Ever increasing terrorism activities, check. A hapless security apparatus, check. Economic meltdown, check. Luckless population at the mercy of wolves, check. Major stakeholders blaming each other, check. Into the abyss, check!
“Battle not with monsters, lest ye become a monster, and if you gaze into the abyss, the abyss gazes also into you”. Nietzsche’s quote seems very apt description of the state of affairs in the land of the pure today! We have become monsters because we haven’t fought the battles we were meant to, we have taken too long to gaze into the abyss and now this abyss has engulfed us! An uptick in violence has coincided perfectly with a downtick in the economy.
Firstly, the security situation. In December 2007, the Pakistani military completed the clean out of Swat in Operation Rah-e-Haq. This was swiftly followed by Rah-e-Haq II and Rah-e Haq III. In 2014, after dilly-dallying by the government of the time, Operation Zarb-e-Azb started and then caught steam in the aftermath of the deplorable attack on the Army Public School (APS), Peshawar. This was truly a watershed moment for Pakistan! The subsequent fury was channeled into the National Action OPINION 9 Plan (NAP), military courts and swift action against non-state actors. By 2016, the War on Terror (WoT) had largely achieved its objectives and relative calm had returned. But the last piece of the puzzle – winning the peace – eluded everyone!
The Centre For Strategic & International Studies (CSIS) recommends seven key actions to win the peace as part of a post-conflict reconstruction effort. One, consistent security of people, property, and process. Two, suitable and inclusive levels of governance. Three, participation of local population as stakeholders in the system. Four, upward economic mobility of people life. Five, mental and social wellbeing of the inhabitants of the area. Six, proportionate and visible dispensation of justice. Seven, reconciliation of previous actions and individuals.
Re-emergence of the terror threat and worsening economic situation act as the perfect cocktail for years of strife, upheaval, and uncertainty.
On almost all accounts, the rulers of the day failed miserably! On top of that, since 2016 the powers that be started to look inwards thinking that if they could win the WoT then they could also improve the national narrative, state institutions, pillars of democracy and the financial welfare of the system! All this time the defeated miscreants, the bane of our existence, regrouped and rearmed ready to strike again. And that day is upon us now! And again, we will have to start from square one. Cue the promises and reaffirmations of “fixing the enemy for good”. The bugles of war are already sounding! Secondly, the downward spiral of the economy. Things are equally despondent here! It is true that the commodity super cycle in a post-Covid world asymmetrically infected countries such as Pakistan that relied heavily on imports. But it is equally true that the policy of our finance wizards of the past and present enabled us to plummet to the hellfire depths of economic negligence. The finest beacon of such a policy was the “Dar Peg” – the simple notion of fixing the US dollar at a specific interbank rate.
And there within lies the rub – owing to decades of mismanagement of the past, the space for policy manoeuvres is few and far between
After Ishaq Dar was officially welcomed back as the country’s finance minister, it was with the hope that he would do something that he hasn’t done in his past stints in the ministry of finance – evolve his thinking! I will let Albert Einstein take this one, “the definition of insanity is doing the same thing over and over and expecting different results”. True to his nature, Dar tried to shout down the US dollar into submission. With fiery rhetoric and angry eyes, he proclaimed that he neither cares about the IMF nor about the US dollar – the two things he needed most to navigate these choppy waters! When the situation worsened and the promise of bringing the dollar rate below Rs. 200 eroded as quickly as it was conceived, what did Dar do? He stuck to his guns and kept the peg firmly in place! Intended and unintended consequences manifested quickly – the widening gulf between interbank rate and the market rate, hyperactive black-market economy, steep increase in imports and incessant inflation. Since then, and on the insistence of the IMF no less, the money markets have been allowed a free hand to settle the exchange rate between the US dollar and the Pakistani rupee thus ushering in a new wave of price increases! For what it’s worth, the creative literati have had a field day with “Dar Memes”. The fault is in our Dars, disas-Dar, Dar-o-tonic, return of the Dark-ages – take your pick! They are a dime a dozen. Would anyone else at the helm of the finance ministry done something different? Perhaps not.
They would still have to deal with the IMF, they would still have to rationalise spending, they would still have to burden the masses and they would still need to increase prices. They may not have stuck with the pegging policy which exacerbated the problem many folds, if not more. And there within lies the rub – owing to decades of mismanagement of the past, the space for policy manoeuvres is far less than before. So much so that even angels fear to tread these grounds!
True to his nature, Dar tried to shout down the US dollar into submission
In conclusion, the re-emergence of the terror threat and the worsening economic situation act as the perfect cocktail for years of strife, upheaval, and uncertainty. There is seemingly no light at the end of the tunnel this time around but to sit back and welcome the abyss!
