Pakistan is no stranger to crises, in fact, any reading of Pakistan’s history will inform the reader that right from 1947, it was the ‘refugee crisis’ that surfaced soon after partition and independence. At least 14 million people crossed the western Pakistan/India border, Pakistan had to deal with this development with non-existent infrastructure. There was concern and fear, by leaders in both independent countries, that Pakistan would ‘not survive’, and might even ‘come back’. But despite an extraordinary and tumultuous first few years, Pakistan continues to exist and thrive. Since 1947, Pakistan has gone through several political and constitutional crises ranging from crises and crises surrounding terrorism.
Crisis and ‘resilience’
Apart from a few good years, Pakistan’s economy has been in a perpetual state of crisis, dependent on donations from donors, international financial institutions and so-called ‘friendly countries’. It has become a cliché that Pakistan is always in crisis, and that the people of Pakistan have a perceived ‘resilience’ (a derogatory and condescending term) that looks down upon them and the country. However, after a month in the New Year, there have been several crises at the same time. First, Pakistan is once again facing an economic crisis, albeit one quite unprecedented in comparison to the past. A few days ago, the Financial Times, in a particularly scathing editorial, suggested that Pakistan was ‘on the brink’ of default and financial catastrophe, a Sri Lanka-like situation. This comes at a time when a delegation of the International Monetary Fund (IMF) is in Islamabad to strike a deal with Pakistan’s battered government led by Prime Minister Shehbaz Sharif. Mr. Sharif himself has said in the last few days that the conditions being imposed by the IMF for releasing only $1.1 billion are extremely harsh and ‘beyond imagination’.
This 23rd agreement of Pakistan with IMF is a cause of serious concern in itself.
A financial abyss, political trouble
Inflation stands at 28%, the highest in nearly five decades, with the Pakistani rupee losing 17% of its value in seven days, reaching close to PKR 300 to a US dollar. Foreign exchange reserves are only close to $3 billion – not even enough for a month’s imports – and are falling every few weeks. There doesn’t appear to be any way to reverse this trend easily and quickly. With severe import restrictions and barriers and inability to make payments in foreign currency, economists have already declared Pakistan to be in ‘partial default’.
While there have been many situations and crises related to the economy in the past, such as the time of Pakistan’s nuclear tests in 1998, the macroeconomy has never looked more uncertain than it did during the global financial crisis of 2008, or in the recent past. five decades. The possibility of default once loomed large when 9/11 (2001) happened and Pakistan’s economy had to be saved and salvaged, receiving huge amounts of aid and rent for its perceived premium geopolitical location next to Afghanistan. US designs and military ambitions in the region. Pakistan at the time was ruled by a military dictator, General Pervez Musharraf, and had apparent political ‘stability’ in complete control of the military. It is not so today.
While the economic crisis has only worsened over the past four years due to misgovernance and inefficiency, until a few months ago there was a sense of political stability. Now, there is an all-out political confrontation between the multi-party coalition led by Shehbaz Sharif, the Pakistan Democratic Movement and the ousted and belligerent former prime minister Imran Khan. Mr Khan not only upset the political status quo since 2018 (when the elections were held), but also dissolved two (out of four) provincial assemblies that his party controlled. Therefore, 67% of Pakistan’s population now faces the situation of not having an elected government, and both provinces are run by caretaker governments. Mr. Khan has become the most outspoken and outspoken critic of senior members of the Pakistani military, including former army chief General Qamar Javed Bajwa, whom Mr. Khan accused of plotting to oust him. In addition, the courts have yet to render their verdicts on cases that could potentially disqualify Mr. Khan and bar him from contesting elections, a prospect that prompted Mr. Khan to announce the launch of a jail bharo (court arrest) campaign. Is. Volatility and uncertainty dominate at every level.
terror shadow
If the political and economic instability was bad enough after several years of apparent peace, Pakistan could see a return to terrorism. On January 30, a suicide bomber killed more than 100 worshipers at a mosque in Peshawar, in one of the most serious single-day incidents in more than two decades of militancy. The fact that there is little clarity as to which faction of the Taliban (or Tehreek-e-Taliban Pakistan (TTP)) was behind this makes matters worse. In the past, such acts have been dealt with through a decisive response, but with the Chief of the Army Staff, General Syed Asim Munir, leaving for a five-day tour of the United Kingdom (on defence-related issues, February 5 and Between) 9) In the immediate aftermath of the blast, questions have been raised on Pakistan’s resolve and response to end terrorism.
Pakistan has become a dysfunctional state where its elite has manifested its incompetence and arrogance in failing to address fundamental and day-to-day issues of public nature. Accumulating wealth through privilege and being unresponsive to the needs of citizens, they continue to rule under the facade of democracy or through extended periods of military dictatorship. The absence of any kind of political protest or alternative, especially in the form of progressive political parties and groups, or even spontaneous civil action demonstrating anger, is Pakistan’s biggest crisis. The label of being ‘resilient’ is fast disappearing.
S. Akbar Zaidi is a political economist and heads the IBA, Karachi. Views expressed are personal