The Summer of our Discontent
Two decades ago the unadulterated ambition of our then leaders overwhelmed the integrity of the most beautiful experiment in nationhood of its time, we have not seemed to learn anything from that sorry episode. We are now in the midst of the most serious political crisis since 1971. The rapidly degenerating state of our economy seems to get only cursory attention while our leaders pursue their own selfish agendas. The Army may yet get over its “reluctant suitor” status before the country goes down the drain (and there is nothing left to defend). After all there is a difference between restraint and inaction. Martial Law is not a solution but the influence that the Army can bring to bear on the politicians should not be held in abeyance till Doomsday. Quick solutions to the political maelstrom will not cause the rapid rejuvenation of our economic situation, this will be a long and painful process adversely affecting the common man placed downstream at the fag end of the economy. Since only a small percentage of our population is privileged to be uncommon, a vast majority are bound to face acute hardship.
In a state of transition, the economy is very vulnerable to external factors. While privatisation was initiated by Ms Benazir Bhutto’s PPP regime, it commenced in earnest due to the dynamism and drive of businessman PM Nawaz Sharif. Along with Deregulation, Disinvestment and Denationalisation, the Nawaz Sharif regime carried out a series of far-reaching liberalising reforms, removing straitjackets from the economy and raising the confidence of the business community. Acclaimed as a genuine politician only post-April 17, 1993, Nawaz Sharif has been impatient to rid the economy of artificially imposed shackles, removing it from the clutches of a bureaucracy corrupted to its very core. In order to kickstart the economy and an ingrained political inclination to achieve economic results within his tenure, he embarked on a series of extremely visible public sector projects in the field of communications, mainly motorways and telecommunications. Like Stephen Leacock’s hero, he seems to have jumped on his horse and galloped off in all directions, the PM should have paid more attention to prioritization. Funds have been hard to come by and credits have only added to the burgeoning national debt, debt servicing already reaching 35.5% of the available annual government revenues. The PM’s enthusiasm may be genuine and not wholly misplaced but financial managers normally tend to be conservative rather than dynamic, cautious rather than creative, they have been caught unawares and thus unready to cope with the demands for more and more funds. The Nawaz Sharif regime thus suffers from the public perception of haste and waste at the very core of its leadership. What was the use of taking back the VIP aircraft from PIA? Whenever it was required PIA could have made it available. This perception is most unfortunate as besides becoming the focus of public censuring, it calls into question the efficacy of perfectly sound plans for the betterment of the communications system in Pakistan. The Islamabad-Lahore Motorway is an excellent scheme but scandal arose in the manner of the hasty award to Daewoo without international tender. Recently the single tenderer for the Sheikhupura-DG Khan motorway tried a fait accompli in trying to persuade the PM into accepting its bid. Thankfully enthusiasm failed to get the better of good sense as it did in the case of Daewoo. Wise and mature leaders do not let themselves be carried away by the shenanigans of the unscrupulous.
One extremely worrying aspect is the process of privatisation. Other countries embarked on such a course have a schedule spread over several years, our game plan is much too fast, more haphazard and much less transparent. On detailed evaluation one finds the criticism about the sales of the two financial institutions MCB and ABL is unjustified, it is clear that the ownership went to the right bidders. However, in the case of many of the other industries denationalised/disinvested this is not true. Speculators have entered the fray with full intention of stripping the assets instead of entrepreneurs interested in running the units. Some of these units were profitable but they have been picked clean and have become virtual shells uneconomically, populated by excess manpower. The appointment Lt Gen (Retd) Saeed Qadir as Chairman of the Privatisation Commission was like putting a wolf to guard the sheep. One of Nawaz Sharif’s first acts on return to power was to re-appoint Saeed Qadir to that post, giving a strong impression that business was to go on as usual, reinforcing a public perception of condoning corruption and nepotism.
One of the countries with a comparable economy as Pakistan’s in the 80s and a GDP growth rate of 5.5% annually, Turkey’s aberration is an inflation rate of 65%. While this anomaly is extremely worrying for Turkish economic managers, invisible earnings through Tourism, Transit Trade, etc more than make up the deficiencies. Salaries of all employees are adjusted for inflation twice a year. Our Budget deficits have been large and seem to grow larger. While inflation is presently under control, this may soon be running wild without having the invisible foreign exchange inflow that Turkey has. Putting money into vast public sector projects may be a good scheme to kickstart the economy but discretion has to be exercised or we will end up printing notes and carrying money for bread in wheelbarrows.
The worst thing that could have happened to the economy is the prolonged period of indecision because of the political stand-off, except for routine business transactions everything has virtually come to a standstill. The Government of the main economic powerhouse of Pakistan, the Province of Punjab, has stopped functioning. We may not feel the difference immediately, down the road the present state of limbo is going to be devastating for the economy. Political polarisation has permeated deeply into business circles, a majority of whom are clearly Nawaz Sharif supporters. One notices a deepening sense of apprehension among the mercantile community and a flight of capital is quite possible if the crisis deepens further. While capital is replaceable, the problem is that skilled entrepreneurs and executives are becoming insecure and have started looking for business and jobs abroad. Human capital is virtually irreplaceable, the resultant vacuum in commerce and industry would be a disaster for the country.
Nawaz Sharif is an even bet to win General Elections in Pakistan in the foreseeable future, he has struck a raw chord that reaches deep into the heart of the masses of Pakistan. His problem is that of timing the Elections to perfection. The involvement of Ghulam Ishaq Khan in the process of elections would mean the rigging of a result against him or even if he views, the appointment of some other person as PM in an effort to influence and/or buy support from the elected MNAs. As such he certainly wants the elections post-December 1993 when President Ghulam Ishaq Khan cannot interfere with the process anymore. On the other hand, the Opposition rightly fears that if the elections were conducted under the aegis of a Nawaz Sharif government, they would be on the receiving end of electoral rigging. They may not fully trust the President but working on Chanakhya’s theory, “an enemy of an enemy is a friend,” they are more comfortable with Ghulam Ishaq Khan. One also comes across with the perception that Ms Bhutto has not been completely wrong when she has sounded skeptical about the sincerity of the Mian Brothers about genuine dialogue. Nawaz Sharif had the initiative and though his rhetoric seems sincere, it does not seem to match his actions. Large crowds have an amazing effect of going to one’s head arousing visions about political immortality. A sincere Nawaz Sharif would not have filibustered the whole of June very much like Aziz Munshi was doing in the Supreme Court.
On the other hand, the President has clearly shown that he is less than neutral and not above politicking, this is in total violation of the principle of the Office that he holds. An elected Prime Minister has been reduced to having his writ only in the Islamabad Capital Territory and the Federal agencies, some of it may certainly be the PM’s fault but the present situation has arisen mainly because of the President’s machinations. The Provincial Governments are in complete revolt of Federal authority, egged on by the President. This is disastrous for the concept of the Federal structure. There is confusion and stalemate, civil war has been avoided but just. While the Army’s neutral role is commendable, by now they surely should have felt the national structure crumbling beneath their feet. Who says the Army has to declare Martial Law? The whole issue revolves around free and fair elections, to be conducted by neutral authority. The Army has to take the initiative and evolve a formula acceptable to both the political groupings while remaining within their Constitutional parameters. No further Presidential intercessions subverting the foundation of the country can be tolerated, for the sake of this country his capacity for destruction needs to be circumscribed so that he cannot do any more harm to the Federal structure. The President should live out the remaining period of his incumbency quietly but if he still persists, he should be replaced by a non-politician Acting President agreed to in consultation (duly moderated by the Army) between the PM and the Leader of the Opposition. The Chief Justice would have been the best choice but Ms Benazir is an aggrieved party in this matter because of her late father. The Prime Minister must appoint a Chief Election Commissioner on the same pattern. The Army has to have a major role in the supervising and conducting of elections in consultation with the CEC. To ensure that the Opposition is convinced about fairplay in elections, Governors should be appointed on the same pattern as for the Acting President and the CEC, with Governor’s rule in the Provinces till elections are held, possibly in November 1993 or as late as January 1994. Respectable citizens who are inducted to act as Advisors to the Governors for running day to day affairs should give a bond forsaking political activity for a period. Once a formula is agreed to the date of General Elections can be selected, there is such severe polarisation in the country that a cooling off period is necessary. The Army may feel that they are being holier than thou by keeping strictly within the Constitutional parameters, they may soon find that they may be left upholding a Constitution but no country.
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