SHAMBOLIC PTI AND ECONOMIC MELTDOWN

Islamabad - It was always about the economy. When General Qamar Javed Bajwa, the army chief, spoke at a seminar about the interplay of the economy and security in Karachi in 2017, he said he was concerned about the country’s low tax-to-GDP ratio, the current account imbalance, lack of tax reforms, the documentation of the economy, diversifying of the export base and sustainable growth through savings and investments. It was a seminal speech. Like all past episodes, it was the powerful establishment showing the civilian leadership the way forward.

However, PTI has made the wrong calculation. Its ministers are continuously harping on an old trope: previous governments are responsible for the current mess. Every day of every week, ministers, state ministers, advisors, and special assistants to the prime minister drill this message. We get it. We seriously get it. However, that’s precisely why the voters brought Imran Khan to power. To fix the emaciated, stubborn, debt-ridden economy.

Nine months into power and the government is flailing and failing. Asad Umar was always inexplicably laughing and giggling, trying to assure the countrymen as he attempted his out-of-the-box approach. His junior Hammad Azhar also tries to give similar assurances with a somber and serious face. Hammad offloads a ton of statistics, figures and verbal charts of past performance but a common man sees what is the bottom line. The bottom line is simple — is he better off or worse off.

The original economic duo could satisfy neither the business community nor the people. Asad was shafted and his replacement, Abdul Hafeez Shaikh, is equally struggling to ease the jitters and unease.

The perception that the new economic team has been installed at the behest of foreign lenders has dented the political government’s credibility.

The last few days have been telling – and alarming. The rupee has seen depreciation like never before. US dollar is skyrocketing. The country’s debt and liabilities have gone up by $10.6 billion in the first nine months of the ongoing fiscal year. Exports have failed to pick up; reduced by 1.54 percent to $2.09 billion in April this year. The foreign exchange reserves remain under pressure. International Monetary Fund $6 billion bailout package news was supposed to bring some stability in the economy. However, there is panic everywhere.

The economy is choked. The informal economy, which has always provided a cushion, is also halting because of the accountability drive. There is no major spending by the government; it has no money. Businesspeople are not making payments. As a result, receivables have shot up; there is no liquidity in the system. The wheel has stopped turning.

Meanwhile, the specter of terror has raised its ugly head. Balochistan has been reeling with a new wave of terror as Gwadar, and its adjoining areas, have come under renewed terrorist attacks. It is a signal that CPEC will remain a target. Lahore saw a terror bombing after a long gap. The Islamic State has conspicuously announced its presence in the country. It is a foreboding sign.

For any government, it is a deeply troubling scenario.

But Prime Minister Imran Khan and his team — both the original and borrowed one — seem unconcerned to the buildup of public disquiet and discomfort. The prime minister has been persistently telling people not to worry. His exhortation “Aap nai ghabrana nahin” (You don’t have to panic) is failing to calm the nerves.

On several occasions, the prime minister has asked the people to pray. Pray for the economy. Pray for the offshore oil and gas exploration. His ministers have been making desperate and hollow claims. Some weeks ago, Faisal Vawda said that within days there would be a rain of jobs and economic opportunities. That deadline passed without a whimper of embarrassment. The straight-faced hollow promises and the angry-faced fulminations to drag the opposition politicians over coals of accountability seem comical ploys to distract from government hobbling.

The message conveyed to the world during foreign visits about rampant corruption back home has boomeranged. Investor confidence has been low. Just as an example, meetings after meetings were conducted in the PM Office since last year to work on FinTech. However, what’s the result? No immediate good news. PayPal has declined to come to Pakistan. Big industry is also showing reluctance. The French giant Renault has also apparently put its plans of investment on hold.

People want to know what is the economic road map. The country is hurtling toward stagflation. How will the government cover for the ordinary folks? The communication strategy of the government has been off-key.

For every government step, every move and every policy measure, there is readily available a blistering and contradictory statement by Prime Minister Imran Khan from his opposition days. Whatsapp groups are rife with such videos and memes. Never have the past words and statements come back to haunt a government like the current one.

The urban-educated middle-class PTI base is not blindly following the party anymore. It is questioning the party and, more so, questioning their own judgment.

The opposition has failed to capitalize so far because the principal leadership has been ensnared in the court cases. Asif Ali Zardari is trying to dodge another jail term while Nawaz Sharif is back in prison. Shehbaz Sharif is looking for ways to escape. But a perfect storm is building up. The rumblings and the disgruntlement on the street, the pain experienced by consumers, especially the middle class, and the anxiety and apprehensions of the business community are all ideal ingredients for a big crisis to suddenly erupt and snowball. The latest development of Bilawal Bhutto-Zardari and Maryam Nawaz Sharif meeting will add a new zest to the opposition morale.

During the 2017 speech in Karachi, General Qamar Javed Bajwa said that he reads the business pages of the newspaper after looking at the front pages. These days, it must be uncomfortable reading.

 

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