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Dr. Ikramul Haq
After taking oath of 22nd Prime Minister of the country on August 18, 2018, Imran Khan has visited China three times (2018-2020 every year) during his 33 months in power. After the first visit to Saudi Arabia, which is customary for all new entrants, the Prime Minister showed the importance Pakistan attaches to the most trusted friend China[1] by visiting it next. The much talked about issues in his speeches in China and elsewhere has been his “firm” (but without any roadmap) commitment (verbally) to uprooting corruption and alleviating poverty. On both the issues, he vowed to learn from China. After 70 years of our cherished diplomatic ties with China, it is the most appropriate time to evaluate what Pakistan has not learnt from China despite clichés and slogan mongering to counter financial crimes—this article is strictly confined to this aspect.
In an op-ed, coauthored with Hassan Aslam[2], it was opined:
“Although Pakistan and China are poles apart in terms of the constitutional framework, forms of government and state structure, Pakistan should undertake a detailed study of the Chinese anti-corruption lawfare model from all perspectives. Some questions that Pakistan needs to address include (but are not limited to) the following: Does Pakistan require stand-alone superagencies to separately regulate the public and private sectors? To answer this question, Pakistan may need to take a holistic view at the National Accountability Ordinance, 1999 (NAO) with a new set of legal eyes. Another important question that Pakistan needs to ask is what are the different forms of corruption that are rampant in Pakistan that require laws, and whether the existing anti-corruption laws are adequate to tackle exiting corruption and corrupt practices”.
The oft-repeated top agenda of Imran Khan as head of Pakistan Tehreek-i-Insaf (PTI)—literally means Pakistan Movement for Justice—before and after coming to power has been across the board accountability and making Pakistan a prosperous and egalitarian society. According to his close aides, it is his unwavering “belief” that “prosperity of people is not possible without punishing the corrupt, irrespective of their party affiliations”.
Arrest of two senior civil servants, alleged as front men by Imran Khan, of thrice-elected disqualified Prime Minister and former Chief Minister of Punjab, preferred to be called Khadim-e-Aala (‘most humble servant’) and their bails for want of credible evidence by higher court, has confirmed one thing: any process of accountability lacking credibility and transparency is bound to fail, even boomerang. Sending men from Federal Investigating Agency (FIA) even after his once most-trusted-political-wizard (master of winning ‘electables), Imran Khan is ostensibly countering allegations of selective accountability using “corruption” as a pretext. On April 23, 2021, Khadim-e-Aala wasalso granted bail by larger bench of Lahore High Court, constituted after split decision of double bench, confirming “inability” of prosecution to produce executable evidence required in criminal cases.
According to a report, “In a rare development, the Federal Investigation Agency (FIA) on Saturday admitted before a banking court judge that it had “mistakenly” accused PTI disgruntled leader Jahangir Tareen of money laundering in one of the first information reports (FIRs) it lodged against Tareen”[3]. Earlier, the Lahore High after announcing grant of bail later conveyed there was a split decision and matter will go to referee judge[4]. It once gain raises questions about politicisation of judicial system after that of institutions of accountability.
The proponents of Imran Khan say that his rock-solid determination to uproot corruption is evident from the fact that he is even not afraid of “electables” still associated with “magic sugar man” (for Premier he is now a sugar baron) that can topple him. Premier managed second vote of confidence with the help of the same man, so say his critics that this is opportunism at its worst! The issue of countering corruption and what we can learn from China after 70 years of ties with our most trusted friend in these circumstances appear bleak.
My mentor and teacher in journalism, the great Ibn Abdur Rehman, before his death, in his last column[5], aptly described the prevailing malady:
“The common practice in Pakistan is to condemn the opposition groups as thieves and receive an identical response in return. This was not always the practice in this country and political rivals were treated with due courtesy. The change for the worse is the contribution to political discourse by characterless upstarts. The usual practice these days is to raise one’s stature by demeaning the other and this often without the requisite information. Thus exchanges between political opponents quite often become weird exercises in search for the most vulgar labels for adversaries.
The present government in Pakistan, for instance, chooses to describe its political opponents as ‘thieves’ and ‘looters’, the last word being our subcontinent’s contribution to the English language…”
In his very first speech, after taking vote of confidence, Prime Minister used the same words late I A Rehman highlighted and said, “I will not give NRO[6] to anybody but retrieve the looted funds”[7]. This narrative of Premier persists even after taking second vote of confidence in the wake of defeat of Dr. Abdul Hafeez Shaikh in Senate elections. It has created a situation of no rapprochement with the Opposition parties that all call him “selected”.
The rift in Pakistan Democratic Movement (PDM), now almost erstwhile, shows accountability neither is anyone’s concern nor is reforming the institutions as China did. However, the tug of war and continuous mudslinging has become an accepted political culture. China never faced such a situation in its lawfare (it is a portmanteau of terms ‘law,’ and ‘war’ is the use of law as a weapon of war to achieve legal, financial and economic objectives) against corruption in private and public spheres.
The menaces of corruption, horse-trading, and various financial crimes have been persisting unabated in Pakistan for decades and the PTI Government since 2018 has also failed to uproot them. The issue is not mere acceptance of the fact of widespread corruption, misappropriation of public funds by state functionaries with or without the connivance of political masters, as done by Premier, but how to end these menaces?
In the wake of Senate election on March 3, 2021 and allegations of corruption by rival politicians against each other, citizens are further disillusioned with the conduct of party leaders and elected representatives. They are stunned that the Prime Minister in his televised address on March 4, 2021 admitted: “Many PTI members were bought”. This statement during Senate elections and leakages of videos of 2018 and 2021 pertaining to horse-trading has discredited the entire system. After confession by the Premier of electoral corruption and available evidence, the culprits must have faced criminal proceedings. Mere expulsion of defiant or allegedly corrupt members from PTI by the Premier in 2018 has proved ineffective.
Perpetuation of corrupt practices by some elected politicians defies all norms of democracy. These undesirable practices are not confined to any particular political party. In theory, Pakistan is a constitutional democracy, but in practice it is an embodiment of kleptocracy. Favouritism, nepotism, corruption and using money or other tactics to secure change of political loyalties have been part of our political culture/governance under both military and civilian rules alike.
The agencies responsible to combat these menaces, National Accountability Bureau (NAB), provincial anti-corruption departments, Federal Board of Revenue (FBR), FIA and Election Commission of Pakistan (ECP), have all failed to perform their duties. They have never bothered to establish a joint task force to counter financial crimes posing serious threat to our internal security, hampering economic growth and entry in grey list of Financial Action Task Force (FATF) since 2018. Even after many years, ECP has failed to decide the complaints and counter-complaints of alleged foreign funding by the political parties. FBR has failed to get tax returns from 125 out of 127 registered political parties with ECP[8]. NAB, ECP, and FIA have poor record of successful prosecution of public office holders though it is open secret that their declarations do not justify their sources shown in tax returns[9].
In these circumstances, Pakistan needs to look China’s way for combatting financial crimes. China, like us, faced rampant corruption and waged effective lawfare. China’s lawfare model is not perfect as ongoing reforms are essential. The measure of success of any criminal justice system is the certainty of punishment and impartiality according to international standards. The main problem of Pakistan is a formidable resistance from all politicians for establishment of an independent watchdog authority.
Pakistan is a signatory to the 2003 United Nations Convention against Corruption (the “Convention”) but the existing fragmented legislation and institutions to implement the same lack capacity and skills to investigate and successfully prosecute the culprits. The Convention signed on December 9, 2003, ratified on August 31, 2007, is still not fully implemented. This speaks volumes about our institutional weaknesses in all three important pillars of state—legislature, executive and judiciary and necessary coordination between them while retaining their separate functions. At the time of ratification, Pakistan opted out of Article 44(6) of the Convention for cooperation on extradition with other State parties. There is need to reconsider it as many convicted politicians and others are taking refuge abroad. All international treaties and conventions have to be incorporated in the domestic laws of Pakistan to become effective that derive sanction from the Constitution of Islamic Republic of Pakistan[10] [“the Constitution’] and Sharia laws.
The laws dealing with “corruption” are numerous e.g. National Accountability Ordinance, 1999 effective from 1 January 1985, Anti-Money Laundering Act Law, 2010 amended hastily and badly in recent months to unsuccessfully meet requirements of FATF and its affiliate Asia Pacific Group, Federal Investigation Agency Act, 1974, Prevention of Corruption Act, 1947, Pakistan Penal Code, 1960, Code of Criminal Procedure, 1898, Extradition Act, 1972 and Law of Evidence (Qanoon-e-Shahadat) Order, 1984.
Due to political and elite capture and fragmented laws, Pakistan has been unsuccessfully tackling the daunting challenge of countering financial crimes in public and private spheres, tax evasion and crimes like money laundering (ML) and countering financing of terrorism (CFT). It is strange that in a country where tax evasion still exists after four tax amnesties from 2008-13, five from 2013-18 and twice from 2018 to 2021, but not a single person is convicted for tax evasion.
How China through lawfare uprooted corruption is elaborated in detail in China’s lawfare against corruption—lessons for Pakistan—I, Daily Times, November 9, 2018 and China’s lawfare against corruption—lessons for Pakistan—II, Daily Times, November 10, 2018[11]. The brief summary is:
- In March 2018, two new “super agencies” were established to regulate both the public and the private sector.
- For the public sector, National Supervisory Commission (NSC) replaced all previous agencies. Its scope was extended covering investigation and to act as watchdog for all state-owned enterprises, public health care, research and educational institutes. The NSC secures executable evidence and recommend cases for prosecution.
- ‘State Administration for Market Regulation (SAMR), is the “super agency to regulate the private sector.
- Anti-Unfair Competition Law (AUCL) deals with commercial bribery by individuals and companies.
It is pertinent to mention that under SAMR political heavyweights who were previously considered untouchables were punished e.g. General Xu Caihao (former Vice Chairman of the Central Military Commission) and Bo Xilai (former Minister of Commerce between 2007 and 2012, and a prominent member of the Politburo and Communist Party Secretary)[12]. Recently, on April 9, 2021, Alibaba, China’s biggest online retailers, faced fine of four percent of its 2019 domestic sales that is three times higher than the $975 billion fine China imposed on US chip company Qualcomm back in 2015. Whatever the motive may be, the evidence stood the test of judicial prosecution. Our successive governments are more interested in media trial of opponents using “corruption” (unapproved) as tool for victimisation. This is the main difference between our ineffective system and China’s lawfare against corruption.
We cannot strictly follow the China’s lawfare as they have one-party rule. However, we can follow on the basis of their experience, the following roadmap to empower the state (a term that is different from ‘government’ as people usually think), defined in Article 7[13] of the Constitution to successfully counter the menace of corruption:
- Dismantling alliance between robber barons and state functionaries ensuring nobody is above law.
- A single “Regulatory Entity” through special enactment with an independent board, resources and operations. This entity [say Pakistan Financial Crime Monitoring Bureau (PFCMB)] should work as watchdog for all financial crimes and passing incontrovertible evidence to a competent and independent National Prosecuting Agency (NPA to take the offenders to task in special speedy trial courts where judges have expertise in laws relating to financial crimes to deliver judgements swiftly but strictly following Article 10A[14] of the Constitution. The proposed structure of PFCMB is given below:
- The PFCMB with multi-source financial intelligence and analysis network will help to detect, investigate, analyse and prosecute corruption by any citizen[15] as per Article 5(2) of the Constitution. It will accomplish the following objectives:
- implement financial crimes related laws and regulations;
- ensure reporting of high-end financial data/information for expert analysis and utilisation to counter corruption and ML/CFT; and
- provide training to the law enforcement officials and financial sector and prosecutors.
As an autonomous PFCMB would be responsible to ensure timely collection, preservation, examination, and transmission of information necessary to counter corruption and ensure the reporting regime by introducing legislative, operational, and technical changes in the existing laws. This centralised agency with skilled manpower in all areas of financial crimes alone can ensure uprooting corruption under the Convention and meeting FATF mandate.
[1] Pakistan became the third non-communist country, and the first Muslim one, to recognize the People’s Republic of China and dispatched a high level delegation to China on January 4, 1950. Pakistan and China established formal diplomatic relations on May 21, 1951.
[2] Hassan Aslam Shad is a practicing international lawyer and a graduate of Harvard Law School. Email: veritas@post.harvard.edu
[3]https://tribune.com.pk/story/2295275/fia-admits-it-wrongly-accused-tareen-of-using-fake-accounts?amp=1, accessed on April 18, 2021
[4] https://arynews.tv/en/lhc-split-ruling-shehbaz-sharif-bail-plea/, accessed on April 18, 2021
[5] Both sides unaware of their role, Dawn, April 8, 2021, https://www.dawn.com/news/1617061/both-sides-unaware-of-their-role, accessed on April 15, 2021
[6] This is highly misunderstood term on the part of Premier as it was never materalised. It refers to National Reconciliation Ordinance, 2007 (NRO) promulgated by General Pervez Musharraf on October 5, 2007 which was declared unlawful by the 17-judge bench of Supreme Court as non-est meaning by as never to have existed. Details in case reported as Dr. Mobashir Hassan v Federation of Pakistan PLD 2010 Supreme Court 265, https://cite.pakcaselaw.com/pld-supreme-court/2010/265/, accessed on April 11, 2021
[7] https://www.youtube.com/watch?v=XDD55oMfRps, accessed on April 11, 2021
[8] FBR and tax-defiant political parties, Daily Times, March 21, 2021, https://dailytimes.com.pk/736628/fbr-and-tax-defiant-political-parties/
[9] Legislators, FBR, NAB, ECP & accountability, Daily Times, September 27, 2020https://dailytimes.com.pk/671306/legislators-fbr-nab-ecp-accountability/, accessed on April 11, 2021
[10] http://na.gov.pk/uploads/documents/1566986522_519.pdf, accessed on April 11, 2021
[11] https://dailytimes.com.pk/320015/chinas-lawfare-against-corruption-lessons-for-pakistan-i/ and https://dailytimes.com.pk/320220/chinas-lawfare-against-corruption-and-lessons-for-pakistan-part-ii/, accessed on April 11, 2021
[12] https://uk.practicallaw.thomsonreuters.com/w-015-2389?transitionType=Default&contextData=(sc.Default)&firstPage=true, accessed on April 11, 2021
[13] “In this Part, unless the context otherwise requires, “the State” means the Federal Government, Majlis-e-Shoora (Parliament)], a Provincial Government, a Provincial Assembly, and such local or other authorities in Pakistan as are by law empowered to impose any tax or cess”.
[14] “For the determination of his civil rights and obligations or in any criminal charge against him a person shall be entitled to a fair trial and due process”.
[15] “Obedience to the Constitution and law is the inviolable obligation of every citizen wherever he may be and of every other person for the time being within Pakistan”.
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The author is Advocate Supreme Court and Adjunct Faculty at Lahore University of Management Sciences (LUMS)