Pakistan sloping down on trajectory drawn during Imran’s term: US magazine

KARACHI: A recently published cover story in TIME magazine by journalist Charlier Campbell that includes an interview with former prime minister Imran Khan given in late March, says “If Pakistan’s economic woes are reaching a new nadir, the trajectory was established during Khan’s term.”

The cover story explores Khan’s plan to meet the country’s economic challenges, saying, “When asked for his step-by-step plan to get Pakistan back on track, Khan is light on details.” The report goes back to 2018 and the then financial situation to provide an understanding of what went wrong over the years. In 2018 when Khan came to power, he immediately appointed “renowned Princeton economist Atif Mian as an adviser”. But he “fired him just days later owing to a backlash from Islamists.”

The report goes on to say, “A revolving door of finance ministers [at least four finance ministers assumed office during Khan’s 3.5-year-long tenure] was compounded by bowing to hardliners.” The story also points out how Khan turned his back on his commitments. In 2018, he made it clear that he would not be carrying the begging bowl to ask for money, “but less than a year later, he struck a deal with the IMF to cut social and development spending while raising taxes in exchange for a $6 billion loan.”

“Meanwhile, little was done to address Pakistan’s fundamental structural issues: few people pay tax, least of all the feudal landowners who control traditional low-added-value industries like sugar farms, textile mills, and agricultural interests while wielding huge political-patronage networks stemming from their workers’ votes. In 2021, only 2.5 million Pakistanis filed tax returns – less than one per cent of the adult population. “People don’t pay tax, especially the rich elite,” says Khan, adding, “They just siphon out money and launder it abroad.”

The cover story also looks at how Imran Khan had been seen as soft towards the Taliban: “He provoked outrage when in August 2021 he said the Taliban had ‘broken the shackles of slavery’ by taking back power (he insists to TIME he was “taken out of context”).

The report points out, “Pakistan recorded the second largest increase in terrorism-related deaths worldwide in 2022, up 120 per cent year-over-year. “It was Khan who was pushing for talks with [the Taliban] at all costs,” says Michael Kugelman, the deputy director of Asia Program at the Woodrow Wilson Center. ‘That embrace is now experiencing significant levels of blowback’.”

Pakistan’s vague stance regarding the Taliban became the reason for former US president Donald Trump ending the $300 million security assistance that the US provided annually to Pakistan. This pushed the country to look for “new benefactors – chiefly Saudi Arabia, Russia, and China.”

Khan still believes that the US was behind his ouster despite the State Department and White House have repeatedly said there is “absolutely no truth” to the allegation.

During the interview when he was “asked how he plans to turn his much trumpeted Islamic Welfare State ideal into a reality, Khan talks about Madina under the Prophet [SAW] and the social conscience of Northern Europeans. ‘Scandinavia is probably far closer to the Islamic ideal than any of the Muslim countries’.”

According to the story, “When Khan visited Putin last February, it was to arrange cheap oil and wheat imports and discuss the $2.5 billion Pakistan Stream gas pipeline, which Moscow wants to build between Karachi and Kasur. More recently, China has stepped in. In early March, the Industrial and Commercial Bank of China approved a $1.3 billion loan rollover — a fiscal bandaid for a gaping wound.”

Pakistan is in a critical situation. The country’s top institutions are divided on the election issue. The country’s foreign reserve stands at $4.6 billion. Inflation in March rose to a “record 47 per cent year-over-year” and the rupee plummeted “by 54 per cent over the same period. The nation has only $4.6 billion in foreign reserves – $20 per citizen – and avoiding default rests on unlocking a stalled International Monetary Fund bailout.”

But “it’s a crisis that Khan still claims can be solved by elections, despite his broken relationship with the military.”