Bankruptcy stares Pindi in the face
MUJIBNAGAR, SEPT. 25% Six months after embarking on the genocide to retain its colonial hold on Bangladesh, Pakistan is now reeling under economic bankruptcy.
According to authoritativ estimates, jute export is down to a third of the normal volume, textile industry is in doldrums and tax revenues from Bangladesh have fallen below 50 per cent of he normal collection, says U.N.I.
On the top of all this army operations against the mounting gurerilla activities are causing a heavy drain upon the country’s scanty resources.
Jute and hide exports from Bangladesh used to earn for the country over Rs. 300 crores in foreign exchange, which is almost 50 per cent of the country’s total such earning. But even the most liberal estimates put this year’s exports at not more than about Rs. 120 crores.
At the time of the army crackdown, most of the jute mills had sufficient stocks for three to four months-normal operations. But a large number of these mills subsequently closed down and most of those that have reopened are operating at about 20 per cent of their former levels of out put.
The dislocation of the road, rail and river transports has reduced the cargo carrying capacity to about one-fourth of the normal. This has created a serious problem for the movement of jute crops from secondary markets to terminals as well as for exports of raw jute and jute goods.
The outlook for the mills now operating is far form reassuring. Largescale exodus of peasants has led to reduced cultivation of jute crops. The disruption of credit facilities and reduced levels of production have entailed serious losses. Consequently, many mills are unable to meet pay rolls.
The textile industry in West Pakistan had thrived mainly on the sheltered market in Bangladesh which used to import about 220 million yards of cloth of the value over Rs. 800 million annually.
West Pakistani fabrics are being boycotted and with only 10 to 20 per cent of the district towns, the import of textiles has been virtually at a standstill for the past several months.
The loss of Bangladesh market has also eroded the export of textiles to African and Arab markets, since it used to be heavily subsidized with the earnings from Bangladesh. A few textile mills West Pakistan have already closed and several thousand workers have been laid off.
There is practically no construction work in Bangladesh and this has thrown the cement industry in West Pakistan into a crisis.
Natural calamities coupled with the present conflict have seriously affected the martial Law Administration’s resources position in Bangladesh.
It is estimated that the tax revenues are likely to amount to less than 50 per cent of the budget estimate of Rs.38 crores.
The most drastic setback has been in land revenue, the most important single tax. The collection for the whole year may at best yield about Rs. four crores budgetted.
This disruption of tax collections closely linked with the general disruption of overall administrative system, had direct repercussions on public resources of Pakistan.
Besides, the financial position of the railways and other public entities such as East Pakistan industrial Development Corporation and internal Water Transport Authority has also been Severely affected. Their aggregate current deficits are now expected to be well over Rs. 30 crores, thus straining further the stringent resource position of Pakistan.
Reference: Hindustan Standard 26.9.1971