From: reddym@Barra.COM (Reddy Mallidi)
Subject: Pakistan Urges India to Lease Jinnah House 
Organization: BARRA, CA
Date: Fri, 22 Jan 93 13:32:19 GMT


     Source : XINHUA, Financial Times
     Dates  : Jan 20-21, 1993
     Country: Pakistan

                                * * * *

    * Pakistan urges India to lease Jinnah house

    Islamabad 01/20 : Pakistan today called on India to lease the Jinnah
    house to Pakistan as official residence of Pakistan consulate general
    in Bombay. In response to Indian government's recent decision to 
    disallow Pakistan to rent the Jinnah house, a foreign office spokesman
    said that it "deeply disappointed us". "We hope Indian government will
    review and rethink this decision with a view to fulfilling its 
    longstanding committment and facilitating our efforts to make our
    recently established consulate general in Bombay fully operational",
    the spokesman said in a statement. According to the spokesman the house
    was built by Jinnah, and served his residence for several years before
    the independence of Pakistan in 1947, so the Pakistan people have
    special sentimental attachment to it. (XIN)

    * Mounting defence and debt costs put Pakistan economy at risk

    Karachi 01/21 : The long shadow of excessive public spending hangs over
    Pakistan's economy. The government continues to spend so much itself
    that it could yet undermine its achievement of the last two years since
    Nawaz Sharif came to power and launched radical economic reforms. For 
    the year 1992, it set a target of 5% of national output for the fiscal
    deficit. The actual result was 7.8%, according to the State Bank of
    Pakistan, the central bank. For the current year, too, the government
    has already given up hope of reaching the 5% target. Mr Sartaj Aziz, 
    the finance minister, admits: "the only area where progress is difficult
    is the budget deficit". The basic problem is that defence soaks up around
    35% of public spending and a further 25% goes for debt servicing.
    Cutting debt servicing is almost impossible without reneging on     
    agreements with creditors. Military spending is also sacrosant as long
    as relations with India remain hostile. Progress has been slow in
    reducing the civilian administration since the bureaucracy, a powerful
    force, is loathe to pull its belt. The inability to cut such big items
    leaves the government with little scope for increasing those programs
    essential for economic development, such as expanding transport networks
    and the power supply. It is also difficult to accommodate emergencies
    such as the autumn floods which cost the government Rs 4-5b. There are
    are levies charged on various economic activities including paying
    and receiving interest, importing and even using electricity. They have
    been devised as a partial substitute for income tax, which is widely
    evaded in Pakistan. The government is trying to improve income tax
    collection but progress will be limited as politically powerful groups
    such as farmers enjoy tax exemptions. (FT)

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