August Issue 2015

Going by the indicators, corruption is anathema to army chief General Raheel Sharif and he is the prime motivating force behind the current drive against corrupt practices by the Sindh Rangers and the National Accountability Bureau across the country. But he is not the first to dip his hands into this tricky cauldron.

Campaigns against illegal money-minting by civilian and military rulers have been continuing since the inception of the country but have only culminated in the acceleration and increase of corrupt practices by those with power, be they politicians, judges, civil servants, army generals or big businessmen. One can now include media groups and journalists in this hall of shame.

Liaquat Ali Khan, Ayub Khan, Yahya Khan, Zulfikar Ali Bhutto, Zia-ul-Haq and Pervez Musharraf all tried to hold politicians and bureaucrats accountable. In the name of accountability, each government has tried to target its political foes while allowing its members and supporters to mint money with official patronage.

No important politician or bureaucrat has ever been convicted despite clear circumstantial evidence against them because accountability measures lacked credibility, were partial and one-sided and anti-corruption institutions themselves facilitated corruption by destroying evidence and silencing witnesses through bribery and harassment.

The ongoing anti-graft drive against the Sindh government and the MQM is a mere rerun of the past, with enthusiastic anti-corruption campaigns launched against politicians and civil servants only to soon wither away.

Early years (1947-1960s)

Corruption has been an issue in Pakistan since its inception and the efforts to check graft and misuse of authority started with the promulgation of a law known as the Public Representative Offices Disqualification Act (PRODA) that was enforced in 1949 with Liaquat Ali Khan as Prime Minister.

The law was invoked against two chief ministers before it was denounced as incompatible with democratic politics in 1954. However, this law proved to be ineffective in stemming rampant corruption within the administration.

The leaders of the country’s founding party, the Pakistan Muslim League, were like vultures swooping down on the real estate and the agricultural lands left by migrant Hindus and Sikhs at Partition. It is generally argued that the scale of corruption by politicians and public servants was low at that time, but it is forgotten that only so much was available to be plundered then.

The military takeover by General Ayub Khan was welcomed since the public was disillusioned by the corruption of civilian rulers, politicians and civil servants. Ayub Khan promised that he would reform the entire government structure and cleanse the administration of widespread sleaze.

In March 1959, General Ayub Khan replaced PRODA with a new law called the Public Offices Disqualification Order (PODO) and later substituted it with a stricter statute named the Elective Bodies Disqualification Order (EBDO).

Under this law, 75 senior politicians tainted with corruption charges, such as Qayyum Khan and Hussain Shaheed Suhrawardy, were disqualified from contesting elections till the end of 1966. However, they were never tried and convicted. Thus, the martial law administration cleared the field for any likely opposition to President Ayub Khan.

Public servants were also tried for misconduct by tribunals consisting of retired Supreme Court and High Court judges. About 3,000 officials were dismissed and many others were demoted.

Yahya Khan’s military regime summarily dismissed 303 civil servants and government functionaries but did not prosecute them.

Bhutto and Zia-ul-Haq

In 1976, Prime Minister Zulfikar Ali Bhutto enacted the Holders of Representative Offices Act and the Parliament and Provincial Assemblies (Disqualification for Membership) Act in 1976, but no case was registered under these laws. However, during the Bhutto era, around 1100 government officers were sacked without trial.

General Zia-ul-Haq repealed the earlier anti-corruption laws and issued two presidential orders, commonly known as PPO No 16 and 17 (1977). The Zia-ul-Haq regime institutionalised corruption as it introduced ideas such as development funds for MNAs and MPAs and wrote off the bank loans taken by the supporters of the dictator.

The 1990s

In 1990, Prime Minister Benazir Bhutto was ousted from power on corruption charges by President Ghulam Ishaq Khan who approved hiring private legal advisers to file 19 corruption cases against Bhutto and her husband, Asif Ali Zardari, during 1990-92.

In 1990, caretaker Prime Minister Ghulam Mustafa Jatoi’s government filed four references against Benazir Bhutto, three against Asif Zardari and one against Hakim Ali Zardari. These included: illegal allotment of the Lakeview Hotel to a front man of Asif Ali Zardari; illegal allotment of LPG quota; undue pressure on Habib Bank Ltd to sanction a loan for duty-free shops to Fauzi Kazmi; and the award of a contract for export of cotton at reduced prices to Raleigh Brothers.

Three references were filed against Asif Zardari on the charge of pressurising Habib Bank Ltd to sanction a Rs 700 million loan for two hotels; pressurising United Bank Ltd to sanction a Rs 70 million loan to one Ghulam Mustafa Memon; putting pressure on Habib Bank Ltd for issuing a loan to his friend, Fauzi Ali Kazmi. A reference was filed against Hakim Ali Zardari on the charge that he had received Rs 2.4 million from Pakistan State Oil (PSO) for renting out 1,000 yards of land that did not belong to him.

Ironically, when Ghulam Ishaq Khan ousted Prime Minister Nawaz Sharif from power in 1990, he inducted Zardari as a federal minister in the caretaker government of Balkh Sher Mazari. He also appointed Zahid Sarfraz, a senior politician from Faisalabad, as chairman of the accountability committee. Sarfraz presented before the media a factsheet against Nawaz Sharif regarding alleged massive irregularities involving kickbacks amounting to billions of rupees in awarding the building contract of the Lahore-Islamabad motorway.

“Never in the political history of Pakistan, and for that matter, in the history of the entire world, has a prime minister and his family manipulated and devised policies to suit their personal business interests, as the deposed Prime Minister Nawaz Sharif did,” Zahid Sarfraz said in a news conference.

Following the 1993 elections, it was Prime Minister Benazir Bhutto’s turn for revenge against Nawaz Sharif. Her government accused the Sharifs of receiving kickbacks in the Lahore-Islamabad Motorway and Yellow Cab Scheme, selling family silver at throwaway prices, extracting huge loans from nationalised banks to build the House of Ittefaq, a cooperative scam in Punjab involving at least Rs 18 billion etc. A total of 150 cases of corruption and irregularities were instituted against Nawaz and his family members.

Yet, at the same time, Prime Minister Benazir Bhutto’s own government was under attack from the independent media for being involved in massive corruption. In 1996, Transparency International (TI) declared Pakistan the second-most corrupt country in the world.

Ehtesab Bureau

In November 1996, President Farooq Leghari dismissed Benazir Bhutto’s second government on charges of corruption and other offenses. He promulgated the Ehtesab (accountability) Ordinance, under which the process of accountability was to start from the date in 1985 when General Zia-ul- Haq had lifted martial law. Leghari established an Ehtesab Commission and a retired chief justice of the Lahore High Court, Ghulam Mujaddid Mirza, assumed charge as Chief Ehtesab Commissioner.

Following the general elections of 1997, Nawaz Sharif came into power for the second time and enacted the Ehtesab Act of 1997. Under this law, he curtailed the powers of Ehtesab Commissioner Justice Mirza and appointed his crony, Saifur Rahman, to lord over the Ehtesab Cell, which was renamed the Ehtesab Bureau in 1998.

The 1997 Act restricted its application to ‘the holders of public offices since the 6th day of November 1990.’ This was meant to keep the corruption charges against Nawaz Sharif as chief minister of Punjab (1985-1990) outside the accountability’s purview. At that time, there were 167 cases of major loan defaults, including 107 cases involving top leaders of the PML-N who had their loans written off and rescheduled from 1985-1990.

This institution tightened the noose around the PPP leadership including former Prime Minister Benazir Bhutto and her husband Asif Ali Zardari besides some leading businessmen of Karachi and senior journalists who were critical of the government.

The Ehtesab law was tailored to prosecute Sharif’s opponents, particularly PPP leaders, and protect him and his colleagues. The Ehtesab Bureau was part of the prime minister’s secretariat and the Chief Ehtesab Commissioner had nominal powers while the real authority was concentrated in Saifur Rahman’s hands. Saifur Rahman used the Federal Investigation Agency (FIA) to conduct investigations against suspects and abduct the government’s opponents, including senior journalists such as Najam Sethi and Husain Haqqani.

During Nawaz’s three-year rule (1997-99), the only major case adjudicated by the courts was the 1999 conviction of Benazir and Zardari on charges of money laundering. They were sentenced to five years in prison and fined US$ 8.6 million. The PPP chairperson was abroad at the time of the decision and her counsel filed an appeal against the decision before the Supreme Court.

Under this accountability bureau, televised confessions were extracted from Salman Farooqi, secretary of commerce under Benazir Bhutto, Ahmed Sadiq, Benazir Bhutto’s principal secretary, and Zafar Iqbal, chairman of the Capital Development Authority. Later, most politicians and bureaucrats who had been charged with corruption or other crimes, were released on bail. 

National Accountability Bureau

In October 1999, General Pervez Musharraf assumed power and issued a very harsh National Accountability Bureau Ordinance replacing the Ehtesab Act of 1997. NAB was given powers which no organisation had ever exercised earlier. It could arrest anyone for 90 days without producing the arrested person in any court of law. The accused could not apply for bail even after 90 days. The onus of proof, under NAB laws, was on the accused and not on the arresting authority. Under NAB law, everybody arrested was considered guilty unless proven innocent.

Under its first chairman, Amjad Hussain, NAB wanted to tighten the noose around those industrialists and businessmen who had established their business empires through corruption. However, Shaukat Aziz, the then finance minister, who was close to Musharraf, wanted blanket protection. Several big businessmen were let off the hook by NAB and some of them allegedly funded the campaign for Musharraf’s presidential referendum and were later decorated with civilian state awards.

In order to gain the support of big businessmen, Pervez Musharraf also gave a package to tax evaders on April 30, 2000, when the Central Board of Revenue announced a Tax Amnesty Scheme to legalise hidden assets and black money by charging a one-time fine of 10 per cent of the undisclosed income.

Soon the Musharraf government started interfering with NAB’s functioning. The government position was that only serving army officers and the judiciary were exempt from NAB’s ambit on the excuse that both institutions had effective in-house correction systems. Under the rules, NAB could not probe serving military officials as they could only be court-martialled by the GHQ and punished if found guilty. It could, however, investigate retired military officers.

All the big names among the retired generals were beyond the purview of the NAB. The names of Generals Aslam Beg, Hameed Gul, Zahid Ali Akbar, Talat Masood, Saeed Qadir, Farrukh Khan, and Air Marshals Anwar Shamim and Abbas Khattak came under discussion, but no action was taken. Amjad was in favour of having them probed, but was restrained from doing so.

Thus, the NAB was virtually left with two main political parties, the PPP and the PML-N and civilian officers. Initially, NAB could pick every defaulting bank borrower, but soon the bureau changed the policy and placed on the ECL only those who owed the banks more than 100 million rupees.

Musharraf had made the decision that he would compromise with those politicians who were ready to join forces with him. He had realised that he needed political support for creating his king’s party and winning the presidential referendum. Soon, several PML-N leaders got bail in corruption cases from the accountability courts and defected to the PML-Q.

The most incriminating evidence about how Musharraf and his team allowed corruption to thrive came from the disclosures of NAB chairman, Lt Gen Shahid Aziz (2005-07), in his interview with Dawn and his book, titled Yeh Khamoshi Kahan Tak.

Aziz confessed that he was appointed NAB chairman with a pre-condition that he would not proceed with old cases against politicians and other prominent people and was pressured into formally closing down cases against politicians supporting Musharraf. He said Musharraf repeatedly intervened to prevent proceedings against some leading politicians. Both Musharraf and his puppet prime minister Shaukat Aziz, often blocked anti-corruption actions against businessmen on the excuse that such actions could depress “economic progress.”

Aziz said he had issued an order that investigations against all politicians would be stopped for four months of electioneering and resume after the elections. He said the cases against a number of big names — Benazir Bhutto, the Chaudhrys of Gujrat, Nawaz Sharif, Faisal Saleh Hayat, Malik Riaz Hussain of Bahria Town — and oil companies, sugar millers etc. could not be completed because of pressure exerted by Musharraf.

The Zardari era (2008-2013)

NAB closed down corruption inquiries against almost 60 leaders of the ruling coalition — mostly from the PPP. The decision was taken at the Executive Board meeting of the NAB on January 29, 2011. During the meeting, the NAB chairman, Deedar Shah, said that since these inquiries were politically motivated, it would be better to close the cases. Zardari did not initiate or pursue any corruption case against his political opponent, Nawaz Sharif.

During this period, three army generals and two senior civil servants were accused of being part of the National Logistics Cell (NLC) scam, but the case was put into cold storage.

Nawaz Sharif (2013- to date)

Nawaz Sharif’s third tenure as prime minister has been marked by the continuation of the policy of reconciliation with the opposition that was the hallmark of Zardari’s government. Several cases of alleged corruption by Prime Ministers Raja Pervaiz Ashraf and Yousuf Raza Gilani have been under investigation with no seeming progress being made.

The recent spate of anti-corruption charges against politicians and bureaucrats in Sindh is on the initiative of the military establishment through the Rangers and the FIA. General Raheel Sharif seems to have a strict no-tolerance approach to corruption and told NAB to investigate allegations of a Rs 500 million land scam carried out by two brothers of his predecessor, Parvez Kayani.

In fact, the history of accountability shows that both civilian and military governments have never allowed anti-graft institutions to work independently and autonomously. Unless the accountability institutions — NAB, FIA and provincial anti-corruption establishments — are independent of government interference, there is little hope that a genuine, impartial and fair accountability can take place in this country.

Until accountability drives include army generals, judges of the superior courts and big businessmen, anti-corruption cases against the politicians and civil servants will be tainted as biased.  For an accountability drive to succeed, it needs to have tremendous public support, which can be obtained only by making the process indiscriminate and even-handed. Otherwise, efforts against corruption will be little more than a witch-hunt.

This article was originally published in Newsline’s August 2015 issue.