Who Owns Pakistan - Yimg

H U Beg and several other bankers who studied the problems of bank loan
default made comprehensive recommendations to discourage industrial sickness
but their recommendations have been ignored and the business of rewriting
loans is going on as usual. Beg, for example suggested that " legal action should
be initiated against the defaulters, at an early stage of default and all banks and
financial institutions should be notified about the action so that they should stop
all facilities, not only to individual sponsors but also to their sister/ associated
concerns. Besides, a sponsor whose unit is once liquaidated for willful default or
siphoning off funds should be blacklisted.
A World Bank report on financial reforms in Pakistan observed that " not only has
political pressure forced institutions to make bad loans and stop collection efforts,
even the modest efforts to reform the recovery framework has met vigorous
political opposition". It reported that as of October 30, 1992 a total of 21,000
cases were pending in the banking tribunals and observed that in order to
discourage the practice of loan default " the bankcruptcy of a few large over
extended firms and jail terms for a few willful fraudulent defaulters would be quite
aslutary".
A USAID study about financing for the Housing sector concluded that the legal
system for recovery of loans was almost non-existent and in one particular case
in Karachi Banking Tribunal, there were approximately 10 hearings and
adjournments since 1987 while in another case in Lahore, there were 67
hearings and adjournments between 1981 and 1991. It cited that a case was
pending before Punjab Banking Tribunal since 1988 because the tribunal was not
functioning for two and half years.
At a time when a firm policy was needed to discourage defaulters from taking
new loans and reform the banking system, Asif Zardari started holding courts
with FPCCI to provide them relief and fresh financial assistance, thus giving
permanency to the evil of industrial sickness, as part of Pakistan's business
culture. It is not surprising that in his second term, Nawaz Sharif and Sartaj Aziz
have identified revival of sick industries, as the top priority of new govt which
means providing additional loans to existing defaulters.
How Central Board of Revenue (CBR) Helps Them
Become Rich
CBR: Corrupt or Politicized
The Central Board of Revenue (CBR) can enrich individuals and groups beyond
one's expectation and imagination by issuing the right SRO (Statutory
Regulations and Orders) or vice versa turn them into pauper by starting
investigations of tax evasion and assessing tax liability with retrospective effect.
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