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Nawaz’s first 100 days

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In Brief

After assuming power to begin a record third term, 14 years after his ouster in a 1999 military coup, Pakistan’s Prime Minister Nawaz Sharif has recently completed 100 days in office.

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His election was Pakistan’s first genuine civilian change of government in its troubled history.

Nawaz leads a different Pakistan from the one he first managed in the 1990’s. The mismanagement and rampant corruption of the Zardari-led government has left the economy in the doldrums. Pakistan suffers from crippling power cuts costing 2 per cent of GDP, and extremism and militancy have disfigured Pakistani society beyond recognition. 

By paying a whooping Rs480 billion (US$4.84 billion) to the oil companies that supply furnace oil to power plants, Sharif has in the short run met his promise of reducing power cuts. That calms the population and gives the industry a breather. But power cuts will recur unless these measures are backed by an effective cost-recovery mechanism. Medium-term plans to convert power production to indigenous coal should follow.

Public sector enterprises continue to slow down the economy.  Despite injecting Rs2.5 trillion (US$200 billion) into these organisations and the power sector during the 5-year term of the previous government, they remain insolvent. Their combined losses now equal the country’s much-maligned defence budget. And still the government dithers on hard restructuring issues.

Sharif, whose mandate is to liberalise Pakistan’s economy, went to the IMF immediately upon taking office. He sought and received a stabilisation package, the first disbursement of which was made this month. In addition to this package, he needs to widen the tax net — according to the Chairman of Federal Board of Revenue only 0.9 per cent of people pay taxes in Pakistan. So far, however, Nawaz has opted for a quick fix — adding taxes over those who already pay instead of taxing the mercantile classes that form his core constituency.

But Nawaz’s biggest challenges are not economic. They are extremism; militancy; gang warfare; and ethnic, sectarian and political killings. He understands that unless the militancy and violence that have cost over 50,000 lives in a decade are contained Pakistan will never make an economic recovery.

Nawaz went to elections calling for talks with the militants, and Imran Khan’s party Pakistan Tehreek-e-Insaf, which garnered the second-highest number of votes, had the same policy. But it took Mr Sharif three long months to establish a consensus between civil and military leaders for talks with the militants.

Talks are to take place under a framework called the ‘All Parties Conference’, which aims to bring together all stakeholders in the conflict.

 There are many potential problems with this approach. First, similar meetings held previously generated commitments that were never fulfilled. Second, although the Tehreek-e-Taliban (TTP) has welcomed the initiative, their pre-conditions are impossible to meet. Third, the TTP is divided, and they are not the only perpetrators of violence. Ragtag groups, criminal gangs and extortionists are behind many of Pakistan’s killings. Fourth, the several political parties who have signed up for talks may splinter if the talks fail, especially if military action is required. In the face of these issues, many worry that the policy of appeasement toward militants will not hold and argue Pakistan should brace itself for military action.

This, too, would present problems. Although the military prides itself in its command system, assassination attempts on former President Pervez Musharraf and attacks on army headquarters and bases with reported insider involvement appear to confirm the presence of rightwing sympathisers within the ranks of the armed forces.

Early in his third term, Nawaz seemed to have control of foreign policy. But the early bonhomie with India through an exchange of special envoys seems stalled due to skirmishes at the Line of Control for which both sides blame the other.   Now, even the much-anticipated meeting between the two prime ministers on the sidelines of the United Nations General Assembly was held after weeks of speculation. They only agreed to cool down the Line of Control before peace process is resumed.

The Afghan government also thought relations could improve under Nawaz. But on this question Pakistan’s powerful military calls the shots, not its civilian government.

Many of Pakistan’s problems stem from poor bureaucratic governance, sacrificed for political expediency. Strangely the national discourse is oblivious to this basic disease. The number of challenges has multiplied and the international community’s patience with Pakistan has declined correspondingly. Nawaz’s mandate allows him to take hard economic, security and foreign policy decisions.

As American forces withdraw from Afghanistan by the end of 2014, peace and stability in Pakistan will be critical for South Asia and beyond. A nuclear-armed country cannot be allowed to remain in a state of economic despair and political turmoil because those conditions produce extremism.

But the international community can only do so much. Only Pakistan’s leadership can bring real change to the country. On this point, Nawaz’s heart is in the right place. Unfortunately, time may not be on his side.

Sajjad Ashraf is an adjunct professor at the Lee Kuan Yew School of Public Policy, National University of Singapore, and an associate fellow at the Institute of Southeast Asian Studies.  He served in the Pakistan Foreign Service from 1973–2008. 

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