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  • Jul 24, 2014
  • Updated: 11:23pm
CommentInsight & Opinion

Pakistan's Nawaz Sharif will inherit a country torn by terror and turmoil

Syed Fazl-e-Haider says law and order is the biggest challenge facing Pakistan's next PM

PUBLISHED : Wednesday, 15 May, 2013, 12:00am
UPDATED : Wednesday, 15 May, 2013, 3:06am

Nawaz Sharif is set to become Pakistan's prime minister for the third time after 14 years. His Muslim League-Nawaz party emerged as victor in the historic polls, which marked the first democratic transition from one civilian government to another in the country's troubled political history.

Being in government will not, however, be a bed of roses for Sharif at a time when the country faces enormous security, energy and economic challenges. The people hope the new government will address their grievances and salvage them from the monsters of extremism and terrorism. The business community expects a resolution to the growing energy crisis and improvements to law and order, to bring back foreign investment.

The worsening law and order situation will be the biggest challenge for Sharif. Pakistan is in a state of war against Islamist extremists challenging the state's writ in the areas bordering Afghanistan by forcefully imposing their theocratic agenda on the people.

How will Sharif, who has been in favour of holding talks with the Taliban and against US drone attacks in the tribal areas, tackle the growing extremism? A dialogue with Taliban militants or a full war against extremists would raise the political stakes. How can he convince the US to stop drone attacks without harming relations with Washington?

The second challenge is to get the fragile economy onto a high-growth track. Presently, Pakistan faces a balance of payments crisis as its foreign exchange reserves are in decline due to repayments of foreign loans. The country's current account deficit continues to widen, while foreign investment is declining. There are fears that Pakistan could default in the next few months.

Short term, the government will have to move to avert the balance of payments crisis. Then it will have to restore confidence of wary foreign investors and international lenders.

Sharif's third challenge is to tackle the chronic energy shortages stifling industry. Last year, prolonged outages triggered violent protests across Pakistan. The crisis has increased the cost of doing business and forced many textile manufacturers to move their bases to Bangladesh.

Above all, the country needs a mega energy-sector project. Earlier this year, the former government signed a deal with Iran on a gas pipeline project, which would generate around 5,000 megawatts of electricity, equivalent to the present peak shortages in the country. But the pipeline faces stiff opposition from the US, which has threatened to impose sanctions on Islamabad if it builds it with Iran. Will the Sharif government expedite work on the pipeline, considered an "energy lifeline" for the country's economy?

Syed Fazl-e-Haider is a development analyst in Pakistan

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