Israel and strategic US partner fall out over Iran

Israeli Prime Minister Benjamin Netanyahu. PHOTO: REUTERS

JERUSALEM: Israel and its US ally have hit a troubled patch in their close relationship, caused by differences over Iran’s nuclear plans and peace with the Palestinians.

In a highly public spat, Israeli Prime Minister Benjamin Netanyahu and President Barack Obama are each seeking to directly address the other’s public.

At the moment, Israeli Economy Minister Naftali Bennett is campaigning in Washington, while the US ambassador to Israel, Dan Shapiro, has been making his case in the Israeli media.

“I’m not telling the Americans what they should do; I just give them the information, it’s for them to decide,” Bennet, who heads the far-right Jewish Home party, told Israeli public radio by telephone on Friday.

“It’s not really lobbying, more a dialogue between friends,” he said of his meetings on Capitol Hill and a speech to the Brookings Saban Center for Middle East Policy.

Meanwhile, Shapiro told public radio the high-profile war of words over a nascent deal Western powers are negotiating with Iran, which would see some easing of sanctions against the Islamic republic, was regrettable.

“It would be preferable if our differences were addressed in private, but sometimes that’s not possible,” he said.

In a speech to North American Jewish leaders in Jerusalem this week he said Obama “has made it crystal clear that he will not permit Iran to acquire a nuclear weapon, period, and is prepared to use all elements of our national power to ensure that we are successful.”

Despite such reassurances, Israeli media speak of a trans-Atlantic crisis of confidence over what Israel and the US say are Iran’s plans to develop a nuclear weapon. A second element involves increasingly fragile peace talks with the Palestinians amid an Israeli West Bank settlement drive, which has come in for sharp US criticism.

On Friday, left-leaning daily Haaretz cited an unnamed senior Israeli minister saying that Secretary of State John Kerry “can no longer serve as an honest broker between Israel and the Palestinians”.

Israeli Home Front Minister Gilad Erdan lashed out at Kerry on Thursday for slamming Netanyahu’s intensive campaigning against the emerging nuclear deal with Iran.

“I was astounded to hear John Kerry’s remarks about why the prime minister is criticising the agreement being formulated in Geneva without waiting for it to be signed,” Erdan told an Institute for National Security Studies conference in Tel Aviv.

“When we’re dealing with a country that wants to destroy Israel and the conditions that will enable it to carry out its wishes, what do they expect from the Israeli prime minister? Not to cry out when they’re holding the knife, but only when it’s at our throat?” he asked.

On Monday, Kerry had said Washington had Israel’s interests at heart and that he shared Netanyahu’s “deep concerns” about Iran.

“But I believe the prime minister needs to recognise that no agreement has been reached about the endgame here that’s the subject of the negotiations,” he said.

Netanyahu has repeatedly warned world powers against striking a “bad and dangerous” deal with Iran that fails to bring its alleged military nuclear programme to a complete halt.

On Wednesday, he warned that a “bad deal” could result in war.

Israel, the region’s sole if undeclared nuclear power, views a nuclear Iran as an existential threat and has said it will not be bound by any deal with its arch-foe, refusing to rule out military action to halt its programme.

Netanyahu’s hard line has the backing of the Israeli public, according to an opinion poll published on Friday that showed 65.5 percent of Jewish respondents opposed to a deal with Iran.

President Shimon Peres, however, urged restraint in relations with Washington.

“There can be disagreements, but they must be conducted with a view to the true depth of the situation,” he said in a speech on Thursday night.

“If we have disagreements we should voice them, ” he said. “But we should remember that the Americans also know a thing or two; we are not the only ones.”

Public radio commentator Ronen Pollak said Netanyahu knows that a deal with Iran is inevitable, “but he has decided on a trial of strength with Washington so that the agreement is the least bad possible.”

Egypt judges recommend dissolving the Muslim Brotherhood

A poster of ousted Egyptian President Mohamed Mursi is pictured on barbed wires during a protest by his supporters at El-Thadiya presidential palace in Cairo November 15, 2013. PHOTO: REUTERS

CAIRO: A panel of Egyptian judges has recommended the Muslim Brotherhood’s Freedom and Justice Party be dissolved, ahead of a court decision that could further drive the radicals underground, state media reported Saturday.

The panel made its non-binding recommendations to the administrative court, which is deliberating a law suit to ban the party for its affiliation with the Brotherhood and contravening laws on the formation of religious parties.

The court will examine the recommendations in a hearing on February 15, the official MENA news agency reported.

The party, headed by Mohamed Morsi before his election in June 2012, has been decimated in a crackdown following the president’s overthrow last July.

More than 2,000 radicals including party operatives have been arrested since an August 14 crackdown on protesters that killed hundreds.

The findings of such panels-appointed by courts to study lawsuits and make their recommendations-are often adopted.

A separate court had already issued a temporary ban on the Brotherhood and ordered its assets seized ahead of a final verdict.

Much of the Brotherhood’s leadership, including Morsi, is already in prison and on trial for allegedly inciting violence after his ouster, following massive protests demanding his resignation.

The Freedom and Justice Party swept Egypt’s last legislative elections in 2011 and 2012, before a court ruling scrapped parliament.

Brotherhood offers talks to ‘exit’ post-Morsi crisis

Meanwhile, the coalition led by the Muslim Brotherhood on Saturday offered negotiations to end the deadly tumult since Egyptian president Mohamed Morsi’s overthrow, without explicitly insisting on his reinstatement.

The coalition “calls on all revolutionary forces and political parties and patriotic figures to enter a deep dialogue on exiting the current crisis,” it said in a statement.

The coalition, which has organised weekly protests despite a harsh police crackdown, insisted in its statement on keeping up “peaceful opposition” but said it wanted a “consensus for the public good of the country.”

The proposal is the party’s most flexible statement yet made in public, and comes “with no conditions,” a coalition official said.

“We have no conditions, and neither should they,” Imam Youssef, a leader of the Asala party,part of the coalition, told AFP.

But he added the talks must lead to a “democratic” solution, and the coalition wanted them to start within two weeks

Sugar rush

During calendar year 2012, the government authorised the export of 500,000 tonnes of sugar. PHOTO: FILE

For a country that is one of the largest food producers in the world, Pakistan has a remarkably inadequate and ill-designed agriculture policy. The latest example of this is the manipulation of prices and artificial shortages that have taken place in the sugar market as a result of government policies that seem on the surface to be designed to help the poor, but in reality, only benefit wealthy sugar manufacturers. Sugar millers appear to have taken to hoarding their sugar stocks, while at the same time, being granted permission to export some of their stocks, creating an artificial shortage in urban areas that has resulted in skyrocketing prices. This situation would be utterly unacceptable under any circumstances, but the fact that it is at least partially the result of government policies is especially disturbing.

The problem arises from the fact that the biggest manipulator of prices and quantities in the country is the government itself. Ostensibly, the government is trying to ensure an adequate supply of essential food items at affordable prices to the poor. We applaud the goal, but disagree with the method. Attempting to impose controls on sugarcane prices and having a government entity that serves as the largest buyer of sugar in the country only creates opportunity for unscrupulous entities to try to game the system to their advantage. A better approach would be for the government to remove itself from the role of a market participant and instead focus on being a regulator. This approach has worked out quite well in the past. The government artificially tried to reduce sugar prices by fiat in 2010 and failed. However, when the Competition Commission of Pakistan simply tried to crack down on collusive activity between sugar mills, consumer prices went down and farmers got better prices for their crops. In short, rather than wasting resources on trying to be a benevolent monopolist, the government would make itself, consumers, and farmers much better off by simply controlling collusive activity.

Stepping up: Finance minister warns against speculative drives

Informs businessmen on tax widening initiatives and economic performance so far. CREATIVE COMMONS

LAHORE: 

Federal Finance Minister Ishaq Dar, on Saturday, warned speculators to refrain from their vile practice in the forex market or be ready to face action for causing huge financial losses to economy.

The federal minister was speaking at the Lahore Chamber of Commerce and Industry (LCCI). The LCCI Acting President Mina Tariq Misbah had presided over the meeting which continued for over three hours

A few people have taken the whole economy of the country hostage, but they would not be allowed to play at the cost of financial loss to the country, said the minister.

The minister assured businessmen that there would be no witch hunt by the Federal Bureau of Revenue to broaden the tax net. He said 165A was meant for tax evaders only. “Name a single tax registered person who has been given notice under 165A,” he asked.

He said that increasing the tax-to-GDP ratio to 15% of the GDP would be the first goal of the government which can be achieved only by registering new taxpayers. He said that the government hoped to fully revive growth and the economy in the next five years.

Despite adverse conditions, the economy showed robust growth in the first quarter of this fiscal, said the finance minister, adding that the foreign direct investment had increased by 83%, portfolio investment jumped by 101% and the large scale manufacturing had grown by 8.5% in the first quarter. “The negative trends in growth have been stopped and we are now moving on,” he added.

Ishaq Dar said that international rating agencies have acknowledged Pakistan’s performance and have upgraded its rating. He said the donors have offered lucrative loans to appreciate the efforts of the new government.

The minister spoke at length on all important issues faced by the economy and the measures being taken to overcome the challenges. He said that a three-year well-tailored economic revival plan had already been put into the motion that would yield positive results.

He told the meeting that newly imposed taxes had been the result of caretaker government’s commitment with International Monetary Fund (IMF). He added that the government is focused on narrowing down the foreign account and budget deficit.

On the issue of energy shortage, the minister said that the government was striving to ensure supply of cheaper energy to masses and for this purpose, it had launched medium- and short-term plans. He said that work on Neelum-Jehlum, Diamir-Basha and Dasu dams were well on their way. Once completed, they would help end power shortage in next three years, he assured.

He said that the government was also working on Civil Nuclear Technology and wind energy projects. He said that the government was determined to add 8,500 megawatts of electricity into the national grid by year 2016.

The finance minister announced setting up two committees comprising former LCCI president Mian Muhammad Ashraf, Sheikh Muhammad Asif, Mian Anjum Nisar, Iftikhar Ali Malik and FBR Chairman Tariq Bajwa to look into the issues of steel industry, under-invoicing, smuggling and sales tax refunds. He said the decisions taken by the committee would immediately be implemented in letter and spirit.

Speaking on the occasion, the LCCI Acting President Mian Tariq Misbah, said that the business community fully understood the economic conditions inherited by the present government.

Standing out: Going against the tide in the textile industry

To operate a factory on electricity from the national grid costs Rs 13per unit, but to operate the factory on heavy diesel generators costs Rs34 per unit. PHOTO: FILE

FAISALABAD: 

In the midst of declining production in the industry due to gas outages, Ashfaq Textile Mills Limited (ATML) has planned to double its production capacity and will invest Rs1 billion to place itself at a competitive position among the textile exporters.

As part of its expansion plan, the company has recently purchased seven acres of land. Currently, the company is operating 240 Sulzer looms and plans to add 260 more, according to Sheikh Ashfaq Ahmad, chief executive officer of ATML. The company will import the machinery from Switzerland at a cost of Rs3 million per machine.

ATML has been a listed company in the Karachi Stock Exchange since 1991. It is one of few companies operating without borrowing from banks, managing to keep the operational cost at manageable levels.

In fiscal year 2012-13, the company’s share price was Rs 10.71; last Wednesday it closed at Rs15 per share. This year the company gave a 33% bonus to its shareholders. According to the annual report 2012-13, the company’s net profit was Rs68.5 million.

In an interview to The Express Tribune, Ahmad said that the company decided to expand its capacity after successfully receiving large amounts international orders.

He voiced hope that with successful expansion the company will fulfil international market requirements.

He said that expansion will be carried out gradually, because the company was doing it on its own without borrowing from the banks. He said the policy of zero bank borrowing was benefiting the company in many ways. Ashfaq said the industries that had obtained loans have to pay a minimum 10% interest, something that ends up being very troublesome for them.

Ahmad said his company was constantly hiring people and the expansion plan will also benefit the unemployed youth.

While other industrialists complain about the adverse implications of the energy crisis, Ashfaq said that there was no doubt that the energy crisis has hit their business the hardest “but we are not relying on the government for electricity.”

The company has installed heavy generators which can run the whole factory without any interruption.

Ashfaq admitted that the energy crisis did increase the cost of production. To operate a factory on electricity from the national grid costs is Rs 13 per unit but to operate the factory on heavy diesel generators costs Rs34 per unit.

“We have no other businesses,” says Ashfaq, “we are just relying on this mill.” He hoped that after approval of the GSP-plus status, industry expected a huge improvement in cash flow.

He demanded of the government to release the billions of rupees to exporters on account of duty drawbacks that were withheld to artificially increase tax revenue.

He said “by withholding taxpayer’s money, the government had breached their trust.”

He demanded a permanent solution to perpetual energy crisis. “an effective solution could substantially increase textile exports which currently stand at $14 billion. If the government could overcome energy crisis, we would have the capacity to increase textile exports $25 billion.

Strengthening ties: Pakistan offers to set up sugar mills in Sri Lanka

Pakistan prime minister Nawaz Sharif (L) poses with Sri Lanka prime minister Mahinda Rajapaksa during a banquet dinner for the Commonwealth Heads of Government Meeting (CHOGM) in Colombo November 16, 2013. PHOTO: REUTERS

COLOMBO: 

Pakistan has offered to set up sugar mills in Sri Lanka, the offer was made by Prime Minister Nawaz Sharif in response to Sri Lankan President Mahinda Rajapakse’s desire to invest in the sugar sector during their meeting in Colombo.

During the meeting, both the leaders agreed to further strengthen economic ties and stressed on increasing bilateral trade volume from the present $460 million to $1 billion in the next few years.

They also agreed that bilateral flow of investments could play an important role in boosting economic relations.

The meeting between the two leaders which is the second one during the last two months will give significant boost to the already strong bilateral ties between the two countries.

The prime minister congratulated President Rajapakse on successfully hosting the Commonwealth Heads of Government Meeting 2013.

Cross border trade: FICCI to organise the second edition in Lahore

President SAARC Chamber of Commerce and Industry, Senior Executive Committee member of FICCI Vikramjit Singh Sahney (L) welcomes FPCCI President Zubair Ahmed Malik. PHOTO: AFP

ISLAMABAD: 

During the last two years, the trade between India and Pakistan has doubled to $2.7 billion, which can be further pushed up to $8 billion through simple measures, said Zubair Ahmed Malik, president of Federation of Pakistan Chamber of Commerce and Industries (FPCCI) while speaking at a roundtable meeting on ‘India Pakistan Economic Relations: The Next Milestone’ organised by the Federation of Indian Chambers of Commerce and Industry (FICCI) in New Delhi.

Malik said that FPCCI and FICCI had been working together for two decades to promote bilateral economic agenda. FPCCI would extend maximum cooperation to FICCI in organising the second edition of the ‘India Show’ in Lahore from February 14 to 16, 2014.

Malik also said that strong political will was needed to realise the actual trade potential, which was no less than $50 billion per annum. The FPCCI chief said that both countries should ease visa restrictions to actualise the real trade potential, which would only flourish if free movement of people was allowed, high import tariff as well as non-tariff barriers were altered and issues such as bureaucratic hurdles, and lack of infrastructure were resolved.

“I believe that the Most Favored Nation (MFN) status will not be a death knell for the Pakistan economy as regarded by some Pakistani sectors; it only suggests that for trade purposes a World Trade Organisation (WTO) member country will not be discriminated by other member countries,” said FPCCI president.

Speaking on the occasion, Vikramjit Singh Sahney, Saarc Chamber of Commerce and Industry president, and senior executive committee member of FICCI, said that political will on both sides was needed to exploit the growing opportunities for which reduction in information gap is imperative. FPCCI Vice-President Gluzar Feroz asked India to allow direct sales of certain items to Pakistan like chemicals, dyes and heavy machinery, which will not only reduce costs but also improve relations. Naeem Anwar, minister of trade at Pakistan High Commission in New Delhi, said Islamabad had completed the consultation and hoped that negotiations on issuing the MFN status to India would start soon.