Tuesday, May 1, 2012

Free Download book: "Capitalism's Achilles Heel" by Raymond Baker with Urdu translation (Exposing corruption of Zardari and Nawaz Sharif)

Below are the download links for downloading the book "Capitalism's Achilles Heel" by Raymond Baker. This book contains description of the corruption of Asif Zardari / Benazir Bhutto family (Page 77 to 82), Mian Nawaz Sharif family (Page 82 to 85)  and the military (Page 85 to 87).

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Capitalism's Achilles Heel in Urdu - by Raymond Baker (PDF format)
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Download: Capitalism's Achilles Heel in English - by Raymond Baker (PDF format)
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Alternate Download Link: Capitalism's Achilles Heel - by Raymond Baker (PDF)
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Excerpts related to Pakistan from the book Capitalism's Achilles Heel by Raymond Baker

Nawaz Sharif Family

Corruption and criminality run from the top down, with the political class constantly looting the national treasury and distorting economic policy for personal gain. Bank loans are granted largely on the basis of status and connections. The rich stash much of their money abroad in those willing western coffers, while exhibiting little inclination to repay their rupee borrowings. Pakistan’s recent history has been dominated by two families—the Bhuttos and the Sharifs—both merely tolerated by the military, the real power in the country. When it comes to economic destruction, there’s not a lot of difference among the three.

Pages 82-85 of the book cover the section on Nawaz Sharif: While Benazir Bhutto hated the generals for executing her father, Nawaz Sharif early on figured out that they held the real power in Pakistan. His father had established a foundry in 1939 and, together with six brothers, had struggled for years only to see their business nationalized by Ali Bhutto’s regime in 1972. This sealed decades of enmity between the Bhuttos and the Sharifs. Following the military coup and General Zia’s assumption of power, the business—Ittefaq—was returned to family hands in 1980. Nawaz Sharif became a director and cultivated relations with senior military officers. This led to his appointment as finance minister of Punjab and then election as chief minister of this most populous province in 1985. During the 1980s and early 1990s, given Sharif ’s political control of Punjab and eventual prime ministership of the country, Ittefaq Industries grew from its original single foundry into 30 businesses producing steel, sugar, paper, and textiles, with combined revenues of $400 million, making it one of the biggest private conglomerates in the nation. As in many other countries, when you control the political realm, you can get anything you want in the economic realm.


With Lahore, the capital of Punjab, serving as the seat of the family’s power, one of the first things Sharif did upon becoming prime minister in 1990 was build his long-dreamed-of superhighway from there to the capital,Islamabad. Estimated to cost 8.5 billion rupees, the project went through two biddings. Daewoo of Korea, strengthening its proposals with midnight meetings, was the highest bidder both times, so obviously it won the contract and delivered the job at well over 20 billion rupees.

A new highway needs new cars. Sharif authorized importation of 50,000 vehicles duty free, reportedly costing the government $700 million in lost customs duties. Banks were forced to make loans for vehicle purchases to would-be taxi cab drivers upon receipt of a 10 percent deposit.Borrowers got their “Nawaz Sharif cabs,” and some 60 percent of them promptly defaulted.This left the banks with $500 million or so in unpaid loans. Vehicle dealers reportedly made a killing and expressed their appreciation in expected ways. Under Sharif, unpaid bank loans and massive tax evasion remained the favorite ways to get rich. Upon his loss of power the usurping government published a list of 322 of the largest loan defaulters, representing almost $3 billion out of $4 billion owed to banks. Sharif and his family were tagged for $60 million. The Ittefaq Group went bankrupt in 1993 when Sharif lost his premiership the first time. By then onlythree units in the group were operational, and loan defaults of the remaining companies totaled some 5.7 billion rupees, more than $100 million.

Like Bhutto, offshore companies have been linked to Sharif, three in the British Virgin Islands by the names of Nescoll, Nielson, and Shamrock and another in the Channel Islands known as Chandron Jersey Pvt. Ltd. Some of these entities allegedly were used to facilitate purchase of four rather grand flats on Park Lane in London, at various times occupied by Sharif family members. Reportedly, payment transfers were made to Banque Paribas en Suisse, which then instructed Sharif ’s offshore companies Nescoll and Nielson to purchase the four luxury suites.

In her second term, Benazir Bhutto had Pakistan’s Federal Investigating Agency begin a probe into the financial affairs of Nawaz Sharif and his family. The probe was headed by Rehman Malik, deputy director general of the agency. Malik had fortified his reputation earlier by aiding in the arrest of Ramzi Yousef, mastermind of the 1993 World Trade Center bombing. During Sharif ’s second term, the draft report of the investigation was suppressed, Malik was jailed for a year, and later reportedly survived an assassination attempt, after which he fled to London. The Malik report, five years in the making, was released in 1998, with explosive revelations:

The records, including government documents, signed affidavits from Pakistani officials, bank files and property records, detail deals that Mr. Malik says benefited Mr. Sharif, his family and his political associates:
At least $160 million pocketed from a contract to build a highway from Lahore, his home town, to Islamabad, the nation’s capital.
At least $140 million in unsecured loans from Pakistan’s state banks.
More than $60 million generated from government rebates on sugar exported by mills controlled by Mr. Sharif and his business associates.
At least $58 million skimmed from inflated prices paid for imported wheat from the United States and Canada. In the wheat deal, Mr. Sharif ’s government paid prices far above market value to a private company owned by a close associate of his in Washington, the records show. Falsely inflated invoices for the wheat generated tens of millions of dollars in cash.

The report went on to state that “The extent and magnitude of this corruption is so staggering that it has put the very integrity of the country at stake.” In an interview, Malik added: “No other leader of Pakistan has taken that much money from the banks. There is no rule of law in Pakistan. It doesn’t exist.”

What brought Sharif down in his second term was his attempt to acquire virtually dictatorial powers. In 1997 he rammed a bill through his compliant parliament requiring legislators to vote as their party leaders directed. In 1998 he introduced a bill to impose Sharia law (Muslim religious law) across Pakistan, with himself empowered to issue unilateral directives in the name of Islam. In 1999 he sought to sideline the army by replacing Chief of Staff Pervez Musharraf with a more pliable crony. He forgot the lessons he had learned in the 1980s: The army controls Pakistan and politicians are a nuisance. As Musharraf was returning from Sri Lanka, Sharif tried to sack him in midair and deny the Pakistan International Airways flight with 200 civilians on board landing rights in Karachi. Musharraf radioed from the aircraft through Dubai to his commander in Karachi, ordering him to seize the airport control tower, accomplished as the plane descended almost out of fuel. Musharraf turned the tables and completed his coup, and Sharif was jailed.

But Sharif had little to fear. This, after all, is Pakistan. Musharraf needed to consolidate his power with the generals, and Sharif knew details about the corruption of most of the brass. Obviously, it is better to tread lightly around the edges of your peer group’s own thievery. So Musharraf had Sharif probed, tried, convicted, and sentenced to life in prison, but then in 2000 exiled him to Saudi Arabia. Twenty-two containers of carpets and furniture followed, and, of course, his foreign accounts remained mostly intact. Ensconced in a glittering palace in Jeddah, he is described as looking “corpulent” amidst “opulent” surroundings. Reportedly, he and Benazir Bhutto even have an occasional telephone conversation, perhaps together lamenting how unfair life has become.

Bhutto / Zardari Family:

Corruption and criminality run from the top down, with the political class constantly looting the national treasury and distorting economic policy for personal gain. Bank loans are granted largely on the basis of status and connections. The rich stash much of their money abroad in those willing western coffers, while exhibiting little inclination to repay their rupee borrowings. Pakistan’s recent history has been dominated by two families—the Bhuttos and the Sharifs—both merely tolerated by the military, the real power in the country. When it comes to economic destruction, there’s not a lot of difference among the three.

Benazir Bhutto on pages 77-82: Born in Karachi in 1953 and educated in private schools, Benazir Bhutto graduated from Radcliffe College at Harvard University in 1973. Going on to Oxford for a master’s degree, she displayed her budding political skills and was elected president of the Student Union in 1977. Meanwhile, her father had become prime minister of Pakistan in

1971, was ousted in a military coup in 1977, and was executed in 1979 on charges of conspiracy to commit murder. In and out of prison and house arrest, Benazir was not allowed to leave the country until 1984 but then returned to lead the democracy movement two years later. Her father’s usurper, General Muhammad Zia ul-Haq, was killed in a mysterious plane crash in 1988, which also took the life of the U.S. ambassador Arnold Raphel, and the head of the U.S. military aid mission to Pakistan, General H.M. Wasson. Benazir was elected prime minister that year, served until her ouster in 1990 on charges of corruption and nepotism, was reelected in 1993, and ousted again in 1996, amidst more charges of corruption. During her two terms in office and since, what has come out portrays Bhutto and her husband Asif Ali Zardari as world-class thieves.

Upon taking office in 1988, Bhutto reportedly appointed 26,000 party hacks to state jobs, including positions in state-owned banks. An orgy of lending without proper collateral followed. Allegedly, Bhutto and Zardari “gave instructions for billions of rupees of unsecured government loans to be given to 50 large projects. The loans were sanctioned in the names of ‘front men’ but went to the ‘Bhutto-Zardari combine.’ ” Zardari suggested that such loans are “normal in the Third World to encourage industrialisation.” He used 421 million rupees (about £10 million) to acquire a major interest in three new sugar mills, all done through nominees acting on his behalf. In another deal he allegedly received a 40 million rupee kickback on a contract involving the Pakistan Steel Mill, handled by two of his cronies. Along the way Zardari acquired a succession of nicknames: Mr. 5 Percent, Mr. 10 Percent, Mr. 20 Percent, Mr. 30 Percent, and finally, in Bhutto’s second term when he was appointed “minister of investments,” Mr. 100 Percent.

The Pakistan government’s largest source of revenues is customs duties, and therefore evasion of duties is a national pastime. Isn’t there some way to tap into this major income stream, pretending to fight customs corruption and getting rich at the same time? Of course; we can hire a reputable (or disreputable, as the case may be) inspection company, have the government pay the company about a one percent fee to do price checking on imports, and get multimillion-dollar bribes paid to us upon award of the contracts. Société Générale de Surveillance (SGS), headquartered in Switzerland, and its then subsidiary Cotecna, the biggest group in the inspection business, readily agreed to this subterfuge.

Letters in 1994 promised “consultancy fees,” meaning kickbacks, of 6 percent and 3 percent to two British Virgin Island (BVI) companies, Bomer Finances Inc. and Nassam Overseas Inc., controlled by Bhutto and Zardari. Payments of $12 million were made to Swiss bank accountsof the BVI companies. SGS allegedly has paid kickbacks on other inspection contracts around the world. Upon being accused in the inspection kickback scheme, Bhutto sniffed, “I ran the government to the best of my honest ability. And I did it for nothing but acknowledgment and love.”

Then there was the 1994 deal to import $83 million worth of tractors from Poland. Ursus Tractors allegedly paid a 7 percent commission to another of Zardari’s Caribbean companies, Dargal Associated. Bhutto waived import duties on the tractors, costing the Pakistani government some 1.7 billion rupees in lost revenues. Upon discovery of this scheme the Poles hastened to turn over 500 pages of documentation confirming the kickback.

The Polish tractor deal was just a warm-up for the French fighter jet deal. After the U.S. government cancelled a sale of two squadrons of F-16s, Bhutto dangled a $4 billion contract for Mirages in front of the French—Dassault Aviation; Snecma, the engine manufacturer; and Thomson-CSF, producer of aviation electronics. Without missing a beat they allegedly agreed to pay a “remuneration” of 5 percent to Marleton Business S.A., yet another of Zardari’s British Virgin Island companies. This would have generated a tidy $200 million for the Bhutto-Zardari couple, but unfortunately for them she was driven from office before they could collect.

Ah, but the gold deal gave some comfort to these aspiring kleptocrats. Gold is culturally important in the Asian subcontinent, in particular as a way for women to accumulate wealth. Upwards of $100 billion is invested in this unproductive asset in Pakistan, India, and surrounding countries. Smuggling is big business. Ostensibly to regulate the trade, a Pakistani bullion dealer in Dubai, Abdul Razzak Yaqub, asked Bhutto for an exclusive import license. In 1994, yet another Zardari offshore company, M.S. Capricorn Trading, was created in the British Virgin Islands. Later in the year, Jens Schlegelmilch, “a Swiss lawyer who was the Bhutto family’s attorney in Europe and close personal friend for more than 20 years,” opened an account for Capricorn Trading at the Dubai branch of Citibank. According to a 1999 U.S. Senate report: “Mr. Schlegelmilch did not reveal to the Dubai banker that Mr. Zardari was the beneficial owner of the PIC [private investment company], and the account manager never asked him the identity of the beneficial owner of the account. . . . Shortly after opening the account in Dubai, Mr. Schlegelmilch signed a standard referral agreement with Citibank Switzerland private bank guaranteeing him 20 percent of the first three years of client net revenues earned by the bank from each client he referred to the private bank.” In other words, Citibank was contracting to pay a finder’s fee for millions brought in from dubious sources. Citibank went on to open three accounts in Switzerland for Zardari, with Schlegelmilch as the signatory.

In October 1994, Citibank records show that $10 million was deposited into Capricorn’s Dubai account by Razzak Yaqub’s company, A.R.Y. International Exchange. In December, Razzak Yaqub received an exclusive import license and proceeded over the next three years to ship more than $500 million in gold to Pakistan. Additional deposits flowed into the Dubai and Swiss Citibank accounts, and funds also were shifted to Citibank Channel Island subsidiaries. The original ceiling on the accounts of $40 million was reached quickly

Toward the end of her second term, the Bhutto case took a bizarre turn. Representatives of thePakistan Muslim League, an opposition party, met in 1995 with private investigators in London who offered documentary proof from an unnamed source of Bhutto’s corruption, in return for a modest fee of $10 million. That deal was not consummated, but two years later, with Bhutto out of office and under investigation, the offer was reportedly concluded for $1 million. The documents “appeared to have been taken from the Geneva office of Jens Schlegelmilch.”

In 2000 Pakistan’s National Accountability Bureau, with the thankless task of investigating corruption, drew upon these documents and other sources and released details of assets and accounts belonging to Bhutto and Zardari. Even to jaded observers, the scale of their holdings was stunning: hundreds of properties, dozens of companies, and dozens of bank accounts. A partial listing of only foreign holdings reported by the National Accountability Bureau is provided in Table 3.4.
 
Summarizing this and other documentation, the New York Times reported that the material included “. . . letters from executives promising payoffs, with details of the percentage payments to be made; memorandums detailing meetings at which these ‘commissions’ and ‘remunerations’ were agreed on, and certificates incorporating the offshore companies used as fronts in the deals. . . . The documents also revealed the crucial role played by Western institutions. Apart from the companies that made payoffs, and the network of banks that handled the money . . . the arrangements made by the Bhutto family for their wealth relied on Western property companies, Western lawyers and a network of Western friends.”

Even the Swiss finally had had enough. Seventeen bank accounts linked to Bhutto and Zardari were frozen. The two were charged with money laundering in connection with bribes received from the inspection company SGS and were convicted by a Swiss court in 2003, with fines and suspended prison sentences. This was short-lived; the decision was overturned and referred back to cantonal prosecutors upon appeal. Meanwhile, Zardari was in prison in Pakistan from 1996 to 2004 on assorted charges.

Bhutto, with her father executed, two brothers assassinated, her mother an amnesiac, her husband still troublesome, and she living in exile between London and Dubai, portrays herself as the victim: “I never asked for power. I think they [the Pakistani people] need me. I don’t think it’s addictive. You want to run away from it, but it doesn’t let you go. . . . I think the reason this happens is that we want to give love and we receive love.” Save your tears. In the global collection of displaced leaders, Benazir Bhutto may be the least sympathetic character of all.

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Disclaimer: This blog is not an official PTI webpage and is run by a group of volunteers having no official position in PTI. All posts are personal opinions of the bloggers and should, in no way, be taken as official PTI word.
With Regards,
"Pakistan Tehreek-e-Insaf FATA Volunteers" Team.



4 comments:

  1. these are good very good information of over leaders

    Who i can share it on Face book?

    ReplyDelete
  2. we need these information in our education system

    ReplyDelete
  3. This stuff should be taught in school and the course name would be "How to get rich in our elders style". I think we waste lot time of our children in stupid math, science, technology, medicine, business or etc. These people are our leaders we should follow them.

    ReplyDelete
  4. đồng tâm
    game mu
    cho thuê nhà trọ
    cho thuê phòng trọ
    nhac san cuc manh
    số điện thoại tư vấn pháp luật miễn phí
    văn phòng luật
    tổng đài tư vấn pháp luật
    dịch vụ thành lập công ty trọn gói

    đọc có ghi: "Người sống trên đời có ai mà không chết? Chắc chắn là không có! Cho nên thầy thuốc chỉ có thể chữa những bệnh không gây ra cái chết. Nhưng như thế nào là những bệnh không gây ra cái chết? Thiết nghĩ, phàm là tác động từ bên ngoài khiến cho cơ thể bị thương tổn hay ốm đau... thì đều gọi là những bệnh không gây chết…

    Những bệnh mà hẳn là phải chết thì đó chính là do thiên mệnh...”

    Đọc tới đây, tinh thần của Sở Dương liền trở nên chấn động dữ dội. Ý tứ của đoạn trên rất rõ ràng: chỉ cần không phải là đèn dầu sắp cạn thì mọi bệnh tật đều có thể chữa trị. Đây chỉ dựa trên lý luận mà nói, thế nhưng khẩu khí lại rất lớn a!

    " Rầm… rầm...!"

    Sở Dương đang cảm thấy hứng thú thì nghe tiếng đập cửa, hắn bực bội hỏi: "Ai đó?"

    "Tại hạ nghe nói nơi này có bán thần binh lợi khí, cho nên đặc biệt tới bái phỏng." Thanh âm từ bên ngoài truyền tới có vẻ mệt mỏi.

    Sở Dương nghe xong liền máy động trong lòng, thanh âm này tuy mệt mỏi nhưng vẫn ẩn chứa sự kiêu ngạo giống như không để bất kỳ kẻ nào vào mắt. Chỉ có những người luôn ở địa vị cao mới có khẩu khí như vậy.

    Hơn nữa, chủ nhân của thanh âm này còn rất trẻ.

    ReplyDelete