KARACHI, Nov 6: The market wants an elected prime minister who has a good working relationship with the President and it needs continuity in reforms and consistency in policies, say market operators.
When Muttahida Mujlis-i- Amal (MMA) sprang a surprise electoral victory and again when Maulana Fazlur Rehman appeared as a potential candidate for prime ministership, the stock market plummeted. The volatility of the market is explained not so much by religious colour of the MMA as the fear that the MMA government/opposition groups and the presidency may take a collision course.
In response to a question, Arif Habib, a former president of the Karachi Stock Exchange, said the market wanted a good working relationship between the elected government and the President. He also said the market wanted continuity of reforms and policies.
Any sign of confrontation and political deadlock that would bring instability and political breakdowns upsets the market.
In the field of economic reforms, MMA’s attitude needs to be spelt out more clearly. The fiscal and exchange reforms were initiated in early 1990s and the banking reforms started in 1997. Both PPP and PML (N) supported the reforms but the speed and sequence of implementation varied from government to government.
The current negotiations between PPP and MMA, according to available indications, are not confined to mere sharing of power but also include contentious issues that could spark confrontation and political instability. Any compromise between the two major political groups could take the country on the path of national reconciliation. The end result could be softening of MMA’s national self-assertion with the needs for harmonious relationship with the United States.
MMA has shown flexibility. It has agreed with ARD to put up a joint candidate, instead of insisting on Maulana Fazlur Rehman.
That the first session of National Assembly will not be summoned on November 8, and has been postponed, opens up a scenario in which national reconciliation between major groups seems to be more probable than hitherto. If PPPP delivers what is expected of it through a compromise with MMA, it would reap the huge gains from it.
MMA in opposition would not only pose problems for the government but would build for itself a political image that may help it win a majority in the next elections.
What has happened in Turkey could perhaps be repeated in Pakistan specially because of US policies on war against terrorism. The Bush doctrine of unilateral approach and pre- emptive action is a sure recipe for collapse of super power politics. It also tends to fuel and strengthen Muslim nationalism around the globe.
What the market needs is that the economic development should be sustained by political stability. The reforms need a consensus and parliamentary politics needs reconciliation. It is time for the emerging democracy to synchronise with the emerging market. The market has its dynamics and its own impact on democracy and pluralism. It is the might of capital that sets the pace of constitutional process.
And it is feudalism that nurtures individual and naked dictatorship. The agriculture, dominated by zamindari system, contributes a quarter of the GDP. Quite a bit of the feudalism has, however, been eroded by commercialization in the countryside.
Similarly, the state ownership of commanding heights of the economy that tends to concentrate power at the federal level, has substantially been discarded in favour of privatization. De-regulation has weakened levers of patronage and crony capital and is creating an even playing field for all economic agents. In politics, also the stage is set for a more equitable sharing of power, which all major political players would sooner or later realize. This is evident from the failure of the the King’s party to form a government on its own without cooperation with a major political group, either MMA or PPP. Hence the demand for postponement of the National Assembly session. And if MMA and PPP reach an agreement, the numbers in the parliament may persuade the two to strike some understanding, cooperation and even coalition partnership with PML (Q). This is the route and mandate for political stability.