File photo of P.M. Shehbaz Sharif
Pakistan’s prevailing crises, both political and social, have understandably raised questions about its future, both locally and abroad. The Feb. 8 general elections have produced some stability, but hardly enough for a country that needs difficult decisions and the wherewithal to implement them. The storm raised by Imran Khan’s popularity has somewhat declined with his incarceration, with the Pakistan Tehreek-e-Insaf (PTI)’s remaining leaders marginalized, even as the party managed to form the government in Khyber-Pakhtunkhwa. Meanwhile, Prime Minister Shehbaz Sharif, despite enjoying the support of the establishment, heads a weak coalition that must reckon with the PTI and Khan’s ongoing attempts to overturn the status quo, including through protests against alleged rigging and calls for the release of all those detained after the May 9 riots.
The political opposition from the PTI and its allied parties will undoubtedly make difficult the process of economic revival, as Pakistan records minimal GDP growth, a balance-of-payments crisis and rampant inflation that has only just started to moderate. In his previous tenure as premier, Sharif secured a $3 billion Stand-By Arrangement with the IMF, expiring this month, but has yet to prove he can implement much-needed reforms, including the privatization of loss-making state-owned enterprises and expanding the tax-net. The government has already announced it would now seek a long-term IMF arrangement, Pakistan’s 25th since 1947. Such a deal, if inked, would require measures that would cause more pain for the general public, already reeling from multiple years of backbreaking inflation, and risk further instability.
There is little doubt among observers that this deal—believed to be around $6 billion—would be attained, but without necessary economic restructuring and a dedicated effort to expand the tax net to include previously untouched sectors, it is difficult to imagine how it could yield the desired results. Pakistan has reached yet another inflection point in its history; how it proceeds in the months to come could well determine whether it can emerge from it a stronger and more stable state.