Pakistan's Economy In Tatters; Is Sharif Looking At The Saudis To Bail Him Out Yet Again?
TORONTO: Ousted Pakistan prime minister Nawaz Sharif and his political party is locked into a latest turf battle with army amidst dwindling hopes to retrieve whatever is left of civilian domain, an all too familiar story is playing out on the sidelines. Pakistan economy lies in tatters amidst a gaping current account deficit of around $12 billion, nosediving exports down from $24 billion to 19 billion, a huge fiscal deficit estimated around nine per cent, widening budget deficit touching six per cent mark and a stock market that lost 1400 points recently before gaining 200 again.
The country’s civilian economic managers are facing another added pressure from the military that stayed behind the curtains on economy so far. Army chief General Bajwa and his spokesman publicly asked the government to do more on economic front as the ‘economy is in bad shape.’ The move, unprecedented, is being seen as an attempt to publicly capture the domain of finance policy from the lacklustre administration of Prime Minister Shahid Khaqan Abbasi. Though the party reacted but the Pakistani media, an extension of the military’s Public Relations arm, largely defended what the army chief said and went in overdrive to sell it to the public at large.
Some analysts see this move by the military to coerce the government into funnelling more funds to the military in the absence of $850 million annual Coalition Support Fund from the US which has been recently blocked by President Trump. Pakistan’s Interior Minister Ahsan Iqbal said in an interview that this year the government has already given Rs300 billion more than the allocated 900 billion to the military. The pensions of the armed forces are not part of the annual allocation as they are diverted from another public exchequer account.
Though, plundering the national exchequer is not the sport reserved for the Khakis. Pakistani politicians plunder it to their heart’s content whenever they find a chance and whenever they are allowed. Pakistan’s external debt stood at $68 billion when the current government took charge and it now stands at $85 billion in just four years. The external debt, it seems, goes into the ghost public companies and is channelled back into the accounts of politicians who then stash it away at some safe haven. According to a latest World Bank report Pakistan is going to need around $31 billion next year if it has to fulfill its foreign debt obligations. Obviously, the only way is to borrow from the same lenders whom the country owes.
The dreadful thing is no one cares and no one bothers. General public fed on the lies and propaganda of the media spending its energies, barring a couple, to defend the military and to malign the politicians in this lopsided battle. While politicians, majority from the victim Nawaz League, are pleading publicly to mend fences with the military as they see their politics fold in an environment where free and fair elections are almost inconceivable. They see courts and jails if they do not bow to the establishment (read military) and loss of perks and privileges. In case of any rapprochement with the military, not only their corruption will be covered up but there is a fair promise to earn more.
However, if Sharif takes the conciliatory course now, he might win the next election with the help of establishment and might save the party as well, but his credibility would become next to nothing…only if he cares. Sharif too, it seems, is looking for an honourable exit and a deal that once saved him before when he was sent into exile by General Musharraf. He has flown to Riyadh on Saturday to see if Saudis are interested to bail him out once again…which looks remote given his history with Saudi Royals. Another interesting meeting he might have with, is former army chief and boss of General Bajwa – General Raheel Sharif with whom Sharif still has good standing. It will be very interesting to see how all this plays out. But for now the doves in his party led by his brother Shahbaz look set to prevail.