Pakistan | Shehbaz to be sworn in as PM today; faces tough task to rebuild tattered economy

Pledging to revive Pakistan's debt-trapped economy and eradicate terrorism, newly-elected Prime Minister Shehbaz Sharif on Sunday (March 3) said his government would not allow the country to become part of some "great game" and would maintain cordial relations with neighbours based on the principles of equality.

In his victory speech in the National Assembly soon after he was elected as the 24th prime minister and for a second time since 2022, the 72-year-old profusely thanked his elder brother and three-time former premier Nawaz Sharif and allies for putting their trust in him and allowing him to head a coalition government after last month's election resulted in a hung Parliament.

While Shehbaz secured 201 votes, his challenger Omar Ayub Khan of jailed former prime minister Imran Khan's Pakistan Tehreek-e-Insaf (PTI) got only 92 votes in the election held at the newly-elected National Assembly.

Shehbaz's victory was expected as he enjoyed the support of seven other parties apart from the PML-N. He also had the tacit backing of the powerful Pakistan Army. Shehbaz said that as no party secured a clear parliamentary majority, it was "the democratic way" that "like-minded parties may form a coalition government".

Coalition keeps PTI out of power

Following the February 8 marred by allegations of vote rigging, the Pakistan Muslim League Nawaz (PML-N) headed by Nawaz Sharif, reached a coalition deal with the Pakistan People’s Party (PPP) led by former foreign minister Bilawal Zardari-Bhutto.

This post-poll deal effectively ensured that jailed former prime minister Imran Khan's PTI party would not return to power though independent candidates backed by it won the maximum number of seats in Parliament.

Amidst vociferous sloganeering by the members of Imran Khan's party members against alleged "mandate thieves," Shehbaz warned that Pakistan was facing an alarming debt crisis where even the expenditures of the National Assembly were being paid by borrowing money.

Goal to become G20 member by 2030

He said that his government would work hard and set a goal to become a member of G20 countries by 2030. The G20 or Group of 20 is an intergovernmental forum of the world's major developed and developing economies.

He pledged to build and improve ties with all leading nations, including its neighbours.

"We will keep ties with neighbours on the basis of equality,” Shehbaz said.

He, however, raked up the Kashmir issue and equated it with Palestine. “Let’s all come together […] and the National Assembly should pass a resolution for the freedom of Kashmiris and Palestinians,” he added.

Shehbaz criticises PTI

Without taking any names, Shehbaz took a jibe at the PTI for hounding the opposition when it was in power, going against the country’s national interests while resorting to levelling serious allegations against the armed forces.

Shehbaz said that his elder brother has never even thought of harming the country, unlike his opponents.

“This is the difference between this leadership and that leadership. The entire assembly is witness to the fact that we never thought of the politics of revenge.

“Never was once a pot broken, nor was any building ever damaged, but it is shameful that the country saw a day when GHQ, corps commander houses, airfields were attacked on May 9,” Shehbaz said, referring to the unprecedented attacks following Khan's arrest in an alleged corruption case last year.

He said that perpetrators of the May 9 riots will not be forgiven, vowing action against all those who were involved in the riots.

Vows to end terrorism in Pakistan

Shehbaz also promised to end terrorism in the country and address its root causes. He said his government aims to take the National Action Plan (NAP) forward.

In his address, Shehbaz said Pakistan had a big challenge and opportunity before it.

“If we come together and decide to change the fate of Pakistan, then God willing, we will defeat these challenges and take Pakistan to its rightful position,” he said.

He said that this job was difficult but not impossible.

Alarming debt crisis, fragile economy

Shehbaz said that Pakistan is facing an alarming debt crisis where even the expenditures of the National Assembly were being paid by borrowing money.

“But if we decide to do a deep surgery and bring changes in the system, basic reform, and I have no doubt that Muhammad Nawaz Sharif, Asif Ali Zardari, and others will agree that we can either get rid of a life of debt or we move forward with heads down in shame.

“No, this will not happen, we will rise, and we will make Pakistan self-sufficient,” he said.

He said the country was facing challenges primarily due to the fragile economy. He said that he was starting his tenure when the country was facing a budgetary deficit of more than one trillion rupees.

“How we will pay the salaries for armed forces and how to pay the civil servants,” he wondered and added that reforming the economy was the biggest challenge faced by the country.

Shehbaz highlighted the burden of debt paying and said that the country was required to pay billions of rupees in interest only.

He highlighted that the energy sector was crumbling due to the accumulating debt owed by the country to the power-producing companies. He also said that state-owned entities like Pakistan International Airlines (PIA) were running into losses worth billions of rupees.

Promises to put Pakistan on development path

He promised to put the country on the path of development.

“Though it is easier said than done, we will fulfil our task,” he said.

Terming the agriculture sector as the economy's backbone, Shehbaz said that his government would provide subsidies to the farmers. He also promised to bring investment into the country and create economic conditions that would spur economic growth.

Tougher task in second term as PM

During his first term as Pakistan’s prime minister from 2022, Shehbaz had to manage a difficult coalition and face public anger against unpopular measures he had to take in order to avoid a default. However, he will be battling a more difficult situation now, according to an analysis by Bloomberg.

He has to renew a loan for the country with the International Monetary Fund (IMF) by next month to save the economy, and this will entail taking several measures that may lead to public unrest. He again has to govern while being the head of a coalition government of eight parties. And he also has to keep the powerful military happy, the same military that once exiled him from the country.

When he took over from Imran Khan as prime minister in 2022, he had to reverse Khan’s decision to subsidise fuel prices, forced by the fastest-rising inflation in Asia at the time. Shehbaz had to make the difficult decision to increase fuel prices in order to obtain the crucial IMF bailout. It took him six weeks to convince his coalition partners and finally secure the $3 billion loan from the IMF.

Shehbaz’s task during his second term as PM is not going to be easy as his two main allies have said they will support the government only on a case-by-case basis. The PPP has even refused to join the cabinet.

‘Shehbaz Speed’

Shehbaz has ample administrative experience having served as the chief minister of Punjab, the country’s most populous province, for more than a decade. He had built a reputation as hard-working and demanding, though he was sometimes abrasive.

Bureaucrats gave him the name “Shehbaz Speed” for the pace at which he completed infrastructure projects, insisting on site visits at midnight, and working with hand-picked teams of officials to ensure adherence to deadlines.

However, he lacked skills in public speaking and relationship-building, and has never enjoyed the level of public support that his elder brother Nawaz Sharif had. He is expected to continue to rely on Nawaz for advice on policy matters, something he did during his first term, making trips to London to seek counsel from his brother who was based there.

He has also been accused of corruption in the past, and he was even imprisoned and deported to Saudi Arabia after the military coup in Pakistan in 1999, where he spent seven years in exile. He has been careful in dealing with the military during his first term, and has even openly praised the army chief Gen Asim Munir.

Best-suited for the task at hand

The Sharif brothers hail from a business family in Lahore, and they entered politics after the steel industry was nationalized by PM Zulfikar Ali Bhutto in the 1970s. This business background manifests itself in his dealings with business groups, and helps him in his ability to understand economic issues and making crucial financial decisions.

Pakistan’s new prime minister will need all the skills he has acquired to steer his country through very choppy waters. Pakistan’s debt is classified as borderline sustainable, interest rates are at record-high levels, and growth is slow. Inflation has fallen, but it is still above 20 per cent. Shehbaz will have to obtain a fresh loan of at least $6 billion from the IMF, which would mean raising taxes and making other unpalatable decisions. Analysts feel that the younger Sharif brother is best-suited for the task at hand.

Shehbaz was first sworn in as Pakistan’s prime minister in April 2022, after Imran Khan was dramatically ousted from power in a parliamentary no-confidence vote.

President Arif Alvi will administer the oath to Shehbaz in a ceremony at the President's House at 3 pm on Monday (March 4).

(With agency inputs)