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FOR this whole affair to become the sort of crisis that brings down governments, it has to spread beyond the capital. Residents of Islamabad may be aghast that their lovely little world has been invaded by a scraggly mob, but the rest of the country chugs — albeit anxiously. After all, history teaches us that the misfortunes of planet Islamabad have a way of trickling down into our lives.
A string of newspaper articles is spreading the idea that an economic crisis has descended upon the country, but in fact no such thing has happened, thus far. I emphasise, thus far, because it could be the next act.
Consider the facts. A leading business daily says, in its editorial of all places, that “[i]ndustrial activity has almost come to a halt, transport and communication sector has been badly hit and there are signs of flight of capital from the country”.
At best, this is a gross exaggeration. Where are factories shut because of the political situation in Islamabad? Faisalabad businesses are reporting a dip in exports of about 8pc for the month of August, an appreciable decline. But no shutdowns are being reported anywhere.
To suggest that the whole economy has ground to a halt is an exaggeration.
Transport was “badly hit” in the days when containers were being intercepted, but much of that has eased away now. How exactly have communications been affected, I have no idea. And where do we see these “signs of flight of capital”?
Reserves have not dipped in any significant way, large ads for housing investments in Dubai are not appearing on a daily basis in our papers, carriers of exchange companies are not being caught at the airports attempting to smuggle large quantities of undeclared foreign exchange out of the country. All of these are “signs of flight of capital”.
Of course, this doesn’t mean all is well. Product launches have been disrupted due to the noise generated by the crisis. Many board meetings were scheduled in the month of August to approve six-month results of large listed companies, and foreign members of the board couldn’t come and had to be video-linked into the meetings from Dubai instead. Transporters are still angry about the interception of containers in Punjab in the early days of the march, and are reporting some stray interceptions even now.
Small savers in the stock market are jittery, but don’t know what to do given that the market falls today but rises tomorrow. The rupee has seen some declines, leading to speculation in the money markets that the IMF has been given some sort of commitment that the ‘overvalued’ rupee will be corrected soon. Some flight into the dollar is taking place, in anticipation of further devaluations, and the greenback is tight in the market. Large investment decisions have been put on hold.
All these are a fact, and at the top levels of the economy, the damage is severe, particularly to confidence. But to suggest that the whole economy has ground to a halt is an exaggeration.
Here’s another example. A wire service report carried by a number of local papers has a quote from an auto dealer in Islamabad saying he’s lost 90pc of his business, and goes on to say that people are not buying cars, clothes or going to the cinema.
Really? I checked with every automaker and none are seeing a significant dip in sales during August. Of course auto sales have been going down since January, but thus far nothing extraordinary in August, other than a natural dip consistent with the declines all year coupled perhaps with a dip due to disruption of marketing plans. And if people aren’t buying clothes or going to the cinema, that too might be an Islamabad-specific perception, because malls and bazaars and cinemas here in Karachi are packed.
And that’s actually the problem. The conductors of this whole affair have laid siege to the government with a small mob clashing in the streets of the capital, but this hasn’t been enough to topple the government. And why should it? Battling a government in the streets is never a small proposition. The lawyers had to fight hard in the streets of Karachi, Lahore and Islamabad for months — braving tear gas and water cannon and baton charges — before getting what they wanted, and their demand was far humbler than bringing down the prime minister.
Fact is, if you want to oust the government by fighting in the streets you should know it takes months and months to build any kind of pressure through this route, something the two parties leading this show have not been able to mount. So the game now is to wind up or wind down.
Winding up means the rallies have to land in Karachi, and there is only one party that can shut down Karachi — the MQM. If an escalation is afoot, the scriptwriters will need the MQM to join the fray. Lahore is a different ballgame altogether. Ask yourself this: when was the last time a party managed to shut down Lahore? It’s hard to remember, isn’t it?
The fact that Islamabad is under siege whereas the rest of the country is moving along, albeit with all the anxiety and uncertainty that the moment is throwing up, is the problem here for those seeking the downfall of the Nawaz Sharif government. Unless the Supreme Court throws a curve ball, or a twist is introduced in the plot via a spectacular new disclosure or some other development coming in from the far left field, the path of the protesters is now a long one, stretching the length of the country. It would be folly of unspeakable proportions to actually seek to walk this path.
The writer is a member of staff.
Twitter: @khurramhusain
Published in Dawn, September 4th, 2014
