Zulfiqar Ali Bhutto’s surname could just as well be Bhatta (Urdu: bribe). Under his rule (1972-77), corruption levels went through the roof.
Finding direct evidence of corruption from the 1970s is difficult. However, many clues remain which provide a window as to how widespread corruption was in the Bhutto era, and how it was the very basis of Bhutto’s government.
This article is the 1977 story of a fraud from rural Punjab in which two men (Mr Rana & Mr Sanaullah) were caught red handed stealing more than £3.4m. This is clearly a great sum today – in 1977 it would have been a princely sum. This is what they did:
1. The two Punjabis forged an order from Bhutto (President of Pakistan) which stated that Bhutto has created a new Development Authority in RahimYar Khan (small rural town).
2. They convinced the local administration office that they were genuine executives, authorised by Bhutto to develop projects worth Rs. 120m (then £7.5m).
3. For 6 months, all they had to do was turn up to the office with some fake construction bills worth millions of rupees, and the district administration would pay them the billed funds. They were disbursed £3.4m (more than Rs.50m)
Eventually they were caught. An official in Bahawalpur suspected they were not genuine. A check with Punjab Government revealed that no such Development Authority had been set up by Bhutto. The men were caught, and Rs. 48m (£3m) was recovered from their accounts.
Z.A Bhutto set up countless such “Development Agencies” across the country. Effectively, he bought power in Punjab and Sindh by promising the local landlords that he would make them rich through corruption. For the poor, Bhutto promised endless war with India, and the illusion of “Power to the People”. This is how he swept Punjab in the 1970 elections.
It was a simple arrangement. The local landlord of an area of rural Punjab would promise Bhutto to deliver the votes in his area, and win a seat in the National Assembly. In return for this support, Bhutto would allow the landlord to set up a “Development Authority”, with an allocated budget. As the example above shows, now all the landlord needed to do was turn up to the local government administration office with a piece of paper showing expenditure of millions, and they would be given a cheque for that amount on the spot. Like the fraudsters above, the money went straight into their pocket.
As long as the Development Authority was genuinely authorised by Bhutto, no questions were asked as to whether the money was really being spent. It was understood that Bhuttoism was Bhattaism – a mechanism for delivering wealth into a feudal system. The fraud example above was for £7.5m in a tiny town in rural Punjab. But there were many genuine development authorities created by Bhutto, hundreds of opportunities for local Bhuttoists to feast on the corruption which Bhutto unleashed for them.
Karachi has consistently provided more than 65-70% of Pakistan’s entire tax revenues, so effectively it was Karachi Muhajirs’ taxes that were being sprayed all around rural Pakistan. (On top of that, Punjab was a massive recipient of Baloch gas, and returned virtually nothing back to the exploited Baloch people).
What actually happened with these development funds? Clearly, most of it went into the Bhuttoist crooks’ pockets. Some of it was shared with their local thugs, whose job it was to maintain the landlord’s control over his area and scare off any rivals. Some of it would have gone towards some small project, which the landlord would them point to as evidence of what a great job he was doing for his area.
Bhutto saw Pakistan’s entire private sector as a piggy bank. He nationalised Pakistan’s banking, textile, manufacturing, insurance sectors and many more. The banks. companies, etc were placed in the hands of Bhutto’s cronies. They put their hand in the till to enrich themselves at the expense of the people. When banks were privately owned (eg. Mr Habib owned Habib Bank), fake loan write-offs were unthinkable. Why would Mr. Habib steal from his own bank?
But once Bhutto nationalised the banks, the situation was reversed – why would a Bhattaist not steal from his own bank? The bank owners were replaced by friends of Bhutto. Now all a senior Bhattaist crony needed to do was go to a bank, get a loan to buy an asset (eg a Sugar Mill), and then ask the bank to write off the loan.
This is how Bhutto destroyed the Pakistan economy.
Bhutto gradually lost the support of the gullible Pakistani Marxists he had filled with dreams of a socialist utopia.
The Baloch hated Bhutto because he blasted Baluchistan to smithereens and dissolved the Provincial democratically elected government. (Needless to say, replacing them with his cronies).
The Pathans hated Bhutto because he kept NAP/ANP leaders imprisoned for much of his rule.
The Punjabis were angry and jealous to see how much corruption was going on in Sindh because they wanted it all for themselves. Bhutto lost the support of Punjab landlords as well. Once that happened, Bhutto was finished.
Eventually they hanged Bhutto, but his legacy of Bhattaism lives on after him.