The return of Nawaz Sharif, a three-time Prime Minister of Pakistan and the leader of the PMLN, may have rekindled the spirit within his party ranks. However, the critical question remains: has it inspired public and business confidence in the system and reignited hope of economic revival?

The actual popularity of Nawaz Sharif as a political leader, when compared to his rivals, is a subject of debate. However, the decent welcome event in Lahore undeniably demonstrated that his party, the PML-N, possesses the necessary resources and goodwill within circles that matter in power games in Pakistan. This raises the question of how much influence an individual, even a key leader, wields in the context of a country’s political landscape.

A study has observed that the impact of an individual leader is inversely related to the strength of the democratic order. In a stable and well-established democratic system with strong institutions, the identity of the leader at the helm tends to have limited significance.

However, in countries governed by autocratic regimes or in the midst of a transition towards democracy, the quality, integrity, capacity and vision of leaders become crucial determinants of the nation’s future and the path it chooses to follow.

In a stable democracy, the identity of the person at the helm tends to have limited significance compared to autocratic regimes

Some analysts posit that, regardless of the leaders, the restoration of public confidence in a system perceived to be fractured and self-serving is an absolute necessity. The current order seems to cater to interests other than those of the people it’s meant to serve.

These analysts point out that the public isn’t just experiencing distress; they are simmering with anger towards power brokers and the elite, who are perceived as colluding to strip them of their fundamental rights to basic amenities and essential choices. These experts have identified a multitude of economic, social and political factors that have collectively led to the erosion of public confidence.

Musadiq Zulqarnain, Chairman and CEO of Interloop Ltd, firmly believes that the restoration of public confidence hinges on economic recovery. In his view, the economic well-being of the nation can only be rejuvenated through a treatment regimen founded on a thorough and scientific diagnosis of its ailments.

“Individual leaders do matter, but in our case, the situation has become very complex. Pakistan needs a broad-based consensus between major political parties and other de facto power centres to undertake drastic structural reforms. This broad-based approach is seen as the imperative path to address the intricate issues facing the country.

“Our economy needs surgery. Treating the symptoms with analgesics or using steroids won’t work. If any leader, including Nawaz Sharif, can develop that consensus, the economy will start recovering. That’s the only way forward,” he emphasised.

Envisioning the PML-N playing a pivotal role in the post-election scenario, another business executive anticipates a return to a more tangible (brick-and-mortar) approach to development. “The big-ticket infrastructure projects are signature ventures of Sharif-led governments, such as motorways, bridges and metro bus systems, as emblematic endeavours”.

The party takes pride in these projects, often without considering their direct impact on the national treasury or the potential opportunity cost. This perspective is particularly pertinent in a country where poverty is on the rise, and the accessibility to basic necessities such as food, clean drinking water, sanitation, gas, electricity, security as well as social services including health, education and housing remains limited.

“During its four-year tenure, the Imran Khan led PTI government saw a notable increase in accumulation of debt, despite a shift towards social development from physical infrastructure. The government projected ‘Ahsaas’ as a cornerstone programme.

A cursory glance at Pakistan’s external debt profile, as analysed by the World Bank, reveals a consistent upward trajectory over the past decade under PML-N and PTI rules.

“While the PPP has shown prowess in the political arena, having played a pivotal role in crafting the 1973 Constitution, managing the 18th Amendment and securing NFC awards, its governance quality has left much to be desired,” he asserted. However, it would be unfair not to recognise the lead it took in effectively managing the challenges of Covid-19 containment and providing support to those affected by floods in Sindh.

Dismissing the leadership debate, some prominent economists argue that achieving growth and development necessitates nothing short of a comprehensive medium-term consensus economic plan.

Dr Nadeem ul Haq, a former federal minister and Vice-Chancellor of the Pakistan Institute of Development Economics, criticised the lack of earnestness in discussing and discovering market-based solutions. He particularly took issue with the bureaucratic inclination to stifle productive forces and artificially prolong the existence of entities that have outlived their relevance.

He underscored that effective leadership can only prove itself over time by spearheading innovative and constructive ideas aimed at bringing about positive change.

Dr Hafiz Pasha, former federal finance minister who also chaired multiple advisory bodies was direct and precise. “There is little policy space unless external debt restructuring takes place under a three-year International Monetary Fund programme.”

Dr Ali Cheema, Professor of Economics at Lahore University of Management Sciences, Director, Center for Economics Research in Pakistan, who sits on boards of multiple research bodies, responded thus when reached for comments.

“The critical issue in Pakistan today is whether the ruling elites of the country can achieve a consensus on the rules of the game that define the political order and transitions of power in the country. This is a necessary condition for political stability and economic sustainability. In addition, development will require deep reforms of the economic structure in the country.”

Dr Nadeem Javaid, former Chief Economist of Pakistan, Professor of Economics at Karachi School of Business and Leadership, stated, “Mian Nawaz Sharif’s return to Pakistan holds significant potential, with implications for the nation’s economy and future. As a seasoned leader, he wields the ability to influence the country, bolstered by both domestic and international trust.

“However, the extent of his impact depends on factors such as the political landscape, judicial decisions, the establishment’s role and public sentiments. It’s important to appreciate the complexity of political developments, influenced by a multitude of variables”.

Published in Dawn, The Business and Finance Weekly, October 30th, 2023