Understanding Arctic, the crossroads of the world

arctic-regionArctic is a polar region located at the north of the earth. This is the place where they have 24 hours of sunlight or 24 hours of darkness depending upon the time of the year. The Arctic region is made up of USA, Canada, Denmark (Greenland), Norway, Sweden, Iceland, Finland and Russia. These 8 countries together form the Arctic Council, an organization similar to United Nations but governs the Arctic region. Along with these eight states there are 6 organizations which are the permanent participants . These indigenous organizations have the same status as countries on the council and bring the indigenous voice in the Arctic to the table.

These are the organizations:
1) The Saami Council
2) Russian Association of Indigenous Peoples of the North – RAIPON
3) Inuit Circumpolar Council – ICC
4) Gwich’in Council International – GCI
5) Arctic Athabaskan Council – AAC
6) Aleut International Association – AIA

On the hindsight it may seem that all the states and organizations in the council are involved in the discussion but unfortunately this isn’t the case. Also in the Arctic council are observers which are the countries which aren’t in the Arctic region but are interested in the Arctic region. The observer countries from Europe are France, Germany and UK among others but also other countries like China, India, South Korea and Japan have got involved in the conversation. Now the question arises, why are all these countries looking north.

Climate change is changing the Arctic in a way we have never seen before. The Arctic is warming faster than any other region in the world and this is causing tangible and measurable changes for something that people still argue is very abstract. From 1979 when the sea ice was first measured, to 2012, the sea ice has been cut in half. This is a big issue because it disrupts the Arctic food chain and it affects the people who call this region home.

When we have open ice; we also have open access. Oil and gas companies have definitely taken notice of this fact. The reality is that the Arctic is home to 90 billion barrels of untouched oil and 44 billion barrels of untouched natural gas. Norway and Russia have really gotten involved in the Arctic oil industry and Norway as of late has had lots of success in this regards. Russia on the other hand seem to be putting all their oil eggs in the same Arctic basket. They have spent so much time and money in Arctic, that oil and gas companies like Rosneft and Gazprom are having huge economic and political implications in Russia. While the world is shying away from Arctic oil, Russia seems to be going full power. It can be very dangerous since Arctic is a very unwelcoming environment for oil extraction because of its isolation and distances. If God forbid there was to be an accident or oil spill, the cleanup would take incredible efforts and the logistics/ cost involved would be tremendous.

In the past an oil rig had gone lose from its tugboat going up to the coast of Alaska and smashed into two islands before coming to a stop. If that rig would have been full of oil, the world would have known about its implications. When we are talking about the oil development in the Arctic, we also have to keep in mind, that there are people who call Arctic home. Few years ago The National Energy board approved a license to do seismic testing off the coast of Baffin Island in the Davis Strait. Seismic testing is essentially when a ship would pull 6 or 8 giant air cannons behind them and blast them off every second. The blasts are so loud that any animal in the water within 100 nautical miles of the blast is at the risk of death. Clyde river, a community on Baffin Island reached out to organizations like Greenpeace to protest against this and are also in the process of going to the Supreme court. The reason for that is to protect the Narwhal, a medium sized whale found in Arctic waters in the Davis Strait.

The question of development in the Arctic for the indigenous people isn’t usually a question of yes or no but right or wrong. Talking example of Greenland, which is home to one of the world’s largest uranium deposits. They are still in the conversation that whether pursuing the deposits is something that is going to be worthwhile. The Greenland has had lots of chances to have lots of economic benefits because of the mining. Greenland is the home to modern gemstones and they are currently mining for these gemstones.

With melting ice we have open water. The shipping companies have taken note of this fact. There are 3 routes through the Arctic region that have been mapped out. One belongs to Russia and one to Canada. This is why lots of Asian states are getting involved in the Arctic conversation and countries like China have their own Arctic Ice breaker e.g. Snow Dragon. Russia is home to one of the routes and it’s called the northern sea route and essentially goes from Murmansk around to Vladivostok. This route would cut the travel time between Rotterdam and Shanghai in half. This route is through Russian territorial waters so Russia has the right to say who is allowed to enter and what type of cargo passes through the region. Russia ensures that this route is open year round with the help of its nuclear icebreaker fleet. Canada is also home to one of the another route and it’s the infamous impassable northwest passage, the magical trade route to get from Europe to Asia without having to go around rest of the world. China and USA both have reached out to Canada and have asked to open its waterways as international waterways which would essentially allow anyone to cross through as if it were international waters. The third route is one that would cross through Norway straight over through the middle of the Arctic ocean. This route has 2 concerns. One is that it would mean an ice-free Arctic and secondly it would be passing through what we call the ‘donut hole’. This is the space of the Arctic ocean that belongs to no one. Arctic council has to figure out a way to ascertain who it belongs to. Countries have to prove that there is a space, ridge or some sort of land attached to their country that passes through the donut hole to claim it. And this is where the Lomonsov Ridge comes into play. Canada, Denmark and Russia have all claimed that the ridge belongs to them as it is attached to their country and it crosses through the hole. There are chances that it is attached to all three of them which would require another way to find out its rightful owner. But right now this is the process that everyone is going through to claim that donut hole.

We cannot talk about the Arctic if we don’t talk about Russia since Russia’s landmass takes about 40% of the Arctic region . Russia has by far the best infrastructure access and military presence in the Arctic region. Over the past few years we have seen increased tensions between Russia and the west and this started with the annexation of the Crimean peninsula from Ukraine into the Russia federation and was recently followed by the downing of Russia aircraft by Turkish air forces in the middle east. In the Arctic, Russia, EU, USA, Canada are all actively participating on a consensus basis. Everything that happens in Arctic is at the Arctic council’s consensus.

Issues like climate change, resource extraction, energy prices, Russia-west relationship, these are all things that cross through Arctic region but usually this region is not a topic of our everyday discussions which is unfortunate. Also Arctic region was largely ignored in the recent Paris Agreement which commits to solve the problem of climate change in the world. It’s ironic since the Arctic region is warming twice as fast any other part of the world. What happens in this region would ultimately affect the rest of the world which is why I have called this region as the ‘crossroads of the world’.

Abdus Salam, the forgotten Nobel Laureate

Abdus_Salam_Nobel_PrizeOn this day in 1929, a boy was born in the small town of Jhang to Muhammad Hussain, a civil servant in the British India and Hajra. Starting from humble beginnings, this boy went to achieve the highest prize in Physics, the Nobel Prize. He did his early schooling from Jhang in the schools which didn’t even have chairs to sit or desk to write on. His humble beginnings could be realized from the fact that he didn’t see electricity until he was a teenager in Lahore. His academic performance helped him secure a scholarship to study at the University of Cambridge from where he got a PhD degree in Theoretical Physics.

That man is Abdus Salam, the theoretical physicist who got the Nobel Prize in 1979 for his contribution to electroweak unification joining the likes of Albert Einstein and other famous physicists. His work helped us understand the basic elements of matter and how basic particles interact with each other. His work led to the discovery of the Higgs Boson for which another Nobel Prize was awarded in 2014. Along with his work on Electroweak unification, he also worked on renormalization theory and Supersymmetry. By 1963 he already had made a name for himself in the field of Physics as he was the youngest member of the Royal Society. President Ayub Khan appointed him as his Scientist advisor. His talent was also recognized by then Prime Minister Zulfiqar Ali Bhutto who summoned him along with all leading scientists of Pakistan to a meeting where he demanded them to start the atom bomb program. His contributions to the program helped Pakistan become a nuclear power state. He also founded the International Center for Theoretical Physics in Italy which today is one of the leading institutions for the scientists from the third world countries. In his honour a street has been named in Geneva, Switzerland.

While there are people who laud him for his achievements, there are many who refuse to recognize his achievements due to his religious beliefs. This is due to the fact that Abdus Salam was an Ahmadi and the parliament of Pakistan in 1974 declared all Ahmadis to be non Muslims. It is rather unfortunate that the children of Pakistan don’t get to read about Dr Abdus Samad in the schools while those people are praised in the school books who claim to be the “father of Pakistan’s atom bomb program” and sold nuclear secrets to other countries.

Although I agree Ahmadi beliefs contradict the teachings of Islam, Dr Salam regarded Islam and Quran as the inspiration for his work. He put his motivation for seeking unification of the forces from the concept of Tauheed which is the uniqueness of the God. He believed that he wouldn’t have been able to work on the subject had he not been a Muslim.

Unfortunately in Pakistan most people are debating whether he was a Muslim or not and not highlighting his achievements despite the fact that he was the first Nobel Laureate for Pakistan.

Pakistan Super League, A ray of hope for Pakistan

Pakistan_Super_League_logoPakistan, a country of 180 million is crazy about a sport called cricket. Unfortunately due to terrorism prevalent in Pakistan, there is no international cricket being played in Pakistan and other countries are reluctant to send their teams to a country which is considered as a ‘terrorist haven’.  Pakistan Super League, a franchise based cricket t20 tournament is a good news, Pakistani cricket lovers were desperately waiting for.

The tournament is going to be held between 4th Feb to 23rd Feb in Dubai and Sharjah. This tournament is under planning for the last 6 years but it failed to took off. Finally PCB under the management of Sharyar Khan and Najam Sethi has took the concept to implementation stage and finally fans are going see the tournament which they had been waiting to see.

A country which has won 2 worldcups in cricket and produced cricketing legends like Imran Khan, Wasim Akram, Inzamam ul Haq, Javed Miandad to name a few, has witnessed the passion for the sport decreasing. Terrorism already had damaged the reputation of the country and the spot fixing scandal also did much harm to Pakistan cricket which led to fans being disheartened and started following other sports like football (soccer). This tournament would help bring back the disheartened fans.

In this tournament, 5 teams are participating based on the 5 largest cities of Pakistan namely Karachi, Lahore, Quetta, Peshawar and Islamabad. Although there are many flaws in the tournament planning, but I will try to only talk about the positives here. PCB (Pakistan Cricket Board), the organization responsible for handling the cricketing matters in Pakistan, is in pretty bad shape financially. As other countries are not touring Pakistan, it doesn’t have the same revenue streams as off other cricketing gaints like Australia, England and India. Pakistan nearly plays all it home games in UAE and it has to share its revenue with the Emirates Cricket Board. Due to this, the salaries/wages of Pakistani players are much less than that of other countries’ cricketers. Pakistan Super League (PSL) is a opportunity for both the players and the PCB to earn big.

PSL is also an opportunity for the young and emerging cricketers to get experience and make a name for themselves in the world of cricket by playing and sharing dressing rooms with legends of modern day cricket e.g. Kevin Pietersen, Chris Gayle and Shane Watson. Fans seeing these emerging players shine would also motivate them to start dreaming of playing cricket for Pakistan. This would help Pakistan cricket get its place and respect back in the cricket world. This tournament would also be the ideal place for identifying and grooming the next Imrans, Wasims and Miandads of the Pakistani cricket.

The PCB is not only aiming for higher revenues but also trying to improve the cricket in Pakistan. This is evident from the fact that there is a requirement that every 16 man squad should include no more than 5 foreign players and the compulsory inclusion of two emerging players.

The most positive factor about PSL is that all the 5 teams are equal in player power on paper. This is due to fact that teams were selected on draft basis rather than auction basis which would have enabled the richer franchise to get all the star players. This would make the tournament more competitive and matches would be more interesting to watch.

The PCB is optimistic that the further editions of the PSL would be held in Pakistan which would bring the international cricket back to Pakistan. PSL is our own tournament. We have watched our stars playing in IPL in India, Big Bash in Australia, BPL in Bangladesh, now its time to watch them play in our own tournament alongside other stars of cricket.

PCB has done its bit by planning the tournament and finalizing all the aspects of the tournaments be it financial and marketing. Now its time for the players to make this tournament a success by playing competitively and in the right spirit (far away from controversies). If they are successful in doing so, then for sure it would bring Pakistan into the spotlight positively at the world stage and would give Pakistan something to be proud off. Here is hoping for the success of PSL and Pakistan cricket.

Pakistan and its role in SAARC

Pakistan is located in South Asia. Other countries in this region include Pakistan’s arch rival India, Nepal, Sri Lanka, Bangladesh, Maldives and Bhutan. These countries are also part of a bloc called SAARC (South Asian Association for Regional Cooperation) which was established in 1985. While Afghanistan was included as  full member in 2006, Iran, China and Myanmar are seeking full member status in the bloc.

After Sub Saharan Africa, South Asia is the poorest region in the world with a large percentage of the population living below the poverty line. Quarter of the world’s poor population is living in Africa while half is in South Asia alone. South Asia is amongst the least integrated region in the world according to a World Bank report published in 2007. In South Asia, trade amongst the countries  is only 2% of the region’s combined GDP while on the other hand in East Asia it is 20%.

These countries are still competing with each other globally, due to similar mindset of the ruling elite, similar climatic conditions and soil composition. These countries have however have hostilities against each other despite having close proximity and common borders.

In this region the largest countries by population in the descending order are India, Pakistan and Bangladesh. These three countries are agriculture and manufacturing based economies but don’t have good diplomatic relations with each other. This ‘trust deficit’ hinders any economic cooperation between these countries in agriculture and manufacturing sector.

Countries in this region are suffering from energy shortage which according to me is a lifeline for any economy in the world.  Inconsistent policies and mismanagement is prime reason for the energy crisis in this region for the past 40 years or so. The power generation facilities in this region are running below optimum capacity because of fuel shortage and poor cash flows.

The aggregate installed electricity generation capacity of Pakistan is around 30,000 mega watt but unfortunately the capacity utilization is around 50% i.e. 15,000 mega watt. Not only Pakistan, but its neighbor India, is also suffering from the same problem. India, which happens to be the third largest economy in the world, has installed generation capacity of 250,000 mega watt but capacity utilization is around 60% i.e. 150,000 mega watt. While India is trying to overcome the energy crisis, Pakistan on the other hand has often ignored the important problem and appropriate steps or not taken to overcome the problem.

One can just forget two of the gas pipeline projects Iran-Pakistan-India (IPI) and Turkmenistan-Afghanistan-Pakistan-India (TAPI). Both the pipelines were aimed at catering to Indian gas requirement but Pakistan was to benefit in two ways: 1) getting millions of dollars transit fee and 2) also gas for meeting domestic requirements. It was believed that after easing of economic sanctions on Iran, Pakistan will succeed in completing portion of gas pipeline located in its territory. However, it seems that Government of Pakistan (GoP) does not wish to complete this project due to the US pressure. Fate of TAPI is also in doldrums as NATO forces are likely to vacate Afghanistan in 2014. Therefore, Pakistan will have to accelerate oil and gas exploration activities in the country and also complete LNG project on war footings.

Pakistan is a natural corridor for energy supply because on one side are energy-rich countries and on the other side are energy-starved ones. Pakistan can also follow Singapore example and establish state-of-the art refineries on the coastal belt. In this regards help can be sought from China, Russia and other Central Asian countries. Pakistan already has a mid-country refinery and two pipelines to carry black and white oil products up to Multan. This can pave way for export of white oil products to Afghanistan and Chinese cities enjoying common border with Pakistan. Realization of all these projects can help the country in earning millions of dollars transit fee.

Ironically, Gwadar port project has been put on back bumper after the departure of Pervez Musharraf. In fact the paraphernalia should have been completed prior to transfer of management control to China. Though, India is facilitating in the construction of Chabahar port in Iran, Pakistan will continue to offer shortest and most cost effective route up to Central Asian countries passing through Afghanistan.

Lately, some of the Middle Eastern countries have shown keen interest in acquiring agriculture land in Pakistan but local feudal lords have emerged to be the biggest opponents to leasing of cultivable lands to other countries. Pakistan has millions of acres of land which is not cultivated, mainly due to shortage of irrigation water. Leasing out land to other countries is not a bad proposal because it would help in improving the infrastructure i.e. construction of farm to market roads, and modern warehouses. Construction of water courses and installation of tube wells would have helped in raising sub-soil water levels in arid zones.

Pakistan produces huge quantities of wheat, rice, sugar, fertilizer but a significant portion of these commodities is smuggled to neighboring countries. Plugging of porous border and formalizing trade with India, Iran and Afghanistan can increase Pakistan’s export manifold. It is estimated that nearly one million tons wheat and half a million tons rice and sugar each is smuggled to the neighboring countries.

The increase in lending to farmers has started yielding benefits with Pakistan joining the club of wheat exporting countries. The recent initiative of State Bank of Pakistan, Warehouse Receipt Financing and trading of these receipts at Pakistan Mercantile Exchange is likely to improve earnings of farmers, though reduction in wastages and better price discovery. It is encouraging that British Government has offered assistance equivalent to Rs240 million to complete the project at a faster pace. The key hurdle in the realization of this project is lack of modern warehouses and absence of collateral management companies.

It is necessary to remind the GoP that nearly 1000 palm oil plants were grown in Sindh near the coastal line. While a large percentage of plants have died due to improper management, extracting oil is almost impossible because no crushers have been installed. Achieving self sufficiency in edible oil can help in saving over US$2 billion currently being spent on import of palm oil.

Pakistan often faces ban on export of seafood because to not abiding by international laws. While local fishermen face starvation deep sea trawlers from other countries intrude into Pakistan’s territorial waters and take away huge catch. On top of all use of banned net results in killing of smaller fish that are ultimately used in the production of chickenfeed. This practice going on for decades deprives Pakistan from earning huge foreign exchange besides ‘economic assassination’ of poor fishermen.

Pakistan’s agri and industrial production has remained low due to absence of policies encouraging greater value addition. Pakistan is among the top five largest cotton producing countries but its share in the global trade of textiles and clothing is around two percent. The country needs to establish industries that can achieve higher value addition. Pakistan should export pulp rather than exporting fruits which have shorter shelf life.

Pakistan has overwhelming majority of Muslims but still goods worth billions of dollars are imported which are not Halal. Ideally, Pakistan should be exporting Halal food products to other Muslim countries. The country need to focus on breeding of animals (i.e. chicken, goat, cows) and export frozen meat and dairy products. If countries like Australia, and Holland can produce Halal Products what is stopping Pakistan.

Another example to follow is Bangladesh, which does not produces cotton but its export of textiles and clothing is more than that of Pakistan. This is because Bangladesh has focus on achieving higher value addition and Pakistan continues to produce law quality and low prices items. This is waste of precious resource and to be honest value addition is negative.

Pakistan has also not been able to benefit from being a member of SAARC. Some of the analysts say it is difficult to compete with India but has Pakistan really made any effort to achieve higher value addition? The reply is in negative due to prevailing mindset of Pakistanis who want to lead ‘easy life’.

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