profitepaper pakistantoday 14th may, 2012

PRO 14-05-2012_Layout 1 5/14/2012 12:04 AM Page 1

Pressures intensify on European leaders Page 02

profit.com.pk

Monday, 14 May, 2012

TAXING TALES

Hoping against hope Agri tax is the only solution for economy’s survival: Kamal

KaraChI

A

NNI

GrICULTUre has to be imposed in the forthcoming budget for survival of country’s economy; this was stated by Senator Mustafa Kamal.

Addressing a dinner reception hosted by President All Karachi Industrial Alliance, Mian Zahid Hussain and former Vice President, FPCCI, Khalid Tawab to honour him and newly elected Senators, Nasreen Jalil and Dr Farogh Nasim at a local hotel on Saturday, Kamal said that if government kitty remains empty and did not have

money to buy event buy fuel for running power generating plants it must enlarge tax net and that could be possible through imposition of income tax on agriculture sector.

“We have to enlarge our tax net and levying agriculture tax is inevitable”, Kamal said. He said that without empowering local governments no good governance is possible in Pakistan.

While agreeing with the speakers about theft in power sector to the tune of billions of rupees every year he said that empower your local government councilor to collect bills and give him incentive for the job. He said that in order to overcome energy crisis we

should go for alternate energy resources such solar and wind energy.

He cited the example of Bangladesh which has successfully overcome its energy shortage through solar energy especially in rural areas. He advised the businessmen that though it’s a difficult time but they should not leave the country. “Do not move to Bangladesh, Sri Lanka, Dubai or anywhere else and let’s put our own house in order”, Kamala Advised the business community.

He hoped that this difficult would be over and businessmen should stay home to revamp economy. The President, India Pakistan Chamber of Commerce of Commerce and Industry, S M

Muneer made it clear that there is no way out except imposition of agri-tax in the forthcoming budget as government has alternative source of revenue.

He said that he repeatedly advised the present government to sit together with the stakeholders and find out solutions many problems being faced by the country and the economy is facing worst ever crisis in the history of Pakistan. He said that industries are closing at a fast pace and he can provide a long list of those factories which have been shut down already. He warmed that country would not be able reach even at the level of $23 billion due to the pathetic condition and looming cri-

sis of power and gas. He said that in such a scenario the government has even stopped the refunds of exporters to further add to their woes.

He condemned the acts of violence in the educational institutions and meaningless operation by the Sindh Police in Lyari which yielded no results yet the massive resources and precious lives of police and Lyari people were lost. Mian Zahid Hussain hoped that the rate of sales tax may be reduced in the forthcoming budget and in that way the FBr would be able to enlarge tax base.

He said that economy is in shambles and the government would have to take at least one wise step to levy agriculture tax n the next budget. He said that at least there should be some good steps in the federal budget 2012-13. He said that country is in bad shape right now due to energy crisis despite that fact that there is no shortage of electricity in Pakistan and we have more generation capacity than demand.

He said that the only problem is bad governance. Senator Dr Farogh Nasim said that there should be friendly tax regime in the country in order to revive ailing economy. He urged upon all the races residing in Karachi to own this city and do not live here like foreigners.

“Bringing in peace and harmony in Karachi is the key of political and economic stability in Pakistan”, Nasim said. He advised the chambers of commerce and industry to teach the feudal lords and ask them not to oppose agriculture tax in the National Assembly where they are in majority.

Senator Gul Muhammad Lot said that despite the fact he belongs to ruling party but still he would support levy of agriculture tax in the next budget.

Former Chairman, Korangi Association of Trade and Industry, Masood Naqi appealed the young senators to raise voice for the business community in the house. Khalid Tawab, Senator Abdul Haseeb Khan and Sardar Yasin Malik also spoke on the occasion.

Gazprom backing out of Iran-Pakistan pipeline?

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Shahab Jafry

e’re well into May, well past the April 30 deadline for russian energy giant Gazprom’s final yes or no on the Iran-Pakistan pipeline, rightly causing serious concern in Islamabad. Pakistan’s financing problems have already caused serious delay, constraining its ability to complete its part of the pipeline before the agreed Dec ’14 deadline. According to sovereign guarantees, Pakistan is liable to pay $1m per day in case of overshooting the scheduled completion date.

And even though the most recent official response has been the typical “will be completed on time” (Ijaz Chaudhry), experts are beginning to seriously question Islamabad’s ability to deliver, especially as American pressure systematically removes all prudent avenues of securing finances.

GAZPROM GAMBIT: Sources close to the project speak of a dichotomy in the government’s position.

“One the one hand it (govt) is 100 per cent committed to the project, and confident it will complete construction according to the agreed timeline,” said a consultant with ILF, the German company responsible for the project, on condition of anonymity. “One the other, it has neither requisite technology nor finances to achieve such an end.”

Speculation about Islamabad’s finances is made worse by the government’s freeze on payments to ILF, and the organisation’s Germany based par-

ent body’s decision to suspend resources to its Pakistan chapter till cash flow resumes. Others see the russian silence as a logical, lengthy analysis of an evolving situation that requires extremely prudent risk management considering the size and scale of required investments and guarantees.

A senior project consultant, asking not to be named since he’s not allowed public comment, told Pakistan Today that expecting an immediate answer from the russians was foolish to begin with. “Seriously, the ICBC pullout was quite a shock and embarrassment for the government that staked the pipeline as a crucial vote winner in the elections. The feeling here has been that it overplayed the Moscow card since the beginning,” he said. Indeed, Islamabad’s newfound likeness for Moscow, especially foreign minister Hina rabbani’s spirited outreach, indicates something concrete is being worked on. But a definitive answer cannot be realistically expected before President Putin visits Pakistan later in the year. For now, the russians will worry about the build-up to Pakistan’s general election, and how different parties posture with regard to American and Saudi incentives of breaking away from anything even remotely Iranian.

“Only and only if the russians are confident the present dispensation will continue, or whichever replaces it will stay committed to the project, will they pledge the monies,” the consultant said.

DEADLINES AND DELIVERABLES: Interestingly, even though that

complicates deadlines and deliverables, whether or not ILF-Pak’s maintaining operations indicates behind-the-scenes hope remains to be seen. “russia’s backing away will seriously limit Pakistan’s options,” according to Salman Shah, former finance minister and part of Gen Musharraf’s economic team that negotiated prices with the Iranians. “If the russians back out, Pakistan will not have access to technology like compressors that are primarily USmade. And even if the question of raising indigenous finances is settled somehow, the government does not have the political will to antagonise the Americans at this point.”

Dr Shah also stresses that the proj-

ect, in its present format, is simply unviable. “They will have to renegotiate prices even if construction gets going.

This government has agreed to much higher prices than we negotiated. The Iranians will have to be more realistic and offer us an affordable deal.”

TAPI LIKELIHOOD: American pressure to break from the deal stems from its wider sanctioning of forex inflows into Iran – citing concern regarding Tehran’s uranium enrichment drive – and advocates the alternate tapi project. Pakistan remains weary because since its inception in the early ‘90s, tapi has been considered unfeasible, owing to 475kms of proposed pipeline through hostile Afghan territory. Strangely the resulting logjam, with Pakistan unable to

leverage either option, may bode ill for energy projection, but does not render the project completely useless, at least not just yet. “There was never any real likelihood of the Iran pipeline coming through,” according to Syed Sayem Ali, senior economist (MeNA & Pak) with Standard Chartered Bank in Karachi. “They’re just using it as a bargaining chip with the Americas as discussions regarding nato supplies and drone attacks near completion”. Sayem’s take will be tested shortly, as negotiations are indeed almost concluded. If ILF’s funding suddenly dries and bankruptcy prevents further operations, StanChart’s monthly economy review will indeed merit greater appreciation.

“This doesn’t even suit the russians.

Tapi should interest them more, it’s in their natural area of influence. And the Chinese have a natural interest in assisting the Iran pipeline. Yet neither are happening, an indication of how complicated this particular problem has become,” Sayem adds.

ENDGAME: It would seem that even the best case scenario of the russians agreeing, that too on our terms (still contentious), would now not see Pakistan reaching the finish line in time. The Iranians have all but built their part of the pipe, while here work has not even begun.

“It’s a non-starter,” says Sayem.

“Why do you think even financial and technical feasibilities have not been sanctioned?” jafry.shahab@pakistantoday.com.pk

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Monday, 14 May, 2012

02 news Pressures intensify on European leaders LONDON

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reUTerS

ONFIDeNCe is already in short supply in financial markets and could evaporate further in the coming week if investors judge that europe’s often fractious political leaders aren’t mapping out a sustainable path through the current crisis. Over the past week investors have been rocked by the increased likelihood of Greece leaving the euro, and an admission by one of the world’s more highly regarded banks, JPMorgan Chase (JPM.N), of an embarrassing failure in risk management.

Many in the markets are now looking to europe’s political leaders to signal a shift in the German-led austerity drive across europe which they now see as threatening the fragile recovery underway in the world economy if cuts are not tempered with some efforts to encourage growth. Credit rating agency Fitch put the whole of the euro zone on notice on Friday that were Greece to leave the currency bloc as a result of its latest crisis, ignited by a voter rebellion against bailout terms, the remaining countries could find their sovereign ratings at risk.

“If you want to make sure the gradual improvement that you see will continue, you need to improve confidence,” said Patrick Zweifel of Swiss fund manager Pictet Asset Management which manages around $359 billion of assets.

“Only the politicians can do this even if they only say that they would agree to have some growth measures going forward instead of more austerity.”

The flight to safety by investors over the past week has taken the dollar to a two-month high against a basket of currencies .DXY, and pushed German and U.S. Treasury bond yields to new lows.

At the same time the MSCI’s index of global share market performance .MIWD00000PUS has steadily given up much of the gains made earlier in the year and, after falls of over two percent in the past week, was close to levels seen in January. Zweifel, Pictet’s chief economist, says euro zone first quarter GDP data due out on May 15 will confirm the region is in recession, but could well be an improvement over the final quarter of 2011, pointing the economy in the right direction. europe’s weak performance contrasts with a U.S. economy which is still seen on track for modest growth and with signs the slowdown in China’s rapid expansion has eased.

EUROGROUP GATHERS: The euro area’s finance ministers get the chance to begin outlining a new growth-oriented

Banks hit by JPMorgan; Wall Street ends week lower

S

NEW yOrK reUTerS

agenda to bolster the global outlook when they gather on Monday in Brussels, where the crisis in Greece and the budget problems in Spain will likely top the agenda.

The talks will be followed by a full meeting of finance ministers from across the 27-member european Union on Tuesday. Potentially of even more significance to the markets will be Wednesday’s first talks between the new French president Francois Hollande, the Socialist leader, and Germany’s conservative chancellor Angela Merkel.

The risk keeping investors on edge is that what emerges from these meetings

about europe and its impact on U.S. recovery won’t be far below the surface when G8 leaders gather at Camp David at the end of the week, hosted by President Barack Obama who faces an election in November. europe’s problems were part of the reason the widely-watched S&P 500 index touched two-month lows in the past week before some positive news on the jobs market and a sharp rise in U.S. exports for March prompted a slight recovery. U.S. markets will mull over April retail sales and inflation data on May 15 and the minutes of the latest Federal reserve policy setting meeting, due out on

HAreS of U.S. banks slumped on Friday after JPMorgan said it lost billions of dollars on bad trades, but the overall market ended only modestly lower, thanks to gains in technology shares. JPMorgan Chase & Co (JPM.N), the largest U.S. bank by assets, dropped 9.3 percent on record high volume after it disclosed losses on derivatives trades. The news sparked fears that the problems could reverberate through the banking sector. The KBW bank index .BKX fell 1.2 percent.

“JPMorgan will become a political issue. This will increase regulations on banks, and the overhang on large banks will last for awhile,” said Tim Ghriskey, who oversees about $2 billion as chief investment officer of Solaris Group in Bedford Hills, New York.

could be a new approach that either relaxes fiscal discipline too far or promotes growth measures that simply increase government spending.

“Adding more debt, when some governments are already rationed, will likely only worsen the outlook for euro area sovereigns,” said Vincent Chaigneau, head of rates strategy at French Bank Societe Generale. Spain’s experience has exemplified the risks. Ten-year bond yields have shot up to over six percent since Prime Minister Mariano rajoy on March 2 said his government wouldn’t be meeting its deficit goal for this year and relaxed the goal to 5.3 percent of GDP, up from the 4.4 previously pledged.

GROWTH WORRIES: Concerns

May 16, for signs of how the central bank may respond after its current market support measures end in June. <FeD/> In commodity markets, investors are focusing on gold which has not gained at all from the safe haven buying that has driven up the dollar and major government bond prices. The gold price peaked at around $1,790 an ounce in early April, but has since slipped to $1,580 an ounce with investors liquidating their holdings to cover losses on other markets and move into cash. “If it does further decline below that very important four-year trendline support (near $1,580) it opens the door to a move probably towards even $1,520 or $1,530,” said Ashraf Laidi, chief global strategist City Index.

JPMorgan’s shares fell to $36.96, and trading volume was around 216.7 million shares on Friday. Wall Street ended lower for the second week in a row, as concerns about europe’s fiscal health resurfaced as political turmoil in Greece again sparked worry that it could exit the euro and Spain’s ailing banks spurred fears the country could need a bailout, while some U.S. economic data raised questions about growth. But a survey released on Friday showed U.S. consumer sentiment rose to a more than four-year high in early May as Americans remained upbeat about the job market. The survey was a welcome sign amid worries that the economic recovery may be slowing down. The Nasdaq finished higher, outperforming the broader market. Shares of chip maker Nvidia Corp (NVDA.O) rose 6.4

Shock-proofing Asia’s economies baNGKOK

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NoeleeN Heyzer

NCerTAINTY and volatility have quickly become the “new normal” of the global economy. For several reasons, this turbulent external environment poses the most significant threat to Asia-Pacific growth in 2012.

One of this environment’s main features is the ongoing weakness of major developed economies. The expected Vshaped global recovery, from the depths of the 2008 financial crisis, proved shortlived. The world economy entered a second stage of crisis in 2011, owing to eurozone’s sovereign-debt crisis and continuing uncertainty about the economic outlook for the United States.

Mapping the landscape of these threats, forecasting their impact, and presenting a range of policy options to help countries to ensure inclusive and sustainable growth despite the

uncertainty, is the focus of the United Nations’ 2012 economic and Social Survey of Asia and the Pacific. Our forecast is that persistent headwinds will slow Asia-Pacific economic growth to 6.5% this year, down from 7% in 2011. reduced demand for regional exports and higher costs of capital, combined with loose monetary policies and trade protectionism in some advanced economies, will contribute to the slowdown. Nevertheless, Asia-Pacific growth will continue to outpace that of all other regions, acting as an anchor of stability and a new pole of dynamism for the world economy. For example, SouthSouth trade with the Asia-Pacific countries in 2012 will help other developing regions, especially Africa and Latin America, to reduce further their dependence on the low-growth advanced economies. Moreover, robust growth from the Asian economic powerhouses will continue in 2012, with China likely to grow at 8.6% and India’s growth

expected to accelerate from 6.9% to 7.5%.

The South-east Asian sub-region is likely to record a slight increase in growth, owing to Thailand’s strong recovery following the 2011 floods, and annual inflation in the Asia-Pacific region as a whole is projected to fall from 6.1% to 4.8%. The greatest risk to the AsiaPacific economy in 2012 is a disorderly sovereign-debt default in europe, or an unraveling of the eurozone. This worstcase scenario could lead to Asia-Pacific export losses of up to $390 billion in one year, with least-developed and landlocked developing countries worst hit – losing as much as 10% of their total exports. Although unlikely, such a scenario could reduce regional growth by as much as 1.3 percentage points, and prevent 22 million people from escaping $2-a-day poverty in 2012. A second key challenge to Asian regional growth in 2012 is commodity price volatility, together with a long-term rising trend.

High prices and persistent volatility are

increasingly features of the “new normal,” and both national and regional economies need to adjust to this reality.

The commodity boom that has resulted from higher prices presents both risks and opportunities. Price shifts alter incentives, but the less-developed economies of Asia and the Pacific must resist the impulse towards narrow commodity specialization. The lesson from the first round of Western globalization was that natural-resource specialization, especially in the poorest countries, can delay industrialization, economic diversification, and the creation of productive capacity. Another key step in “shock-proofing” Asian economies will be to address the problem of jobless growth, unemployment, and rising inequalities. This needs to be a gradual process of rebalancing, supporting greater domestic consumption as an enhanced engine of growth and productivity, job creation, and income equality. Other critical

percent to $13.21 after quarterly results beat expectations. The stock boosted the Nasdaq and was the S&P 500’s top percentage gainer.

Other chip stocks also rose, with the Philadelphia Semiconductor index .SOX up 0.73 percent. Also in the tech sector, shares of Netflix (NFLX.O) jumped 6.8 percent at $77.38. The Dow Jones industrial average was down 34.44 points, or 0.27 percent, at 12,820.60. The Standard & Poor’s 500 Index was down 4.60 points, or 0.34 percent, at 1,353.39. The Nasdaq Composite Index was up 0.18 points, or 0.01 percent, at 2,933.82.

Chesapeake energy Corp (CHK.N) shares fell 13.9 percent to $14.80 after the company said it may delay assets sales in order to preserve cash flow needed to comply with requirements of its corporate credit facility. For the week, the Dow fell 1.7 percent, the S&P fell 1.1 percent, and the Nasdaq was off 0.8 percent. Marc Pado, a U.S. market strategist at DowBull.com in San Francisco, said traders had helped support the market by closing short positions bets that stocks will fall - after gains at the start of May. “The trader types see that we came down to that 1,340 area on the S&P 500, started to bounce, started to see some buying, some bottom fishing, then you got that consumer sentiment number, and that was compelling enough,” he said. The disclosure by JPMorgan came as shocking news by a bank viewed as a strong risk manager. JPMorgan estimates the business unit involved in the trading loss will lose $800 million in the current quarter, excluding private equity results and litigation expenses. The bank had previously expected the unit to post a profit of about $200 million. Jamie Dimon, JPMorgan’s chief executive, cautioned that losses could grow by another $1 billion, another hurdle for a sector already besieged by the sovereign debt crisis in europe and fears of slowing growth globally. The news weighed on bank shares as investors feared both a greater risk of more regulation and the potential for more such losses at other banks. The stocks, however, came off their lows of the morning.

Citigroup Inc (C.N) lost 4.2 percent to $29.35 and the Financial Select Sector SPDr (XLF.P) was off 1.1 percent at $14.82 and the S&P financial sector .GSPF fell 1.2 percent.

Financial stocks have been among the most volatile in recent months as investors question what the growth outlook for the United States and the european debt crisis will mean for the group’s profits. JPMorgan has fallen 14 percent this month. The CBOe VIX Volatility Index .VIX rose nearly 16 percent for the month in a sign of growing caution. Thomson reuters/University of Michigan’s preliminary consumer confidence index for May improved to a reading of 77.8 from 76.4 in April, topping forecasts of 76.2. Of the 453 companies in the S&P 500 that have reported earnings to date for the 2012 first quarter, 66.2 percent have reported earnings above analysts’ expectations, according to Thomson reuters data. That compares with more than 80 percent at the start of earnings season and is below the average for the past 4 quarters of 68 percent.

economic-policy challenges in 2012 will include managing the balance between growth and price stability – which will require inflation-fighting measures beyond monetary policy alone; coping with capital flows, especially the surge in short-term debt; dealing with exchangerate volatility; and addressing the impact of extreme weather and natural disasters.

The Asia-Pacific countries are fortunate to face the turbulence and uncertainty of the global economy this year from a position of relative strength. High GDP growth rates, significant fiscal room for maneuver, and increasing economic cooperation make the region’s prospects for 2012 brighter than almost anywhere else. Making the right policy choices – to build resilience and pursue a sustainable pathway to shared prosperity – will prepare Asia and the Pacific to flourish in the context of sustained global uncertainty. That is good news in a troubled and turbulent world.

The writer is Under-Secretary-General of the United Nations and executive Secretary of the economic and Social Commission for Asia and the Pacific.

Courtesy: Project Syndicate

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Monday, 14 May, 2012

news

The secret strength of Pakistan’s economy

Hashwani’s ‘Five Star Gold Standards’ for rebuilding Pakistan

NaWEEN a maNGI

P

I

T’S early morning in Karachi, Pakistan’s biggest city, and Muhammad Nasir is outside his makeshift shelter of palm leaves, rags, and bamboo, washing up after breakfast. He uses water stolen from a nearby supply pipe that belongs to the local water utility. The 17-year-old bids farewell to his mother, an unlicensed midwife, and walks to his tire-repair shop, an open-air stand in a residential area with a table of tools and a wooden bench. He checks to make sure the electricity he’s drawing illegally from the overhead power line is on so he can run his tire pump. Then he sends 10-year-old Abid, one of his two employees, along with 12-year-old Irfan, to get tea from a nearby shop.

Nasir’s business, his home, his power and water supply, and even the cup of tea Abid brings him don’t exist in Pakistan’s official figures. They’re part of another economy that doesn’t pay taxes or heed regulations. It probably employs more than three quarters of the nation’s 54 million workers and is worth as much as 50 percent of Pakistan’s 18 trillion rupee ($200 billion) official gross domestic product.

And while the documented economy had its smallest expansion in a decade at 2.4 percent in the year ended June 2011, soaring demand for cars, cement for houses, and other goods shows the underground market is thriving. “everything from auto parts to sports goods, knitwear, clinics, and beauty salons fall into the informal economy,” says Sayem Ali, country economist at Standard Chartered Bank in Pakistan. “All these make a significant contribution to employment and income, and that’s one reason why the economy is still growing. But since Pakistan has one of the worst tax structures in the world, these fall under the radar.”

Pakistan’s tax-to-GDP ratio— that’s taxes as a share of gross domestic product—was 8.6 percent in June, one of the world’s lowest, according to Macroeconomic Insights in Islamabad. Only 25 percent of the economy is taxed if the undocumented sector is taken into account, says Chief executive Officer Sakib Sherani.

Developing economies usually have a tax-to-GDP ratio of from 13 percent to 18 percent, according to Invest Capital Markets, a brokerage in Karachi.

Former Finance Minister

Shaukat Tarin said in 2010 that Pakistan loses 800 billion rupees a year in tax evasion: The government collected 1.7 trillion rupees in tax last fiscal year.

That’s not enough to close the budget gap, which is 6.3 percent of GDP. Nasir says he pays 200 rupees a month to employees of the utility company to look the other way, and 400 rupees to the police to allow him to run his unregistered shop. Then there are the occasional political contributions to local parties— protection money, in other words, to keep the parties’ criminal components at bay. “I don’t think paying taxes to the government will do any good to me,” says Nasir. “We are already

paying taxes.”

He spends the morning repairing tires and fixing motorbikes, taking payments in cash and never issuing a receipt. At lunchtime he sends for salad and yogurt or lentil curry from one of the nearby pushcart vendors, none of whom is licensed. His mother and sister, a maid, supplement the family income with jobs in the informal sector.

After work, a religious teacher comes to give them lessons on the Koran at home, charging a monthly fee in cash that isn’t reported to the government.

Once a month, Nasir pays 300 rupees rent to a man who illegally settled on the land where Nasir’s family dwelling was built.

Only 1.5 million people, less than 1 percent of the population, file tax returns, according to the finance ministry. That compares with 3 percent in India. “A low tax-toGDP ratio means we get into a vicious cycle of high budget deficits financed by printing money or borrowing, which adds to the debt burden and creates inflationary pressures,” says Asad Sayeed, director of the Collective for Social Science research in Karachi.

Pakistan has the fastest inflation in Asia after Vietnam, and its budget gap may expand to 7 percent of GDP in the year ending in June, according to the IMF. Courtesy: Bloomberg Businessweek

Entrepreneurial vision SaIma aLI / ambrEEN raShEED

V

ISION plays a very vital role in our lives with the help of clear vision we usually sets our day to day targets. Mr. Winston Churchill says “The empires of the future are empires of the mind.” Mr. robert Fritz says “If you limit your choices only to what seems possible or reasonable, you disconnect yourself from what you truly want, and all that is left is a compromise.” Vision is the main aim in a

person’s life or entrepreneur. Vision contains the maximum potential that we as entrepreneur how to achieve the goals. A clear vision is just like to have an anchor in the board and a blurred vision is just like a board without having an anchor. entrepreneur are also called visionaries because they have ability to realize their own potential of doing work, think out of the box ,analysis the business problems and find out solution of it by having the vision in its mind. The vision start from entrepreneur and entrepreneur is that

who brings his ideas in market and creates business relationships which make the vision possible. Vision without action is day dream and action without vision is nightmare. A vision is not a strategy. A strategy is the outline of the plan for achieving the vision. entrepreneurs typically have great vision. entrepreneurs have the ability and work toward it even they may not be able to express the objectives. entrepreneurs have clear vision.

They just see it and are convinced that it is right. entrepreneurs are strong in his

03

Dr KamIL Tarar

AKISTAN is under crises internally as well as externally. A comprehensive solution is required to bring positive change in our destiny as a nation. This situation of uncertainty can only be overcome by collective wisdom and insights from leaders who have a proven and successful track record of ensuring top performance throughout their carriers. Pakistan needs strong leadership in all sectors, which can make us feel proud of ourselves by helping us achieve our well deserved true status and potential. We need role models who can give us strength, courage, confidence and inspire us by showing us the way to come out of shadows. One such high achiever and a leader is Sadruddin Hashwani who needs little introduction. By analyzing his leadership vision and management philosophy we can help define the recipe for rebuilding our great country. As far as Pakistan is concerned Sadruddin Hashwani’s role in the developmental history of this country is undeniable. He is a man of yesterday, today and tomorrow. He is a true corporate leader and patriotic Pakistani. He has introduced new meanings to the excellence in services in the hotel industry. He has always adopted the right course for his personal and professional life. He has shown strong values and beliefs and effectively puts them into action. He was a pioneer of 5 Star standards in hotels in Pakistan decades ago. Very few people were aware of 5 Star standards at that time. Due to Hashwani’s unique management and leadership style, these standards have not only been maintained over the years but are still shinning bright as always. In Pakistan where everything has deteriorated over the years, simply surviving is a formidable task.

Many big businesses and conglomerates have disappeared from the scene since they failed to maintain their standards and brand names. This issue has haunted not only the private sector but many public sector companies have met the same fate generally. The basic problem lies in the failure to provide strong and effective leadership, maintaining consistent performance and investing adequately in human capital. Other ailments include compromising integrity, poor corporate governance, corruption, lack of adoption of latest management and leadership techniques, ignoring integration of high end technology and most importantly not to be flexible and change in a preemptive mode with changing times.

vision. entrepreneurs without a clear vision usually fail, because they make their focused on short term gain or to have a little input but have more and more output of it. entrepreneur is a person who sells everything to everyone at the cost of their vision. It can be their customers, supplier, and partners. To achieve the entrepreneurial vision, the entrepreneur must analysis the market gap .It is the process of determined that what changes you should make in your business to filled out that gap. entrepreneur must sets targets which should be specific, measureable, attainable, and realistic and can be fulfilled on time. The entrepreneur must be worked smart rather than harder and have the capability to deal with the environmental risk as well

The change is happening at a breakneck speed even for a developing country like Pakistan.

Handling change both internally and externally with compatible speed demands vision, strategic planning, efficiency and of course firm grip on the management structure of the organization right from top to bottom. Sadruddin Hashwani has successfully and diligently addressed these issues in all his businesses. His strength lies in his swift ability to handle and manage the strong wave of change every day with integrity and dignity.

His attention to detail is visible in his sophisticated personality, choice of words in his passionate speech, whether related to business or his beloved country Pakistan. His infectious patriotism never fails to enthrall people while talking on any subject about Pakistan. The deftness with which the successful people like Hashwani maintain the precarious balance in life, offers lots of learning for us. He is an extraordinary person with exceptional courage like a lion, resolve and capability when it comes to facing tragedies like Marriott Islamabad’s bombing. Its rehabilitation was not less than a miracle and all of us have witnessed it firsthand. He empowers his human resource that invariably instills confidence and sense of responsibility. It is evident in the professionalism and ease his staff members conduct business in his hotels and other organizations.

Sadruddin Hashwani has strong faith in the future of Pakistan and potential of Pakistanis. He has built state of the art hotels in the least developed and neglected areas like Azad Kashmir’s capital Muzaffarabad and Gawadar port in Baluchistan to promote tourism and business as well. Investing in these least income generating areas at the moment from hotel industry perspective clearly reflect his commitment to development vision of Pakistan. People like him are game changers. His core values and golden rules of management and leadership are a role model for all of us. That is why “Hashwani’s 5 Star Gold Standards” philosophy can be applied across the board in all sectors of Pakistan to ensure success and overcome failures in rebuilding Pakistan. This narrative cannot cover every aspect of his multi dimensional and dynamic personality. His vision needs to be promoted and emulated as this is the need in these difficult times. We can benefit from his wisdom to define a clear vision not only for over selves but for our corporate and political leaders as well.

The writer is a corporate communications analyst

as operational risk; they have ability to take right decision on every time. They should be transparence in the decision which means the greater acceptance and having more support and the vision become fruitions. Goals for the business should be SMArT: n Specific _______Clearly defined by those who have the knowledge n Measurable ____Quantifiably defined in such a way as to determine progress n Achievable ____ Challenging and rewarding, but still within reach n relevant ______Tied to current tasks and abilities of the team n Time-based ____related to an agreed-upon timeline