Khan’s debt enquiry: Justified or a new gimmick?
As part of his anti-corruption drive, Prime Minister Imran Khan has set up a commission to probe into what he describes as the “misuse of borrowed money” by previous governments in the past ten years. He has accused his political predecessors of piling up the foreign debt and causing arguably the worst financial crisis in the country’s history.
In his address to the nation earlier this month, Khan vowed to go after the “thieves who left the country badly in debt.” He announced that after the initial focus of the government on stabilizing the economy, his attention would be targeted toward bringing to task those who had caused the country to fall into such dire straits.
The commission, which includes members of Military Intelligence and Inter-Services Intelligence (ISI) besides representatives of other government branches, is set up to probe just how previous governments managed to raise the national debt to Rs 24,000 billion in one decade and where that money was spent.
A notification issued by the cabinet division said the commission would have to submit interim progress reports every month and a final report within six months. The time period “may, however, be extended with the prior approval of the prime minister,” it stated.
This is the first time that such an investigation into the country’s debts is being conducted. Predictably, the opposition has rejected the move, declaring it another gimmick by the prime minister to divert public attention from a worsening economic crisis.
The timing has been intriguing. The announcement of the government’s debt probe came as the parliament was debating the national budget presented by the government.
Arguably, it is the toughest budget in Pakistan’s history with the government slamming fresh taxes to increase revenue. It was passed amid constant protest from opposition parties that seem to have united to a large extent against what they describe as the political victimization of their leaders. Some critics are describing the enquiry into the alleged misuse of debt as a move to divert the public’s attention from the fallout of new taxation.
What Imran Khan refuses to understand is that the debt burden has more to do with flawed economic and fiscal policies pursued by successive governments, and is not necessarily linked to corruption.
Zahid Hussain
One does fail to understand the rationale behind the prime minster threatening the opposition mere hours after the announcement of a heavy-handed budget at a moment where he was expected to mobilize public opinion in favor of the budget’s reform program.
Indeed, the massive debt piled up over the past years has contributed to the country’s worst financial crisis and has forced the government to seek an IMF bailout. Support from friendly countries has helped ease a burgeoning current account deficit and stabilize the fiscal situation. But any government claim of having put the economy back on track is premature; it will be a long while before the financial crisis is over.
What Khan refuses to understand is that the debt burden has more to do with flawed economic and fiscal policies pursued by successive governments, and is not necessarily linked to corruption.
Furthermore, it is economists and financial experts, not military and civilian intelligence agencies, who should be examining the issue of Pakistan’s massive debt, because the purpose should be to find the solution to the problem and not to use it to fuel a political witch-hunt.
True, it is a daunting challenge for the PTI government to clear the financial mess it has inherited, and it needs to take tough and unpopular reform measures. But Khan’s confrontationist approach makes the task for the government that much harder.
For these tough but necessary budgetary actions, the government should have lowered political temperatures instead of raising them. Indeed, the economy may be showing a few signs of recovery, but continuing political instability could affect its revival.
More dangerous, however, is the Khan government’s growing dependence on intelligence and security agencies and involving them in areas beyond their mandate and expertise. One such example is the inclusion of the army chief in the newly formed “Economic Development Council.”
Such a move will only weaken the civilian authority and formally expand the role of the military. These concerns may be exaggerated, but perceptions are important.
Economic and political stability are interlinked. Strengthening the civilian democratic process is a prerequisite to economic recovery and it is in the interest of the government to lower tensions inside and outside parliament, not have a combative approach which will do it more harm than good.
– Zahid Hussain is an award-winning journalist and author. He is a former scholar at Woodrow Wilson International Centre for Scholar, USA, and a visiting fellow at Wolfson College, University of Cambridge, and at the Stimson Center in Washington DC. He is author of Frontline Pakistan: The struggle with militant Islam (Columbia university press) and The Scorpion’s tail: The relentless rise of Islamic militants in Pakistan (Simon and Schuster, NY). Frontline Pakistan was the book of the year (2007) by the WSJ.
Twitter: @hidhussain
