Monday April 22, 2024

A state of flux

By M Saeed Khalid
February 03, 2023

Consumers are in a state of shock over the latest jump in petrol prices. However, there are some who will be satisfied with the raise. First, the International Monetary Fund, which strongly opposes subsidies on energy products which lead to large budgetary deficits. Second, the petroleum industry and distributors as their profits will go up. Third, the PTI and the JI because they just got a bigger stick to hit the ruling coalition with. Indeed, Imran Khan and Sirajul Haq lost no time in calling the Rs35 raise in petroleum prices proof of the government's anti-people character.

Beyond the populist rhetoric, there are two ways to interpret the IMF bailout package that may see the light of the day soon. It will lead to a series of price hikes as transportation costs of commodities, notably food items, go up. In other words, unprecedented hardship for the people is on its way.

The other way to look at the IMF package is to accept it as a bitter pill that our ailing economy needs simply to stay afloat and avert a default on Pakistan's foreign debt. The IMF's stand-by credit is a green signal to other multilateral institutions and bilateral sources of finance to lend money to a beleaguered economy.

Khan will go on attacking the PDM government for adding to the common citizen's misery. No surprise from a leader who allowed a petrol subsidy of Rs60 per litre a year ago as a spoiler in case his government was removed. He will not spare any effort to criticize the PDM leaders to gain greater popularity among the people.

Ever since the vote of no-confidence against his government in April last year, Imran Khan has donned the cloak of a prophet of doom, predicting a fate like Sri Lanka's not realizing that decency requires not to speak ill of a friendly nation especially in its time of distress. Nor does he seem to recognize that in case of default, his government too will be held responsible like those before him for over-spending and over-borrowing.

Probing minds are raising questions about what Khan can possibly do to revive the economy if he returns to power. There is no word from him or his spokespersons on measures they would take to reduce inflation and provide jobs. When pressed on this point, an aide to the PTI leader said that they had plans to address challenges in the economic sphere but those cannot be made public at this moment. From lofty promises prior to the 2018 election to none as now, the party seems to have come full circle.

Imran Khan has apparently recovered from the setbacks he received in two unsuccessful protest movements. The attack on his life must be condemned with full force and hopefully he can soon walk normally. His verbal attacks against the dynasties have become more virulent, leaving little chance for a dialogue with the ruling coalition.

Syed Mohsin Naqvi's selection as the caretaker chief minister of Punjab is proving to be the proverbial last straw for the PTI. It raised tensions between party leadership and the institutions to a new high, leading to Fawad Chaudhry's arrest (he has since been released). Khan is also piqued over the brisk acceptance by the NA speaker of months-old resignations by the PTI's MNA, thus foiling any plans of their return to the National Assembly unless through by-elections.

Some observers believe that the country's economy has grievously suffered from the prevailing political instability. A new crisis is brewing over the centre's reluctance to hold fresh elections to the provincial assemblies in Punjab and Khyber Pakhtunkhwa. The PTI, meanwhile, has been hinting at a presidential move requiring a vote of confidence for the Shehbaz Sharif led government.

What is the way forward to mitigate a spiraling political crisis with its long shadows on the country's economy characterized by inflation and recession? There is a growing belief that the government and the main opposition party have no inclination to work for a compromise as, according to one observer, they are nursing a collective suicide wish. This is a situation that causes great concern in the country's institutions about the risk of an internal upheaval.

While the PDM is being accused of finding excuses for delaying elections to the provincial assemblies of Punjab and KP, there is speculation that the highly polarized situation may lead to an out-of-the-box arrangement like delay in all elections while a caretaker setup takes control of running the affairs. A scenario not so simple to work out and fraught with uncertainty if the opposition decides to bring legal challenge to the government's plans.

These developments have aggravated the state of flux generated by Imran Khan's refusal to accept the vote of no-confidence against his government as a part of the democratic process. The ruling coalition, for its part, is unwilling to concede to his demand for early elections to the National Assembly. There is considerable suspense about elections to the two provincial assemblies dissolved by the PTI and allies – with Imran Khan repeatedly claiming that the government has no intention of holding any election.

It is unclear at this stage what role the institutions envisage to play if the government tries to deviate from the constitutional course.

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