Тема социально-экономического и политического развития пакистанской провинции Белуджистан крайне редко освещается в мировой научной литературе. Тем интереснее представленная пакистанским автором Мусаррат Джабин статья "Наследие нищеты, маргинализации общества и социальной неразвитости в Белуджистане и пути его преодоления". М. Джабин, преподаватель факультета международных отношений Университета г. Кветты в провинции Белуджистан, в 1999 г. защитила диссертацию на тему "Международные экономические отношения в 90-х годах XX века и их влияние на страны третьего мира (на примере Пакистана)". В статье автор рассматривает вопросы влияния инвестиционных процессов на социально-экономическое и политическое развитие Белуджистана, выбор федеральным правительством Пакистана приоритетных мега-проектов, и реальные последствия для населения провинции от их реализации. Мусаррат Джабин справедливо подчеркивает стратегическую важность территориального расположения Белуджистана, что позволяет провинции удерживать статус района, наиболее благоприятного в Пакистане для иностранных инвестиций. Одним из крупнейших проектов является порт Гейдар - первый и пока единственный порт в Белуджистане. Расположен он в непосредственной близости от входа в Персидский залив на побережье Индийского океана, что и делает его привлекательным как для Китая, Афганистана, так и для стран Центральной Азии и Ближнего и Среднего Востока. Строительство порта ведется при финансовой и технической помощи Китая, предоставившего заем в 180 млн. американских долларов.

В своем исследовании автор показывает противоречивые тенденции в местном обществе: с одной стороны, власти Белуджистана приветствуют иностранные инвестиции, с другой - всячески противодействуют структурным изменениям в экономике провинции, проводимыми федеральным центром; к тому же отдельные националистические группировки находятся в открытой оппозиции к местной администрации.

Н. А. ЗАМАРАЕВА, к.и.н.

Legacy evolves with the passage of time depending upon the genesis of legatee and the interests of other linked entities. The prevalent economic legacy effects the economic development as it becomes the base of any economic edifice. The legacy of economic development is an anthropological phenomenon which descends upon heirs of particular territory linked to historical, political, and social factors.

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This study is significant to highlight the legacy of marginalization in Balochistan comprised of poverty and underdevelopment as the economic growth has remained nominal. It is the Third Millennium that Balochistan has secured such a status amplified by economic opportunities within and around Balochistan because of foreign investment and interests. It has become the hub of foreign investment because of its geo-economic location which has expedited the conflict trends in Balochistan with two dimensions; one is that socio-political structure in Balochistan has taken up violence as means to obstruct economic change and two is highness of power structure of Pakistan to suppress the socio-political forces against economic strategies; the study has addressed the following questions:

1. How the legacy of marginalization effects economic development?

2. What are the permeating factors of marginalization in Balochistan?

3. Which conditions encourage bringing in Balochistan in economic development?

4. Will the present configuration of interested entities in international-national-provincial economic system become able to adapt to contemporary economic challenges for greater economic development of Balochistan?

THE LEGACY OF MARGINALIZATION REFERRED TO BALOCHISTAN

When the legacy of poverty and underdevelopment in Balochistan is filed it comes through the process of marginalization, which further compounds as follows:

General legacy: a sum of belongings paid out of assets generally - means what exactly Balochistan inherited from historical factors and trends.

Demonstrative legacy: a general legacy with particular fund named from which it is to be satisfied referred to Balochistan is the centre-province relations revolving the economy.

Cumulative legacy: an additional legacy to Balochistan caused by regional and international factors.

Factors of Marginalization

The whole edifice of economic development will rest upon the socio-political capital of the province for longer utility. The literacy rate in Balochistan is 36% as compared to 45% of Pakistan, and per capita income is $ 677 as compared to $736 of Pakistan. At the same time the spots focused by foreign investment they lag behind even the rest of the province for example in Gwadar the literacy rate is 25.5 and per capita income is $337 [A Situation Analysis Study, 2005, p. 7].

Balochistan is 43% of Pakistan with huge and numerous terrain. Lack luster people are led by political leadership; lacking commitment for development. These two simple factors are most of the time churned by the regional and international spree of events; either it was the occupation of Afghanistan in 1979 by Russia in pursuit of hot waters of Indian Ocean, or 9/11,2001, terrorist attacks in America and then its accumulation into war against terrorism (see Fig. 1).

Geo-strategically important terrain of Balochistan is very unfriendly for development as it is populated sparsely. For example in Punjab (the densely populated province of Pakistan) four pylons of electricity may provide electricity to 8000 people, but in Balochistan four pylons only to 200 people because of the distances. The population of Balochistan is 4.99% of total population of Pakistan.

The planning and development in Balochistan starts with political considerations, that who is in power and their relevant areas for example in 1995 the then Muslim League government emphasized development work in Jhal Magsi and its suburbs (political constituency of the then Chief Minister). Again political instability pools into the economic malady, for example the government in Balochistan took over as result of military coup on 12th of October 1999, diverted all

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Source: self-made

Fig. 1. Horizontal Factors of Marginalization

the P&D to its area that was Noshki. The projects are given to those having political affiliations with out considering their qualification. People feel dejected having no political background. They either desist to work, or migrate from the province or country.

Actually the province is weak economically with few exceptions the quality of human resources is abysmally low. The human resources are not developed, in quantity may be, but actually it is not. For example yearly turnout from educational institutions is increasing but the quality is decreasing. Since the advent of Afghan crisis in 1980s and de facto end in 1988 has tremendously affected the natural resources, economic activity, and social services in the province. Due to the Afghan Problem the crime rate has been increased, drug abuse, and Kalashnikov culture has wrought the social fabric.

The foreign investors have their base in developed countries of the world. They are the big managers of capital, technology and skilled manpower. Pakistan can try to get investment inflows, transfer of technology, technical know how inflows by manipulating the policy and research of international institutions [Here the International Institutions may be defined as UN organizations, nongovernmental international organizations, and multinational corporations] in the province. This task is not simple because of vertical challenges to manage foreign investment (see Fig. 2).

Corruption is rued in vertical zones of investment governance. A couple of dams and major parts of the recently built Coastal Highway have been washed away was constructed by the FWO (Frontier Works Organization). Billions of rupees flowed into the sea. The quality of construction or sitting of bridges or both was not up to mark [Sayed Shahid Hussain, 2005].

Since independence lack of political commitment of Pakistan and its reflection on the development of Balochistan has remained steward cause of underdevelopment in the province. An interface exists between foreign investment, injustice, poverty, oppression, and insecurity. In this situation the alternative sensibility is the theme of partnership, cooperation, collaboration and mutual dependence, among foreign, national and local entities - and among the people, government and foreign investors.

Dynamics of marginalization

Marginalization is a very dynamic process it changes its shape and volume in different systems. In international-regional-national-provincial systems referred to politics, economics the same nation state system is marginalized and centered.

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Source: self-made

Fig. 2. Vertical Factors of Marginalization

Geo-strategic systems: International Geo-strategies: Balochistan remained a rogue buffer or passage for invaders from Central Asia or in geo-polity between Russia and Great Britain. To fulfill their interests they did not need to develop it as it now going to be. So in economic development Balochistan was marginalized.

National geo-strategies: Balochistan has played a pivotal role in national foreign policy endeavors; either it was alliance with the West to make Russia to withdraw from Afghanistan or the role of Pakistan in present war against terrorism.

Economic systems: The available human development in Balochistan exists in periphery of economic system while planning economic development with national and international imperatives Balochistan exists in the core of economic system.

Decision making systems: In decision making system Balochistan is having marginal position vis-a-vis its political institutions but it is in the center of federal decision making system because of planned economic development. Balochistan is also the centerpiece of foreign policies

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of USA and China the two economic contenders in international system. Undoubtedly Iran, Afghanistan, Central Asian States and Gulf countries also focus on Balochistan.

So Balochistan exists in the core of policy making for economic development but its genesis exist in the periphery of economic development system at national and regional level when, it is compared to rest of Pakistan or Iranian Balochistan or to Dubai as coastal economy. The geology of conflict created due to Marginalization in Balochistan appears relevant to format the conflict. The next section draws mean of historical, social and political factors of marginalization.

GEOLOGY OF CONFLICT CREATED DUE TO MARGINALIZATION OF BALOCHISTAN

Conflict in Balochistan has been prompted; as contenders are seeking to possess the economic resources, and to occupy the same exclusive position; while playing incompatible roles through incompatible means. The issue is about the management of mega-projects and the relationship of mutual trust and benefit between the federation and the province and the other stake holders regional and international powers. The struggle and the fighting are to determine who is the owner of Balochistan's wealth and resources, the Baloch or someone else.

In fact marginalization takes place in two ways; one by the governing hierarchy and two is due to quality of governed. These two main factors have always been churned by international imperatives as the external threat remained steward cause of Pakistan's foreign policy molds. This study has focused following factors:

1. Historical Factors

Historically, Balochistan came under influence of British colonial rule in 1876. It had a divided status under colonial rule. British divided it into two regions from administrative point of view. While one region comprised of view of the princely states of Kalat, Kharan, Mekran and Lasbela, the other region was known as British Balochistan. After independence, the states of Kalat, Kharan, Mekran and Lasbela acceded to Pakistan. Balochistan remained as administrative unit under British rule, but it did not enjoy the status of province. It was denied all forms of reforms. It was deliberately kept backward and least attractive to foreign powers under colonial rule. It served as military base for the British due to its geo-strategic location. British in fact pursued a policy of containment against the expansionist designs of Russia, who has an eye on the strategically important Balochistan.

In geo-economic terms Balochistan has remained strategic vocal in history between British and Russian hegemonies. From 16 - 18 centuries Gadani port was used for trade purposes to and from Central Asia but later the British stopped it as to determine the regional development [Mansoor Akbar Kundi, 2005].

After the independence of Pakistan Balochistan served the international policy of containment; when USA, Pakistan, Iran, Iraq and Turkey joined SEATO in 1954 and CENTO in 1955, and later on Turkey, Iran and Pakistan signed RCD (Regional Cooperation for Development) in 1964 and a road link was built through Balochistan to link the three countries.

Balochistan has provided strategic depth to military policy of the country as it is the 43% of Pakistan and its terrain is sparsely populated. Balochistan enabled Pakistan to explode five nuclear devices successfully in 1998. In fact all the foreign aid coming to Pakistan in 1980's (when Pakistan was the ally of West against Russia) and after 9/11 can be attributed to this strategic depth. The utilization of this strategic depth by international conflict management strategies has badly effected the natural and human resources of Balochistan.

Long standing resentments caused armed conflict in 1948, 1958, and 1973. Today these resentments persist because of the central government's suppression of nationalistic aspirations; the absence of economic and social development in Balochistan despite its possessing almost 20 percent of the country's mineral and energy resources; and the exclusion of the provincial author-

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Fig. 3. Political Economy of Balochistan

ities and local population from decisions and major regional projects, most notably the construction of the Gwadar port.

2. Socio-Political Factors

Social politics connotes the political trends exploiting the social factor to achieve the politico-economic objectives - as the politics always pursue the power mainly the economic advantage. The socio-political structure of Balochistan may effect the foreign investment or vice versa, the agility of political institutions is affected by many factors.

The province of Balochistan lacks in social, political capital and physical infrastructure to implement foreign investment. That may be called as local component for development. In Balochistan the government intends to build mega-projects, like Gwadar port, oil and gas exploration projects, huge housing schemes, and military cantonments. These endeavors meant for effective foreign investment are not being absorbed by the locale.

In Constitution of Pakistan the wealth of natural resources belongs to native people; but the concurrent list of the constitution empowers the federal government to supersede the provincial writ for the security of natural resources. Factors of dependency, mistrust, center-province disharmony and international imperatives establish the base for conflict created due to marginalization of Balochistan. The pre- and post-Pakistan independence policy makers referred to Balochistan have always considered the doctrine of external threat. Very less compatibility exists between local, national, and international agendas to format the political economy, as it is retrogressive (see Figure 3) to utilize the land of Balochistan. The wholesale cry about the province by the natives and the center is always that the province is deprived and poor. The center utilizes it to format a pretext to interfere in the provincial matters and the natives try to acquire more and more benefits from the center.

Dependency: Balochistan is dependent on center, because of myriad of factors. Balochistan is 43% area wise but only 4.99% of population. The national resources are divided on the basis of population.

No federation follows in the world population as the sole basis for distribution of revenues among the federation units except for Pakistan. The Balochistan Position Paper declares in clear words while giving examples of revenue distribution criteria of three federations of the world - India, Australia and Germany. In all the three federations population has been given 10 to 11 percent ratio while other factors have been given much more weightage [ Sabihuddin Ghausi, 2005]. The other indicators in case of Balochistan can be included are backwardness, the share of provinces in national wealth, and Inverse Population Density.

Balochistan receives direct transfers from the federal government on account of its ownership of gas. These transfers relate to the excise duty and royalty on gas, and its share of the Gas Development Surcharge (GDS). The royalty on gas is paid in recognition of the ownership right of

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the province. It is fixed at the rate of 12.5 % of the gas sold and valued at the well-head price. However, the well-head has been pitched at a low level for the gas fields in Balochistan, compared with the royalty being paid on gas fields in other parts of Pakistan discovered recently. At present, the GDS is determined on the basis of exploration cost and distributed among the provinces according to the proportion of volume contributed by different gas fields to total national gas supply. This sharing arrangement has been put in place despite the fact that GDS collected is a function of the difference between the weighted prescribed price (determined on the basis of the well-head price, operation & maintenance cost, excise duty) and the price paid by the consumer. Balochistan's gas fields are mature and fast depleting, which has resulted in the reduction of the share of Balochistan in the GDS. Since the well-head price for Balochistan fields is low, its contribution margin per unit of gas, to the total GDS is more than the contribution of gas fields in other provinces. By allocating the GDS receipts on the basis of volume rather than total value of gas sold (being the product of volume and average weighted price paid by the final consumers), Balochistan's share is being artificially depressed. Whereas it contributes 53% to 65% under different formulas, it is now getting a share of roughly 35% in the GDS distributed among the provinces. If the formula is changed to give Balochistan a fair share, it would get a GDS of approximately Rs. 9.8 billion instead of the present Rs. 4.8 billion [Shahid Kardar, 2005].

The Balochistan Province contributes around 6% of revenues and receives federal transfers as 94.5% for provincial expenses; which also highlights both the heavy dependence on federal transfers and the huge mismatch between the assigned responsibilities of the province and the wherewithal available to it to discharge such obligation. The high fiscal dependence on federal transfers is on account of the centralized tax structure (especially after the introduction of GST), the almost exclusive powers granted by the constitution to the federal government to make use of the revenue potential provided by all major, broad-based taxes the skewed distribution of tax revenues brought about by the NFC Award 1997, which has resulted in a revenue sharing formula that favored the federal government at the expense of the provincial governments. The high degree of dependence on federal transfers has left Balochsitan little leeway in absorbing the cost of shortfalls in such transfers, since the potential for mobilizing of revenues from its own taxes and user charges for provincially provided services has tended to be limited [Shahid Kardar, 2005].

The OGDC has three operating fields in Dera Bugti, which are under the influence of Nawab Akbar Khan Bugti (tribal chief). They are Pirkoh, Loti, Uch. Since the inception of operations, Nawab has been paid as much as Rs. 6.60 m by the OGDC alone as rental for three fields is different, which is paid annually and for the year 2005 reached Rs. 80 m. The Pakistan Pipe Line has also been paying certain amount in order to carry out work in its fields. How much of it goes into alleviating the pain of the people? Nothing [Syed Shahid Hussain, 2005]. Under the Agreement signed between the GOP and Nawab Bugti's representatives on Dec 14, 2001, there are also indirect benefits for the Nawab. All employment of the locals is done through the Nawab, he nominates the persons to be employed. All transport is to be hired through the contractors who are his men. Similarly, all contracts for civil works and supply are given to the locals that front for the Nawab.

Table

Facts related to gas royalty

Natural gas sales

Rs. 24.990 billion

Net gas sales:

Rs. 17.6 billion

Profit before tax:

Rs. 9.063 billion

Profit after Tax

Rs. 6.617 billion

Royalties

Rs. 1.9 billion

Workers participation fund

Rs. 0.475 billion

Community Development

Rs. 0.041 billion

Source: Pakistan Petroleum Limited Report 2004.

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Community development is the worst sufferer because it is ad hoc and discretionary (see Table).

Mistrust: Mistrust exists between bureaucracy and the people of Balochistan. The rule of military bureaucracy to subdue the politicians has accentuated the mistrust. During 1970 election the people of Balochistan voted for the National Awami Party (NAP) which stood for full provincial autonomy. Its leaders tried to implement manifesto so as to have more provincial autonomy. The central government dismissed the provincial government after leveling allegations against the NAP government.

At the root of discontent is underdevelopment, widespread poverty and the fear; that the megaprojects in Gwadar and the coastal regions will provide a cover for the induction of outsiders into Balochistan, making the Baloch still more deprived and impoverished. The genuine projects are suspected as their utility to local population is suspected, because it will threat the identity and livelihood of the local inhabitants.

In July 2005 government planned to shift the population from Sui to adjacent area some 12 km away. People belonging to Mondrani clan of the Bugti tribe would be shifted to Tilimat area some 12 km off Sui while tribesmen of Kalpar clan would be shifted to the "Go" area in the North of Sui township. Provincial government aims to get around 2.00 acres of land in those areas on nominal rates. "Shifting of the local population is programme about their destruction, not there settlement, 10.00-acre land was allocated for establishing 100 industrial units in the area while Tilimat would be linked with Kashmoor-Rajanpur and Dera Murad Jamali through rail. It is the plan to divide people [Nawab Bugti, 2005].

Disjuncture between contemporary rights talks and the historical processes through which rights came to frame: Balochistan is an unending tale of our political and socio-economic lapses. Despite its abundance in the wealth of natural resources, it remained the most backward province of the country. A deep-rooted sense of deprivation and frustration has made its people highly suspicious of the policy-makers in Islamabad, raising serious questions about the state of federalism in Pakistan. The current atmosphere is so murky that even genuine development projects initiated by the federal government are suspected and resisted only because there are unaddressed question in terms of their actual utility and benefit to the people of Balochistan.

Center Province Disharmony: Balochistan politics need to be looked upon as part of Pakistan. It has been always facing the crisis of political development: these can be elaborated as Binder [ Binder Leonard, 1963, p. 43] explains in, "Religion and Politics in Pakistan". The crisis of identity means that people of a nation fail in large to identify themselves as one nation and are rather divided into ethnic and religious groups. The crisis of legitimacy means that government is not based on popular support but is rather based on coercion and force. A country suffers from the crisis of participation where the people are denied to vote. In crisis of representation attitudes, preferences: viewpoints and desires of the entire citizenry are not shaped into governmental actions. The crisis of penetration begins where government fails to penetrate its jurisdiction in all parts of the territory.

Since independence the people of Pakistan in all provinces have had limited role in determining the course of their history or the direction of their country's policies. They have been exploited in the name of ideology and external threats while the real domestic challenges facing the country have remained unaddressed. The governments have been presiding without taking the people into confidence or accepting the responsibility of their actions or policies. The Constitution has not been implemented truely.

In this backdrop Islamabad has taken many of the activities, because of the massive share of national revenues and resources that it appropriates. The federal development program includes not only Gwadar, the coastal highway and the Sandak project but also the construction of provincial roads (like those connecting Chaman and Quetta and Quetta and Kila Saifulla), which should be implemented by the provincial government, essentially because some of them, even under the flawed Constitution, fall entirely within the purview of the provincial and local governments. It

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is just that the federal government will simply not let go of functions and resources that rightfully belong to lower formations of government.

The five highways towards Gwadar are made because of international interests, secondly all the revenue will go to federal government. In Gwadar Housing Scheme the land mafia residing in Karachi has manipulated the land record in their favour with the help of government machinery and now the per acre land prices have gone from thousands to millions [Irshad Ahmed Haqani, 2005].

The issue of Dera Bugti has become complicated as the government mobilized armed forces, thus creating a situation of armed conflict. The coastguard agency treats all the people as criminals. Women and children are always humiliated on the pretext of search. The Baloch people think that subjugation and colonization is taken in the name of development. In Frontier Core 75% are from North West Frontier Province, 20% Punjab and 5% from Sindh [Remat AH Baloch, 2005].

In between is the provincial tier of government, to work with the tribal system and abide by the central government simultaneously. The provincial government sides with the center, and seems unable to manage the potential of local political system in larger interest of the country.

The problems of Balochistan over the years perhaps are not exclusively rooted in our Constitution. We have a clear constitutional framework delineating the federal and the concurrent legislative lists with all residuary subjects being left to the provinces. In essence, the problems are in the non implementation of the Constitution and in the patterns of governance and the centers of power that have kept the whole country in a state of flux for all years of independent statehood. The sharp ethnic tensions are the result of continued sense of political and economic neglect among the people of the smaller provinces. There is a strong underlying resentment in Balochistan against what is seen as continued "Punjabi dominance", inequitable distribution of power and resources, and exploitation of province's natural wealth.

Tribal system is existing in Balochistan from centuries, when the Arab tribes descended upon this territory. In British times Balochistan was divided as British Balochistan, and Native Balochistan. The British Balochistan was 25% and mostly comprised of Pathan belt. The rest included mostly the Baloch areas. The 75% of native Balochistan was led by Khan of Kalat, as the small tribes were paying royalty to Khan of Kalat and he was paying it to British government. This tribal system was suppose to interject the people and the government, always fulfilled their own interests rather then to embark upon real social and economic development. Now sardars are like demigods to their people who are their bonded subjects. They hold sway over their life and death. How could any one dare vote against them in an election? The sardars become chief ministers and ministers through the electoral process. On being elected they wield unbridled state power; which is otherwise not available to them.

People in Kuhlo recount innumerable Nawab Marri's views on development, "the rulers will plunder the wealth of the area once we allow roads to be constructed. The government had been taking away gas from the Bugti area, Sui, for decades but in return the local population got very little [Rab Nawaz Gazni, 2005, p. 6].

3. Regional and International Factors

One of the drastic impacts of Afghan Revolution on the tribal set up of the province was the deepening crisis of penetration and growing militancy among tribesmen. The indigenous population of Balochistan divided into a large number of tribes might have been familiar with the traditional knowledge of guerrilla warfare, nonetheless, they were peaceful and non-warlike as were few years after the revolution. The prolonged Afghan war entailing a low-intensity conflict between the Soviet/Afghan forces and Mujahideen, the emergence of Kalashnikov culture, and availability of advanced weapons made a large number of tribes militant and violent [Dunken Emma, 1989, p. 7]. It is particular in case of many tribes such as Marri, Bugti, Rind, Mengal, Acakzai, Raisani tribes. Marri tribesmen who were involved in a large scale insurgency in 1973-

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1974, fled to Afghanistan, and returned 18 years later, are more violent and militant today than were then.

In the era of globalization political institutions are being expedited as per frequency of global agendas visiting there potential to get realized at macro- or microlevel and the political institutions in Balochistan are no exception to this reality. In Balochistan political institutions are effecting the development, and behavior of civil society. The war economy might be trying to compatriot with foreign investment to create its own job. The truth of the matter is that the international forces of globalization sweeping across the world at the moment aimed at integrating with the global economy, have destabilized our societies and intensified conflict.

Gwadar port is being developed with full assistance from the Chinese. There was recent report in the American press expressing concern over the Chinese interest in some ports including Gwadar. It was suggested that the Chinese were trying to seek bases all along the oil route. Also there are people in the White House who are all for military action against Iran. If Seymour M. Hersh is to be believed, preparations for invading Iran are afoot. According to Bush at war by Woodward, similar secret preparation was ordered for Iraq before its invasion. There was also a report published in journal under the caption US digs deeper in Afghanistan. According to it Americans are building a new base in Herat in Afghanistan to encircle Iran. A request for NATO logistics hub in Karachi has already been conveyed to Pakistan [Saed Shahid Hussain, 2005]. That is where Balochistan would offer a tempting target for international intrigue.

The development of energy system vis-a-vis South Asia, e.g. gas pipeline planned among Iran-Pakistan and India through Balochistan, impacted upon the US relations with all the three countries. The visits of Indian and Pakistan's heads of states to USA in 2005 may be illuminated in this respect; and American president's visit to India and Pakistan in 2006. Then the foreign investment in Balochistan is a matter of concern for United Arab Emirates (UAE) coastal economies as well.

If it is determined that the wealth of natural resources belongs to the people and they are unable to utilize it in their favor; what can be the mechanism to build a synergy among local population and operational modalities to manage foreign investment at socio-political level.

STRATEGIES TO MANAGE MARGINALIZATION OF BALOCHISTAN

The collating point to marginalization is economic development which may end up negatives at sustainable level. The strategies proposed are: management of local component for economic development, management of centre province disharmony for economic development, management of regional-international relations vis-a-vis economic development in Balochistan.

Basis of Action

Law and order situation in Balochistan may affect the economic vitality of Pakistan because:

* Provision of gas from Balochistan is linked to economic growth of Pakistan vis-a-vis foreign investment

* Law and order situation discourages the foreign investment in general and in oil and gas in particular.

* Disruption of gas daunts the regional gas pipelines from Central to South Asia via Pakistan-Balochistan.

The management of marginalization of Balochistan is vital because of following reasons:

* Sustainable development is the challenge of Third Millennium.

* Energy has become the defining factor of international-national politics

* 9/11 and war on terrorism - Pakistan has emerged as the non-NATO ally - the conflict trends may be dealt by generating economic activity via management of foreign investment.

Pakistan may locate a capable place in global community by exploring new avenues of raw materials and economic activity in the province of Balochistan. The area of Balochistan may open new vicissitudes of prosperity for Pakistan. The province of Balochistan has become the center of attention because of following reasons as opportunities:

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1. The disintegration of USSR and economic independence of Central Asian states have created a huge economic opportunity. Balochistan is a gate way to Central Asia.

2. The economic potential in Balochistan:

* Large coastal line of Balochistan of 770 km from the mouth of the Hub River in the east to the Iranian border in the west.

* Enormous mineral resources; as it sits on geological belt with world-class mineral deposits. For example, Sarchashma in neighboring Iran has reserves of 1.2 billion tons of copper and other mineral ores, the Chaghi metallurgical belt, 480 kilometers long and 50 kilometers wide, offers the prospect of a similar potential in Balochistan [Ihtasham ul Haque, 2004].

* Interest of foreign investors and of international institutions, bilateral donor agencies, and international non-governmental organizations in Balochistan - because of above given strategic and commercial qualifications.

There should be a political commitment for economic development of Balochistan. The process requires a prerequisite sense of urgency. More complex analysis of both the causes and symptoms of marginalization in Balochistan can be directed as follows:

* Move from discrete projects in particular areas to looking more at other parts of Balochistan, i.e. Awaran.

* More strategic engagement with tribal system at different levels to try to ensure that they have both the capacity and the political will to uphold their responsibilities to protect the right of the poor and marginalized.

* More collaborative work with other, social movements and networks at different levels; moderate & progressive political leader.

Management of local component for economic development

The right to development is human right as declared by UN declaration of 1986 and focused by UNDP Human Development Index 1990. The rights based approach emphasizes that development should be based on recognition of the equal rights of all citizens to the resources required for material well-being and social inclusion with such a conceptualization of development, the contribution of state is given prominence. Legitimate political institutions can embark upon socio-economic development; if they are willing for change to improve the social capital. In Balochistan the political institutions drive and affect the economic process, because there are no agile economic institutions within the political network.

Specific education is required to bring changes in decision-making support system over which the socio-political structure seems dependent. Some revolutionary steps can be taken like in 1949 India passed a political order to dismantle the previous political structure having 525 states and instead 22 provinces were created. Constitutional amendments should be made to manage the conflict in Balochistan. Economic development may be interjected with society by building required knowledge economy to promote economic development. Plus the social services should be enhanced in the province.

A lot is required to promote labor-intensive, small and medium enterprises to tap the strengths of Balochistan. It should include agro-based industries, ground water development projects, livestock development, including abattoirs for export to the Gulf where they can easily win a big share of the market presently dominated by the imports from Australia and New Zealand, cold storage, fruit and vegetable processing plants and development of mineral resources. Spread across the length and breadth of the province, and appropriate for its existing level of development, these and similar other projects and business in the hands of the people of the province would address their problems much better than capital-intensive projects largely concentrated in one or two regions.

Three areas for industrial investment potential. Foremost place is Lasbela district where all facilities are available. The second area is Naseerabad where agriculture is fairly developed mak-

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ing the raw material, basic infrastructure, railroad, electricity, water and other facilities available. Proximity of Sindh is an additional factor finding markets for finished products for local consumption. The third area is Mekran, with the highest literacy rate and manpower, got good exposure from the Gulf region. The construction of Gwadar Port with a free trade area and the proposed export processing zone will add to the investment opportunities. Two major valleys of Mekran, Kech and Panjgur, are known to be the cultural capital of Balochistan where highly literate population is available to man the future industries of Balochistan. Fisheries, seafood industry too has vast scope for development on Balochistan coast right from Bunewari near Hub to Jiwani on the borders with Iran. The seafood industry alone can earn two billion dollars foreign exchange if the available sea wealth area is exploited properly meant only for the benefit of the local people. The government in the case will have to stop illegal fishing and indiscriminate use of deadly fishing gears that is being patronized by corrupt political bosses for the past many decades [Saleem Shahid, 2005]. Chromites was found in Balochistan in 1903, Balochistan should have refinement plant, and iron upgradation plant in Dilband. Onex marble is available in Chaghi, which should be refined. Balochistan has the best quality of cotton it produced six billions bales in 2004 - 2005 [Fazle-Haider, 2005]. This potential may be harvested.

The short-term interests of land mafia or vested interest groups should not damage the interests of local population. Most of the infrastructural development is linking Gwadar with Karachi. The government should pay equal attention to developing road and rail links from Gwadar to the hinterland of Balochistan so that all Baloch equally share the development.

A national law should be enacted fixing a minimum of between 1 - 2% of profit based tax to be contributed by resource extraction companies towards a 'Community Development Fund', which should be managed under a Trust to plan for long-term welfare of the community/union council/tehsil where these facilities are located.

Management of center province disharmony

Cooperation beyond economics - if the politics do not catch up with the economics, many things can go wrong. We need leadership, we need institutions, and we need cooperation in many dimensions.

State has to assume the responsibility to build infrastructure - public economy. A shift is required in conventional development thinking by stressing that development is about people, their knowledge and institutions. The relations between center and the province can be improved by genuine federal system, fiscal devolution, and by building confidence in people. Here few of the suggestions of tribal chiefs are added as well. The view is to consider wider options for sustainable management of conflict.

To have the amicable solution the concept of "weness" can be launched between the military and local population. It was the shield of Pakistan military which made USSR not to invade Balochistan in pursuit of hot waters in 1980's. Pakistan military provides defense against external threat. At the same time the territory of Balochistan provides strategic depth to Pakistan military to benefit them at national and regional-international levels.

Genuine federal system: Balochistan demands the provincial autonomy provided in the Resolution of Pakistan 1940 [Amanulla, 2005]. The question of provincial autonomy remains the key to addressing the issues of federalism. If any changes are needed in our Constitution, they should be made. Our Constitution has been amended many times for reasons of political power or expediency. It can be amended now to remove the underlying causes of injustice and socio-economic deprivation of the people of smaller provinces. A new federal structure has to be devised in the interest of stability in Pakistan. This will require a recasting of the Constitution and the establishment of a more viable structure that gives meaningful autonomy to the provinces. This involves a slashing of the Concurrent List and managing the control of all key resources like oil and gas where these resources are located. The people of Balochistan also need to be freed of the outdated

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and exploitative darbari and sardari tribal systems, which keeps them backward to sustain its own privilege and power. The Sardars in Balochistan must understand the new realities of the world. Instead of obstructing genuine development and security related projects, they should welcome any public or private investments in their province which would ultimately bring direct or indirect socio-economic dividends to their people. With greater share in political power and better economic opportunities, the people of Balochistan could chart for them a new and better place in the federation of Pakistan. A system is needed to check the abuse of economic and political power.

Lack of legislative and financial powers is causing the conflict between center and the province. The Senate should be directly elected, it should have the financial powers and be able to by pass the National Assembly and the National Assembly should not be able to by pass the Senate [ Sardar Attaullah Mangel, 2005]. The answer to the injustices felt by the Baloch lies in solutions in a genuine federal system and not in conjuring at political system around some misconceived notion of, "supreme national interest" nor by simply increasing the size of the federal government's development programs in Balochistan and enhancing the job quotas for the Baloch in federally managed public services and projects.

Army should be recruited from all over Pakistan and NFC (National Finance Commission) should be revised [Abdur-Rahim Ziaratwal, 2005]. This plea has already been taken by the recruitment policy of Pakistan army, as around 100 officers from Balochistan are now taken yearly. Disciplinary clauses of relegation and withdrawal are also relaxed in Pakistan Military Academy.

The only solution lies in dialogue and mutual adherence to the agreed constitutional framework. Wherever a change or adjustment is warranted, it should be made through political and constitutional means. The government should establish firm authority that the rule of law prevails in every corner of the country. The government and the local forces should effect reconciliation with local residents and then work together with them in places where military operations against insurgents have taken place. The government should listen to the voices of the local people and involve them in the decision-making process when planning local development projects.

Legislative powers regarding Gwadar and other mega-projects must vest in the Balochistan Assembly and the entire income, in the shape of taxes at present going to the federal government, should belong to the Balochistan government. The head of the port authority must be a Baloch and 60% of the membership of its board of directors should be from Balochistan. All the foreign investments in Gwadar should be made on the pattern of the UAE that is on the basis of 51 % local and 49% foreign partnership without meeting this condition, no license should be issued. The four federating units should be given equal representation in the Senate.

20% of royalties should go to the district governments to carry out regular development works, 30% should go to a provincial 'Human resource development fund' to fully finance the education of meritorious boys and girls of the province to study science and technology in quality institutions in Pakistan and abroad. The 50% should go to the provincial exchequer to improve the financial resources [Muhibullah Shah, 2005, p. 13]. Along with this, a mutually agreed formula for the division of royalties - not just for the gas from Sui but also for the copper from Saindak and the gas pipeline from Iran to India across Pakistan - and its actual implementation would offer a pragmatic solution. The idea should be to restore confidence and good faith between the center and the province. The federating units must be empowered to make all laws on their own units [Sardar Attaulah Mangel, 2005].

Winning the confidence of the local people; a civil society should be developed by taking all the political forces into confidence. Unpopular policies should be modified, as the policies of building cantonements. Government has already devised some of steps to promote confidence building measures.

Prime Minister Shaukat Aziz has granted Rs. lbillion grant for speeding up development activities and rehabilitation of drought hit areas in Balochistan. Rs. 10 billion Balochistan uplift Plan, 23 June 2005: These include the implementation of the 5.4% quota for Balochistan in fede-

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Fig. 4. Strategy for Economic Development Vision

ral jobs, priority for local people in new jobs expected to be thrown up by the Gwadar seaport, compensation to fishermen affected by the port's construction, representation of Balochistan leaders on boards of directors of the oil and gas Development Corporation and the Sui Southern Gas Company. The package also include a one time waiver on gas charges for local residents, payment of oil and gas royalties directly to areas from where these are extracted, removal of the Constabulary and Coast Guard check posts from cities and towns and the provision of night-landing facilities at Quetta airport. Of the Rs. 10 billion for the province, one billion would be spent on improving health-care system, two billion on uplifting schemes in the Sui area, three billion in Gwadar and four billion in Quetta. But the period within which the pledged amount will be made available to Balochistan and spent on development project is not clear.

Management of regional-international relations vis-a-vis foreign investment in Balochistan

Foreign investment in Balochistan can be managed in three ways: The first emphasizes the mitigation of excesses of foreign investment, second can be to bring market forces into balance with the social needs of people, and the third stresses the responsibility of people and political institutions to adapt to the needs of global markets.

The real challenge is to manage external factor, because political institutions take the cognizance of contemporary realities as much as they serve their interests. In Balochistan the private sector lacks the economic strength much needed for development. Therefore the national and international private sectors would encroach upon the province. In this predicament, integration of diverse identities for economic development is needed.

Integrating diverse identities: The remedy lies in granting political and economic rights to all regions and groups for enabling them to make economic and political advancement. This is pressing for the preservation of our identity as a state. This step needs to be supported by measures aimed at neutralizing the negative effects of globalization on our economy so that the size of the cake is not reduced and its distribution is not skewed further, giving rise to an upward swing in poverty levels and an assertion of cultural identities with renewed force.

To comprehend the economic development; economic strategic vision should be built as elaborated in fig. 4 at community, provincial, national, regional and international levels. A regional forum for the economic development of Balochistan should be created calling in all stake holders, India, China, United States of America, Afghanistan, Iran and, of course, the multinational corporations which are interested to have security concerns managed by utilizing their economic strategy.

LEARNING STATEMENT

The Nobel laureate Prof Tinbergen in his "Design of Development" set out certain basic characteristics that an economy must possess to achieve sustained development. Among these was a government engaged in 'activity' essential to an orderly state such as the maintenance of order and physical security of persons and property. In addition there must be minimum instruments of

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economic policy in the hands of the government and these must be properly used. He assumed that the state would be effective in its interventions in the economy and would behave like guardians rather than as predators, and use it only to further the interest of the governed.

It is established that the strengths of Balochistan are not highlighted while discussing Balochistan. A full constellation of circumstances constituting Balochistan conflict is operative; but the gravity of the situation is not well taken into account. The power structure has not taken the cognizance of the issue in real sense for a sustainable solution. The politicians at the helm of affairs are considered as some different creatures - to become a politician is considered as some matter of priority for idol people, in fact no strength exists in the education system of Pakistan and particularly of Balochistan to refine political capital. The resource illiteracy exists at different levels: as the power structure of Pakistan lapses the Balochistan factor as denominator of economic development in Pakistan. The tribal and native system does not recognize that foreign investment is a source for development.

Subjects of 57 years of neglect or managed under ad hoc strategies; are now partners in development. It is a clear lack of domestic component for economic development which undermines the utilization of foreign investment. In Balochistan genuine democracy does not exist; as either the elections are engineered by the bureaucracy or hampered by the tribal system. Sardars fear loosing of power once the economic development takes place. The government has been patronizing majority of sardars for its own objectives. Provision of incentives to native population becomes difficult in tribal system. In Balochistan matter to the fact is that the investors out of Balochistan and out of Pakistan are equally considered foreigner by virtue of practice. Their fears are that outsiders, whether foreign or domestic, will undertake development work and threaten the identity and livelihood of the local inhabitants. The local population can not question their tribal leaders for their welfare rather they are directed to account and audit the government in this respect to secure more benefits which will be ultimately used by the sardars of tribal system. In fact they are being played by their political leaders. In socio-political management of foreign investment in Balochistan the sardars can not be overlooked.

To reiterate, the dominant patterns (foreign investment oriented) of economic development continue to be reductionism; for instance the development project is based on a cost benefit analysis, where it is assumed that everything is quantifiable. While the cost of old-growth forest, culture or community cohesion can't be quantified and costed. It is clear that foreign investors do influence economic policies. Moreover, their policy design is often defective, ignores ground realities. More importantly mega-projects yield more benefits to international investors or the rest of the country, as compared to the local population.

Building Gwadar port is linked to the stability in Afghanistan and Central Asia. From a defensive perspective, Pakistan navy would find it easier to operate closer to the Gulf. During times of crisis it could move its naval assets farther from Indian naval and air threat.

While locating Balochistan in global foreign investment trends the study establishes; that the natural resources have become integrated into the political economy of local, regional, and global conflicts. With the present distribution of factor endowments and technology between developed and developing nations, the theory of comparative advantage thus prescribes that developing nations should continue to specialize primarily in the production and export of raw material, fuels, minerals, and food to developed nations in exchange for manufactured products [Salvatore Dominick, 2005]. The development of mineral resources in Balochistan reflects the global politics as well.

The paper has found that locals are suffering from crises of identity and the national elites at the helm of affairs are facing the rights of federation legitimacy while the regional states are overvaluing their interests whether they are Chinese commercial interests or US war on terrorism-energy interests.

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It is clear that long term security of the state is not possible without providing its citizens with at least basic subsistence, education and health care. Politicians are not included in the factors of production, but they affect the process of production.

"Let me assure you that I have not for one moment allowed the affairs of Balochistan to slip out of my mind. I pondered, over the ways and matters of improving the lot of our people in this province and of enabling them to secure for themselves the same position and the same political status within the polity of Pakistan, which are open to their brethren in other provinces..."

Quaid-I-Azam Muhammad Ali Jinnah Address to Sibi Darbar on Feb. 14,1948.

Balochistan may remain dependent as the seriousness of dependence relies on the element of competency. Ownership is not the most critical factor. Balochistan may insist on majority ownership by its own locals. But if locals are incapable of successfully making the important entrepreneur and managerial decisions; there is still reliance on others. Entrepreneurship is more important than management. It seems that international interests would work with power structure of Pakistan so it is desirous on part of local socio-politics to resolve the conflict amicably with power structure of Pakistan for greater development of Balochistan. It seems also that future socio-political fabric going to be generated by virtue of migration streams from and out of Pakistan will also be affecting the future political economy of Balochistan.

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