or the amending of the presently suspended 1973 Constitution would
probably be deferred. Zia is conscious of the fact that constitutions without
the consensus needed to make them work are merely short-lived pieces of paper.
This lack of a consensus has been Pakistan's weakness all along and it is one
reason why in 35 years the country's two general elections ended in the first
instance in civil strife--and the breaking away of the country's eastern wing,
now Ban~ladesh--and the second in a military coup. The nation's constitution-
al history has been characterised by the rise and fall o~ larqer-than-life
leaders--men much loved and eventually much hated, whose colourful if brief
fortunes have seen the state lurching from one crisis of confidence to the
next.
Zia seeks a way out of the political log-jam, and a change in direction, from
the busine~ss of crisis management to long-term political management. Apolo-
gists for his five years of military rule insist that the man wants to extri-
cate himself from the political process, but that he is not willing to do so
- as long a~s a return to the anarchy of 1977 which broght the military to power
seems inevitable.
- They point out that the authorities have moved some o� the way towards the
vision they have of a stable, democra~ic, but essentially Islamic state. The
- Shariah (Islamic law) is now practised in the courts and it does have consider-
able popular support (as do military courts because of the expeditious manner
in which cases are handled).
The use of an Islamic banking system, following Islam's prohibition of usury
- or interest, is proving a success and other Muslim nations watch the experiment
enviously. Zakat (the Islamic taxation system which provides money for the
= poor) is a national institution. Gambling and the consumption of alcohol have
been banned. national dress has been adopted by the civil service. And on
several occasions this year Zia has voiced his thoughts to the press on an
evolutionary return to democratic government.
= Another move was the establishment of the Majlis-i�-Shoora, a federal advisory
- council (REVIEV~1~ Jan.B). It may well consist of hand-picked people whom the
- 10
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000500070065-8

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000500070065-8
- ' FOR OFNIC[AL USE ONLY
~
- banned opposition condemns as opportunists and yes-men, but it functions with
all the trappings of parliamentary procedure and, despite the fury of at least
' one senior minister, the flow of criticism directed at government policy has
gone unchecked. In an election its members are expedted to be encouraged to
stand as candidates and though many of them do in fact represent opinions far
- to the left of Zia's supporters they will be expected to play a central role
in that badly needed consensus.
The same may be said of the local bodies or councils elected in 1979. That
exercise was an important lesson for Zia, for the bodies wera initially domin-
ated by the very people Zia wanted to manoeuvre out of the political ring--
supporters of the PPP, still estimated today to be the most important sin.gle
force in opposition circles. But these and other elements viewed as undesir-
able were quickly disqualified wider the local election rules. Hence the close
attention now being paid to regulations governing the selection of candidates
for a potential general election.
Recently, Zia speculated publicly over the future role of the armed forces in
the country's political decision-making. He said he was considering the for-
~ mation of a higher command council which would include fihe defence minister
and representatives of the three armed services, together with the president
and prime minister. Such an institution would ostensibly ensure the armed
forces a continued stake in the state and would help preclude the possibility
of a return to full military rule. ~
But his more outspoken critics view official and unofficial hints of a return
to civilian rule through elections as a Machiavellian campaign of psychologi-
cal warfare directed both at Zia's domestic opponents and at his external
friends and critics. "Zia is a soldier," said the acting president of the Teh-
- rik-i-Istiqlal party, Mohammad Ali Kasuri. "He knows the art of camouflage
and right now he is bus,y hoodwinking his enemy--the Pakistani people." This
view is common among social democrats and socialists--in fact all politicians
left of centre. But the assumption that whatever Zia and his colleagues do is
designed to consolidate and legitimise the military's grip on the country could
lose the politicians their first opportunity in years to gain at least ]:~,mited
= power by going along with any electoral~ moves by Zia. Zia hopes the politi-
- cians will cooperate. With this cooperation he could achieve what he calls
"positive results."
All public political activity is prohibited. Yet, on the surface at least, a
lively interest in political controversy remains. The press, still partially
muzzled by the authorities, refers in often detailed po].itical commentaries
to the "defunct" political opposition groups as a way of gett~ng around the
- regulations. Members of the middle classes will express their often extreme
opinions quite openly and observers can be forgiven for concluding that as far
as military dictatorships go, this one is remarkably liberal.
Politics remains very much a middle-class preserve. One reason for the rela-
tive inactivity of the PPP is that it is still led by a dozen wealthy people,
often landowners or successful merchants lacking the common touch of their .
erstwhile leader; the charismatic, Oxford-educated Zulfikar Ali Bhutto, exe-
cuted in 1979.
11
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000500070065-8

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000500070065-8
- FOR OFFICIAL USE UNLY
Also, sporadic arrests of large numbers of opposition activi~ts and the pros-
pect of lashes or lengthy tez~cRS of confinement have discouraged grassroots
political organisers from defying martial law. Political activity is a
shadowy, semi-clandestine affair and this has reduced the MRD to a loose col-
_ lection of personalities rather than well-defined parties.
- There is some truth in the cliche here that there are only two true political
parties in Pakistan: the PPP and the army. For the opposition rests primarily
on an almost feudal social order, a network of dynastic.families which resist
- change. ~ut society is nevertheless changing--larqely under the impact of
migrant labour. Streams of people are moving from frontier and rural areas
to the major cities. Also hundreds of thousands of Pakistanis are now working
abroad, mainly in the Gulf, and are remitting big suma home.
The second constituency is *aze armed forces. Zia sees himself as accountable
to the joint chiefs of staff, the three service chiefs, the army's general
staff and to a lesser extent the four provincial governors and the corps com-
manders. To that extent he is their man and represents the military's views.
There is no sign of significant dissatisfaction with his performance or the
threat of a sudden putach by his military peers.
Zia seems t~ recognise his own limitations--that he lacks the easy informali~y
and personal appeal essential for a general looking for popular support. At
any rate, he has rejected appeals by some of his supporters to step down and
enter the political arena in his own right. He has also to consider the brutal
fact that the opposition is motivated by revenge for the execution of Bhutto.
- He has his own safety to consider.
If he does step down, he will do so quietly and in favour of another general,
- probably someone who is thought to have sufficient charisma to attract popular
support as president. Several names have been mentioned, but one possible
candidate who stands out is lLieut-Gen. Fazle Haq, currently governor of North
West Frontier Province, a di:Eficult and key role.
Haq is articulate and has a fatherly image. He has a good political mind and
though some Punjabi officers would regard a Pathan as an ~utsider, his origins
_ could work in his favour. Lacking a natural power base in Punjab or Sindh
provinces, he would pose no threat to the military and would have to rely
heavily on his colleagues. In short, he could be controlled. He also seems
to hold robust, pro-American views in keeping with the hawks in Zia's cabinet.
If the middle ground of the opposition seems soggy, there has been a percepti-
ble polarisation of politics. Zia must walk a tight-rope between the radicals
of the PPP on the one hand and the disciplined, Islamic reformers and their
armed student supporters on the other. As opposition leaders so often pro-
claim, without the holding of free and fair elections the country will inevit-
ably become radicalised.
One example is the A1-Zulfikar guerilla organisation operating out of Afghan-
- istan and led by Bhutto's son Murtaza. Reliable sources said that an A1-
Zulfikar guerilla fired at the presidential aircraft carrying Zia from
12
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000500070065-8

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000500070065-8
FQ~R OFFICIAL USE ONLY
Islamabad to Lahore on February 7 with a Soviet anti-aircraft missile but
missed. Two other squads of alleqed assassins have been rounded up recent-
ly before they could put their plans into effect.
Zia is under pressure from his friends in the Middle East, the United States
and Western Europe to stabilise Pakistan by a return to civilian rule. The
Soviet invasion of Afghanistan in 1979 may have ende3 the international ostra-
cism of Zia's regime which followed the execution of Bhutto, but the invasion
is no longer a blessing in disguise. The presence of 2.5 million Afghan refu-
gees in Pakistan and Kabul's efforts to revive latent separatism in border
areas threaten the country's territorial sovereignty. Despite hopes of re-
newed talks with New Delhi aimed at creating a no-war pact, the perception of
' a short-term military threat from superior Indian armed forces has not receded.
. Zia cannot afford to underestimate the strength of his domestic opposition,
either. It is most remarkable that the MRD came into being at all and sur-
vived the trauma of the hijacking of a domestic airliner to Kabul by A1-Zulfi-
- kar members early Iast year (REVTEW, Mar. 20, '81). The hijacking helped Zia
to attack the PPP as a subversive organisation because of the involven?ent of
Bhutto's son Murtaza. He used the hijacking as an excuse to round up PPP ac-
tivists, who were charged with grave offences.
There are reports that the MRD is planning to mount a general strike in urban
_ areas later this year after what is expected to be a tough budget which may
not meet the expectations of municipal and railway workers, teachers and bank
employees, to name but a few of the sectors clamouring for hiqher waqes.
_ Expert foreign opinion on ~he future of Pakistan's econoany can be su~ned ug in
two words: cautious optimism.
� The private sector is actively encouraged, but political uncertainty has meant
that the denationalistation of major enterprises has produced mixed results.
Although the worldwide economic slowdown has hit exports of textiles, raw and
processed cotton and rice in the past six months, many people are still wait-
_ ing to see whether the cutting of the links between the rupee and the US dollar
will have the desired effect (REVIEW, Feb. 5).
While the goverrunent devotes much attention to irrigation and rural develop-
ment, weather is a crucial factor in trying to establish a self-sufficient
agricultural base. The rains came late this year, but, despite this there is
a sugar surplus and the anticipated wheat shortfall is smaller than originally
feared, and can be made up from last year's bumper crop.
The forthcoming budget is expected to follow pragmatic lines. The temptation
ta pump money into the economy will be resisted while the liberal policy to-
wards imports will continue. Wage demands will be met, partially at least,
- through an improvement in allowances rather than direct increases in wages and
salaries. The growth rate of 5-6~ should continue through to 1983 at least
and, in political terms, that suits Zia in any attempt to change direction
towards democratic civilian rule.
Given all these tactors, it is imperative for Zia to be seen to be moving to-
wards elections, and soon. Time is running out for the generals and they ap-
pear to knour it.
COPYRIGHT: Hongkong FAR EASTERN ECONOMIC REVIEW 1982
CSO: 4220/57 ~3
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000500070065-8

APPROVED FOR RELEASE: 2407/02/09: CIA-RDP82-00850R000500470065-8
FOR OFFICIAL USE ONZY
PAKISTAN
JAM~TE ISLAMI'S POWER, POLICIES D~SCUSSED
Hong Kong FAR ~ASTERN ECONOMIC REVIEW in English 4 Jun 82 p 24
[Article by John Fullerton]
[Teact] Lahore: Jamaat-i-Islami Pakistan is the wild card in the country's
~ opposition pack. Proselytising, lavishly funded, disciplined and ~ell-organ-
ised, its tiny membership beli~s the influence of its Islamic reformers who
~ seek to turn Pakistan into what they would regard as the world's first, truly
Islamic state.
An ambassador representing a European government tried to explain its nature
in his reports hoane by describing the Jamaat-i-Islami as "an inverted, ortho-
dox communist party." The Left here views it as a small group of fascist
bully-boys enjoying the partial protection of the country's military govern-
ment. One senior police officer said he thought the organisation was "getting
carried away" because it thouqht it had official sanction. It evokes both
fear and respect among its opponents, fear because its student wing has a
reputation for vi.olence and respect because of its dedication and homogeneity.
Mian Tufail Mohammad, the party leader, explained that the Jamaat-i-Islami
avoided confrontation with the military authorities because of the external
dangers--in the form of the Soviet occupation of Afghanistan and the perceived
Indian threat. Nevertheless the party sought an immediate lifting of martial
- law and the holding of elections under the suspended 1973 Constitution. He
_ wanted safeguards too: candidates w~ould have to qualify in terms of Islamic
principles and the elections would ahve to be based on proportional represen-
tation (thereby helping to ensure that no one party would emerge an outright
winner) .
'Tufail puts the Jamaat-i-Islami's membership at 4,000, but other sources say
it ntunbers 12-15,000. There is an associate membership system and a large
pool of active supporters. Cadres can be found in almost all sectors of so-
ciety, from the armed forces to the civil service. The Jamaat-i-Islami's
power lies mainly in the universities, however, and among airline and railway
- workers. The leader pointed out that in local., provincial or national elec-
_ tions the Jamaat-i-Islami could and would put up candidates who were not mem-
bers but who were willing to pledge support for the party manifesto.
lI~
- FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000500070065-8

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000500070065-8
FQ~R OFFIC[AL USE ONLY
~ Participation in the seven-party alliance known as the Movement for the, Res-
toration of Democracy would have made all the difference to the opposition's
ability to provide an alternative to President Zia-ul Haq's policies. But
' the Jamaat-i-Islami has studiously avoided collaboration with what it reqards
~ as leftists--and leftists have been the party's No. 1 enemy. "Its power is
].argely negative," said a rival political leader. "It has enormous power in
terms of disruption, but its popular following is negligible and hence its '
contribution to forming an alternative system to the military is slight."
Until elections are held, the extent of the Jamaat-i-I4lami's backinq will not
be known. It was founded in 1941 by the Sub-continent's leading Islamic phil-
osopher, Sayed Abdul A1 Maududi, whose work in support of a resurgent Islam
coincided with the emergence of reformist Islamic societies such as Nursi in
Turkey and the Ikwhan, or brotherhood, in Egypt. Jamaat-i-Islami is very much
part of a worldwide phenomenon, far from isolated.
Its mer.~bers are in constant, albeit informal, contact with similarly minded
Muslims throughout Asia and the Middle East. The organisation a':so plays a
vital role in foreign policy. It actively supports and funds some of the Afghan
resistance groups--notably Hezb-i-Islami. Tufail believes that West European
countries and the United States should do far more to help the Afghan resist-
ance and despite his misgivings about the policies of both superpowers, he
was more favourable towards the US because of what he saw as its Christian
character. Like many Pakistanis he expressed bitterness and bewilderment at
what he saw as intransigence by the US in the face of Palestinian demands for
- a homeland.
On April 23 bus loads of banner-waving Jamaat-i-Islami students broke into
_ two Lahore newspaper offices, ransacked the premises, burned furniture and
j man-handled members of staff following local reports that one of their lead-
i ers had boarded a Pakistan International AirZines aircraft with a pistol and
' ammunition in his possession. Was this attack in accordance with Islamic
principles? Tufail was unrepentant.
"We have been under constant attack from leftist qroups, some of which are
instigated by the Soviet Union. Our peogle have been murdered. Now that we
are gaining control through elections the leftist parties are clamouring for
government restrictions to be placed on students. You must appreciate that
in the present crisis in Pakistan the Soviet Union is doing its utmost to
cause disruption..."
A left-leaning barrister active in the city's political circles~was frank:
` "The last thing I would want to have to do is to back down in the face of
Jamaat-i-Islami pressure or threats. But to be quite honest I'd rather not
cross their path at a11...They are trouble!"
COPYRIGHT: Hongkong FAR EASTERN ECONOMIC REVIEW 1982 .
CSO: 4220/57
15
_ i FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000500070065-8

APPROVED FOR RELEASE: 2007102/09: CIA-RDP82-00850R000500070065-8
FOR OFFICIAL IJSE ONLY
PAKISTAN
NUSRAT BHUTTO'S BITTERNESS DESCRIBED
Hang.KongFAR EASTERN ECONOMIC REVIEW in English 4 Jun 82 pp 26, 29
[Article by John Fullerton~ ~
[T.ext] Karachi: Opposing the military rule of President Zia-ul Haq can be
extremely costly as Nusrat Bhutto knows only too well. The tall, immaculate-
ly dressed widow, who gives a misleading impression of fragility, maintains
an intense personal commitment to the Pakistan People's Party (PPP) which rep-
resents the strongest danestic challenqe to Zia's government.
The PPP was founded by her late husband, Zulfikar Ali Bhutto, who was toppled
in the 1977 coup which brought Zia to power and hanged in 1979. The Bhutto
home at the Clifton suburb here has many photographs, paintings and other me-
mentoes of the late leader. And for his widow, now the PPP leader,~the fight
goes on.
But in personal terms the cost of he~ commitment has been high. She has spent
about 42 months of the five years of military rule in de~ention. Her two sons,
Murtaza and Nawaz, who~have opted for ~�iolent political change, abandoned
- their studies in London and moved to Kabul to head the A1-Zulfikar querilla
group. Mrs Bhutto says she has had no direct contact with them since they
went to Kabul.
Her fiery and politically formidable daughter, Benazir, is detained at the
family home at Larkana near Karachi. Mrs Bhutto herself is under surveillance
and the authorities have registered a case in the courts charging the Bhutto
family with expropriation of secret government funds during the PPP adminis-
tration. "I cannot give up the leadership," she told the REVIEW. "My con-
science wi11 not let me do so even if I wanted to. I cannot let our people
down--people who have languished in jail for years for their support of the
party."
She insists that the PPP has survi~red the waves of arrests which follawed the
generals' takaover. She describes its progress as slow and steady but con-
ceded taht the prospect of indefinite terms of imprisonment, lashes and tor-
ture deterred many people from active political life in an environment where
. all public politics and political parties themselves are banned.
- 16
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000500070065-8

APPROVED FOR RELEASE: 2407/02/09: CIA-RDP82-00850R000500470065-8
FOR OFFICIAL USE ONLY
Mrs Bhutto maintains that Zia has no intention of l~aving politics and that
any moves by the authorities wc~uld simply be a step towards consolidatinq and
legitimising martial law. She rejected any form of what she calls farcical
democra~y. For the PPP and other opposition groups, the only acceptable elec-
- tions would have to be held ~nd~r the 1973 Cons~itution, which is currently
suspended.
In such circumstances she could give an assurance that the PPP would not
threaten law and order. "All I would need to do would be to address two polit-
ical meetings, one in the Punjab and one here in Sindh province and I could
promise a peaceful and orderly transfer of power. In fact I think I could
speak for the other opposition parties, too."
She holds that the longer it takes to return the country to democratic,:~con-
stitutional life the more explosive the situa'tion would become. "We don't
look for chaos. We hope it would never happen. We are not traa.ned for Fight-
ing on the streets. We don't have guns and bombs. The PPP is trained to pre-
pare for elections. We are ready now."
Party committees had contacted groups of students, teachers, lawyers and wo~k-
ers to study what the groups wanted, and what help the PPP could prov~ide. On
- the day the interview took place Mrs Bhutto had been meeting until the early
hours of the morning with about 200 grassroots supporters. She had asked them
for their response to Zia's hints of elections based on proportional represen-
tation or on a non-party basis. The overwhelming reactinn had bc~en a resound-
ing no. "They said it would simply be another Nlajlis-i-Shoora [the federal
advisory council set up by Zia last December]," she said.
"Why would Zia hold elections? For what he calls positi~e re~ults. And what
do positive results mean? They mean that he wants to get himself elscted to
powe r . "
In May it was Mrs Bhutto's turn to chair the Movement for the Restoration of
Democracy (MRD), the seven-member opposition group seeking an immediate end to
martial law. Why was it that the MRD seemed unable to act, rel~ectant to acti-
vate ,popular opposition to the government? Mrs Bhutto pointed out that the '
seven parties involved all had different pr~litical manifestos. 'i'hey held in
common a desire for the immediate lifting of martial law.and the holding of
elections under the 1973 Constitution. Even some of the opposition groups which
which had remained outside the movement had indicated that they wer~ willing
to cooperate with the NgtD, at least unofficially.
Although Jamaat-i-Islami Pakistan--the ultra-conservative Islamic grouping--
had not joined the MRD, it too wanted elections to be held now. And Mrs Bhut-
to had received a message from the Karachi branch of the Jamaat-i-Islami pled-
- ging co-operation. She noted that the MRD had only existed for a year and
said that its existence and survival was a remarkable achievement.
The PPP leader was clear~y upset by reports she had received alleginq that
people detained for political reasons had been tortured and maltreated.
- "It's as if Zia is not satisfied with the blood of my husband--he seems to
want to crush us..."
17
FOR OFFICIAL U~E ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000500070065-8

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000500070065-8
' FOR OFF[CIAL USE ONLY
She alleged that people had been burned with cigarettes, and mentioned one
y ouung man who she said could only crawl following his release because his
spine allegedly had been c~.amaqe~ by beatings. She accused the authoritiea
_ of arresting young peoPle and accusing them of links with the A1-Aulfikar
organisation of which the pecp~.e detained knew na~hing. She alleged: "In
soane ins~ances the only way for saneone to avoi.d being connected with terror-
ism was to have�his or her family pay a police officer a large s~:u~ of money.
Where is justice in Pakietan now? Where si~ we go to find it? Zia seems to
treat people as the enemy. But we don't have tanks and armies. How can the
people support him in such a situation today?"
,
COPYRI~HT: Hongkonq FAR EASTERN FCON~IIC REVIEW 1~82
' CSO: 4220/S7
�s
~ 18
~ FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000500070065-8

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000500070065-8
FOR OFFtCIAL USE ONLY
- ' PAKISTAN
COTTON AND TEXTILE INDUSTRY'S PROBLEMS DISCUSSED
HongKong FAR EASTERN ECONOMIC REVIEW in English 7 May 82 Pp 52, 54
[Article by Mohammed Aftab]
[Text] Islamebed: Thc Pakistani Govcrnment, ~million bales ~of cotion from tarmcrs and
ti the textile industry and priratc cotton ex- ~ ginners this year. So far, it has purchased
poners are knotted in a secmingly endless' '1.6 million bales, of which 625.U00 bales ,
controversy. Accusations ot mismanage� were exportcd up to Apri115. Thc average
ment, losses to the state and pressurec on price of cotton already shipped was
~ theindustrytobuycottonatarbitrarypri- ahout56UScentsalhwhichtheCFCterms
ces ace flying. "reawnably attractive in view~ of prcvail-
The seeds of the controversy were sown ing internat~onal prices, following the
in thc 1973 nationalisation oF the cotton world cotton glut."
tradc as a result of the socialisatl0n poli- ln fisca11981, the CEC sold 1.91 million
cies of Zulfikar Ali Bhutto. The state- bales of cotton abroad for USS525.6 mil-
~~wned Cotton Export Corp. (CEC) was lion, aarording te the Ministry of Com-
set up to buy all cotton from farmers and merce, which oversees the corporation.
cotton ginners. lt alone sells lint cotton ta Ot the 42 wuntties a~hich bought it the
the domestic tcxtiles industry and mona main ones were: China (at 1.2 miqion
polises cotton e~ports, thereby almost balcs). Japan. Hongkong, Bangladesh,
completely eliminat~ng the private cotton lndonesia and lndia. The sale to China.
traders and exporters - who once had a �hc CEC claims, was "the single Iargest
lucrativc business. � � deal in world ootton trading history." Pa-
The situatian has hurt the textile indus- kistan has also managed to explore riew
try and has led to significant losses to the markets such as Iraq. Tumsia. Nigeria, Sri
national cxchequer because of the inex- Lanka. Bul~taria, Romania, and some of
perience and bureaucratic red-tape of the the Europcan Ecor.omic Cummunily na-
CEC, which deals with a commodity for liona.
which split-second decisions are needed to ~ 6 mCll o~ bales
in fi cal 982!or all
tradc internationally.
Thc situation has left many buycrs of of thc estimeted exporteble surplus. The
Pakictani lint cotton, textiles, cotton yarn qupntity hes detiined beeause at the start
.~nd othcr cuttumhased products exasper- of 1982. carry-over stocks from tfie pre-
ated. Among thr higger buyers are those vious year were almost totally exhausted.
from Hungkong, Japan and China - the The exportable surplus tor fisua11982 wiU
latter bcing thc biRgest. remain lower than 1981, despi~e a higher
Thr importancc of raw cotton to the crop in 1982. '
Pakistan economy is evident from the fact CEC cleims to have earned a profit of
that around 60% of all thc country's ex- USS7S millian in 1981, mainly due to a
ports are ci~her ot the raw commcxlity it- large carry-over stock irom the previous
self or uf cotton-based products such as yeer. "The sale was made at relatively at-
textilcs, yarn, garments and hosiery. The tractive prices,"� it:says. But private busi-
tcxtiles industry ~s thc largest employer as nessmen dispute this claim. The country,
wcll as forming the single biggest group of they cay, suffered liuge losses in cotton,~n
large-uale manufacturing units. fiscal 19~1 berause of poor marketing. 71~e
CEC chairman Nusrat Hussain says the Karachi Cotton Association (KCA), whose
curp~uation H~ill purchase more than 4.1 members used to export all cotton ~n addi-
FOR OFFI~ AL USE ONLY ~
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000500070065-8

APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000500074465-8
FOR OFFIGIAL USE ONLY
~i~m to srlling to the domestic merket in' Thc textilc:~ industry aaaues the CE(' ot
the prc-nationalisation days, makes a ~ca- selling cottai~ chcapiy nbroad, but at quitr ,
thing criticism of the CEC'svperations. !r~ high pricxs to domestic uscrs. This means'
- a just-published report, thC KCA says the Pakistani textiles, yams and other finished
_ CEC managed to export 1.91 million bales praiucts are hard to market overscas lx-
of cotton in 1981 tor USSSl2.1 million - cause of the added cost element beforr
and not USS525.6 million, as claimed by costs of productivn are taken in~o ac- .
thc ministry. It says the average pria count.
per Ih fob works out ai around 70.5f?cents. Tb~ ~SUCS are all behind the currcnt
lt contends that during the same period. feud. But the heart of the matter is that thc
manthly average prices in norttx:rn Eu- Private sector challenges the continued
_ rure wcrc "ncver less than 80.~2 c~:nts per nationalisption of the mtton tradc a~ :~II.
Ih, and the monthly average pnccs ~f the Since the 1997 changc of govemment, pri-
vate ootton dealer's anci tormer exporters
Takinq into account traris- have intensified tlieir campai~tn to get thc
actiona of certain weeks on trade de-nationatised. There is no deny~ing
the Honqkong and Japan eotton that the bureaucrats-turned-executive. ot
markets, the KCA ataintains : the CEC still lack the expertise of interna-
tional ootton tradcrs. [n additi~m, th~� all~
"Cotton was sold cheaply, and gations of rcd t~ and mismanagcment
the benefit of high prices are disturbing.
during the 1981 season was 'T7~e entrepreneurs who handlcd thc
eottcm tradc sina the commodity becamc
not transferred to qrowers in an rtem of internationat commercc wrrc
Pa]cistan. " able to respond rapidly to thc wurld ~
Thcre ~pp c~ers to be some substana to merket cituation and ~bv~ousl~ msdc
this Thc CEC has bccn opcrating in a ga~d profits--carninE.s v.h,rh thc~~~ want
murcl~i~~ez-faircmannerthanthepnvate again. Thc g~ivernmrnt and thc ~n+wcn
,ector. Pric~r to the 1973 nationalisation, h~ve o(ten accused them uf ganging ~up
thc KCA says~ the State Bank of Pakistan against the growers by not huying thc a~t-
(ccntral hank) cxercised an export price tnn quickly, thereby depressing priccs.
check. Under this arrangemenl, only oot� Bw as soon as the crop camc to pnvate-
ton transactions withid'S cents of the prc- sector traders; prices would start rising.
vailing New York fu3ures pria were ap- These traders wauld then sell cotton at
rruvcd for cxpprt. ~ � high prices to the textile industry; making
In 1981, New York futura remained a good deat of pro~t.
abc,ve 85.25 cents a Ib. whiie in Apguat Some ezporters were also accused of re-
198U and January 1981 the quotes went Lp taining abroad pert of their foreign-ex-
t~~ 9t~ ccnts. On this baais, the KCA al- � change earnings (rom ootton exports.
I~ges, the average invisible loss in foreign Another allegation against them was sell-
exchange comes to eround ~ZS cents a ingcottonofpaorqualityornotstiekingto
Ih. Pakistan's 1.91 million pxported bales international specifications. i~Vhen ~the
t~ruught the country e paperlosbof nearly government took over the cotton ir~de in
l~SS1Q.1 million, it argues.� � 1973, the main argument was that it want-
Thc KCA catalogues.several losses the ed to he}p the poor farmer and improvc
CEC allegedly suffered because of its mit- quality. But tfje government, in the pro-
management and lack o~f foresight: cess, ha$ ~ been making a healthy profit
? It sold 63.335 bales of cotton in 1981 each year itself, and does not want to part
at an average price of about 60 cents a Ib. with it. That is why government spokes-
down from conservative estimates of 70 , men have repeatedly ruled out de-nation-
cents available at prevailing market kvels alisation.
- for a loss of USS2.A million. The CEC-KCA feud appeared to be
? Despite �a large stock, the CEC de- coming to a head on April 23 when the
faulted in fulfilling several export oon- CEC threatened legal action against the
tracts involving 300,000 bales. lt had to association. lt served a notice on the KCA
pay USSS miUion in compensation and rc- claiming USS10 million in general dam-
bat~s. ages tor "allegedly publishing baseless and
? The CEC incurred an expenditure of false imputations against the corpora-
LlSS15.B5 million in 1981 on interrst to tion," and dcmanded a publishcd retrac-
bankx on overdrafts. storage of cot~un and tion.
insurance because of "a lack ol pn~mpt The imputations referred to coneerned,
markcting." among other things, 'thc allegation that
? The CEC carried uver 7~.INK1 bale. Pakistan registercd i~visible losses of
nf cotton from 1980stocks. thouFh it cauld USS128.2 million nn fiscal 19R1's cotton
- casily have been marketed et araund 71? cxport~ as a result of incfficicnt CEC mar-
cents a Ib during 198p for USS20t+miflion, keting. The corporation described the al-
and saved the storage cxpcnses. legations as "detamatory." ~
COPYRIGHT: Far Eastern Economic Review, Honqkong 1982
' END
CSO: 4220/641 20
- FOR OF'FICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/09: CIA-RDP82-00850R000500070065-8