Crisis in Pakistan -Terror to Asia?
Terrorists and access to nuclear weapons, spell horror together. We might be staring into the face of a dark abyss right now as we speak. When a country with nuclear warheads and a sizable population is on the verge of destruction,it is a feeding ground for terror.
Pakistan’s financial crisis is deepening with no overnight fix.
The Pakistani rupee is at an all time low at Rs.275 for a dollar and inflations have hit double digits. The country suffered a paralysing blow with a flood that affected one out of three citizens in the country, crippling the country further.
In 2022, Pakistan was carrying a total of $128 billion in external debts and liabilities and was due to pay up $21 billion by March of this year.
More than the damage caused by the calamity, what is pulling the country into the quicksand, is its immeasurable debt. According to the defence minister of the country, Pakistan has already started defaulting on its liabilities. If the situation had been a one off situation, it could have been shaved off by taking aid from Pak-friendly countries like China, Saudi Arabia. Pakistan however wouldn't gain with such a measure.
The country lacks a stable financial system and a logically laid economic system.
It is autocratically controlled by its military, which results in ridiculously biassed budget allocation, where a 17 percent is allocated to the military without paying heed to development of the country or the citizens.
In 2022-23 the total percentage of military spending is an inconceivable 47 percent , that's nearly half of the total budget , allocated autocratically .
There is no concept of “long term” investment or real foreign investment in the country. The government gives massive subsidies and takes foreign loans to cater to the popular vote. When the new government took charge , the country was already overburdened with debt. But to retain popularity they did not remove subsidies and instead started loading up more debt on an already crumbling structure. Instead of preventing an economic meltdown and attempting to secure the future of the nation, they picked short term gains in terms of public popularity.
What comes in the name of a foreign investment is a reward for using Pakistan’s territory for one’s own geopolitical interests. If one takes China for instance, one would be inclined to opine that the country’s debt trap policy has acted as a major catalyst to expedite Pakistan’s rapid downfall.
Atif Milan, a Pakistani born economist, said that the country is outsourcing its growth with huge debt. Pakistan has entrusted China with their infrastructural development, with huge loans under CPEC (China Pakistan Economic Corridor). Now the Chinese are sending their own workers and companies to manage the project, which includes a total of 26 constructions.
Result? There is no employment growth for Pakistani citizens or Pakistani companies.
The money that is lent by China is being sent back to China, while Pakistan is under the load of their high interest loans. Since Pakistan is not seeing any development within the country, its capability to pay back the debt or dream of being debt free is slowly becoming a mirage.
If one delves deeper into the core of the issue, the absolute lack of democracy excessive dominance of the military and complete lack of political stability , has built destruction over the decades. No government in the history of the country has completed its full term.
In the recent past, the ousting of Imran Khan is a mere reiteration of the complete lack of a political culture and unstable decision making. With shaky governments and zero economic logic to back critical decisions , Pakistan has become a textbook example of how important an economic-political structure is, in a country’s future. An utter disregard for the future of its citizens , rearing extremism and state sponsored terrorism has culminated in the complete black out of the nation.
The country today is in a war with itself. Decades of faulty policy making, shortsightedness in waging wars and obsession with India rather than its own long term growth, has gauged a hole that is too big to fill.
Will Pakistan even have a functioning government ?
The threat however is just beginning. Pakistan is a nuclear-powered country. Failure will mean nuclear warheads falling in the hands of terrorists. India, China and Pakistan are nuclear powered countries. Situations between China and India are tense. Situations between India and Pakistan are waiting for a trigger. When a country with nuclear weapons succumbs to overpowering debt and is on the brink of destruction, it becomes a fertile ground for breeding terror. And this puts not just India but South-East Asia at risk.
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