The toll of political instability

What is transpiring in Pakistan is remarkable. On the one hand, there is a rallying cry for a political change, while on the other hand, there is a defiant government which believes that budging in the face of popular pressure will ensure its capitulation.

In a deeply polarized, fractured and divided society, Pakistan’s economy continues to nosedive amid greater turmoil and upheaval. The question lingering in every average Pakistani’s mind is: Will the economy recover if such political adamancy becomes a routine? Unfortunately, there is no definitive answer to this question.

Former prime minister Imran Khan’s rallying cry to defy the system and force the incumbent government to hold early elections comes at a time when Pakistan inches closer to default.

Sovereign debt has soared beyond proportion and the calamitous floods have resulted in the agricultural sector stagnating to the point of near chronic food insecurity.

Inflation has skyrocketed and unrest in the country may not remain limited to the PTI’s push to dethrone the ruling coalition. Farmers, laborers, wage earners, semi-skilled professionals and what was once a vibrant middle class are equally disillusioned by the current government’s economic performance. All this will fuel the PTI’s campaign.

Since the Sharif government came into power through a no-confidence motion, the parliament has passed not a single legislation to resurrect the economy or adopt people centric policies to uplift the economy.

The government has only been obsessed with providing the coalition leaders a safe passage out of the corruption cases which had marred their ability to make inroads into the political landscape. Imran Khan’s charged campaign makes references to these political shenanigans, delegitimizing the coalition in front of the public eye.

The entire concept of the social contract theory espoused by Jean Jacques Rousseau hinges on popular sovereignty where the ruling party is to be determined by popular will.

The inability of the Sharif government to cater to popular public sentiment has undermined the entire social contract that exists or existed between the people of Pakistan and the ruling elite.

The economic policies, which are anchored in lofty statements or retrospective analysis of the PML-N’s cosmetic performances in the 1990’s and from 2013 onwards, are not translating into tangible outcomes.

The exchange rate, for example, continues to put upward pressure on the entire vision of Pakistan becoming an export oriented economy.

The rising dollar is also concomitant with supply side shocks from the global pandemic and a decline in international consumer demand, partly due to China’s stringent Covid-19 curbs.

OPEC Plus’s decision to implement petroleum cuts, which contributed to soaring oil prices, and the US Federal Reserve’s decision to spike interest rates all have global implications.

These developments hurt some of the world’s most impoverished countries, many of which have been facing political instability.

One can think of Kenya, Senegal, Nigeria and Yemen as some of the world’s worst affected countries. However, chaos is also unfolding in Pakistan and clouds of doom and gloom also hang over Islamabad

A complete absence of a dialogue on economic reconstruction and reliance on cosmetic policies to attract investments is hurting the national economy.

Many prominent economists including Dr Ishrat Hussain have called for comprehensive reform packages and sustainable development through interdisciplinary approaches for economic recovery.

Focusing solely on boosting GDP growth rates will not suffice as Pakistan’s problems remain largely structural. According to Professor Hafiz Pasha, Pakistan’s economic profile has declined from stable to negative on the international metric of credibility and financial stability.

The country is also ranked fourth in sovereign debt vulnerability which itself is a damning indictment.

While the ruling coalition can claim that political instability comes at an inopportune time, the truth is that their inability to handle the economic crisis has contributed to the present malaise.

The PML-N and its ruling coalition partners had rallied on rectifying the ills of the PTI administration when assuming power which resulted in the Pakistan Democratic Movement gaining some public traction.

However, Imran Khan’s popularity grew tremendously as the new government’s legislations remained lopsided in favor of the ruling elite and the economy continued to nosedive. The ruling coalition should hence, mull options to try and save face instead of trying to isolate the PTI.

The political crisis has emerged due to callousness and political expediency of the PML-N led government and not Imran Khan’s so-called disruptive influence. The ruling coalition remains adamant in vilifying the former prime minister through character assassinations which are reflective of a diversionary mindset.

Attempts to sway public opinion through castigation will only add to the popularity of a movement which calls for early polls. The Sharif government has little to offer to offset this surging popularity.

For Pakistan, these are dangerous times. The disappearance of the middle class – which is the backbone of any economy – is exasperating the income divide. The ruling elite remains largely nonchalant about the woes of the common men, who are protesting against rising inflation and poverty or trying to cope with the aftermath of devastating floods.

Political instability instigated by the Sharif government is only compounding the problem and its catastrophic toll will be felt in the years to come.

The writer is an Assistant Research Associate at IPRI