The Pakistan political scene has been familiar with chief executives of the government, the Prime Ministers, being shown the door unceremoniously; until the smokescreen erodes to show the real powers behind. The coups of 1958, 1999 and the Hybrid test tube of 2018 were all preceded by decades when people falsely felt that Pakistan is finally on the track of civilian supremacy.
As discussed before with the reference of the other nation states with similar variables, especially Turkey, if the economic dividends have been forthcoming, the common person’s belief in the system remains intact. Turkey’s experiments with complete military domination; quasi-arrangement with compliant politicians and now complete domination of an Islamist party; have been punctuated with manageable economic goals. It has been only the period, when Turget Ozal and Tansu Ciller were the prime ministers, when the economy came under an IMF programme.
At that time, Turkey was referred to as a test case of economic reform towards the recovery. Now where Turkey stands is the fact of history. Turkey’s Islamist experience has in fact succeeded on the back not only economic recovery; but also nof impressive growth rates between 2002-2017. Comparing that situation with Pakistan, it has been a different or a dismal story to begin with. Pakistan’s ills started after the end of the fruitless war of 1965; which frustrated its sustained takeoff to economic growth. The 1971 civil war and its military and political fallout left Pakistan with few “disaster recovery” options.
The 1970s, instead of witnessing the return towards political sanity; witnessed even more turmoil; with a military dispensation forwarding its own cooked-up agenda for change in 1977. The economic side was initially taken care of by the workers’ remittances from the Gulf States, where there was an era of construction and infrastructural development after their disengagement from colonial powers. There were many opportunities for unskilled and skilled workers to find and earn. In turn these workers sent back their hard earned remittances; firstly to lift their respective households’ living standards and secondly to buck up the country’s foreign exchange. Zia’s survival on the economic question was precisely influenced by that factor.
Later the Afghan war helped the government sustain itself. However, a deeper look into the system reveals that it was the time when the internal fiscal contradictions started to put invisible pressure on the resource mobilization of the state machinery. Data processing on the basis of budget figures and economic surveys throughout the 1980s reveals that the deficit was recorded in the range of five to seven percent. Here it may be pointed out that when resources are less than expenditures, that situation is called budgetary deficit.
The IMF dictates for the post-1988 civilian governments was to keep the deficit at the magical percentage of not more than four percent of the GDP. During the closing years of the Afghan war and Zia government, that deficit was already touching the seven percent mark. It was not just a coincidence that economist/ central banker V.A Jafri, satirically called Value Added Jafri by the business community, was recommended to 1988 PPP Government led by late BB to have him on board, by the Americans and the powers that be.
The political parties, especially the opposition, need to go beyond the “family gala”-based “inflation week”. Rather it needs to reach out to masses in a more aggressive way. The same is true of the two other parties; if they wish to be politically alive and not be shrunken to a dead horse. Consequently; it remains upon the minds of the political groups; how much they are able to read the public pulse and redo their roadmaps accordingly.
The period between 1988 to 1999 when the two political parties, the PML(N) and the PPP took turns in Islamabad, the economic questions remained more or less the same. These parties’ willingness to implement IMF-based reforms were the final key to their acceptance or rejection as the civilian face of the system.
The events of October 1999, did not free the successor regime to shy away from the IMF. The pressure for reform on that government remained in one way or another. The 9/11-based Paris Club breathing space did allow a façade of economic development or at least consumerism in Pakistan; allowing the middle income group to bask for a while. However deep down the contradictions remained the same.
Many readers can recall that when the PPP again reached the corridors of power in 2008; its rule was followed by rapid withdrawal of POL subsidy, pushing the per-litre price of petrol from Rs 60 or so to more than Rs 100 at that time. That subsidy started during the 9/11 days after the Paris Club arrangement was stretched too long until 2007. Automatically it was left to the PPP government to earn an unpopular backlash in 2008.
How much economic growth happened, during the succeeding political government of the PML(N) and then the quasi-arrangement under the banner of the PTI, is recent history. All these political periods and the constant interference in the decision-making by the real powers left Pakistan literally at war with all its neighbours. Trade-based economic growth was the first casualty followed by widening current account deficit (CAD). In fact it was observed that a stalled economy experiencing stagflation and consequently importing less, was hailed as an economy whose CAD was under control.
To put the discussion on the intended track; during all these five decades; Pakistan continued to slide deep into the economic quagmire. A quagmire, which was influenced by the apparent and invisible political factors and mechanics at work. While the rich and the resourceful thought it opportune to move towards greener pastures around the globe; the middle income groups too tried to invest in education so that their next generations are able to optimize their skills. For the majority lower middle class and the poor, it has been the only viable option to stay in Pakistan and correct it. Despite many political parties claims to be able to attract “families” into their political rallies; it has been the lower middle and the poor having faith in political struggle and its economic result; who swell the political marches and opposition rallies with their presence.
Today; in face of a “super stagflation” scenario; that vanguard is more than willing to radically change the system. We see these expressions in social media where the sections of society whose sanctity was earlier untouched are being taken to task at least in words.
What are these indications? Indications of change; where regretfully the political parties inclusive of the just booted-out PTI are still thinking in terms of seats and electoral politics; leaving much of the state structure on old lines; with no real need for reform; especially a meaningful one.
Despite the main opposition party’s bid to match the aspirations of the disgruntled average person, the communication mechanism as witnessed strongly suggests that electoral victory is all the opposition wants. Such aspirations have been the part of electoral politics since 1988, when the PPP led by the late Benazir Bhutto disowned many of its radical goals and preferred to settle with the established order.
However, this time there is a big mismatch to point out. The common person exhausted by the pressing economic hardship caused by the Stagflation-plus Scenario might not be in the frame of mind to settle for a few proverbial peanuts offered by the real rulers. Pakistan’s 75 years of existence and an unimpressive show of leadership has landed the country and economy in a crisis. The external factors notwithstanding; a complete new social contract within the limits is necessary for correction; a correction, which can deliver as desired.
The political parties, especially the opposition, need to go beyond the “family gala”-based “inflation week”. Rather it needs to reach out to masses in a more aggressive way. The same is true of the two other parties; if they wish to be politically alive and not be shrunken to a dead horse. Consequently; it remains upon the minds of the political groups; how much they are able to read the public pulse and redo their roadmaps accordingly.
