Gender Dynamics of Development in Pakistan

The Atlantic Council’s South Asia Center held a public discussion on “Gender Dynamics of Development in Pakistan,” with Ms. Roshaneh Zafar, founder and managing director of Kashf Foundation, chair of Kashf Holding and chair and founder of Kashf Microfinance Bank Limited based in Pakistan.

The event was moderated by Shuja Nawaz, director of the Atlantic Council’s South Asia Center.

Microfinance has become a widespread tool to alleviate poverty and empower those who traditionally lack access to banking and related services, particularly poor women. The Kashf Foundation, established in 1996, was the first specialized microfinance organization in Pakistan and focuses on providing support to women across the country. With nearly 300,000 active members, Kashf has provided a way for women to become entrepreneurs, enabling them to open their own businesses and support their families. Borrowers have gone from participating in small income-generating activities to creating enterprises that are actively creating jobs in the local economy. Ms. Zafar will discuss how microfinance has the potential to transform the lives of those in poverty and lead Pakistan on a track of sustainable growth, and the role of gender dynamics in addressing Pakistan’s developmental challenges.

Roshaneh Zafar
is also the founding member of the Pakistan Microfinance Network and is a member on the board of several NGOs and networks, including Women’s World Banking, Engro Foods, and Kaarvan Crafts. She is a member of the UN Advisory Group on Inclusive Financial Services, member of the Vital Voices La Pietra Council for promoting Women’s Issues and a member of the following Global Agenda Councils of the World Economic Forum: Gender Gap Council and Pakistan Council. Ms. Zafar is also a member of the US Department of State’s International Council on Women’s Business Leadership’s (ICWBL) Subcommittee on Access to Capital. Ms. Zafar is a graduate of the Wharton Business School University of Pennsylvania in finance and economics and also holds a master’s in international and development economics from Yale University.

India-Pakistan Trade: Profitable Relations?

 Vice President of the India-Pakistan Chamber of Commerce and Industry, Syed Yawar Ali provided an overview of the current trade flow between India and Pakistan, highlight mutually beneficial opportunities of bilateral and regional agreements, and emphasize the need for new infrastructure to increase cooperation.

Shuja Nawaz, director of the Council’s South Asia Center, moderated the discussion.

Trade between India and Pakistan amounts to only $2 billion, but has the potential to reach multiples of that amount in the next few years provided the barriers to trade are removed. Political tensions coupled with tariff and non-tariff barriers enforced in both countries have prevented India and Pakistan from benefitting from each other’s diverse markets and from their respective comparative advantage. This year, India and Pakistan began moving toward a more open trade relationship with Pakistan’s promise to accord India Most Favored Nation status. Commerce and industry ministers from both countries have met to discuss customs agreements, new trade routes, and enhancing people-to-people business ties. Joint business conferences have been held and mechanisms to deal with business-related grievances have also been setup.

Syed Yawar Ali joined the family business, Packages Limited, and then became managing director of Milk Pak Limited. After three years of the joint venture with Nestlé, he was promoted to chairman of the board. He is currently the vice president of the India-Pakistan Chamber of Commerce and Industry and facilitates PBC’s work in Aman Ki Asha to promote trade between India and Pakistan.

Mr. Ali also currently serves as chairman of Nestlé Pakistan Limited, Wazir Ali Industries Limited, and was the former chairman of the Pakistan Dairy Association. He has also served on the Board of Directors of the State Bank of Pakistan, Pakistan International Airlines, Agricultural Development Bank of Pakistan and Lahore Electric Supply Company.

After graduating from Aitchison College in Lahore, and receiving a bachelor’s degree in Chemical Engineering, Mr. Ali attained a master’s degree in Management Science from Stevens Institute of Technology, New Jersey.

Aman Ki Asha is an initiative launched in 2010 by Pakistan-based Jang Group and the Times of India. For more information on this campaign, please click here.

Exiting Afghanistan: A Regional Approach

Hamid Karzai and Gilani

Now that the dust has settled on the Chicago Summit, it might be time to see what truly emerged from all the noise and celebration about the cooperation among NATO allies and with Afghanistan. One issue got lost in that hoopla: Afghanistan’s regional context.

As NATO troops come home, a diplomatic strategy for the region must be put into place. It isn’t a stable Afghanistan that is key to generating regional stability and prosperity — rather, the opposite is true: if the region cooperates to maintain wider stability, then Afghanistan stands a better chance of becoming stable and prosperous.

Interestingly, even the Chinese seem to have understood this issue. According to a Reuters report out of the recent Shanghai Cooperation Organization summit, President Hu Jintao told the official People’s Daily, “We will continue to manage regional affairs by ourselves, guarding against shocks from turbulence outside the region, and will play a bigger role in Afghanistan’s peaceful reconstruction.” He added: “We’ll strengthen communication, coordination and cooperation in dealing with major international and regional issues.”

The best path to Afghan self-sufficiency is to work with Afghanistan’s neighbors near and far to ensure that Afghanistan’s economy can develop via trade and investment. That is the most effective and sustainable method of weaning Afghanistan away from U.S. and European assistance beyond 2014. Last week’s regional “Heart of Asia” conference, hosted by President Hamid Karzai in Kabul, was a modest step forward in the process.

U.S. support for such efforts would advance what is now a regional trend. Already India has invested more than $1.2 billion in Afghanistan. Pakistan, too, has sent economic aid and supplies, as has Iran. China and India have both invested in the mineral sector. Trade between South Asia and Afghanistan, and through Afghanistan with Central Asia and Iran, would provide much-needed revenue and facilitate direct investment in Afghanistan.

Pakistan remains key to these endeavors. A stable Pakistan that has normalized its relationship with India would find common ground in Afghanistan rather than fear being bracketed by a hostile India in Afghanistan. It could partner with India in opening up gas and hydroelectricity links to Central Asia and even invest in joint exploitation of the Kabul River gorge for producing electricity that both Afghanistan and Pakistan badly need. A secure western border with Afghanistan would allow Pakistan to combat the so-called U-turn trade with Afghanistan that deprives it of some $2 billion in taxes each year, where duty-free goods imported into Afghanistan are smuggled back into Pakistan.

The United States need not take the lead in underwriting Afghan stability post-2014. But it can achieve that objective by acting as a facilitator, bringing neighboring countries of the region together and using its clout in the international financial institutions, such as the International Monetary Fund, the World Bank and the Asian Development Bank, to direct aid to support regional trade and development efforts.

Revival of the Turkmenistan-Afghanistan-Pakistan-India (TAPI) oil-and-gas pipeline could also be a boon to the region. The Asian Development Bank has already done much of the groundwork on the TAPI pipeline. And, as the United States brings Iran into talks on Afghanistan’s future, it might find it possible to ease up on sanctions enough to allow India and Pakistan to benefit from Iranian gas and oil rather than making it a hindrance to relations with these important South Asian partners.

Crafting a sustainable policy toward Afghanistan and its surrounding region requires less emphasis on “architecture” and more on longer-term relationships. With elections looming in the United States, Afghanistan, Pakistan, Iran and India, and a changing of the Politburo in China later this year, the danger is that short-term actions fueled by domestic considerations could derail long-term actions and relationships. The United States must remain engaged with all countries in the region surrounding Afghanistan and bring its powerful business community into its efforts to create a network of investments in the region as a whole. This approach would tie the economies of South Asia with Afghanistan and Central Asia and thus help create stability over the longer run.

Shuja Nawaz is director of the South Asia Center at the Atlantic Council in Washington, D.C. Abigail Friedman is former Director for Afghanistan at the National Security Council in the White House and a Foreign Service Officer with the Department of State. This post originally appeared in The Hill. Photo Credit: Getty Images

Relations with Pakistan: Forging a New Partnership

Pakistan is at a precarious point in its faltering return to democratic order, after yet another extended period of military-dominated rule that has left its bureaucratic system and civilian institutions stunted. Its polity and society have undergone rapid change, with countervailing forces emerging to counter the military’s overwhelming power. Though political parties remain weak and divided, the democratic impulse appears to be taking hold in civil society, as illustrated by the emergence of active media and social networks combined with an increasingly assertive judiciary. Although elements in the intelligence services still occasionally attempt to control the media and political actors, the military has neither the will nor the capacity to mount a coup, nor the ability to effect major political change.

Public opinion in the U.S. and views on the Hill are heavily biased against a cordial relationship with Pakistan, reflecting years of mistrust of Pakistan’s role in the Afghan war. Pakistan’s two-handed approach to the Afghan Taliban, taking U.S. assistance and payments for military operations in the borderlands while allowing selected groups of Afghans free movement to and from Afghanistan, hinders the Administration’s ability to provide more military aid to Pakistan. On the Pakistani side, suspicions that the U.S. has shifted its stance away from Pakistan and towards India, with the ultimate goal of defanging Pakistan’s nuclear weapons capability, make it nearly impossible for U.S. officials and aid representatives to operate freely inside the country. Public denunciation of the drone campaign by government and civil society actors fuels antipathy toward the U.S. Pakistan’s Parliament has echoed these fears in its calls for protection of national sovereignty and for greater controls and taxes on coalition supplies going through Pakistan to Afghanistan.

In such an environment, cutting our losses and walking away from the region, and specifically from Pakistan, might seem an obvious —and popular—choice. But such a decision would entail significant longer-term costs. Not only will the withdrawal of forces from Afghanistan require ground and air lines of communications via Pakistan, our Afghan allies will continue to require supplies and air support via Pakistan. Cutbacks in air and military support would be disruptive at a critical stage when their security forces are being prepared to take on more ground operations. Without air support, those might be jeopardized and Afghan morale would plummet.

What happens inside Pakistan affects its immediate neighbors— India, China, Iran, and Afghanistan—instantly, and more distant countries over time. A precipitous U.S. withdrawal could lead to heightened conflict in the borderlands of Pakistan, allowing the Pakistani Taliban and their Punjabi allies to use the Federally Administered Tribal Areas as well as contiguous Afghan territory as sanctuaries in fighting the Pakistani army and state. It would give extremist elements inside Pakistan greater voice and control over public discourse in civil society and the military.

Latent anti-U.S. sentiment in the military, especially among younger officers and perhaps the soldiery, is indicated by the fact that some of the attacks against General Pervez Musharraf and military headquarters included lower-level personnel from both the army and air force.

Large portions of public opinion in Pakistan view the U.S. civil nuclear deal with India as an anti-Pakistan move, and the absence of any attempt to engage Pakistan in a similar dialogue as proof of an entrenched anti-Pakistan bias. A shift toward India, if this were to accompany U.S. withdrawal, would strengthen conspiracy theorists inside Pakistan in their belief that the U.S. always intended to compromise and weaken Pakistan.

The U.S. has been and remains the largest supplier of assistance to Pakistan, both civil and military, and via the International Financial Institutions (the International Monetary Fund, World Bank and the Asian Development Bank, in particular). But our aid program has been sporadic and tied to regional or global aims in a manner that has led Pakistanis to become wary of U.S. ties, understandably regarding their relations with China more kindly. The U.S. has an opportunity now to change that dialogue and move toward a longer-term relationship with Pakistan as the center of gravity of U.S. engagement in the region, rather than as an after-thought relative to emerging regional crises or changing global policies.

What needs to be done?

Firstly, the U.S. should expand its approach to Pakistan by working with regional partners, many of them Pakistan‘s friends, to ensure a stable Pakistan and a steady U.S.-Pakistan relationship. Building on the Pew Global Attitudes Poll results that regularly indicate that six out of 10 Pakistanis polled want better relations with the U.S., we can create a steady, longer-term relationship that is not tied to short-term goals.

Helping Pakistan to help itself should be the key to this new relationship. If Pakistan’s people and government want to improve governance and provide jobs and education to their growing population of nearly 200 million, then the U.S. should make that its aim too.

Combining our resources with those of the United Kingdom in the education sector, as has been done recently, offers a good model. Working with China in building infrastructure and the energy sector could bolster Pakistan’s ability to get out of its economic hole. Open borders with India for trade and the movement of people would help to remove decades of fear and hostility on Pakistan’s eastern border. Our new strategic relationship with India enables us to use moral suasion on India to show “strategic altruism” and give Pakistan the breathing room for its economic and political development. A moratorium on active Indian and U.S. intelligence operations inside Pakistan would most likely win Pakistan’s trust in this endeavor.

Secondly, the U.S. should review and rebalance its policies on aid to Pakistan. Specifically, U.S. assistance to Pakistan can gain from the multiplier effect of aid from IFIs that Pakistan sorely needs and is more willing to accept. U.S. support in the boards of these institutions can help Pakistan to garner the resources it needs to restructure its economy. The U.S. can also help in persuading Pakistan’s government and bureaucracy to move faster on the reform path.

An Aid to Pakistan Club may be one way of doing this. The U.S. Congress may be able to help the Pakistani Parliament, via direct parliamentary contacts, to allow Pakistani parliamentarians better understand economic issues and the value of a reform agenda that has been crafted inside Pakistan but still lacks support from its politicians. Congress could thus come to be seen as a partner of Pakistan, rather than the hectoring controller of the U.S. aid purse that it is often perceived to be.

A greater role for civil society

Thirdly, U.S. aid and a strengthened relationship with Pakistan should be made contingent on actions by Pakistan to allow civil society and business to play a greater role in setting it on the path to economic and political stability. The civilian government needs to show a desire and ability to re-establish its control over government, instead of outsourcing decision-making to the military. Once the military recedes into the background, relinquishing its role as default drafter of policy on India, nuclear policy, Afghanistan, and U.S. relations, the U.S. could commit, under an agreed military aid program, to improve Pakistan’s ability to combat insurgency and defend its borders with a more mobile and better-equipped army and an improved and integrated police force.

Pakistan is both a strategic ally and a potential bulwark of stability. If its people and government are prepared to align and commit themselves to fulfilling that potential, the United States must be willing to help them. 

Shuja Nawaz is director of the South Asia Center at the Atlantic Council. He is the author of Crossed Swords: Pakistan, Its Army, and the Wars Within. This piece is taken from the Atlantic Council publication The Task Ahead: Memos for the Winner of the 2012 Presidential Election.