Newspaper Article 08/01/2023
2022 would go down as a tumultuous year in Pakistan’s history. Persistent brinkmanship amongst political parties and a downward economic spiral has spilt over the country’s foreign relations. The year was also bad for the civil-military relationship. Meanwhile, the power of social media, rightly or wrongly, registered its potential to mould public opinion.
Imran Khan, whose political fortunes were plummeting fast due to a lack of statecraft, faced no confidence in the parliament and lost. He blamed his defeat on the “establishment”. Through numerous public meetings, he succeeded in playing the victim card, which, with the support of social media, not only washed away the blame of incompetence on his government but also made him the most popular leader in the country. However, the PDM government succeeded in delaying Imran Khan’s election demand in the hope that the people would get disillusioned with him over time. Therefore, the chicken game is still on to undermine opponents.
The above scenario hardly gives the Foreign Office mandarins the confidence to present Pakistan’s case to foreign investors. They are mindful that their interlocutors would first ask about the local equity, which in many cases is unavailable. Investors’ confidence becomes shaky when they see that the country’s leadership has invested billions of dollars in properties abroad, along with many more billions in businesses. Similarly, the sale of Pakistan’s assets abroad and the difficulty in getting loans even on higher commercial rates further erodes the investors’ confidence. There are reports that remittances have also gone down due to political bickering. A cumbersome judicial process is yet another discouraging factor for investors to come to Pakistan.
From the foreign policy perspective, a diplomat posted in Islamabad would make a detailed assessment of the overall situation in the country and his recommendations about future interaction with the host country. The preceding paragraphs give enough reasons to the foreign missions to advise caution to their governments and entrepreneurs about entering into a deal, except for selling their products, provided Pakistan has enough foreign exchange for supporting imports.
With the above preface, 2023 will be more challenging for Pakistan than the last year. The PDM-led coalition of 13 parties has failed to impact the country’s economy. However, on the foreign policy front, it succeeded in retrieving, to some extent, the damage caused by Imran Khan’s uncanny allegations against the US’ involvement in his defeat in the parliament; pulling the country out of the Financial Action Task Force’s (FATF) grey list; and making a solid pitch about the climate disaster that inundated one-third of the country, causing an estimated loss of $30 billion. The massive floods were the last thing Pakistan needed when the Ukrainian crisis had already jacked up oil and food prices at the global level. Pakistan also suffered due to price hikes, raising inflation levels and the cost of living to an alarming level. The IMF’s conditions further squeezed the country financially due to increased power tariffs, which proportionally increased the prices of other commodities.
Coming to external affairs, the neighbourhood remained tense on the eastern and western borders. The mush euphoria about the Taliban dawned a bitter reality upon the dream merchants that they were betting on the wrong horse. The resurgence of the Tehreek-e-Taliban Pakistan’s (TTP) activities against Pakistan’s security forces while using Afghan soil called into question the sincerity of the Afghan Taliban. The TTP launched over 170 attacks on security forces and civilians; it reminded of the 2009-like situation when the TTP’s activities against law enforcement agencies were at their peak. The resurgence of the TTP’s attacks has once again alarmed prospective investors, compelling western countries to issue travel advisories. Therefore, 2023 will likely consume most of Pakistan’s diplomatic skills in overcoming the challenges that Afghanistan poses to its security.
Although the Line of Control (LOC) had remained silent since February 2021, tensions with India continued. The latest spat between the foreign ministers of India and Pakistan at the UN Security Council reminded the observers about the deep-seated mistrust between the two neighbours. India has been single-mindedly pursuing the agenda of isolating Pakistan. It sabotaged the SAARC summit slated for Pakistan in 2016. To replace SAARC, India has tried to activate the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC), comprising Bangladesh, Bhutan, India, Myanmar, Nepal, Sri Lanka and Thailand. Indian actions in the Indian Illegally Occupied Jammu and Kashmir (IIOJK) have been a setback to maintaining even a modicum of normalcy at the diplomatic level. For the time being, one can expect a freeze in the bilateral relationship, with bouts of spats against each other at international forums.
China has been a trusted friend and a source of strength for Pakistan. The China-Pakistan Economic Corridor (CPEC) is the game changer for Pakistan, which would lay the foundations of modern knowledge-based industries. Indeed, India and the US are opposed to the project. Pakistan and China are still committed to completing the phase II of the project concerning Special Economic Zones (SEZ) in the coming five years. Both countries have been working together to create a regional economic platform which may boost intra-regional trade with Afghanistan, Iran and Central Asia. If found profitable, India is likely to join the project. The forecast for 2023 gives optimism to the economic content of the bilateral relationship despite capacity problems with Pakistan.
Pakistan’s relations with Iran have remained cordial, although trade between them is far below their potential. The main reason for the low trade is the American sanctions against Iran, discouraging our dollar-based banks from conducting transactions with Iranian banks. However, given Iran’s significance in Middle East politics, Pakistan cannot remain aloof from its extended neighbourhood. The stalemate over the nuclear deal known as the Joint Comprehensive Plan of Action (JCPOA) may force Iran to resume its activities. Israel’s possible attack on Iran cannot be ruled out should Iran achieve a certain level of threshold in nuclear technology. Iran’s former foreign minister, Kamal Kharrazi, told Al-Jazeera TV in July last year that “Iran is technically capable of making a nuclear bomb but has not decided whether to build one”. Whatever turn the Iranian nuclear programme takes, it will face opposition from Israel and the Gulf states, which will have implications for Pakistan.
Finally, the Ukrainian crisis has almost ushered the world into a renewed cold war, with the US and NATO nations leading the charge primarily against Russia. China is also taken as an adversary. Pakistan’s neutrality in the Ukrainian crisis will be like walking a tightrope in an increasingly tense environment, especially when Pakistan is hard-pressed economically. Therefore, the new year will be a big challenge for the leadership to face the headwinds.
Note: This article appeared in BOL, dated 08 January 2023.
Disclaimer: The views expressed in the article are of the author and do not necessarily represent Institute’s policy.