The first year of Imran Khan’s government is the bleakest in living memory. Part of the blame must rest with the Miltablishment that selected and hoisted him to power and condoned his bumbling, stumbling U-Turns. Unfortunately, despite pious statements from a battery of spin masters, the outlook for the next twelve months is extremely depressing. Consider.
Economic Policy: The fiscal deficit for 2018-19 was 8.9% of GDP (first target 4.9%, second target 7.1%), the highest in 40 years. This was largely due to IMF conditions regarding interest rates and rupee devaluation that bloated debt payments. Matters deteriorated when the PTI government’s mismanagement led to a drastic fall of the Tax/GDP ratio from 15.2% in 2017-18 to 12.7% in 2018-19. Inflation is the highest in decades, the poor are drowning in it. Business confidence is rock bottom, investment has ceased. The bureaucracy is afraid to sign off on projects. CPEC has ground to a halt. Standard & Poor rating agency has downgraded Pakistan’s yearly outlook from B to B-. The revenue in the first quarter of the new fiscal year is far short of targets. Development budgets have been slashed. Privatisation policy is uncertain and confused. Public sector development in health, education and the social sector is dismal. Exports remain sluggish. There are no foreign investment inflows on the horizon. The large-scale manufacturing sector is sagging. Forex Reserves are falling. Unemployment is rising.
Foreign Policy: Pakistan’s isolation is unprecedented. Barring Iran and Turkey, no Muslim country has supported Pakistan’s position on the annexation of Jammu & Kashmir by the Narendra Modi government. Indeed, several of them have lined up to invest big time in India and award Mr Modi with medals for being a high achiever. Even US President Donald Trump has withdrawn his offer to mediate the Kashmir conflict. Indeed, he has gone so far as to support Mr Modi’s position that the two neighbours should resolve their problems bilaterally. At home, the Miltablishment-Government is up the creek without a paddle. It is beating its chest and running out of breath. While Mr Modi is treading the red carpet in the capitals of the world, our own Imran Khan is regaling us to death with history lessons about the Rashtriya Swayamsevak Sangh.
Regional Security: Ominously, President Trump has publicly confirmed that India is a strategic stakeholder in the resolution of the conflict in Afghanistan even as we are being assured by our Miltablishment that a big breakthrough – a deal between the Taliban and Washington – auguring well for Pakistan is on the cards. But this isn’t clear at all. There is no assurance that the Taliban will ceasefire for long, nor that they will effectively share power with the pro-American government and other stakeholders in Kabul. In other words, a deal with the Americans doesn’t automatically imply a deal between the Afghans, which means that the civil war may simply take another turn after the Americans’ exit, prompting regional countries like Iran, India and Russia to restart proxy interventions and wars.
Internal Conflict: The unrelenting clampdown on the opposition and media has sharpened divisions at home and weakened the national resolve to confront national crises together. The exploitation of NAB, FIA, IB, ISI, FBR, etc. for persecuting political opponents has damaged the credibility of state organs by eroding the notion of a constitutional contract between the rulers and ruled. Parliament hasn’t passed a single law in the last twelve months. The President of Pakistan has been issuing Ordinances and References without fulfilling his constitutional duty to vet these for propriety, resulting in an embarrassing blowback from the Chief Election Commissioner, Justice Qazi Faez Isa of the Supreme Court and various organs representing the bar and bench. Indeed, the Supreme Court of Pakistan and certain judges have been so politicized in the blind subservience of the Miltablishment and government that the notions of justice and trust on which the modern state rests have been rapidly eroded.
Spectre of War: The failure to anticipate the turn of events in India and fashion internal and external policies to confront them has raised the spectre of war with India at a moment in time when we are economically and institutionally weak and when the chances of any “settlement” with India are truly remote. Even a limited conflict will exact a heavy toll of our economy. But an escalation will draw foreign powers into the conflict and they will tend to lean on India’s side. This will lead to political upheaval at home and plunge the country into an existential crisis when we are not equipped to cope with it.
Way Forward: In this situation, it is insufficient for the Miltablishment and PTI government to be “on the same” page when the mainstream opposition parties are in the dock, when the independent media is gagged, when the courts, Election Commission, NAB etc. are under pressure to give biased judgments, when parliament has been rendered impotent, when the people are simmering, and when international powers are conspiring. A strong national government is the need of the hour.
Economic Policy: The fiscal deficit for 2018-19 was 8.9% of GDP (first target 4.9%, second target 7.1%), the highest in 40 years. This was largely due to IMF conditions regarding interest rates and rupee devaluation that bloated debt payments. Matters deteriorated when the PTI government’s mismanagement led to a drastic fall of the Tax/GDP ratio from 15.2% in 2017-18 to 12.7% in 2018-19. Inflation is the highest in decades, the poor are drowning in it. Business confidence is rock bottom, investment has ceased. The bureaucracy is afraid to sign off on projects. CPEC has ground to a halt. Standard & Poor rating agency has downgraded Pakistan’s yearly outlook from B to B-. The revenue in the first quarter of the new fiscal year is far short of targets. Development budgets have been slashed. Privatisation policy is uncertain and confused. Public sector development in health, education and the social sector is dismal. Exports remain sluggish. There are no foreign investment inflows on the horizon. The large-scale manufacturing sector is sagging. Forex Reserves are falling. Unemployment is rising.
Foreign Policy: Pakistan’s isolation is unprecedented. Barring Iran and Turkey, no Muslim country has supported Pakistan’s position on the annexation of Jammu & Kashmir by the Narendra Modi government. Indeed, several of them have lined up to invest big time in India and award Mr Modi with medals for being a high achiever. Even US President Donald Trump has withdrawn his offer to mediate the Kashmir conflict. Indeed, he has gone so far as to support Mr Modi’s position that the two neighbours should resolve their problems bilaterally. At home, the Miltablishment-Government is up the creek without a paddle. It is beating its chest and running out of breath. While Mr Modi is treading the red carpet in the capitals of the world, our own Imran Khan is regaling us to death with history lessons about the Rashtriya Swayamsevak Sangh.
Regional Security: Ominously, President Trump has publicly confirmed that India is a strategic stakeholder in the resolution of the conflict in Afghanistan even as we are being assured by our Miltablishment that a big breakthrough – a deal between the Taliban and Washington – auguring well for Pakistan is on the cards. But this isn’t clear at all. There is no assurance that the Taliban will ceasefire for long, nor that they will effectively share power with the pro-American government and other stakeholders in Kabul. In other words, a deal with the Americans doesn’t automatically imply a deal between the Afghans, which means that the civil war may simply take another turn after the Americans’ exit, prompting regional countries like Iran, India and Russia to restart proxy interventions and wars.
Internal Conflict: The unrelenting clampdown on the opposition and media has sharpened divisions at home and weakened the national resolve to confront national crises together. The exploitation of NAB, FIA, IB, ISI, FBR, etc. for persecuting political opponents has damaged the credibility of state organs by eroding the notion of a constitutional contract between the rulers and ruled. Parliament hasn’t passed a single law in the last twelve months. The President of Pakistan has been issuing Ordinances and References without fulfilling his constitutional duty to vet these for propriety, resulting in an embarrassing blowback from the Chief Election Commissioner, Justice Qazi Faez Isa of the Supreme Court and various organs representing the bar and bench. Indeed, the Supreme Court of Pakistan and certain judges have been so politicized in the blind subservience of the Miltablishment and government that the notions of justice and trust on which the modern state rests have been rapidly eroded.
Spectre of War: The failure to anticipate the turn of events in India and fashion internal and external policies to confront them has raised the spectre of war with India at a moment in time when we are economically and institutionally weak and when the chances of any “settlement” with India are truly remote. Even a limited conflict will exact a heavy toll of our economy. But an escalation will draw foreign powers into the conflict and they will tend to lean on India’s side. This will lead to political upheaval at home and plunge the country into an existential crisis when we are not equipped to cope with it.
Way Forward: In this situation, it is insufficient for the Miltablishment and PTI government to be “on the same” page when the mainstream opposition parties are in the dock, when the independent media is gagged, when the courts, Election Commission, NAB etc. are under pressure to give biased judgments, when parliament has been rendered impotent, when the people are simmering, and when international powers are conspiring. A strong national government is the need of the hour.