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Crisis and instability threaten Pakistan’s economy yet again

APARNA PANDE

Pakistan’s backing of anti-Indian, anti-Western extremism has cost it dearly as its new prime minister confronts economic misery, rising discontent and challenges from his predecessor.

Pakistan has so far managed to stave off riots and repay creditors, avoiding an economic meltdown like that seen in Sri Lanka. Still, Prime Minister Shahbaz Sharif’s coalition government, which took over in April 2022, is grappling with multiple political and economic crises. Pakistan’s rupee is one of the world’s worst-performing currencies, the country’s foreign exchange reserves are abysmally low, and it has been unable to attract much-needed foreign investment.

Domestic political instability and increased vulnerability to terrorism following the Taliban takeover in neighboring Afghanistan add to the country’s problems. Four years of erratic rule by former cricketer Imran Khan has deeply polarized Pakistani society. Ex-Prime Minister Khan’s claims that his ouster through a parliamentary vote of no confidence was orchestrated by the United States, with help from the army leadership, have had an unsettling effect.

Pakistan’s political class is fragmented. Its society has been radicalized further. The economy is weaker than it was four years ago, and the country is more isolated internationally.  The all-powerful military establishment has been bruised by coming under criticism, first for helping Mr. Khan into office, and now for helping push him out.

Mr. Khan came to power in 2018 through the open backing of the security establishment, but his government was hobbled by poor coalition management and ineffective governance. As Pakistan’s economic crisis grew, and tensions between Prime Minister Khan and the military establishment deepened, a coalition of opposition parties used the opportunity to push a no-confidence motion against him.

Instead of facing the no-confidence motion in parliament and accepting defeat gracefully, Mr. Khan sought to hold on to power through extra-constitutional means. In the end, the Supreme Court of Pakistan intervened, supported behind closed doors by the army top brass, to ensure that the no-confidence vote took place, and a new government was sworn in.

If Pakistan’s economic crisis continues, the public may forget that it was Prime Minister Khan who is responsible for the mess

Mr. Sharif, the current prime minister, is a former chief minister of Punjab state, and the younger brother of Nawaz Sharif, a three-time prime minister. Shahbaz Sharif is a good administrator but lacks the national-level political experience critical to managing a disparate coalition. Mr. Khan, in the meantime, is applying pressure on the government and the military establishment both through social media and street protests.

Pakistan badly needs to get back on track with an International Monetary Fund (IMF) lending program, both to get through its immediate balance of payments difficulties as well as for longer-term economic stability. The political environment makes tough economic decisions, like ending subsidies and raising taxes, difficult to implement.

Economic and political challenges

Pakistan’s current crisis is the culmination of decades of fraught policies. The desire to combat a perceived existential threat from India, the country from which Pakistan was carved out in 1947, resulted in decades of unsustainable military expenditure that depended on foreign, historically American, support.

That external backing ended in part because of changing geopolitics. Rival India, not Pakistan, is now America’s ally of choice. Pakistan’s policy in Afghanistan and its support for jihadi terrorist groups targeting India have also led to a loss of Western support. Unable, or unwilling, to raise revenue from taxes and economic expansion, Pakistan has repeatedly turned to either multilateral institutions or friendly countries – in the Arab Middle East and China – for budgetary support.

The new prime minister and his foreign minister, Bilawal Bhutto Zardari, have indicated their desire to reframe U.S.-Pakistan relations. However, to truly repair relations with Washington, Pakistan would have to completely revise its foreign and security policy, especially vis-a-vis India and China, which might not be possible in the short term.

Pakistan’s economy remains dependent on the export of cotton textiles, with little investment in diversification. The literacy rate stands at 52 percent, the lowest in South Asia, resulting in an unskilled labor force that migrates primarily to the Gulf and sends remittances back. Pakistan’s ratio of taxes to gross domestic product (GDP) is one of the lowest in the world and key segments of the economy, such as agriculture and some military-run corporations, are exempt from income tax. Instead of raising revenue through taxes, governments have preferred to keep giving subsidies to avoid political and social unrest.

A direct military coup is the least likely scenario but cannot be ruled out.

Mr. Khan’s poor management and the impact of the Covid-19 pandemic left Pakistan’s economy badly battered. He changed finance ministers four times in three and a half years and changed his mind on trade and investment policies frequently. In addition to a $6 billion loan from the IMF, over the last four years, Pakistan has borrowed $10 billion altogether from Saudi Arabia, the United Arab Emirates, Qatar and China.

To forestall balance of payments difficulties, Pakistan borrowed in 2019 from the IMF – its 22nd loan from the institution since 1958. Pakistan has a pattern of drawing the first one or two tranches from the IMF and then abandoning the program to avoid fulfilling stringent conditions for economic restructuring. Mr. Khan’s government also initially agreed to the IMF’s demands to lower fuel subsidies in February 2022 but reinstated them once its ouster became imminent.

Though it was a difficult decision politically, Mr. Sharif’s government has rolled back the fuel subsidies and the IMF is expected to release the next tranche of its loan soon. But there is still no quick fix for Pakistan’s economic predicament. Rising utility costs and food prices, and a potential hike in interest rates, will slow industrial activity. That would hurt employment and add to the likelihood of street protests that are already being incited by Mr. Khan and his followers.

This vicious cycle will be difficult to break, even more so at a time when the global economy is recovering from the dual blows of Covid-19 and Russia’s war on Ukraine. Further, Pakistan has refused to open trade with its largest neighbor, India, because it is anathema to Pakistan’s ubiquitous security establishment.

For decades, Pakistan’s military establishment has intervened, directly and indirectly, in Pakistani politics to choose winners and losers. They once chose Mr. Khan but have now discarded him. The former prime minister is using the army’s own playbook against them: blaming everything on a foreign conspiracy, using anti-Americanism and pan-Islamism to rally support on the streets, and labeling anyone who disagrees with him – including military leaders – as anti-national.

The army is finding it difficult to fight an ideology it crafted and the monsters that it created. There are enough people within the lower and middle ranks of the military, in the media, and within the middle class in Pakistani society who believe Mr. Khan’s narrative, as it echoes what is taught in the educational curriculum.

Scenarios

The three key actors right now are the coalition government, the military-intelligence establishment and ex-Prime Minister Khan. The current army chief, General Qamar Javed Bajwa, is reluctant to intervene in politics directly and is still bruised from supporting Mr. Khan for the last four years. Prime Minister Sharif is a good administrator, but his experience in provincial politics might not transfer effectively to national politics. The quicker he solves some of Pakistan’s economic challenges, the better it is for him, irrespective of when the next elections are held.

If Pakistan’s economic crisis continues, the public may forget that it was Prime Minister Khan who is responsible for the mess. Mr. Khan will try to generate chaos, believing that the more he pushes Pakistan to the brink, the more the army is likely to help bring him back to power as the savior.

A wild card in all these scenarios is the role of the Supreme Court of Pakistan, which could upend the situation by disallowing certain politicians from participating in elections or striking down policies. Historically the court has sided with the military-intelligence establishment. Recent years, however, have witnessed judicial activism that has underlying Islamist and populist elements.

The timing of the next elections is important. The next army chief is scheduled to be appointed by the prime minister in November. All major actors – the political parties, the army, and the judiciary – would like their favored person to be prime minister when that decision is made.

The most likely scenario is that things continue as they are right now with the coalition government managing to stay afloat with tacit backing from the military. Neither the coalition government nor the army have any incentive in rocking this rickety boat and both need the next tranche of the IMF loan to come through quickly. Mr. Khan’s momentum is dissipating and, as of now, he has backed off when threatened with imprisonment.

In this scenario, Prime Minister Sharif would extend the current army chief’s tenure by a year and hold general elections, in which his coalition would then win the army’s support. Alternatively, Mr. Sharif could appoint a new army chief as advised by the incumbent.

If the IMF delays the next tranche of its loan and even friendly Gulf states – like the United Arab Emirates and Saudi Arabia – are slow to offer support, there could be a real threat of Pakistan’s default on debts. In that second, less likely, scenario, the army might install an interim caretaker government to stabilize the economy. Such a caretaker government would comprise technocrats and retired politicians and judges and would have a limited mandate.

A direct military coup is the least likely scenario but cannot be ruled out. If the politicians continue to squabble, and an interim government fails to restore economic health, General Bajwa or his successor could take over, promising to clean up the political and economic mess. Deep divisions within the army make such a scenario possible but not very likely. If Mr. Khan and his reverential following threaten violence and the current prime minister asks the army to put down the violence, the possibility of direct army intervention would increase.

https://www.gisreportsonline.com/r/pakistan-crisis-economy/

#Pakistan #ppp - Bakhtawar Bhutto slams Imran Khan for allegations against Asif Ali Zardari

Bakhtawar Bhutto-Zardari, the daughter of PPP Co-chairperson Asif Ali Zardari, hit back at PTI Chairperson Imran Khan for levelling allegations against the former president.

The former prime minister had alleged that Zardari was the “main architect” behind the alleged horse-trading in Lahore, adding that the former president has secured an “NRO for his corruption and purchases people with looted wealth”.

He had demanded that the PPP leader should be jailed.

Following the allegations, Bakhtawar, while taking to her Twitter account, warned Khan and stated: "Why don’t you take your obsession with proof to the court, otherwise you will be hearing from our lawyers for defamation and lies."

"Still not over the absolutely no phone call? Why don’t you take your obsession with proof to the court," she wrote, adding that she pities the PTI Chairman as he has never read the Constitution as nothing will save him from committing treason.

https://www.geo.tv/latest/428979-bakhtawar-bhutto-slams-imran-khan-for-allegations-against-asif-ali-zardari

Pakistan’s Council of Islamic Ideology - Ignorance from the 7th century is still in effect. - Theocracy in the 21st Century

By Khaled Ahmed

Pakistan’s Council of Islamic Ideology has a long history of seeking to impose more religion in all aspects of life.

Pakistan began describing itself as an ideological state after the word had been made respectable by the Soviet Union through its planned economy and rapid growth. Ideology means the state has an idea which it thinks is right, and will punish anyone who doesn’t believe in it. Section 123-A of the Pakistan Penal Code specifically criminalizes anyone who opposes the ideology of Pakistan, which the state has designated its religion, Islam.Pakistan’s ideology, like most other ideologies, was utopian; it made Pakistanis different from Indians. It also set Pakistan apart from states like Iran or the Soviet Union, with theocratic characteristics vulnerable to “theocratic” Taliban and parts of the population that live under their influence. At least one leader, Imran Khan, employs political rhetoric that links him to Pakistan’s “theocratic” dream.

Theocracy, or the rule of God, was a great experiment tried during the Middle Ages in the Christian West. As history shows, that experiment in governance failed. Although some theocracies continued to exist for hundreds of years, the idea never really worked for the simple reason that the will of God must always be interpreted by mortal, fallible human beings. Theocracy, in the last analysis, is no better than the men who govern in God’s name. As a matter of practice, such men are no better than other governors, and often they are worse. Unlike Christianity, Islam has never quite given up the theocratic ideal. Almost all Christian nations today erect strong constitutional hedges between religion and the state. God may continue to be understood as guiding the nation’s destiny, but his servants are not permitted to interfere in the affairs of the state. Some Islamic nations, although not all, have refused to erect such barriers to direct action by the servants of God and the interpreters of His will.

Theocracy in Iran

Iran, under the ayatollahs, is the leading example of theocracy. The shah of Iran, Mohammad Reza Pahlavi (1919-1980), was overthrown in 1979 in a revolution led from exile by Ayatollah Ruhollah Khomeini (1900-1989). Khomeini returned to Iran in February 1979 and immediately took over control of the new government, which he appointed and continued to dominate until his death. He was succeeded by another ayatollah, but it appears likely that no Iranian successor will have as much power as Khomeini did.

An absolute despot who convinces his subjects that his word is the word of God may enjoy more power than any other kind of ruler. Numerous examples of people ruling with absolute power and authority over religious communities have been noted during the 20th century. Jim Jones (1931-1978) ordered more than 900 of his followers to commit suicide at Jonestown, Guyana, on Nov. 18, 1978. Most of them did so, passively and without protest. Jones himself died of a gunshot wound, perhaps not self-inflicted. Other communities have undergone similar experience.As a nation, Iran underwent a comparable suicidal experience in its war with Iraq (1980-1988). The number of casualties, many of them teenage boys, has been estimated at well over a million. These children gave their lives for God, the ayatollah said, and the people believed it to be true.

Democracy as enemy of Islam

Democracy is anathema to theocracy. It is not surprising, therefore, that the United States, the leading exemplar of democracy in the world, was considered an evil nation by Khomeini and the Iranian imams. A religious tyrant cannot afford to allow his followers to be tempted by democracy; he must claim that democracy is the invention of anti-God, or Satan. For Khomeini, the United States became the Great Satan. As long as his followers believe this to be so, there can be no dialogue between democracy and theocracy. And when dialogue begins, theocracy is inevitably dissolved. Theocracy cannot survive freedom, which, like democracy, is anathema to it.

The Ayatollah Khomeini was able to impose an absolute tyranny over his followers. Anyone who sought to interject the slightest amount of freedom into the operations of the state was killed in the name of God. Historically, it has usually proved impossible for a succession of theocrats to impose and enjoy such absolute power. In the present state of world, with the vast majority of living human beings either already possessing or manifestly desiring and demanding democratic freedoms, theocracy has very little chance of surviving for long except in the circumstances that occurred in Iran in 1979. At the present time, therefore, theocracy would seem not to be a serious long-term threat to democracy.

It should not be forgotten, however, that a theocracy lasted in ancient Egypt for 3,000 years. And theocratic overtones are often heard in the claims of despots of other persuasions. Communism, as an example, banned God not only from the government but also from society with men and women not being allowed to be religious or to worship God privately, to say nothing of permitting God’s servants and interpreters to play a role in the state. This might have created a kind of vacuum in the lives of many persons that could only be filled by the state itself and the overwhelming idea of the Revolution. The Revolution was, or became in some people’s minds, a kind of deity. Thus several Communist states, notably the Soviet Union, began to take on a theocratic hue even though they were explicitly nonreligious and indeed antireligious.

The example of Pakistan

In Pakistan’s capital Islamabad, the Council of Islamic Ideology (CII), an advisory body of clerics and scholars tasked with assisting the government in bringing laws in line with the holy Quran and the example of the Holy Prophet (Peace Be Upon Him), declared in 2004 that a man might not ask for permission from his first wife before marrying a second one. The “decision” at the CII grated on many nerves because the law in force at present is that marrying the second time without asking the first wife will entail one year in jail and Rs. 5,000 as fine. The law of “permission” raised belly-laughs anyway because if the first wife refuses permission she can be divorced by the husband by pronouncing “talaq” (divorce) three times, no questions asked. But the primitive anachronism of the Council’s “advice” provoked the Human Right Rights Commission of Pakistan (HRCP) into condemning it as another sign of tightening up the faith in anticipation of the Rule of Taliban. There is a common fallacy that Islam as enforced in Pakistan is misinterpreted and somehow there exists a true religion of Islam which should be revived. The truth of the matter is that under the prevailing principles of interpretation, what Pakistan has is the correct interpretation of Islam. The “rational” Islam of Sir Syed Ahmad was rejected in his lifetime by all schools of thought among Muslims, Deobandi and Barelvi alike. In Egypt the reformist spirit of Muhammad Abduh was challenged and set aside by the Islamists of the 21st century, including the ulema of Al-Azhar. There is an emphasis on fiqh under the principles of ijtehad (reinterpretation). Not many people know that Islamic law is based on fiqh and that ijtehad is allowed only on matters not decided by fiqh. Allama Iqbal once tried to write on ijtehad and corresponded with Maulana Salman Nadvi, asking him tough questions on points where fiqh actually supersedes the Quran, to which the maulana made no reply.

Women under the religious state

The verdict on riba by the Supreme Court Shariat Appellate Bench in 1999 shocked many, but it was according to the standard application of theocratic jurisprudence called fiqh. Right after that, the Federal Shariat Court also abolished the old Family Law Ordinance and allowed men to practice polygamy without the permission of their first wives. In an effort to make the verdict rational, the Court said it was good for Pakistan because there were more women here than men! After that the wife of Dr. Israr Ahmad, a famous Lahore cleric, said that she would not mind her husband taking another wife.

Lashkar-e-Taiba chief Hafiz Saeed never stopped saying that democracy was against Islam and that those who believed that Islam allowed Parliament were ullu (owls). Only the Army liked what he kept on saying, but he was right. The CII and the Ministry of Religious Affairs should not be blamed for issuing outrageous Islamic proposals (one advice being that all banknotes be withdrawn and the photo on them of the Quaid-e-Azam be erased) because they are following the rules of interpretation in Islam.

Extremism as misinterpretation

Most people think that extremism comes out of a misinterpretation of Islam. This is wrong. Extremism and violence occur when people do not accept what the Islamists regard as the irreducible crux of Islam in the shape of shariah. (What is shariah may differ from country to country). The mood among the clergy and the Islamists has been aggressive since the turn of the 20th century and violence is normally resorted to when a literalist version of fiqh-dominated Islam is not enforced. That is where extremism starts. As for the practicability of literalist Islam, many laws in force have either produced malpractice or have simply lain dormant, as in many cases of diyat (blood money) and qatt-e-yadd (cutting of hands).

In such cases the stand of the Islamists is that only they will enforce them correctly when they come to power through aggressively isolationist policies in the manner of the late Mullah Umar of Afghanistan. According to an old edition of daily Urdu newspaper Jang, the CII would hold a session to recommend that anyone blaspheming against Allah should be punished. It would also recommend that no woman be allowed to marry without the permission of her wali (male guardian). It was expected to ban kite-flying, organ transplant and smoking.

Pious destruction of Buddha statues

According to daily Khabrain, the ministry for religious affairs in Islamabad gave its verdict on the destruction of ancient statues in Afghanistan in 2001 by saying that the Taliban were right in doing so; the Foreign Office had earlier asked the ministry about the status of this destruction in sharia. Thus Pakistan now had to support the destruction of the ancient Buddha statues in Afghanistan, although it was not made clear what should be done to such statues in Pakistan. According to Khabrain, the CII had also become seized with the question of Christian jallad (hangman) executing Muslim convicts in Pakistan. Among issues taken to the CII by the religion ministry was the issue of girls marrying of their own choice.

According to daily Din, the religion ministry had given the task of preparing a draft ordinance for the enforcement of namaz in Pakistan. Its directive was that all businesses should be closed down five times a day during namaz and during Friday namaz, and no one should be allowed to break this law. The entire country would also have the same namaz and azan (call) timings.

No songs on television, please!

Not long ago, according to daily Jang, the federal ministry for religious affairs sent a recommendation to the ministry of information that all songs and dances shown on PTV should be banned. The ministry’s letter said the PTV was involved in emulating Indian TV channels and was showing women shaking their bodies. According to daily Khabrain, the CII also announced that girls getting married of their own choice should be punished under law. A verdict undoing such a marriage at the Lahore High Court was, however, set aside by the Supreme Court. The other enlightened opinion of the CII was that co-education should be banned, that all lotteries like prize bonds should be banned and the paper used for printing the Quran should not be recycled.

According to daily Din, incumbent chairman of the CII S.M. Zaman has criticized the Supreme Court for postponing the removal of bank interest for another year. He said it was not an economic issue but an issue related to the Quran and the Prophet (PBUH). According to daily Nawa-e-Waqt, the CII also rejected then-religion minister Mahmood Ghazi’s plan to use zakat to allow the poor to invest in businesses by saying that zakat could not be used for investment of any kind. The body has also ruled that insurance of all kinds was against Islam and should be abolished forthwith, with instalments paid into a policy given under mudaraba (leasing) to make it Islamic; Mudaraba businesses did not do well in Pakistan.

In another report from Jang, the CII came to the conclusion that soft drinks sold as non-alcoholic beer were not jaez (allowed) in Islam, adding that any drink that is not sharab (alcohol) could not be called sharab or that the name beer should not be put on it. It also said preparation and trade of non-alcoholic beer inside or outside Pakistan was haram (prohibited). Another newspaper reported that despite the passage of 23 years since the CII made its first proposal about it, the government had not changed the flag; the recommendation had called for the kalima tayyaba (short prayer in Arabic) to be inscribed on the national flag along with Allah-u-Akbar.

Get women to stay at home

Quoted in another newspaper, the CII said that women should be disallowed from appearing in ads and only men should be used to promote products through photographs. It said that women were allowed to work as air-hostesses but only if they wore burqa or hijab, adding that no darzi (tailor) should be allowed to sew clothes for women and only women darzi should be used for women. According to the daily, the CII also recommended that ACRs of all state employees should contain sections indicating religious observance and those not saying namaz should not be promoted.

At one point, per Jang, the CII also declared that it was wrong to label jihad as solely a defensive war. The truth, according to the CII, was that jihad could be offensive as well. According to Nawa-e-Waqt, the CII stated that Western propaganda against jihad had pushed it into the background, but everyone should be grateful to Afghanistan for having revived it. It said the greatest act of piety was participation in jihad; and one cause of the decline of the Muslims was their abandonment of it.

The final verdict

Daily Jang magazine once quoted Lashkar-e-Taiba chief Hafiz Saeed—today in confinement under a FATF “grey-list” fiat—as saying that when an Islamic government is imposed on Pakistan, currency would be abolished and gold and silver coins would be the sole legal tender. He said the Constitution, too, would be abolished as there was no need of a Constitution in the presence of the Quran. Similarly, Khabrain reported, the CII declared that sending anyone to prison was against Sharia and recommended that prison sentences be abolished. Early Islam had no jails, no police, and no banks, it said, and thieves used to have their hands cut.

https://www.newsweekpakistan.com/theocracy-in-the-21st-century/