Nawaz’s way of doing business

The PM’s personal touch leaves a little something to be desired

First year of a new government is always an important benchmark. And since the N League has been here before, a good couple of times, its ought to be all the more instructive. There were some novelties about this win, though. It was the first time one civilian government succeeded another. The Musharraf clique liked to think otherwise, marking the Q league’s handing over power to the PPP as the first completely democratic transition, but the rest of the polity, and indeed much of the country, seems to think otherwise.

Then this was also the first time his boys faced a tough fight at home in Punjab. PTI’s Naya Pakistan clicked well with the people, especially the youth, and it seemed giving N a real run for his money. And the military had been on the back foot for some time now, like seldom before. Musharraf’s long years, a deepening insurgency, and increasing civilian ingress into security related decision making by the PPP government, especially after the Abbottabad incident, made Kayani keep his distance from politics. The way the courts had started hounding Musharraf, not letting him contest (with a lot more to follow), was an important indicator of the limits the army had set for itself, and N understood this well.

But the win has not been without its share of controversies either. One year into the new government, he’s not been able to shake off accusations of rigging completely. Some of his actions on some of the state’s most important matters, too, have alienated much of the public, making long time analysts question his political maturity.

“I don’t think there is much change in his style of governance”, said Dr Mehdi Hasan, prominent writer and analyst. “Just like before, instead of taking decisions on merit, he seems to want things to automatically come to his expectations, which wastes time and achieves little”.

His style of governance is still reckless, and centres on confrontation and isolation, rather than consensus.

The talks with the Taliban are a good example. There was much public uproar when he took APC unanimity as license to let his core right wing constituency take the lead on the insurgency, allowing the religious lobby far more prominence, and legitimacy, than it enjoyed before. And just like Dr Hasan said, it complicated the talks, and also upset the military.

He also seemingly went out of his way to rub the military the wrong way. In the matter of the talks, the army was furious when the government freed select Taliban captives without even consulting with the brass. Gen Raheel is reportedly just as unhappy over the Musharraf affair. The army believes its dignified silence till the indictment should have been repaid by agreeing to the ECL demand, and allowing Musharraf safe exit. N not only refused, but let his most belligerent ministers publically rubbish Musharraf, which widened the cleavage with the forces.

His style of governance is still reckless, and centres on confrontation and isolation, rather than consensus. “There is not much that is dynamic about his leadership”, added Dr Hasan. “This is just a replay of the ’97 scenario, when he ruled because of his majority in Punjab, and upset most other players”.

Foreign front

N’s foreign policy has not found many admirers either – soft on India even as the far right of the Modi variety establishes itself in complete strength in New Delhi, and confused about Afghanistan as Abdullah Abdullah seems likely to bring the old Northern Alliance’s dislike for Pakistan to power in Kabul, even if publically he hopes for common ground.

And his attempt to punch above his weight in the Arab world became the subject of much ridicule, especially in the Arab press. It’s been clear for some time now that with the Saudis and Americans somewhat estranged, Riyadh has turned to Islamabad for its security. That much is fine, but talk of selling weapons that could be funneled to Syria, and calling for regime change in Damascus, invited serious backlash from home and away, especially Iran.

Then Sartaj Aziz attempted to save face, and implied Pakistan would help Saudi and Iran overcome their differences, still not realising that the proxy war between the two has taken close to half a million lives in the last half decade, and Pakistan, openly taking an anti-Iran position, was way out of its league in thinking of itself as a peace broker.

Then there was the damage-control trip to Tehran; promising reviving the IP pipeline, cooperation on border security, etc – all issues he had been cold about till very recently. Analysts like Dr Hasan believe balancing Iran and Saudi will be a tricky proposition, not the least because of his personal closeness to Riyadh. But ignoring Iran will be dangerous, especially because of the long border and possible blowback in Balochistan, which is what will happen if any Pakistani weapons are found among Saudi sponsored al Qaeda hordes fighting Bashar Assad’s secular regime in Damascus.

N has also missed other prominent features in international politics. Iran, along with China and Russia, is part of a new emerging power bloc that has displayed the ability to rein in the imperialistic belligerence of US and its NATO allies. A closer alliance with these countries, two of which share long borders with us, would have enhanced Pakistan’s position, especially considering its crucial geopolitical location. But such winds of change completely passed the ruling party by as it concentrated more on inter institutional fighting.

‘N has also missed other prominent features in international politics. Iran, along with China and Russia, is part of a new emerging power bloc that has displayed the ability to rein in the imperialistic belligerence of US and its NATO allies.

“But these failures are not new”, said Dr Hasan. “We have never been too smart about choosing our friends. Considering our geography, there is no question that Iran and China should be very strong allies. But Islamabad has never given these issues much though, or we would have chosen superpower friends more carefully”.

And the economy?

One of Nawaz’s promises on the campaign trail was strengthening the economy. Years of dictatorship followed by years of mismanagement, he said, had sent the economy on a sharp downward spiral. His team would turn it around, revive growth, rejuvenate the private sector, restructure PSEs, etc.

But few except the finance minister believe the economy has done much to write home about over the last year. Inflation his high, especially food inflation, energy shortage has no end in sight, and foreign investment is about as far away as during the PPP days.

In such times, the private sector must become the preferable engine of growth. But that would require smart policies that stimulate such growth, raise employment, and enable the economic multiplier.

“The private sector is very unhappy”, said Dr Salman Shah, former finance minister and one of the key architects of the high growth of the Musharraf years. “The textile sector is particularly stressed. Bank financing is marginal, and they are having to pay back more than they are getting”.

Therefore, Dr Shah argues, there is no clear strategy to take advantage of the GSP plus provision, which had already been compromised because it coincided with the artificial gains engineered in the rupee. And since the other avenue of raising internal revenue, tax revenue, is also minimal, there is an urgent need to implement expenditure reforms.

“In the present picture, the government is just filling too many holes with debt, which is not a sustainable position”, added Dr Shah.

“There is an urgent need to contain the energy problem and stimulate private competitiveness, otherwise liabilities will increase and growth will not exceed three to four per cent. For six per cent plus growth, we need investment, both local and foreign, for which a host of reforms need to be implemented”.

One year is rightly considered too little to gauge a new government’s direction, especially in the economic realm (because of time lags between implementation of policies and results), but it does give a fair idea about the way it postures itself for the long haul. And Nawaz’s priorities, both in politics and economics, have already become cause for worry.