When Imran Khan’s party won the Pakistani election in 2018, there was enthusiasm and hope that the Pakistani people had gotten their country back from the elites. Khan who had run on a populist agenda promised equal opportunity and vowed to reform the economic system that only benefited a few.
He criticized his predecessors who were in cahoots with the leading business families. He said that since other parties were too close to the investor class, his was the only one that could truly represent the people.
He roused fundamentalists by promising to stick to the Islamic principles that had led to the golden age of Islam. Pakistani youth that is more religious than the last generation also bought into it and overlooked the innumerable instances when he wrongly recited the Koranic verses. Since there are no policy debates in Pakistan, only rhetoric, he promised his way through the elections without offering policies.
There was, however, one aspect of his campaign and his political career that was commendable. He emphasized the need to preserve the environment. His state government had planted almost 1 billion trees in 4 years leading up to the 2018 elections.
He ended up winning the elections. By most accounts, these were the fairest elections in Pakistan’s history but then again, that’s a low bar.
The Pakistani economy was in a crisis when he took power. Debt payments were due and Pakistan was low on foreign reserves. But luckily for Imran Khan, Saudi Arabia was in a pickle. Keeping in line with the tradition of the House of Saud, the Saudi Crown Prince Muhammad bin Salman had ordered the murder of a dissident. The dissident was Jamal Khashoggi, a Washington Post journalist.
Turkey was already giving Saudis a hard time (because Erdogan wanted the US to extradite Fethullah Gulen). Saudis had to get Pakistan on their side so they lavished Khan with $13 billion in pledges. Imran Khan and his cabinet initially claimed that the multi-billion dollar package was ‘unconditional’ but only recently has it come out that Pakistan will have to pay anywhere between 8% to 14% interest on the amount received. Another gulf nation, the United Arab Emirates also pledged $3 billion in support.
But Saudi Arabia and UAE will receive more than just interest payments. After receiving pledges from Gulf nations, Imran Khan undermined his only worthy policy position. Rather than giving tax incentives to green businesses and penalizing the carbon footprints, he is offering 0% tax for oil exploration companies to explore new reserves in Pakistan. It means that oil exploration companies will not pay taxes on their profits but the Pakistani people who buy gas at the gas station will still have to pay hefty sales tax.
Even though a mass-transit system in Karachi just received a UN endorsement due to its’ use of biomass, the Federal government under Khan is unwilling to provide the state government with the buses as promised.
Khan is just like other elitist and out of touch politicians from the third world. He has embraced the Chicago School of Economics that puts monetary profit above all. Like the Chilean Military Junta in the 1970s that was so hellbent on being pro-business that it did not care if the income inequality got worse.
Khan is on the same road. Even though the per capita income in Chile went from $700 to $14,000 in 40 years, it has the fourth highest poverty rate and ranks worst on income inequality.
Khan’s administration has increased the subsidies it offers to big businesses that export to other countries while there are no incentives for the manufacturers to sell in the local markets. Due to this, locals have to buy imported goods. The cost of imported goods has also gone up as the central bank devalued rupee to help the exporter class.
Foreign buyers that buy goods made by biggest manufacturers in Pakistan are receiving indirect subsidies by the Khan government while Pakistanis have to pay the full and sometimes inflated prices for the same items locally. So much for being a populist!
A month into power, he nullified all subsidies on natural gas, which increased the cost to consumers by some 22%. This was around the same time when he proposed a ‘mini-budget’ that included subsidies to biggest landowners in Pakistan, some of whom financed his campaign and represent his party in the Senate today.
Just two days before he announced the end of subsidies, the Pakistan Stock Exchange declined, which is damning evidence of rampant insider trading. But neither Khan’s government nor the SECP launched an inquiry. Instead, Khan met an ethnic delegation that has a disproportionate amount of wealth and control most if not all of the brokerage houses in Pakistan. Media houses under control by the same group have helped Khan politically for the past 3 years.
Businesses in Pakistan already operate with minimum regulations. Imran Khan is clipping away the last ones. It has been almost six months since he took power. He has met with business representatives and spoken at investors’ conferences dozens of times promising to create a pro-business economy.
The only sectors over which he has exercised some oversight are the ones through which his political opponents made a fortune. Those sectors are corrupt and in dire need of reforms. But rather than target those sectors as a whole, his administration, and the Supreme Court have only targeted specific businesses linked to his political opponents. Chilean military Junta?
It is not like his tendencies were not apparent as soon as he took power. Since taking office, he has praised 4 political leaders only. One of them was the Malaysian leader, the other three are China’s Xi, Turkey’s Erdogan, and Saudi Arabia’s Muhammad bin Salman.
All three of them are ardently against dissent, criticism, and civil liberties. Erdogan has jailed thousands of critics and journalists for unforgivable crimes like ‘denigrating Turkishness’, while videos show his nephew Ali Erdogan ordering officers to abuse detainees that had criticized his uncle.
China’s Xi is running internment camps, kidnapping the Interpol chief, and spying on their civilians. Muhammad bin Salman directed the murder of a journalist inside a Saudi consulate, jailed women’s rights activists who are tortured and sexually assaulted almost every day and jailed political opponents.
When Khan praises these people, he is subtly implying that if he were to follow them, it would be justifiable. Politicians lie and mislead to justify what they intend to do. Xi, MBS, and Erdogan have eliminated all worthy political opponents to turn their nations into single-party oligarchies. Pakistan under Khan might be going down the same road.