PPP and PML-N reach a consensus for government formation at the centre

Daily Briefs

Photo : Dawn

20-21 February 2024, Wednesday| Vol 5, No.31

PPP and PML-N reach a consensus for government formation at the centre

Supreme Court disposed of a plea asking for the general elections held on 8 February to be ruled invalid and null

PR Daily Brief | PR Team

In Brief
PAKISTAN ELECTIONS 2024
PR Exclusive Update #71
PPP and PML-N reach a consensus for government formation at the centre
On 21 February, Dawn reported that PPP and PML-N have reached a consensus after multiple rounds of talks for a power-sharing formula at the federal level. In a press conference, PPP chairman Bilawal Bhutto revealed that both parties have substantial numbers to form the federal government with PML-N president Shahbaz Sharif as the Prime ministerial candidate. He further stated that the PPP leader Asif Ali Zardari will be the joint candidate for the president’s office. Bilawal said: “We pray the upcoming coalition government manages to overcome external and internal problems faced by the country.” He added: “We are thankful to the PML-N for throwing its weight behind PPP candidate Asif Ali Zardari. Despite the discussions, an insider told Dawn that as per the deal, PPP would not be able to join the federal cabinet and the National Assembly (NA) speaker slot would be assigned to the PML-N. The source further revealed that the senate chairmanship would go to PPP and the slot of deputy chairman to PML-N. The governorships in Khyber Pakhtunkhwa and Punjab would go to PPP and both parties would form a government in Balochistan with Sarfaraz Bugti as the likely chief minister. (Syed Irfan Raza, “Consensus at midnight paves way for PDM 2.0,” Dawn, 21 February 2024

Supreme Court disposes of a plea requesting 8 February elections be declared invalid and null
On 21 February, the Supreme Court disposed of a plea asking for the general elections held on 8 February to be ruled invalid and null. The plea was disposed of as the petitioner Ali Khan failed to show up for two consecutive hearings. The petition had filed a petition on 13 February, requesting the court to pass an order to hold elections again within 30 days under “the direct supervision and oversight of the judiciary” in order “to ensure fairness, transparency and accountability.” According to the plea, a stay order was requested to prevent the formation of a new government until the lawsuit was resolved. In the petition, it was stated that the court should order “a thorough and impartial investigation” into the claimed election fraud, malfeasance, and pre-poll rigging and hold those accountable who have undermined the country’s democratic foundations. Referring to the petitioner’s absence, CJP Isa, observed that “It seems that Ali Khan had done a publicity stunt by filing a petition before the Supreme Court.” The plea was heard by a three-member bench, including Justice Muhammad Ali Mazhar and Justice Musarrat Hilali along with the CJP. The bench not only disposed of the plea but also mandated the petitioner to pay a fine of PKR 500,000.
(“SC disposes of plea seeking nullification of Feb 8 polls,” Dawn, 21 February 2024, “SC moved to declare elections void, order repolling,” Dawn, 13 February 20

LHC nominates two judges as election tribunals
On 21 February, Dawn reported that two judges have been nominated by the Lahore High Court (LHC) as election tribunals, owing to the Election Commission of Pakistan’s request, to decide the petitions regarding the polls held on 8 February. An official stated that the names of Justice Muhammad Sarfraz Dogar and Justice Sultan Tanvir Ahmad have been sent to the ECP for their nomination. The ECP had requested for the nomination of nine judges for the tribunal. However, Chief Justice Muhammad Ameer Bhatti rejected the request owing “to the huge backlog of cases and low strength of the judges.” According to Dawn, LHC currently has 39 judges against the commissioned strength of 60. The appointment of judges to the election tribunal will leave LHC with 37 Judges. Dawn further added since 2021 no appointment of judges have been made. (“Two Lahore High Court judges to act as election tribunals,” Dawn, 21 February 2024)

Senators call for action against CEC Sikandar Sultan Raja amid rigging allegations
On 20 February, senators from different political parties called for action against the Chief Election Commissioner (CEC) Sikandar Sultan Raja over a “stolen mandate.” The senators called for his arrest and trial for high treason under Article 6. The senators condemned alleged rigging in pre and post elections and sought investigations into the charges of manipulated results and audit of Forms 45 and 47. Speaking in the senate house, senior politician Tahir Bizenjo criticized ECP for its failure to act according to its responsibility of conducting “free and fair elections.” He said: “Mandate given by the people to their real representatives had been stolen to bring “drug lords” and “land grabbers” to the assemblies.” He further questioned the right of the judiciary to strip PTI’s electoral symbol ‘bat’. He added: “Can these rigged elections bring stability to the country?” Subsequently, Jamaat-i-Islami (JI) senator Mushtaq Ahmed in his speech demanded the trial of CEC on charges of “high treason” for “failing to meet his constitutional obligation.” Followed by Senator Ahmed, PTI senator Syed Ali Zafar said that “a revolution of hope” was brought by the country’s youth despite the pre-poll rigging. He further warned of spreading anarchy and unrest in the country if those to whom the “people had given a mandate were not given the right to rule.” (Iftikhar A. Khan, “Senators call for CEC’s arrest, trial for treason,” Dawn, 21 February 2024)

2024 elections saw a 70 per cent drop in complaints filed with the ECP despite allegations of rigging
On 20 February, The News International reported that in the 2024 elections, there were 87 complaints filed with the Election Commission of Pakistan (ECP), a 70 per cent drop from 2018, when there were 299 petitions filed. Allegations of rigging were 340 per cent higher in 2018. The article cited the geographical analysis by Najam Ali, as per which 22 of the 87 complaints were pertaining to the National Assembly (NA), ten from KP, seven from Punjab, three from Sindh and two from Balochistan. Ali thus questioned how the PTI could claim that 80 NA seats were “stolen” from them if only 12 petitions had been filed from Punjab, Sindh, and Balochistan. He also pointed out that 43 per cent of the petitions originated from KP, where the PTI has won with an overwhelming majority. Ali therefore additionally questioned why KP had a ‘disproportionate share’ of both NA and provincial assembly seats. Another argument that he raised was whether the 70 per cent drop in petitions from 2018 to 2024 marked a ‘genuine leap in electoral integrity,’ given the fact that social media amplified the perception of rigging during the electoral process. (Farrukh Saleem, “Rigging petitions drop 340pc,” The News International, 20 February 2024)

PTI’s proof of post-election rigging video debunked
On 19 February a viral video, touted by the PTI as being ‘proof’ of post-election rigging, was shared by Imran Khan only to be debunked later. The video showed two journalists inspecting ballot papers for NA-15, where Nawaz Sharif had contested, prompting questions on why papers were being printed so long after elections. Simultaneously, the two journalists and an editor raised questions over the authenticity of the video, alleging that they were led to the printing press and were forced to release the videos. Senior journalist Nasrullah Malik questioned whether the news was ‘planted,’ calling for a “detailed investigation into the matter” to prevent it from becoming a part of “any political party’s agenda.” Those who filmed the video said the press was owned by a PML-N member, though PML-N Punjab information secretary Azma Bokhari labelled the journalists as “PTI social media activists.” (Mansoor Malik, “‘Post-poll rigging’ videos or a damp squib?” Dawn, 20 February 2024)

IHC suspends the announcement of three returned candidates who were elected to NA from constituencies in Islamabad
On 19 February, the Islamabad High Court (IHC) suspended the announcement of three returned candidates who were elected to the National Assembly from the three federal capital constituencies. The notifications of NA-46, NA-47, and NA-48 were put on hold by a division bench made up of Justices Minagul Hassan Aurangzeb and Arbab Mohammad Tahir. According to the Election Commission of Pakistan (ECP), Anjum Aqeel Khan, Tariq Fazal Chaudhry, and Raja Khurram Nawaz Khan were all proclaimed returned candidates. With the backing of Pakistan Tehreek-i-Insaf (PTI), Amir Mughal, Muhammad Shoaib Shaheen, and Muhammad Ali Bukhari ran as independent candidates from these constituencies. They had contested the ECP’s notification, arguing that it was sent out against the ECP’s status quo order. Their petitions had previously been dismissed by a one-member bench, which instructed the ECP to determine their submissions. However, the three appealed the verdict made by the one-member bench within the court. The registrar of the IHC objected to the appeals, stating that the appellants were ineligible to submit an appeal against the ECP’s notification because a tribunal had been established to adjudicate disputes pertaining to elections. The ECP attorney argued that the commission had not yet released a notification in this respect. The court then dismissed the registrar’s objection. (Malik Asad and Munawer Azeem, “Court suspends ‘victories’ on all three capital seats,” Dawn, 20 February 2024)

PPP solidifies its position in Balochistan with maximum seats
On 19 February, the Pakistan People’s Party (PPP) gained three independent MPAs (Member of Provincial Assembly) to its ranks, solidifying its position as the only party with the most seats in the 51-member assembly of Balochistan. Asfandyar Kakar, Mir Liaquat Ali Lehri, and Maulana Noorullah were the three independent MPAs-elect who declared their intention to join the PPP. Noorullah won the Qila Saifullah election against the provincial chairman of the JUI-F Maulana Abdul Wasey. Former minister Asfandyar Kakar ran for office as an independent and won when the PPP refused to offer him the party ticket. Lehri was an MPA during the time Asfandyar Kakar was elected on the PPP ticket. According to PPP sources, one more independent MPA would join the PPP. The identity of the PPP’s nominee to fill the top position and form the new Balochistan administration has not yet been finalized. (Saleem Shahid, “PPP now largest party in Balochistan,” Dawn, 20 February 2024)

Former Chief Minister of Sindh, Syed Murad Ali Shah, likely to be PPP’s candidate for the new leader of the house
On 20 February, Dawn reported that the former Chief Minister of Sindh, Syed Murad Ali Shah’s name emerged as the frontrunner for the Pakistan Peoples Party’s (PPP) nomination for the new leader of the house. The PPP is poised to form the next government in Sindh for a record-breaking fourth time. Party insiders asserted that Shah’s selection as the province’s chief executive was now certain, despite the PPP having not yet made an official declaration. Initially, Murad Ali Shah’s name gained momentum for the spot, but the names of former local government minister Nasir Shah, former communication minister Sharjeel Memon, and Zardari’s sister, Faryal Talpur, were also in circulation. However, they added that the leader of the party, Bilawal Bhutto-Zardari in particular, was completely happy with his performance, especially during and after the province’s historic floods and COVID-19 pandemic. (Tahir Siddiqui, “Murad tipped as CM as PPP set to rule Sindh for fourth time in a row,” Dawn, 20 February 2024)

PTI joins the SIC to claim its share of reserved seats
On 19 February, in an effort to secure its share of reserved seats in the national, Punjab, and Khyber Pakhtunkhwa assemblies, the Pakistan Tehreek-e-Insaf (PTI) formally joined forces with the Sunni Ittehad Council (SIC). On the same day, the SIC informed the Election Commission of Pakistan (ECP) in a letter, that 50 PTI-backed independents had joined their party. The leader of the SIC Sahibzada Muhammad Hamid Raza, was elected as an independent from Faisalabad, and it is noteworthy that the party does not own a single member in parliament. As per a document from the ECP, Raza is the head of the SIC, which is enlisted with the ECP. The party, however, is not represented in the provinces or at the centre. Raza’s attorney, Jawadul Hasan Kazmi, who submitted the SIC’s paperwork to the ECP, informed Dawn that Raza had emerged victorious in the election from NA-104 (Faisalabad) running as an independent. Kazmi said: “After winning the election, Mr Raza has given a formal notice to ECP to consider him as a member of the SIC as the party is enlisted with the ECP.” He further stated “However, it is the right of the candidates to join any enlisted party within 72 hours after the victory notification, so Sahibzada Muhammad Hamid Raza will join the SIC and the PTI will also get the reserved seats.” PTI founding member Akbar S Babar responded to media reports regarding the PTI leadership’s alliance with SIC by stating that the alliance has no legal significance and will not affect how reserved seats are distributed in the parliament. Meanwhile, a delegation of PTI leaders met with the leadership of the Jamiat Ulema-i-Islam (JUI-Sheerani) in Islamabad to solicit their support for possible protests on the streets. (Ikram Junaidi, “PTI ‘merges’ with seatless party for three assemblies,” Dawn, 20 February 2024)

PTI petitions PHC in a bid to reclaim its reserved seats in assemblies
On 19 February, the PTI filed a petition for reserved seats in the national and provincial assemblies with the Peshawar High Court (PHC). According to the petition filed by advocate Mashal Yousafzai through advocate Qazi Muhammad Anwar, the ECP’s interpretation of a political party as stated in Rule 94(4) of the Election Rules 2017 should be declared unconstitutional and unlawful. The petition has been filed as the PTI has been deprived of reserved seats for women and minorities due to it being stripped of its election symbol. According to the plea, PTI has provided a list of names for seats designated for minorities and women in the assembly. It stated that PTI candidates ran for office as independents and that, despite numerous obstacles, they were able to secure the majority of seats in both the national and KP Assembly elections. According to the petition, should the party choose not to affiliate with any political party, it would forfeit its allotted seats. It made clear that the Supreme Court, not the ECP, had the authority to delist a party. The petition further asked the court to declare the Election Rules 2017 null and unlawful and order their party to be allocated women’s and minority-reserved seats in the same manner as other political parties, arguing that the ECP’s interpretation of Rule 94(4) was unconstitutional. (Umer Farooq and Mohammad Ashfaq, “PTI moves PHC to reclaim reserved seats in assemblies,” Dawn, 20 February 2024)

Legal obstacles on PTI’s path to reclaiming reserved seats
On 20 February, The News International in an article highlighted legal obstacles that the PTI would face in securing its independents’ share of reserved seats in the National Assembly by joining the Sunni Ittehad Council (SIC). Additionally, there is another argument that an ‘incomplete parliament’ would be formed if the PTI is not given its complete seats. The article cited journalist Majid Nizami, who said that despite the SIC not winning any NA seat, it is a registered party which anyone can join. As per Nizami, if the PTI were to get its reserved seats, its strength in the NA would increase; however, the partnership would not be ‘smooth sailing’ and there is a potential for a legal battle to ensue. On 19 February, PTI leader Salman Akram Raja said if “someone wants to create a legal obstacle” in PTI’s quest to get its reserved seats, “they can.” He then pointed out that “these seats can’t go to any other party in addition to whatever reserved seats they have acquired based on seats they have won.” Regardless, journalist Mehmal Sarfraz said the PTI “has no choice at the moment other than joining a smaller political party so that it doesn’t lose on its reserved seats quota.” Constitutional lawyer Usama Khawar also highlighted that aligning with the SIC would not “necessary mean that the PTI loses its identity as a political party outside the NA.” Instead, the alliance would “enhance” the party’s representation. (Zebunnisa Burki, “PTI’s quest for reserved seats may not be smooth sailing,” The News International, 20 February 2024)

POLITICS
Source to The News International details events of meeting that led to Imran Khan’s ouster
On 21 February, The News International reported on a meeting that took place on 26 March 2022 between the then opposition leaders. As per an “informed source,” PPP Chairman Bilawal Bhutto Zardari had told the former army chief Gen (R) Qamar Javed Bajwa that if the opposition leaders were pressurized by the military establishment to withdraw the no-confidence motion against Imran Khan, the former would ‘go public.’ This meeting had become a contentious issue last week, after JUI-F chief Maulana Fazlur Rehman alleged that Bajwa had directed the opposition leaders to move the motion. Although some leaders denied what Rehman said, the article pointed out that Bhutto Zardari had spoken to Bajwa on the motion, after Khan had sent the army chief and the DG ISI to persuade the opposition leaders to withdraw the motion. The article also claimed that Rehman and Bhutto Zardari had opposed Bajwa’s proposition in which the no-confidence motion would be withdrawn in exchange for midterm elections. The News cited a source, who stated that Bhutto Zardari told Bajwa that going forward with the motion against Khan and the PTI was the democratic right of the opposition and the constitutional method of removing a prime minister. This was when Bhutto Zardari warned Bajwa that if they were pressed by the military establishment to withdraw the motion, he would go public about it. (Ansar Abbasi, “Bilawal warned Bajwa of going public if pressed to revoke no-trust against Imran,” The News International, 21 February 2024)

X remains inaccessible for the fourth consecutive day
On 21 February, X was accessible for a few hours before its access was disrupted without an official announcement. This marks the fourth consecutive day of disruptions which began on 17 February. Earlier, ahead of the polls, authorities had claimed that an error led to social media sites being inaccessible, while on poll day, the internet faced a complete shutdown on the pretext of security and terrorism concerns. However, users have reported problems with using X even after the results were declared. The Islamabad High Court (IHC) had ruled in 2018 that internet shutdowns went against fundamental rights and the constitution. The freedom of information (Article 19-A), freedom of speech (Article 19), and freedom of association (Article 17) are all constitutionally guaranteed rights in Pakistan. Geo TV claimed that it was told to contact the minister information technology and chairman of the Pakistan Telecommunication Authority (PTA), after reaching out to the caretaker Information Minister, Murtaza Solangi, on the matter of disruptions. Digital rights activist Farieha Aziz pointed out that no official acknowledgement was given by the PTA or the caretaker government on the ban on X, and alleged that the “prime minister and the IT minister are using VPNs to post on X.” Aziz also highlighted PECA laws, as per which only the PTA has blocking powers but is not obliged to do so at the behest of the government. She called for an end to “snatching away of platforms where citizens’ voices are heard.” Additionally, the Director of Bolo Bhi, Usama Khilji, said that the fact there was “no notice, no announcement, no certainty around when the block will be lifted” had created “uncertainty” and made way for an “environment of disinformation.” (“X still inaccessible for more than 4 days in Pakistan,” The News International, 21 February 2024)

“The PTA has quietly become just another tool in the hands of our habitually oppressive state,” laments an editorial in Dawn
On 21 February, an editorial in Dawn titled “Silencing the public” highlighted the “stench of desperation” in Islamabad that hung heavy as officials have faced “a lot of trouble” in trying to keep the “public under their thumb.” He linked this to access on X being blocked in Pakistan, claiming that since the authorities were “afraid of the public setting the narrative agenda,” they decided to “pull the plug” on a site that provides a platform for self-expression. With no announcements from the Pakistan Telecommunication Authority (PTA) or the IT ministry trying to justify the disruption, the editorial pointed out the “hypocrisy” of some caretaker ministers, who have used “VPN services” to continue posting on X. The IT minister in particular seemed to be more interested in “self-promotion” as he praised the ‘take-off’ of Pakistan’s IT industry and announced two new schemes. With mobile phone services suspended throughout and following the Election Day, the PTA “wreaked immeasurable damage on Pakistan” as denying citizens their constitutional rights to communication worsened the political instability by “providing a convenient cover for the alleged irregularities that occurred later that night.” The editorial lamented that the authority still refused to learn, noting that the PTA had become a tool in the hands of the “habitually oppressive state” to be used against Pakistanis when they start “inconveniencing the powers that be.” (“Silencing the public,” Dawn, 21 February 2024)

Caretaker government elevates IB, giving it financial autonomy and operational independence
On 19 February, the caretaker government granted the Intelligence Bureau (IB) the status of a full-fledged division, effectively giving it financial autonomy. Caretaker Prime Minister Anwaarul Haq Kakar issued the notification, as per which the IB was elevated as a division, with the director general becoming the ex-officio secretary to the division. The division will work directly under the prime minister, ending the interference of other departments in IB’s operations. A source told Dawn, that because the IB used to work under the cabinet division, it faced multiple obstacles financially and administratively, as it could not spend anything without sanction from the finance division. Additionally, the secretary of the cabinet division was the IB’s principal accounting officer and would scrutinize all of the bureau’s expenditures. However, following Kakar’s decision, the IB can directly seek funds from the prime minister and independently make decisions regarding the transfer, posting and promotion of officials. (Syed Irfan Raza, “Intelligence Bureau’s status elevated, with full financial autonomy,” Dawn, 20 February 2024)

Senate rejects bill for public execution of sex offenders
On 19 February, Senator Mushtaq Ahmad Khan of the JI introduced a bill seeking public execution of sex offenders and rapists, which was rejected by the Senate. Khan highlighted a report as per which of the 1122 cases of rape recorded in KP in the last five years, 581 individuals were arrested, of which 494 were acquitted and 87 were convicted. Additionally, of the 341 individuals booked for raping women, only 23 received sentences. Khan further stated: “According to one report, in the first six months of 2023, 12 children were targeted for sexual assault every month.” He thus proposed four “public executions,” explaining the need for “strict punishments” to control crime. Some senators from different parties supported Khan, saying “what is happening in the world is not important; what Islam says is important.” They also argued that countries with public executions had low crime rates. However, those who opposed the bill contended that public executions would spread barbarism, and attention should instead be given to improving policing. PPP senator Sherry Rehman added that “public hanging does not suit a society of the 21^st century” and would not be able to stop crime. The bill failed, with 14 bvoting in favor and 24 against. (Waqas Ahmed, “Senate shoots down public hanging bill,” The Express Tribune, 20 February 2024)

ECONOMY
“Clarity on political direction” on formation of new government helps boost PSX
On 20 February, shares on the Pakistan Stock Exchange (PSX) gained more than 900 points, with analysts linking the bullish trend with the agreement reached between the PML-N and the PPP to share power in order to form the new government. Last week, political uncertainty owing to rigging allegations and doubts on forming the coalition government had led to a fall in the PSX. The head of research at Arif Habib Limited, Tahir Abbas, said that the 1.58 per cent increase in market on a day-on-day basis was due to “clarity on the political direction regarding the formation of a new government,” though investors remained vigilant for the new government’s economic strategy. Similarly, the director of research at Akseer Research, Awais Ashraf, noted that the new setup would “continue with the reforms and take a more cohesive approach for settling issues between the Centre and provinces required for fiscal discipline.” (Mahira Sarfraz, “Shares at PSX rally 900 points in early morning trade over ‘clarity’ on govt formation,” Dawn, 21 February 2024)

CPPA seeks highest ever increase in fuel cost adjustment
On 21 February, Dawn reported that the Central Power Purchasing Agency (CPPA) sought a PKR 7.13 per unit increase in fuel charges in electricity bills from January, with the intention of generating PKR 57 billion for power distribution companies (Discos). This would mark the highest fuel cost adjustment (FCA) that the CPPA has ever demanded, and will be on top of a 26 per cent increase in the annual base tariff and an 18 per cent hike in quarterly tariff adjustments. With consumers being forced to pay excessive bills in spite of comparatively lower consumption owing to the winter, questions have arisen on the power sector bureaucracy’s ability to forecast fuel costs for the short-term. The National Electric Power Regulatory Authority (Nepra) has agreed to a public hearing on the matter on 23 February. An increase in domestic coal and gas prices are the main causes for the higher proposed FCA for January 2024. The CPPA in a petition sought an additional FCA of PKR 7.1308 per unit in the March bill for January’s electricity consumption, claiming that the actual fuel cost was PKR 7.131 per unit more than the reference fuel cost for January. If Nepra approves the increase, the amount would be adjusted in the March bill of all consumer categories except lifeline power consumers and protected domestic consumers using up to 300 units, and agricultural consumers and electric vehicle charging stations. (Khaleeq Kiani, “Electricity bills to surge with record fuel cost adjustment,” Dawn, 21 February 2024)

“Politicking over a new deal and the reforms mandated by it is no longer an option for Pakistan,” says an editorial in Dawn
On 21 February, an editorial in Dawn titled “Fitch’s concern” highlighted how the uncertainty created by the scramble to form a “potentially weak coalition” in the center was giving Pakistan’s investors “jitters.” Doubts over the new government’s ability to negotiate a new and larger bailout with the IMF, and ability to “adhere to tougher policy commitments” were voiced by Moody’s in its post-election comments on Pakistan’s macroeconomic weaknesses. The uncertainty is prevailing despite a “strong political consensus” that another IMF deal is “critical for Pakistan’s long-term economic trajectory” and the country’s ability to secure financing flows from other creditors. The editorial cited the “disquiet” expressed by Fitch Ratings over the political conditions in the country, and its belief that “finalizing a new IMF deal is likely to be challenging” due to “near-term political uncertainty.” According to the American credit rating agency, even though the new government would prioritize securing new loan goals given the “worrying nature of the economic challenges and the limited options in Pakistan,” there is concern of prolonged discussions with the IMF due to “continued political volatility.” The editorial justified the fact that creditors and investors remain worried, given the fact that Pakistan’s politicians are “known for changing their stated position on crucial economic and other policy matters when in the opposition.” In the past, governments withdrew from financial deals as a result of “political backlash.” The editorial concluded by arguing that “politicking over a new deal and the reforms mandated by it is no longer an option for Pakistan.” Referring to Fitch, it stated that the failure to secure a deal could lead to an increase in both liquidity stress and the potential for a default. (“Fitch’s concern,” Dawn, 21 February 2024)

“It is a reform programme of the bureaucracy by the bureaucracy for the bureaucracy,” says opinion in The Express Tribune on the FBR restructuring
On 21 February, Haroon Khawaja argued in an opinion in The Express Tribune titled “Lost FBR hits a dead end” that fiscal deficit was the “mother of all problems” facing Pakistan’s economy, noting that if the country were to spend more than it earned, a need for borrowing would arise which would cause “fiscal deficit to bloat” and inflation to remain “stubbornly high.” The country’s “astronomical” potential to mobilize taxes is “under-explored” given the tax to GDP ratio of 8.5 per cent. Khawaja regarded the Federal Bureau of Revenue as the “single biggest obstacle” to Pakistan raising its earnings, as majority of the due taxes are either evaded or end up in “the pockets of FBR officials.” The agency’s proliferation of “harassment in the business community” further disincentivizes taxpayers to disclose their income while creating a “culture of harassment.” Khawaja also pointed out that reforms to change the “jumbled tax policy” and the FBR itself have been “without essence” as they have failed to address the issues of “rent-seeking and harassment.” The non-performance of the government has forced the IMF to “intervene to control the direction of the FBR.” As per the opinion, there is no need for a “humungous bureaucratic entity that has continued to fail in delivering” when the bulk of Pakistan’s tax revenue is paid by a few hundred corporates and more than 9 per cent is collected through withholding at source. For nearly a decade, Khawaja has been advocating for a “sleek, professional, efficient, competent and faceless tax authority that acts like a service provider to win the confidence of its customers (the taxpayers) while having the ability to use technology to identify evasion.” This entity should deal with existing taxpayers, “plugging the holes in identification and accountability of tax evaders,” and eliminating any communication between the taxman and the taxpayer. On the other hand, the FBR should be focused on bringing new taxpayers. Khawaja goes on to contend that the recent FBR restructuring failed to address the “core issue” of eliminating harassment and corruption as it only looked at creating another board under the finance minister for tax policy, and bifurcating the Customs from the IRS with separate oversight boards. While he agreed with the separation of the two, Khawaja stated that tax policy should be discussed by the public and media, debated in parliamentary committees, and then moved before the parliament for final arguments and enactment. He concluded by stating that the current restructure plan would “confuse the real reforms that ought to be made,” as it is a “reform programme of the bureaucracy by the bureaucracy for the bureaucracy.” (Haroon Khawaja, “Lost FBR hits a dead end,” The Express Tribune, 21 February 2024)

Pakistan records its highest net outflow of FDI in six years
On 20 January, Dawn reported that according to the State Bank of Pakistan’s latest data, the net outflow of Foreign Direct Investment (FDI) from Pakistan stood at USD 173 million in the month of January 2024. This is the highest outflow of FDI from Pakistan in the last six years and reflects the ongoing political uncertainty in the country. The SBP data revealed that the net outflow of FDI (USD 173.2 million) in January 2024 is in sharp contrast with the net inflow of FDI (USD 237 million) in January 2023. The data further revealed that that during July-Jan FY24, the FDI inflow stood at USD 689.5m in contrast to USD 876.8m in the corresponding period of last fiscal year. This translates into a decline of 21.4 per cent amounting to a loss of USD 187.3 million FDI. Even though Pakistan does not depend on FDI inflows to maintain its foreign exchange reserves, the current outflow “reflects the erosion of confidence of foreign investors,” according to a senior analyst. Experts and analysts are also certain that there would be no improvement in the situation until a “stable” government takes over in at the centre. (Shahid Iqbal, “Foreign direct investment outflow hits six-year peak on instability,” Dawn, 20 February 2024)

Pakistan on Twitter

We're dealing with a different generation that can't be easily fooled. They don't rely on mainstream media that's been crafting false narratives for decades. World leaders need to grasp this reality before it's too late. Pakistani youth have already demonstrated this, seizing control, and it won't stop there. With 2024 being an election year in many countries, including the USA, we're bound to witness significant changes worldwide.
-Atif Khan

Manufacturing a hung parliament by through extensive manipulation and electoral fraud, in order to impose a failed coalition against the will of the people of Pakistan will not change reality: the people's choice is Imran Khan!
-PTI

Documentary on Mandate Thieves of Pakistan! There is one day in five years where Awaam gets to have an input on the system. Rejecting their mandate is a recipe for disaster. It’s not PTI vs PDM anymore, it’s people vs establishment now!
-Salman Ahmad

“Pakistan’s most powerful institutions and individuals have a chance to course correct. The ECP need to be held to account, the wrongdoings of February 9 need to be fixed,and the efforts to suppress citizen expression need to stop.”
-Hamid

“Only in Pakistan an army chief imposes his ideas on how to form a democratic government in the country.”
-Irfan

“Chief Election Commissioner (CEC) Sikandar Sultan Raja MUST Resign as he has Failed to Hold Free, Fair and Transparent Elections in Pakistan and has to be Tried Under Article 6 of High Treason Against the People of Pakistan.”
-Sana

Daily Briefs

PPP and PML-N reach a consensus for government formation at the centre

Supreme Court disposed of a plea asking for the general elections held on 8 February to be ruled invalid and null

Other Daily Briefs