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Saturday, July 24, 2010

Pakistan's M2 provokes some jealousy across the border....

Indians have at least something to envy or to be jealous about Pakistan. Although both countries have different identities, they have so many things in common also. The corrupt practices of the public functionaries wherever there is involvement of contractors, is something which both can equally boast about. In the area of corruption, the public “servants” of both the countries have a common DNA.

Over the decades, the public works have consumed so much of the capital outlay that it bled the economy profusely without any tangible returns. The budgetary deficit was caused by corruption wherever construction was involved. Eventually, funds for development fell short of resources forcing borrowing. It is a common belief that works completed by public works department are 50% more expensive and 50% more unreliable as far as the quality of construction is concerned. 35% of the project funds are pilfered by functionaries with 15% paid to contractors in excess of his rightful claim. These are rough statistics of Pakistan and India would be no better.

It is for this reason that roads are built and rebuilt many times over making “them” rich at the cost of taxpayers. And as the ratio of indirect taxes dominates direct taxes, we can safely assume that 100% population of Pakistan pays taxes. These roads are built and are “maintained and repaired” every year then rebuilt after every five years but these are never of any international standard and are never in good conditions on both sides of the border.

However, there is one road,  which impressed even Indians and that is M2, Pakistan first motorway between Lahore and Islamabad completed in November, 1997. But alas! We have hardly any reason to be proud of because this road was never built by Pakistani Highway money minters, it was built by South Korean engineers. Wall Street Journal has reported that a major conundrum to those who visit both India and Pakistan is why the roads are so much better in the latter. For all its problems, Pakistan’s 367-kilometer-long M2 motorway between Lahore and Islamabad strikes a visitor as being streets ahead of India’s decrepit inter-state roads.

For one, there’s a disciplined motorway police that patrol Pakistan’s highways and don’t take bribes. If you go above 120 kilometers an hour, and are caught on camera, a fine awaits you at the toll gate. Nonpayment means you can’t get out. The M2 motorway passes through the densely populated Punjab countryside but there are no cows, rickshaws or motorbikes coming at traffic on the wrong side of the road which is a common experience in India. The M2 road was built in the late 1990s by South Korean firm Daewoo, whose name is still emblazoned on the modern service stations that line the route.

Sunita Kohli, a New Delhi-based interior designer who recently did work on a boutique hotel in Lahore, says she was impressed with the road compared to similar developments in India. “We really lag behind on infrastructure,” she said. “Now we’re trying to make up for lost time.”

That’s not to say Pakistan doesn’t face its own infrastructure challenges. Its most pressing need is to build more power plants and stop people from stealing electricity to avoid hours of blackouts across the country. And Pakistan’s motorways — at just over 600 kilometers in combine length — are only a small fraction of the total road network, much of which is old. Ms. Kohli says she sees the M2 as a “showcase.” India still slightly edges out Pakistan in the United Nations’ Human Development Index, which measures per capita GDP, literacy, life expectancy and other development criteria.

Until a couple of years ago, Pakistan’s economy was booming and there was plenty of public and private money for infrastructure spending. Now, foreign direct investment has dried up and the government, running a large deficit, has had to turn to the IMF for more than $11 billion in loans. But first-time visitors to Pakistan, many expecting a failed state, are surprised by some of the modern infrastructure. Apart from the roads, Pakistan’s broadband and wireless roaming speeds also compare favorably with India. Doing business in Pakistan is easier than in India and China, according to the World Bank.
With regular Taliban suicide bombings, though, Pakistan is unable to capitalize on these positives and continues to generate only negative headlines. [Article courtesy: Wall Street Journal]

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