Tag Archive: United States


Pakistan’s president Zardari has always remained in the line of fire for expensive US trips but now the cost of President Obama’s trip to India @ $200 million a day makes Zardari a true representative president of poor Pakistan. The figure of $200 million is making the rounds among the Obama’s conservative critics, including potential 2012 Obama challenger Mike Huckabee and U.S. Rep. Michele Bachmann (R-Minn.), as the president takes off Friday for a 10-day trip to Asia.

If that is indeed true then we must solute President Zardari for exercising economy and austerity in his trips. But look at the possible outcome of the visit-more business for USA. According to Yahoo News Obama is set to speak to American and Indian business leaders and is expected to announce trade and export deals worth billions to the U.S. In the wake of the Democrats’ devastating midterm losses, attributed in part to the poor state of the U.S. economy, the White House is intent on highlighting concrete benefits to U.S. consumers from Obama’s foray overseas. The president left Washington shortly after the government reported that the economy added 151,000 jobs in October. It wasn’t enough to lower a stubborn 9.6 percent jobless rate and the president said it wasn’t good enough.

“It is hard to overstate the importance of Asia to our economic future,” the president wrote Saturday in an op-ed in The New York Times.

Huckabee made the claim of $200 million a day to Fox News on Tuesday night (citing “reports”) and in the social media sphere. “Reports say that Obama’s trip to Mumbai, India tomorrow will cost taxpayers $200 million dollars a day – come to think of it, that’s much less than Obama’s been spending here,” Huckabee wrote in a Facebook message Tuesday night (misstating the day of Obama’s departure). “So maybe it’s not a bad thing he’s leaving.”

On Wednesday, Bachmann repeated the claim on CNN’s “Anderson Cooper 360.” “Within a day or so the president of the United States will be taking a trip over to India that is expected to cost the taxpayers $200 million a day,” Bachmann told Cooper. “He’s taking 2,000 people with him. He’ll be renting out over 870 rooms in India. And these are five-star hotel rooms at the Taj Mahal Palace hotel. This is the kind of over-the-top spending. It’s a very small example, Anderson.”

The numbers evidently originate with the Press Trust of India, whose report was linked on the Drudge Report and picked up by Fox News host Glenn Beck. The news agency also wrongly said that the White House had blocked off the entire Taj Mahal Palace hotel for Obama’s visit and that the U.S. was stationing 34 warships—roughly 10 percent of the naval fleet–off the coast of Mumbai for security reasons.

The agency attributed the $200 million figure to an anonymous Indian government official. It didn’t attribute the warships claim to any source. Pentagon spokesman Geoff Morrell called the warship claim “absolutely absurd.” “That’s just comical,” he said at Thursday’s Pentagon news briefing.  “Nothing close to that is being done.”

The White House, meanwhile, issued a blanket statement that the $200 million figure “had no basis in reality” and was “wildly inflated.” The press office declined to disclose the trip’s actual cost, citing “security concerns.” In a news briefing Thursday, White House Press Secretary Robert Gibbs also refused to release numbers, but he told reporters point-blank, “We are not spending $200 million a day.”

The nonpartisan FactCheck.org took up the issue, too, saying that even though the administration won’t release a price tag, there is “simply no evidence to support” a claim of $200 million a day. One reason to doubt the report, according to the group:  The entire war in Afghanistan costs $190 million a day.

That is not to say that some of the precautions for Obama’s first presidential visit to India aren’t possibly a tad over the top. As the BBC reports, Indian officials have been removing coconuts from any trees that Obama might walk under, to prevent anything from falling on the presidential head. And as London’s Daily Telegraph notes, the country has deployed trained monkey catchers to prevent any “simian invasion” (a measure that Indian officials also took when President Bush visited in 2006).

 

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As soon as the parcel bomb plot started unfolding, it immediately got shrouded in mystery again. It was initially reported that a 22-years old girl, a medical student, was arrested in Yemen along with her mother for allegedly sending the parcel containing deadly explosive, it was subsequently reported that the cell number of the girl was found written on the parcel invoice which led to her arrest. Her lawyer has said that she has been unwittingly set up. It has now been reported by Reuters quoting a US official that a Saudi bomb-maker believed to be working with al Qaeda‘s Yemen-based wing is a key suspect in the parcel bomb plot against the United States.

Ibrahim Hassan al-Asiri, who tops a Saudi Arabian terrorism list, is the brother of a suicide bomber killed in an attempt to kill Saudi counter-terrorism chief Prince Mohammed bin Nayef last year. That attack, as well as another attempt on a U.S.-bound airliner on Christmas Day 2009, involved the use of pentaerythritol trinitrate (PETN) — a highly potent explosive that appears to be the weapon of choice of al Qaeda’s Yemeni branch, al Qaeda in the Arabian Peninsula (AQAP).

At least one of the two U.S.-bound parcel bombs sent from Yemen addressed to synagogues in Chicago and intercepted in Dubai and Britain on Friday employed PETN. The U.S. official, speaking to Reuters on condition of anonymity, said Asiri was being closely looked at by authorities in view of his experience with explosives. There were also indications he may have been the bomb-maker behind the Christmas Day attempt and the failed attack on Prince Nayaf last year, the official added.

Saudi Arabia, which provided intelligence that helped identify the parcel bomb threat, put Asiri at the top of its terrorism list in 2009. Authorities are scrambling to track down any AQAP operatives behind the latest plot. Yemeni police earlier on Saturday arrested a medical student believed to be in her 20s in Sana’a, but her lawyer told Reuters he feared she had been unwittingly used by others.

U.S. Homeland Security Secretary Janet Napolitano said the parcel bombs sent from Yemen had the hallmarks of al Qaeda, and in particular AQAP. White House counter-terrorism advisor John Brennan has called AQAP “the most active operational franchise” of al Qaeda outside its traditional Pakistani and Afghan base. The Obama administration has been increasingly focused on the al Qaeda wing, which authorities have said was behind the failed attempt to blow up a U.S. jetliner on Christmas Day last year with a bomb that a Nigerian man hid in his underwear.

AQAP is headed by Nasser al-Wahayshi, a Yemeni former associate of Osama bin Laden. But it’s Anwar al-Awlaki, an American Islamist preacher of Yemeni ancestry, who is now drawing considerable attention in Washington. Awlaki, who argues al Qaeda’s extremist views using Western ideas and the Internet, has called the Christmas Day bomber one of his “students” and he traded emails with the U.S. Army psychiatrist who went on a shooting rampage at a military base in Texas last year that killed 13 soldiers. U.S. officials have said Washington has authorized the CIA to kill or capture Awlaki, a rare act against a U.S. citizen that shows the degree of threat he is believed to pose. They have also said the United States will likely increase strikes against al Qaeda in Yemen, seeking to apply the same degree of pressure there as covert drone attacks in Pakistan have had on the core group.

Pakistan’s former president, Pervez Musharraf is accused by his opponents of giving in to the US pressure in 2001 and going out-of-the-way to accept those demands which even the Americans were not expecting that he will accept. Musharraf, as his opponents suggest, joined America’s War on Terror at the slight “provocations” and failed to negotiate the terms of his cooperation. As a matter of fact, the very first of his demands was that the Taliban regime should be replaced with Pashtuns and not the Northern Alliance which was never heeded to the USA. This was a sensible demand and if US could install a Pashtun regime, Afghanistan, and indeed Pakistan, would have not been in difficulties they are facing today.

Musharraf claims to have given another, apparently unsolicited advice, to the Americans not to fight Taliban. This also seems to be consigned to the trash bin. Talking to NDTV, Pakistan’s former military ruler Pervez Musharraf has said that the US could have avoided the nine-year long war in Afghanistan, had it recognized the then Taliban regime there.

“I always proposed that we need to have a different strategy. We need to recognize the Taliban and try to change them from within,” he said adding that had there been US and other foreign missions in Afghanistan “maybe we could have resolved this Osama bin Laden tangle. (It) may not have erupted even.”

Pakistan’s former military ruler said the acceptance of Taliban by the global community could not only have prevented the war in Afghanistan but would also help in saving the Bamiyan Buddhas. “Had we had 18 missions there, including the US mission, with the Taliban I think we could have saved the Buddha statues,” he said at the Asia Society’s Texas Centre. Defying global pressure, the two colossal 1,500-year-old statues of Buddha, carved into the sandstone cliffs of Bamiyan, were demolished by the Taliban on March 2001 as part of a campaign to rid the land of all un-Islamic graven images.

Musharraf pointed that the US-backed talk-process with Taliban is “from a position of weakness” and an attempt to end the war in Afghanistan, but said that he supports the dialogue with “moderate Taliban”. On his plans to return to Pakistan politics by fighting elections in 2013 and launch of a party called All Pakistan Muslim League in London, Musharraf said “I personally feel the environment in Pakistan at this moment is absolutely right for initiating a new party.”

He is counting on Houston’s 75,000 Pakistan origin people to help him lead to the victory by giving financial support and political support. A longtime political observer Kamran Riaz said “One of the reasons Musharraf is here is to gain some financial support. He thinks the US thinks of him as an ally, so in addition to getting financial support he can also get some political support.” The former Pakistan President has a set of Houston meetings planned this week with wealthy Pakistani-Americans and corporate leaders.

US communities do not play a visible role in Pakistan elections, but Musharraf could stand to gain from his current North America tour, Jamal Elias, an expert on contemporary Pakistan and chairman of the religious studies department at the University of Pennsylvania, said. Musharraf is also going to campaign in Chicago, New York, San Francisco and Toronto. He visited Dallas last week. Many Pakistani-American elites have in the past contributed financially to political parties in Pakistan and will likely do so again.

Infamous NRO is not the only misdeed of President Musharraf so dear to the present government. There are some other decisions of the military dictator which the present government not only feels unable to reverse, it wants to implement those decisions more zealously than Musharraf himself. Prime Minister Yousuf Raza Gilani revealed Friday for the first time that former military ruler Pervez Musharraf gave approval for US drones to make surveillance flights over the country. It implies that his government gave a tacit nod to replace surveillance with lethal bombing.

“The previous government gave them permission for surveillance and reconnaissance flights by US drone aircraft but not to launch missile attacks,” Prime Minister told diplomatic correspondents. The United States does not officially confirm the drone attacks, but the campaign is unpopular among the Pakistan public who see military action on Pakistani soil as a breach of national sovereignty.

Gilani said “we will find out” when asked about reports that US drones use Shamsi base in southwestern province Balochistan, but denied that drones were taking off from a military base in southern province Sindh.

“We have not provided them space (to fly). This is wrong and I have contradicted that drones were using Shahbaz base (in Sindh) for this purpose.” A covert US drone campaign has dramatically increased the frequency of drone strikes in the tribal belt in response to intelligence claims of a Mumbai-style terror plot to launch commando attacks on European cities. Officials in Washington say drone strikes are highly effective in the war against Al-Qaeda and its Islamist allies, killing a number of high-value targets, including Pakistan’s Taliban founding father Baitullah Mehsud. But in Pakistan, anger over the attacks has fuelled reprisals from militant groups who have targeted NATO supply convoys destined for Afghanistan.

“We have repeatedly said the drone attacks are counter productive,” Gilani told the group of local and foreign reporters. “We want to have drone technology and also if they have any actionable intelligence, we want them to share it with us.”

Mary Ellen O’Connell, a law professor at the University of Notre Dame in the United States, this week became the latest legal expert to warn that the drone strikes in Pakistan, Yemen and other countries violate international law and should be halted.

“The use of drones is causing really serious anger in Pakistan. I really seriously question the necessity for what we are doing,” she told London think-tank Chatham House. Although he did not specify bombing raids by unmanned aircraft, CIA chief Leon Panetta has been quoted as telling US media that the agency’s expanding operations in Pakistan have taken “a serious toll” on Al-Qaeda. Washington on Friday held out an offer of two billion dollars in fresh military aid to Pakistan, where it wants the military to do more to fight insurgents crossing into Afghanistan from the northwestern tribal belt.

The United States considers the area an Al-Qaeda headquarters and the most dangerous place on Earth. At talks in Washington, Secretary of State Hillary Clinton said the United States had “no stronger partner when it comes to counter-terrorism”. Clinton said the military package, which is subject to Congressional approval, would come over several years and be in addition to 7.5 billion dollars in civilian aid the United States has committed over five years.

Are you finance major and depressed about economic depression? Do you feel that bad bankers are causing you worse publicity? Well don’t lose hope if you have lost a job or an opportunity. People still have faith in the discipline which has been so very close to your heart. Businessweek has reported that finance is not dead yet. With a slew of jobs lost on Wall Street and bad publicity surrounding bankers, the finance major has lost a bit of its sparkle with undergraduate students. Still, there are people betting that crisis will birth opportunity and finance majors will again be in demand. Banks around the world have cut 330,000 jobs during the latest financial crisis, according to data compiled by Bloomberg, and another 80,000 are expected to bite the dust in the next 18 months as revenue growth begins to slow, according to Meredith Whitney, a former Oppenheimer & Co analyst.

So it’s no surprise that at some schools the number of students majoring in finance has dipped in recent years. For example, at Lehigh University‘s College of Business & Economics (Lehigh Undergraduate Business Profile), 47 percent of business students majored in finance this year, down from 49 percent in 2009.At New York University‘s Stern School of Business (Stern Undergraduate Business Profile), which is known for its ability to place graduates in Wall Street firms, the percentage of students majoring in finance dropped from 76 percent in 2008 to 75 percent in 2009 and 71 percent in 2010.

The paper reports that the dearth of traditional Wall Street jobs has forced finance students further afield, but it’s also forced them to differentiate themselves to make themselves more marketable, says Anne Anderson, one of the finance chairs at Lehigh. “The types of jobs have not changed. The competition has changed,” she says. “You must distinguish yourself more.” Students at Lehigh can get certified in the use of specific databases—Thomson Reuters for investment banks and CQG for futures markets—to get an edge, says Anderson. The skills themselves are valuable to employers, but at the very least, she says, students with these certificates can speak more intelligently in their interviews.

When possible, students are pairing finance with another major, such as accounting or marketing and those who want finance jobs also get certified as chartered financial analysts, which qualifies them for jobs in the investment industry. Crisis breeds opportunity, says Michael Silverman, a sophomore at Stanford who is a management science and engineering student in the financial decisions track. “Now might be the best time to get into finance because of the upheaval,” he says. “There’s opportunity in reform, and it should be more fun.”

While the finance major may have lost some of its luster, it’s certainly not on life support. Considering the magnitude of the crisis and the extent of the job cuts in banking, it remains fairly popular with students, said Mark Zupan, dean of the Simon Graduate School of Business at the University of Rochester, in an interview. The Simon school is planning to launch an undergraduate business program in January 2011, and Zupan said he expects finance to be the most popular major.

“As humans, we have a great, long-run track record of coming up with creative ways to generate wealth, notwithstanding the current crisis,” said Zupan. “We’ll always need people to manage that wealth.”

[Article courtesy: Businessweek]

Pakistan is probably one of those few countries where not a single principle of good taxation system is followed. Those who make tons of money remain out of tax net whereas burden of tax is invariably on the poor segments of the society. The rich are thriving on the tax contribution of the poor. Two third of the total taxes is collected through indirect taxes. Tax on economic resources of the rich is just one-third of the total collection. Nearly a month ago, a warning was sounded that Pakistan’s unjust taxation system alone can trigger public revolt. Please read: This system alone can trigger a public revolt….

The present taxation system is also partly responsible for inflation and price hike for which the poor of the country have to bear the brunt. It is also responsible for discouraging economic activities. The rich are becoming richer and thriving on the regressive system of taxation. On the other hand, Pakistan has to beg for its relief activities of the flood victims. The amount required for this purpose can easily be generated at home. Pakistani government was conveniently indifferent to this potential but its plea for billions of dollars to recover from this summer’s floods has sparked pressure on the country to reform its dysfunctional tax system, which collects very little money, even from the rich.

The country’s biggest donor, the United States, has issued one of the strongest warnings, saying the world will only be able to fund a quarter of the tens of billions of dollars it will take to rebuild — and it will be difficult to get American taxpayers to help if Pakistanis aren’t footing their share of the bill. Businessweek has reported that this threat is not being taken seriously because the nuclear-armed country is so important in the war against al-Qaida and the Taliban. The fact of the matter is that American taxpayers could be expected to sacrifice only when Pakistani fat cats shed fraction of their (ill-gotten) wealth. And this fraction will be enough to fund the entire development program.

Despite years of international pressure, Pakistan has one of the lowest effective tax rates in the world, equal to about 9 percent of the value of the country’s economy, according to the Carnegie report. In contrast, the U.S. equivalent is more than three times as high at about 28 percent. Even India’s tax-to-GDP ratio is twice as much as that of Pakistan. One of the reasons Pakistan’s rate is so low is because many people avoid paying taxes. Fewer than 2 percent of the country’s 175 million citizens pay any income tax, according to the report. Also, some sectors of the economy like agriculture — a major money-maker for the elite — are totally exempt from tax, and the rich have pushed to keep it that way.

Ishrat Hussain, former head of the Pakistan central bank, estimated that better enforcement of current tax policies and the elimination of key exemptions should produce an effective tax rate of 15 percent — generating nearly $10 billion in additional revenue per year. That money would go a long way toward repairing devastation from the floods, which affected more than 18 million people and damaged and destroyed over 1.8 million homes. It would also provide the money necessary to begin fixing Pakistan’s crumbling school system and health infrastructure.

“This is a time we have to tell people that we have to all pitch in and mobilize our own resources,” said Hussain. “Why should the international community come to your rescue if you are not doing your part of the bargain?”

He said donors should keep up the pressure on Pakistan, but advised against directly linking reconstruction money to tax reform, predicting the move could backfire in a country where animosity toward the West, and the U.S. in particular, is extremely high. “It wouldn’t be a very smart move because people here would consider this as an intrusion on their sovereignty, and the debate would then be muddied,” said Hussain.

The U.S. and other countries have donated around $1 billion for emergency relief, and international financial institutions have provided about $2.5 billion in emergency loans. Donors are scheduled to meet in New York this weekend to discuss raising additional aid. Washington has promised more money for reconstruction, but the U.S. special envoy to Pakistan, Richard Holbrooke, warned during a visit to the country this week that the international community could only fund about 25 percent of the bill. He said the U.S. would not condition reconstruction money on tax reform, but cautioned that American generosity has its limits.

If Pakistan does not reform its tax system and the donors fail to bail the country out, it is unclear how the nation would come up with the money necessary for reconstruction. The government has proposed a one-time tax on urban property and agricultural land not affected by the floods, but it is uncertain whether it will be implemented and how much money it would produce. Hussain, the former central bank chief, said that even if the one-time tax was implemented, he was worried the elite would simply use their influence to avoid paying anything as they have done in the past. “The system has given power to the thieves to monitor themselves,” he said.

Those who were happy that the democracy has made Pakistan an investment heaven should be ready for another rude shock. The latest blow has been dealt by no less than World Economic Forum which says that Pakistan has now reached 123rd position amongst 133 countries as compared to 101st position in the last year in the competitive index. The Global Competitiveness Report 2010-11 released by the World Economic Forum has disclosed that 15 problematic factors for doing business in Pakistan.   These factors in the order of severity are corruption, government’s instability, inflation, access to financing, tax rates, tax regulations and foreign currency regulations. The report has kept in view each and every step and Pakistan’s ranking in each area.

In the ranking of institutions the country has been ranked at 112. 2nd pillar: in the area of infrastructure Pakistan has been placed at 110. 3rd pillar: Due to the vulnerable macroeconomic environment the country has been ranked at 133, 4th pillar: health and primary education 123, Efficiency enhancers 95th, 5th pillar: higher education and training 123rd, 6th pillar: goods market efficiency 91st, 7th pillar: labor market efficiency 131, 8th pillar: financial market development 73, 9th pillar: technological readiness 109, 10th pillar: market size 31.Innovation and sophistication factors 76th, 11th pillar: business sophistication 79, 12th pillar: innovation 75. From a list of 15 factors, respondents were asked to select the five most problematic for doing business in their country.

1st pillar: in the area institutions, property rights 107, intellectual property protection 86, diversion of public funds 92, public trust of politicians 91, irregular payments and bribes117, judicial independence 74, favoritism in decisions of government officials 87, wastefulness of government spending 58, burden of government regulation 72, efficiency of legal framework in settling disputes 103, efficiency of legal framework in challenging regulations 96, transparency of government policymaking 115, business costs of terrorism 138, business costs of crime and violence126, organised crime127, reliability of police services 119, ethical behavior of firms 100, strength of auditing and reporting standards 97, efficacy of corporate boards 115, protection of minority shareholders’ interests 94, strength of investor protection 27.

2nd pillar infrastructure: Quality of overall infrastructure 100, quality of roads 72, quality of railroad infrastructure 55, quality of port infrastructure 73, quality of air transport infrastructure 81, available airline seat kilometers 48, quality of electricity supply 128, fixed telephone lines115, mobile telephone subscriptions107. 3rd pillar macroeconomic environment: Government budget balance 90, national savings rate 89, inflation 137, interest rate spread 94, government debt 82, country credit rating 125.

4th pillar health and primary education: Business impact of malaria 111, malaria incidence 109, business impact of tuberculosis 114, tuberculosis incidence 113, business impact of HIV/AIDS 102, HIV prevalence 22, infant mortality 123, life expectancy 105, quality of primary education 103, primary education enrollment rate132.

5th pillar higher education and training: secondary education enrollment rate 125, tertiary education enrollment rate 121, quality of the educational system 87, quality of math and science education 90, quality of management schools 80, internet access in schools 84, local availability of research and training services 97, extent of staff training115,

6th pillar goods market efficiency: Intensity of local competition 87, extent of market dominance 65, effectiveness of anti-monopoly policy 73, extent and effect of taxation 46, total tax rate 37, number of procedures required to start a business 99, time required to start a business 71, agricultural policy costs 106, prevalence of trade barriers 106, trade tariffs 133, prevalence of foreign ownership 109, business impact of rules on FDI 73, burden of customs procedures 98, degree of customer orientation 97, buyer sophistication 62.

7th pillar Labor market efficiency: Cooperation in labor-employer relations104, flexibility of wage determination 104, rigidity of employment 110, hiring and firing practices 51, redundancy costs 111, pay and productivity 93, reliance on professional management 87, brain drain 68, female participation in labor  force 137.

8th pillar financial market development: Availability of financial services 101, affordability of financial services 85, financing through local equity market 43, ease of access to loans 40, venture capital availability 51, restriction on capital flows 83, soundness of banks 88, regulation of securities exchanges 76, legal rights index 60. 9th pillar technological readiness: Availability of latest technologies 88, firm-level technology absorption 88, FDI and technology transfer 100, internet users 100, broadband Internet subscriptions 103, internet bandwidth 111. 10th pillar market size: Domestic market size index 26, foreign market size index 61.

11th pillar business sophistication: Local supplier quantity 87, local supplier quality 95, state of cluster development 46, nature of competitive advantage 84, value chain breadth 69, control of international distribution 89, production process sophistication 76, extent of marketing 90, willingness to delegate authority 85. 12th pillar innovation: Capacity for innovation 58, quality of scientific research institutions 79, company spending on R&D 67, university-industry collaboration in R&D 81, Gov’t procurement of advanced tech products 84, availability of scientists and engineers 80, utility patents per million population 88.

Believe it or not, there are dozens of American projects in Iraq being abandoned after wasting billions of dollars of American taxpayers’ money. If you look at these projects closely, you might even see a clear stamp of Pak PWD on them. Pakistan is a country where important decisions about investment and development involving billions are taken purely on political considerations. The impact and outcome of such investments is obvious. The school and hospital buildings remain unused or if ever these are used, these are not used by the intended user for the intended purpose. But this is not specific to Pakistan alone. It has been widely reported in the media that USA has invested American taxpayers $50 dollars in infrastructure development out of which $5 billion have been spend on buildings which have been abandoned and will probably never be put to any use. The taxpayers’ money has gone down the drain.

It was a good pastime for the American forces to disrupt and dismantle existing infrastructure and then reconstruct. These are the games of wealthy nations who do not care about the money or who have liquidity overflowing from their coffers. They also have a system of oversight and accountability and it is yet to be seen how their auditors react to this extravagance. This report was originally prepared by inspector general and US GAO has yet to present its report on these useless spending. Hopefully, GAO is not like Pakistani auditors but if they were, then thrilling and juicy stories would be cooked and with publicity-hungry politicians on PAC, everyone i.e. media and these politicians and also the auditors would be happy like in a story published on a sister blog: auditors should be tabloid editors.

Nearly every media out let including Yahoo News has reported that a $40 million prison sits in the desert north of Baghdad, empty. A $165 million children’s hospital goes unused in the south. A $100 million waste water treatment system in Fallujah has cost three times more than projected, yet sewage still runs through the streets. As the U.S. draws down in Iraq, it is leaving behind hundreds of abandoned or incomplete projects. More than $5 billion in American taxpayer funds has been wasted — more than 10 percent of the some $50 billion the U.S. has spent on reconstruction in Iraq, according to audits from a U.S. watchdog agency.

That amount is likely an underestimate, based on an analysis of more than 300 reports by auditors with the special inspector general for Iraq reconstruction. And it does not take into account security costs, which have run almost 17 percent for some projects. There are success stories. Hundreds of police stations, border forts and government buildings have been built, Iraqi security forces have improved after years of training, and a deep water port at the southern oil hub of Umm Qasr has been restored. Even completed projects for the most part fell far short of original goals, according to an Associated Press review of hundreds of audits and investigations and visits to several sites. And the verdict is still out on whether the program reached its goal of generating Iraqi good will toward the United States instead of the insurgents.

Col. Jon Christensen, who took over as commander of the U.S. Army Corps of Engineers Gulf Region District this summer, said the federal agency has completed more than 4,800 projects and is rushing to finish 233 more. Some 595 projects have been terminated, mostly for security reasons. Christensen acknowledged that mistakes have been made. But he said steps have been taken to fix them, and the success of the program will depend ultimately on the Iraqis — who have complained that they were not consulted on projects to start with.

“There’s only so much we could do,” Christensen said. “A lot of it comes down to them taking ownership of it.”

The reconstruction program in Iraq has been troubled since its birth shortly after the U.S.-led invasion in 2003. The U.S. was forced to scale back many projects even as they spiked in cost, sometimes to more than double or triple initial projections.

As part of the so-called surge strategy, the military in 2007 shifted its focus to protecting Iraqis and winning their trust. American soldiers found themselves hiring contractors to paint schools, refurbish pools and oversee neighborhood water distribution centers. The $3.6 billion Commander’s Emergency Response Program provided military units with ready cash for projects, and paid for Sunni fighters who agreed to turn against al-Qaida in Iraq for a monthly salary.

But sometimes civilian and military reconstruction efforts were poorly coordinated and overlapped. Iraqis can see one of the most egregious examples of waste as they drive north from Baghdad to Khan Bani Saad. A prison rises from the desert, complete with more than two dozen guard towers and surrounded by high concrete walls. But the only signs of life during a recent visit were a guard shack on the entry road and two farmers tending a nearby field. In March 2004, the Corps of Engineers awarded a $40 million contract to global construction and engineering firm Parsons Corp. to design and build a prison for 3,600 inmates, along with educational and vocational facilities. Work was set to finish in November 2005.

But violence was escalating in the area, home to a volatile mix of Sunni and Shiite extremists. The project started six months late and continued to fall behind schedule, according to a report by the inspector general. The U.S. government pulled the plug on Parsons in June 2006, citing “continued schedule slips and … massive cost overruns,” but later awarded three more contracts to other companies. Pasadena, Calif.-based Parsons said it did its best under difficult and violent circumstances. Citing security concerns, the U.S. finally abandoned the project in June 2007 and handed over the unfinished facility to Iraq’s Justice Ministry. The ministry refused to “complete, occupy or provide security” for it, according to the report. More than $1.2 million in unused construction material also was abandoned due to fears of violence.

The inspector general recommended another use be found for the partially finished buildings inside the dusty compound. But three years later, piles of bricks and barbed wire lie around, and tumbleweed is growing in the caked sand. “It will never hold a single Iraqi prisoner,” said inspector general Stuart Bowen, who has overseen the reconstruction effort since it started. “Forty million dollars wasted in the desert.” Another problem was coordination with the Iraqis, who have complained they weren’t consulted and often ended up paying to complete unfinished facilities they didn’t want in the first place.

“Initially when we came in … we didn’t collaborate as much as we should have with the correct people and figure out what their needs were,” Christensen said. He stressed that Iraqis are now closely involved in all projects. One clinic was handed over to local authorities without a staircase, said Shaymaa Mohammed Amin, the head of the Diyala provincial reconstruction and development committee. “We were almost forced to take them,” she said during an interview at the heavily fortified local government building in the provincial capital of Baqouba. “Generally speaking, they were below our expectations. Huge funds were wasted and they would not have been wasted if plans had been clear from the beginning.”

As an example, she cited a date honey factory that was started despite a more pressing need for schools and vital infrastructure. She said some schools were left without paint or chalkboards, and needed renovations. “We ended up paying twice,” she said.

In some cases, Iraqi ministries have refused to take on the responsibility for U.S.-funded programs, forcing the Americans to leave abandoned buildings littering the landscape. “The area of waste I’m most concerned about in the entire program is the waste that might occur after completed projects are handed over to the Iraqis,” Bowen said. The U.S. military pinned great hopes on a $5.7 million convention center inside the tightly secured Baghdad International Airport compound, as part of a commercial hub aimed at attracting foreign investors. A few events were held at the sprawling complex, including a three-day energy conference that drew oil executives from as far away as Russia and Japan in 2008, which the U.S. military claimed generated $1 million in revenues.

But the contracts awarded for the halls did not include requirements to connect them to the main power supply. The convention center, still requiring significant work, was transferred to the Iraqi government “as is” on Jan. 20, according to an audit by the inspector general’s office. The buildings have since fallen into disrepair, and dozens of boxes of fluorescent lightbulbs and other equipment disappeared from the site. Light poles outside have toppled over and the glass facade is missing from large sections of the abandoned buildings. Waste also came from trying to run projects while literally under fire. The Americans committed to rebuilding the former Sunni insurgent stronghold of Fallujah after it was destroyed in major offensives in 2004. The U.S. awarded an initial contract for a new waste water treatment system to FluorAMEC of Greenville, S.C. — just three months after four American private security contractors were savagely attacked. The charred and mutilated remains of two of them were strung from a bridge in the city.

An audit concluded that it was unrealistic for the U.S. “to believe FluorAMEC could even begin construction, let alone complete the project, while fierce fighting occurred daily.” The report also pointed out repeated redesigns of the project, and financial and contracting problems. The Fallujah waste water treatment system is nearly complete — four years past the deadline, at a cost of more than three times the original $32.5 million estimate. It has been scaled back to serve just a third of the population, and Iraqi officials said it still lacks connections to houses and a pipe to join neighborhood tanks up with the treatment plant.

Desperate residents, meanwhile, have begun dumping their sewage in the tanks, causing foul odors and running the risk of seepage, according to the head of Fallujah’s municipal council, Sheik Hameed Ahmed Hashim. “It isn’t appropriate for the Americans to give the city these services without completing these minor details,” Hashim said. “We were able to wipe out part of the memories of the Fallujah battles through this and other projects. … If they leave the project as it is, I think their reputation will be damaged.” By contrast, the Basra children’s hospital — one of the largest projects undertaken by the U.S. in Iraq — looks like a shining success story, with gardeners tending manicured lawns in preparation for its opening. But that opening has been repeatedly delayed, most recently for a lack of electricity.

The construction of a “state of the art” pediatric specialist hospital with a cancer unit was projected to be completed by December 2005 for about $50 million. By last year, the cost had soared above $165 million, including more than $100 million in U.S. funds, and the equipment was dated, according to an auditors’ report. Investigators blamed the delays on unrealistic timeframes, poor soil conditions, multiple partners and funding sources and security problems at the site, including the murder of 24 workers. Bechtel, the project contractor, was removed because of months-long delays blamed on poor subcontractor performance and limited oversight, the special inspector general’s office said. A Bechtel spokeswoman, Michelle Allen, said the company had recommended in 2006 that work on the hospital be put on hold because of the “intolerable security situation.”

Don’t you see the stamp of Pak PWD on these projects?

Pakistan is facing one of the worst catastrophes in its history which has displaced nearly 20 million people and killed nearly 2000. Number of deaths may be insignificant as many more were killed in Taliban attacks on poor civilians in their noble cause to establish their regressive rule in Pakistan. They could tried their luck elsewhere also like in Saudi Arabia or UAE but the governments and people of these countries are more vigilant than Pakistani government people who were under the illusion that Taliban style slaughtering and chopping would bring about change in their lives. No amount of change is possible unless people themselves decide what they want and then start a struggle for that. They will continue to be fooled by bearded, landed and moneyed feudal.

As the world has started pooling up it human and monetary resources to help rescue and rehabilitate flood-hit Pakistanis, there is a visible frustration in two camps; Taliban and the ruling party. The latter is frustrated because no one is prepared to hand them any amount of aid money due to their much known Penchant for Pilfering and Plundering (PPP), the former is even more frustrated and has threatened to kill whoever comes from abroad to help flood-affected Pakistanis. Killing is the only pastime which thrills them and when it comes to killing infidels (read foreigners and hapless Pakistanis), the very thought of excites them no end.

It has been reported by the foreign media that Taliban have hinted they may launch attacks against foreigners helping Pakistan respond to the worst floods in the country’s history, saying their presence was “unacceptable.” The U.N. said it would not be deterred by violent threats. The militant group has attacked aid workers in the country before, and an outbreak of violence could complicate a relief effort that has already struggled to reach the 8 million people who are in need of emergency assistance.

Pakistani Taliban spokesman Azam Tariq claimed Thursday that the U.S. and other countries that have pledged support are not really focused on providing aid to flood victims but had other motives he did not specify. “Behind the scenes they have certain intentions, but on the face they are talking of relief and help,” Tariq told The Associated Press by telephone from an undisclosed location. “No relief is reaching the affected people, and when the victims are not receiving help, then this horde of foreigners is not acceptable to us at all.”

He strongly hinted that the militants could resort to violence, saying “when we say something is unacceptable to us, one can draw one’s own conclusion.” U.N. humanitarian chief John Holmes said the U.N. remained committed to helping flood victims in Pakistan. “We will obviously take these threats seriously as we did before, and take appropriate precautions, but we will not be deterred from doing what we believe we need to do, which is help the people of Pakistan … who have been affected by the flood,” he told a news conference at U.N. headquarters in New York.

Holmes noted that the Pakistani Taliban carried out a suicide attack against the office of the U.N.’s World Food Program in Islamabad last October, killing five staffers, and in March, militants attacked the offices of World Vision, a U.S.-based Christian aid group helping earthquake survivors in northwestern Pakistan, killing six Pakistani employees. He said U.N. security experts will be working with U.N. agencies and international organizations “to assess what the risks are and to minimize them.” U.S. State Department spokesman P.J. Crowley said Washington is also taking the threat of attacks by militants seriously.

“We have information of the potential targeting of foreign relief workers in Pakistan, as well as government ministries,” Crowley told reporters in Washington, adding, “It just underscores the bankrupt vision that these extremists have and we are conscious of that threat.”

According to the United Nations, almost 17.2 million people have been significantly affected by the floods and about 1.2 million homes have been destroyed or badly damaged. Holmes said U.N. agencies have reached almost 2 million Pakistanis with emergency food supplies and an estimated 2.5 million with clean drinking water. He said medical treatment has been provided to about 3 million people and more than 115,000 tents and 77,000 tarpaulins have been distributed. About 70 percent of the $460 million initially sought by the U.N. and its humanitarian partners for flood relief — some $325 million — has either been contributed or pledged so far by foreign donors, while an additional $600 million has been provided or promised outside the appeal, he said.

“We’re approaching $1 billion with funds offered or already contributed inside and outside the appeal for this crisis,” Holmes said. “That’s a reasonable response, but we certainly need more.”

The floods began almost a month ago with the onset of the monsoon and have ravaged a massive swath of Pakistan, from the mountainous north to its agricultural heartland. The U.S. military has also stepped in to help, flying helicopters that have evacuated flood victims and delivered relief supplies in Khyber Pakhtunkhwa, the northwest province that was hit hardest by the floods. It is unclear how many foreigners are operating on the ground in Khyber Pakhtunkhwa, which borders Pakistan’s semiautonomous tribal area where the Pakistani Taliban are strongest. Many aid organizations involved in the relief effort have been in Pakistan for years and use networks of locals in the most dangerous areas. The United Nations said Thursday that the group won’t let violent threats deter its relief effort.

“There is a lot of work ahead and millions of people who need our assistance,” said Maurizio Giulano, spokesman for the U.N.’s Office for the Coordination of Humanitarian Affairs which Holmes heads. “We would find it inhumane for someone to target us and our work, effectively harming the millions of people whose lives we strive to save.”

Violence has been relatively low in the country since the floods hit, but three bomb attacks in northwestern Pakistan on Monday killed at least 36 people. While increased Taliban attacks would complicate the flood relief effort, the group could also risk backlash from the millions of victims who have lost everything and are desperate to receive food and shelter. The death toll in the floods stands around 1,500 people, but the disaster ranks as one of Pakistan’s worst ever because of the scale and massive economic damage, especially to the country’s vital agricultural sector. The U.N. said earlier this week that some 800,000 people are still cut off by the floods and accessible only by air.

Pakistani officials urged anyone left in three southern towns Thursday to evacuate immediately as floodwaters broke through a levee, endangering areas previously untouched by the country’s almost month-long disaster.

The swollen Indus River broke through the Sur Jani embankment in southern Sindh province late Wednesday, threatening the towns of Sujawal, Daro and Mir Pur Batoro, said Mansoor Sheikh, a top government official in Thatta district. Most of the 400,000 people who live in the area are thought to have evacuated already, but those remaining were warned to flee, he said.

Pakistan’s senior meteorologist, Arif Mahmood, said high tides were preventing the Indus River from fully shedding excess water into the Arabian Sea. “We hope these tides would fully subside after 48 hours,” he said.

There was news that Pakistan’s expensively-dressed Prime Minister will donate his wardrobe for the flood-hit people. A very noble gesture indeed; but nobler still will be for the Prime Minister to donate at least half of his Cabinet which will save enormous amounts of money. And this is serious talk as Pakistan is in the eye of a storm which has the potential to destabilize the entire system that we have so far been able to save. It has been estimated that the flooding in Pakistan will inflict serious damage on its economy, posing another challenge for a cash-strapped government struggling to keep a recovery on track amid high inflation and a relentless Islamist insurgency.

Wall Street Journal has reported that Assistance from the International Monetary Fund and Western countries will likely help Pakistan avoid another brush with bankruptcy as it tries to cope with the damage, which by some estimates may reach $43 billion. But the floods will weigh heavily on economic growth this year and leave a long-term mark on the economy.

“The hit on the growth rate is going to be very severe,” said Philip Wyatt, a senior economist at UBS. “We can see a loss of one or two points of economic growth, depending on the damage.” In the fiscal year ended June 30, Pakistan’s economy grew 4.1%. Moody’s Investors Service, which had expected Pakistan’s economic growth to expand to 4.5% this fiscal year, may lower its estimate to 3% to 3.5%, analyst Aninda Mitra said.

The flood began in July and at one point covered one-fifth of the South Asian nation, or land roughly equivalent to the size of Uruguay. It has damaged crops sown over 1.93 million acres, or 776,996 hectares. Cotton output will shrink to 11.76 million bales from the 14 million bales estimated at the start of the season by Pakistan’s food and agriculture ministry. Cotton is an important raw material for the key textile export sector, one of Pakistan’s few sources of export income.

According to the United Nations, the disaster has affected close to 20 million people, killing 1,500 and leaving 1.2 million homes damaged or destroyed. Coping with the social and economic costs of the catastrophe will strain the government’s finances. The budget deficit was already on track to reach 4.5% of gross domestic product before the crisis but now could widen to as much as 6% to 7% of GDP, said Mr. Mitra of Moody’s. That is a grim prospect for a country that had external debt totaling $55.63 billion as of June 30. President Asif Ali Zardari‘s government has been reaching out to other countries for help. A delegation met with IMF officials Monday in Washington. Donors including the U.K. and the European Union have so far pledged almost $500 million in additional help.

Moody’s is unlikely to upgrade Pakistan’s credit rating in coming months due to the devastation from the floods and other challenges, but the country’s current B3 rating “adequately captures the risk” of the likely economic slowdown and is unlikely to be downgraded further, said Mr. Mitra. A B3 rating is just one notch above the C level, which applies to countries in effective sovereign default, and makes it hard for a country to issue bonds in the international market.

The natural disaster is the latest setback for the Pakistan economy, which after several years of strong growth almost ground to a halt in 2008, hurt by budget overruns, a loss in export competitiveness due to high inflation, and an insurgency that continues unabated. On Monday, while emergency workers worked to shore up levees in two southern cities, at least 36 people were killed in three separate bomb attacks across the country, and 12 suspected militants were killed in U.S. drone attacks near the Afghan border.

Concerns about the economic fallout have kept pressure on Pakistan’s financial markets, though the impact has been moderate. The cost of insuring against a default or restructuring of Pakistan’s bonds remains at very elevated levels, but has been relatively steady in recent weeks, a sign that investors anticipate IMF and U.S. support to prevent any fiscal crisis. The spread on Pakistan five-year credit default swaps was quoted at 1,099 basis points Tuesday, roughly on par with those of other high-risk sovereign bond issuers like Venezuela, but well below early-2009 highs of over 2,100 basis points during the global financial crisis.

Pakistan’s benchmark stock index, KSE-100, has fallen 7% so far in August, but is up 4% so far this year, roughly in line with other emerging market indexes. The Pakistan rupee, one of Asia’s weakest currencies in recent years, has fallen in recent days, but has found support above its record low against the dollar of 85.84 rupees hit on Aug. 2, helped by expectations that remittances from overseas Pakistanis, which have averaged around 10% of GDP in recent years, may rise to help families at home cope with the floods.

But analysts expect the rupee to remain under pressure in coming months due to Pakistan’s current account deficit and high inflation rate, which ran at 12.3% in July. The floods are likely to push up food prices and transportation costs for other goods, likely eliminating any chance that inflation might fall below 10% this year, said Mr. Wyatt at UBS.