Easternisation of the world

Daily: Pakistan Today
Date: 19.03.17

The term easternisation can be understood as a phenomenon embodying the economic
rise of the countries in the east. A few centuries ago, especially in the wake of Vasco da
Gama’s effort to discover a sea route from Europe to India in 1498, the economic potential
of Asia beckoned Europeans who vied with one another for gaining a foothold on Asian
lands to monopolise raw material to feed European industrial complexes.

After the Second World War, Asia took over the reins of destiny. Japan was the first to
express its economic prosperity, followed by the second wave of opulence launched by
South East Asian countries named Asian Tigers. Both these waves espoused capitalist
policies under the auspices of the US military hegemony in the region. Nevertheless, in the
1990s, China initiated the third wave of economic sufficiency, which India joined quickly.
Generally, not only did the expansion-cum-diversification of local industry based mostly on
raw material, but also the shifting of multi-national companies to Asia in search of cheap
labour contributed significantly to the economic surge of Asia. The growth of the software
industry offered an additional benefit to all to utilise human potential contributing to Asia’s

The implied idea in easternisation begrudged by many is that it is happening at the
expense of the west or westernisation. In this regard, Gideon Rachman’s book,
Easternisation: War and Peace in the Asian Century,” published by Penguin Random
House in 2016, says that easternisation not only reflects the dwindling significance of
European countries but it also reflects their burgeoning troubles ravaging various spheres
of life. To put this point across, Rachman writes on page 167: “The process of
Easternisation means not just that Europe no longer controls large swathes of the globe.
That has been the case for decades. It also means that Europe is increasingly vulnerable
to political, social and economic trends in the rest of the world that it cannot control – but
which pose direct and indirect threats to European stability, prosperity and even peace.”
That is, today’s Europe is beset with a two-pronged challenge: first, the loss of political clout
to reframe its calling in resource-rich areas of the world; and second, to devise a way to
stop the inflow of troubles affecting various spheres of European life. Unfortunately, when
extant, both these challenges reinforce each other.

In 1956, when the US ended the hegemony of two European powers, the UK and France,
on the issue of the Suez Canal, Europe started shrinking into its fold. In this way, the
primary challenge to the west or westernisation came from the west itself. Years afterwards,
the economic crisis that visited Europe in 2009 debunked the reality that European
authority over the world was moribund. In this regard, Rachman writes on page 167: “By
2009, when an economic crisis erupted in Europe, the age of European imperialism in Asia
and elsewhere had been over for roughly half a century…[M]ore and more economists are
giving voice to the idea that competition with low-cost producers in Asia, in particular in
China, has contributed to the European economic malaise.” In fact, Chinese cheap
industrial products undermined the residual monopoly of European manufacturing
industries and funnelled European money into the Chinese economy.

Whereas the year of 2009 can be considered the time when the existence of easternisation
became noticeable, the realisation got itself reified into more palpable results in 2014, when
China spearheading the phenomenon of easternisation surpassed the US. In this regard,
Rachman writes on page 6: “A symbolic moment was reached in 2014 when the IMF
[International Monetary Fund] announced that, measured in terms of purchasing power,
China was the world’s largest economy”. Similarly, Rachman writes on page 8: “By 2014,
China was already the world’s leading manufacturer and its largest exporter. China was
also the biggest export market for forty-three countries in the world; whereas the US was
the biggest market for just thirty-two countries. (Twenty year earlier, China had been the
largest market for just two countries in the world, and the US was number one for forty-four
nations).” In this way, in 2014, the world finally recognised the presence of easternisation.
In the post-2014 era, the world is supposed to be stretched between retiring westernisation
and mounting easternisation, whether the two phenomena are coterminous or not.

The economic challenge posed by easternisation is just one dimension of the issue. There
are two other dimensions. First, economic sufficiency cannot be seen in isolation from
political adequacy. In this regard, Rachman writes on page 6: “It is economic might that
allows nations to generate the military, diplomatic and technological resources that
translate into international political power.” Second, like westernisation, easternisation is
non-sparing in asserting its history, values and practices. In this regard, Rachman writes on
page 29: “Yet while attitudes to the West vary across Asia – between countries and
individuals – there is little doubt that a widespread process of Easternisation is underway,
as Asian nations reassert their own histories and heritages, and scrape away some of the
accumulations of Westernisation.” In fact, losing grip over economic and political affairs of
the world and getting vulnerable to crises of various types express the worst fear of Europe.

Whereas China is heading the post-2009 wave of easternisation, the US has been trying to
challenge China in the Pacific by developing a pivot to Asia since 2011 with the help of
Japan and India. The cases of Japan and India are different. Japan experienced the
humiliation of defeat at the hands of the US and later developed its economy on capitalist
lines under the supervision of US military. This relationship is more a patron-client one than
a partnership of equality and respect. On the other hand, the bonhomie that thrived
between the US and India is a post-1998 phenomenon, which expressed itself in October
2008 by signing the 123 Nuclear Energy Agreement. It is still difficult to say if India – which
is also part of easternisation – is ready for being an active frontline partner of the US in the
pivot to Asia plunge.

Back to columns in 2017
Back to the July 28 judgement

Daily: Pakistan Today
Date: 25.10.17

The mere globalization is instrumental in thrusting the tyranny of awareness on the people
of Pakistan. Understanding the law is no exception. The decisions of the Supreme Court
(SC) of Pakistan that remain sequestered from the public eye may not endure a debate;
otherwise, the decisions such as the July 28 judgement can claim no immunity. Certainly,
the judgement was replete with blunders.

On October 21, Federal Minister Daniyal Aziz held a press conference in Islamabad and
reminded viewers of certain important points.

First, Aziz said that the definition of the word “assets” used by the SC was non-existent in
the Black’s Law dictionary mentioned in the judgement. Similarly, the second dictionary, the
Business Dictionary, existed only in the virtual world of internet and not in any printed form.
Taken together, this means that the relevant bench of the SC used a fictitious definition
and did not bother to consult these dictionaries in reality before writing the judgement, to
ensure the authenticity of their decision. In no case can this act be considered an oversight
in the judgement to be disregarded. Instead, this is an addition of another flaw to the long
list of mistakes impugning the validity of the judgement.

Second, Aziz also said that “receivables, if not received, could not be classified
automatically as assets”. Interestingly, how to deal with receivable encompasses both the
areas of the income tax (or the wealth tax) law and the accounting rules. Receivables lie on
their border. In fact, the SC could not discriminate between the concept of “assets” given in
the accrual basis accounting of a company and that in the cash basis accounting of an
individual such as an employee. Nevertheless, if the interpretation of the SC is accepted as
correct, this point alone holds the potential of adversely affecting the prevalent income tax
and accounts practices. Perhaps, both have to be revised to accommodate the July 28
judgement, if the judgement is not reviewed to meet the reality. Anyway, the implied
message in this point of Aziz is that the government might be thinking of introducing an
amendment to the Income Tax Ordinance 2001 in the light of the judgement to bring it in
line with the judgement. Any such amendment is bound to invite an outcry from society and
discomfiture for the SC.

Third, Aziz said that all nomination papers filed in 2013 for general election had to be vetted
again in light of the July 28 judgement, as the SC could issue no judgement that could be
person specific but that spared the rest of the country. In principle, by now, the Election
Commission (EC) of Pakistan should have done the requisite screening of the papers of the
candidates. There should be left no need on the part of anybody to challenge someone’s
nomination papers springing the EC into action. Instead, the July 28 judgement carries an
automatic execution force retrospectively, though any writ petition in a high court can
prompt the ECP to do so. Interestingly, the July 28 judgment is also saying that the EC,
which had been vested with defining “asset” and which had been doing so for years, failed
to perform its desired function. In this way, the EC should be penalized for the same, as the
judges sitting on its panel are thriving at the expense of public money.

The SC is in a quandary. The Black’s Law dictionary is known for its being the secondary
legal authority for understanding legal briefs and opinions. In case of Pakistan, the Income
Tax Ordinance 2001 was the first legal authority. Interestingly, through the July 28
judgement, the SC not only set a precedent for making the Black’s Law dictionary (i.e. the
secondary legal authority) preferred to the Income Tax Ordinance 2001 (i.e. the primary
legal authority), but the SC also relied upon the definition of the word “assets” not found in
any edition of the Black’s Law dictionary. By not giving a justification for bypassing the
Income Tax Ordinance, the SC made an arbitrary decision. This is precisely why people
lose faith in the SC and question its objectivity and capability.

Attached to this point is another dimension of the issue. It is known that there is present no
definition in the Representation of the People Act (ROPA) of 1976 and that the Act relies on
the relevant primary legal authority for definitions. Interestingly, instead of keeping the
ROPA subservient to the Income Tax Ordinance (i.e. the primary legal authority), the July
28 judgement made the ROPA deferential to the Black’s Law dictionary for finding
definitions. The consequent direct relationship between the ROPA and the Black’s Law
dictionary will have its own adverse effects. In fact, without any plausible justification, the
Income Tax Ordinance was bypassed and the ROPA was made subservient to the Black’s
Law dictionary. Per se, the bypassing of the Income Tax Ordinance begs not only revision
of the whole ordinance but also readjustment of the accounting system in line with the
parameters of taxation and accountancy set by the SC in the judgement.

The SC assumed that the mere presence of the Wage Protection System used by the
Ministry of Labour in the United Arab Emirates and the Jebel Ali Free Zone was enough to
verify the electronic payment of the salary to an employee, Nawaz Sharif. The attached
assumption was that the electronic payment also meant electronic receipt. Interestingly, in
its judgement, the SC failed to produce any such receipt or bank statement (or even a bank
account) as an evidence or proof. The mere presence of rules does not mean the
presence of proof. Similarly, the SC remained credulous to accept that the rules governing
the Wage Protection System were inviolable. If the Wage Protection System meant the
delivery of the salary in absolute terms, the SC has so far not explained the reason for the
presence of penalties on the violation of rules. To voters, the situation indicates that the SC
decided perfunctorily and sloppily about the fate of their elected representative, who
happened to be the prime minister of the country. Secondly, when committed a mistake, the
SC is not flexible to admit the mistake and rectify it.

Three points are now obvious. First, the SC had no expert knowledge on and
understanding of the law related to taxation. Second, the SC opted advertently for not
consulting income tax practitioners available with the SC as amici curiae. Third, the SC
counted on assumptions. The SC is overlooking that fact that the attack boys and defence
analysts in the media are incapable of defending SC’s July 28 judgement. Nor can they
paper over the mistakes traducing the judgement. Intelligence agencies also offer no

The respect of an institution does not forbid anyone from disagreeing with its decision and
asking instead for a fair, sane judgement. The point is simple: the SC is not supreme to the
law. The SC is subservient to the constitution and the judges are paid salaries from the
public exchequer. Rights of people reign supreme. The constitution does not confer upon
the SC to make arbitrary interpretation of law. The SC needs to satisfy people on its July 28
judgement, respecting their right to know and valuing the tyranny of their awareness.

Back to columns in 2017