- Test of political, diplomatic and military leadership
The prime minister has formulated short and long-term goals for stabilising the country’s maimed economy and rectifying its endemic imbalances. The former include seeking forex assistance of three unnamed friendly countries and /or resorting to familiar IMF, both for boosting critically low foreign exchange reserves, while the latter involve combating corruption, identifying and reclaiming illegal assets stashed abroad, and restructuring cash guzzling public sector enterprises. But the source of urgently required vast funding apparently remains an issue within the PTI leadership. While some, including the finance minister, prefer the IMF recourse, not just for its cheap emergency loaning, but for its collateral benefits like augmenting the country’s economic credibility and ratings and making borrowing easier from other multilateral lenders, another school of thought regards the usual, strict IMF conditions as contrary to the party’s manifesto and promises made to the people. Indeed, in talks last week, a visiting IMF delegation called for even higher power and gas tariffs and free- floating Pak rupee, both steps certain to hit ordinary citizens hard in the short run, and provide political ammunition to the opposition, which would then exploit their ‘anti-people’ aspect.
Substantial economic relief of any sort is also closely interlinked with the country’s relations with the US, and it is at this point that the Financial Action Task Force (FATF) and the inconclusive Afghan war enter into the equation. The sole superpower’s global economic clout and power of the almighty dollar can be denied only at one’s peril, especially in the chastening era of Donald Trump, Mike Pompeo and John Bolton. Pakistan’s fiscal mess makes it particularly vulnerable to oblique arm-twisting, such as that afforded by FATF and the ‘do more’ refrain on Afghanistan. While a watchful FATF team is conducting a 12-days ‘on-site inspection’ on terror financing and money laundering, US Central Command chief General Joseph Votel came up with the sideswipe that Pakistan halt communication and cross-border movement between Taliban leaders allegedly based in the country, and their fighters in Afghanistan, and use its influence to force the latter to the negotiating table. Pakistan’s political and military leadership must see the big picture and make calculated, realistic and pragmatic decisions accordingly.
