January issue 2010

As a matter of course, we expect our elected representatives to be evasive, slippery and deceitful. Occasionally, though, even a politician lets slip what he truly thinks. The PPP’s Abdul Qayyum Khan Jatoi, the federal minister for defence production, took to the airwaves recently to explain to a talk-show host that a politician has a right to be corrupt and that if one person out of a thousand isn’t corrupt, then he is stupid for losing out on the available opportunities.

With the Supreme Court striking down the National Reconciliation Ordinance (NRO), talk of corrupt politicians has become ubiquitous and much of the country has become as cynical as Jatoi. The media is pouring over cases that date back to nearly decades to find out who ransacked the national exchequer. But corruption, if media coverage is anything to go by, started and ended with Asif Zardari and his cronies in the PPP. What seems to have been forgotten is that corruption is a menace that transcends party affiliation; everyone has been accused of it and everyone has been judged guilty — at least in the court of public opinion.

It might, therefore, be useful at a time when partisan passions have been provoked by the corruption debate, to recall that just about every politician has allegedly gorged on public funds.

Certainly, the PPP deserves all the scorn that is being poured on it. Its record on corruption is shameful and, in the case of Asif Zardari and many ministers in the current government, dates back to Benazir Bhutto’s first government. The accusations against Zardari are so legion that it would be impossible to list them with any detail. Here, though, is a sampling:

Zardari’s financial dealings, mostly shady and suspicious, span the entire globe. The most well-known of these is the case filed against Zardari and Benazir in Switzerland claiming that they had used Swiss banks to launder nearly $15 million. Both were declared guilty by the court and ordered to pay a $11 million fine to the Pakistan government. The NRO, however, was promulgated by Pervez Musharraf while the couple were appealing the verdict, and the state withdrew from the appeal.

Zardari has also been accused of taking a commission of $10 million from the Dubai-based businessman Abdul Razzaq Yaqoob in return for giving him a monopoly to import gold to the country. While both vehemently denied the charges, in 1994 the PPP government did give Yaqoob exclusive rights to import gold for a period of two years.

The Polish government, too, investigated Zardari and concluded that he was guilty of accepting kickbacks. As part of the Awam Tractor Scheme, the Polish government alleged that Zardari received $2 million in bribes to give a Polish company a license to import nearly 10,000 tractors. The French government also claimed that Zardari took hefty commission fees from a military contractor to give them a contract for fighter jets. Then, there was the £2.5 million Surrey estate, which Benazir and Zardari initially denied they owned, and only admitted was theirs after a British court threatened to impound it since it had no apparent owner.

Back home, Zardari was accused, among other things, of taking kickbacks in the government purchase of airbuses, handing out plots of land to cronies and forcing banks to give loans to business partners and friends that were never repaid. These loans included one of Rs 700 million from Habib Bank and was investigated by Nawaz Sharif. A conviction could never be secured, however, as key witnesses never testified. These included the then president of Habib Bank Safdar Abbas Zaidi, who was made the head of the Pakistan Investment Board when Benazir returned to power. The land given to friends at drastically reduced prices included a plot estimated to be worth Rs 300 million that was given to Inter Pak Hotels, in which Zardari’s brother-in-law had a stake, for Rs 10 million. Contracts, too, were handed out to Bhutto favourites, such as the Saif Group of Companies, headed by Anwar Saifullah, who is now an MPA in the NWFP Assembly.

There are other PPP politicians who may soon find themselves in court on charges of corruption. Prominent among them are Interior minister Rehman Malik, who has been charged with embezzlement in the Yellow Cab scheme and receiving kickbacks; the party’s secretary-general Jehangir Badar, who is alleged to have awarded jobs at Sui Gas Company to friends; Defence Minister Ahmed Mukhtar, who has been accused of issuing sugar export permits to his cronies; and Principal Secretary Salman Farooqi, who is charged with forgery, fraud and illegal kickbacks from foreign companies.

While many of these cases will now be reopened, similar corruption allegations made against Nawaz Sharif are unlikely to ever to be prosecuted in a courtroom. The newly-minted anti-corruption crusader has quite a history of corruption himself. In his first term as prime minister, like Zardari, the main accusations against Sharif involved bribery. He was believed to have received kickbacks for contracts handed out in connection with the Lahore-Islamabad Motorway and the Yellow Cab Scheme. Additionally, his family business, the Ittehad Group, also took massive loans from banks that were never repaid. Like the PPP, Sharif was also accused of buying the cooperation of potential witnesses. Ittehad had taken huge loans from Bankers Equity Limited and after his government was dismissed, Sharif made the group’s chairman Saeed Sadiq the secretary of the PML secretariat.

In his second term, Sharif faced even more allegations of corruption. The most notorious of these was his decision to freeze all foreign currency accounts after the nuclear tests of 1998. It is believed, though never proven, that top ministers of the government withdrew all their foreign currency from banks in the days leading up to the announcement. He was also accused and convicted of refusing to pay taxes on a helicopter he had purchased. Other schemes from which the PML-N government is alleged to have benefited financially include the Kurz Utaro, Mulk Sawaro scheme, which collected money from citizens to reduce Pakistan’s external debt.

Nawaz and his brother Shahbaz Sharif were also alleged to have used Hudaibya Paper Mills to launder money they had made illegally. This case is currently with the National Accountability Bureau (NAB) and Ishaq Dar, a former finance minister of the PML-N and current senator, had testified before NAB in 2000 confirming the charges. The PML-N, however, claims that the confession was made by Dar under duress.

The Sharif brothers used Hudaibya Paper Mills to get a loan from the British-based Investment Funds Limited, which they didn’t repay until the company filed a lawsuit in a British court. In March 1999, while Sharif was still prime minister, the Sharif brothers were ordered by the court to pay the company $450 million. When they still hadn’t paid up by November, the court ordered that the Sharifs’ four apartments in Park Lane be seized. It was only then that the full amount was paid, even though Nawaz Sharif’s tax returns in Pakistan showed him to be virtually penniless. He claimed that the nearly half-a-billion-dollars were paid by an Arab friend.

With Musharraf’s promulgation of the NRO in 2007, the new PPP government decided to put the NRO issue on the back-burner and thus did not raise any questions about the financial dealings of the PML-Q government. They, however, have far from a clean record themselves. Party chief Chaudhry Shujaat Hussain as well as politician Humayun Akhtar, among others, are alleged to have hoarded sugar, precipitating the current sugar crisis. Additionally, Chaudhry Shujaat and Chaudhry Pervaiz Elahi are accused of getting loans in billions of rupees written off by the National Bank of Pakistan. These loans had been given to their company, Punjab Sugar Mills.

Since these cases didn’t fall under the purview of the NRO, it is highly unlikely they will be pursued. Still, it is important to remember that in Pakistan corruption is not the exclusive domain of a single party.

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