According to New York-based credit rating agency Moody’s, Nawaz Sharif’s ouster as a prime minister by the judiciary in the Panama corruption case could not only lower the rating of the economic growth, but also adversely affect the ongoing projects and policies in the country. The agency fears that political uncertainty and strife could lead to disruption in the economic and fiscal agenda, macroeconomic stability and the access to external finance of the government, affecting the credit profile of the country. It warns that political events could affect sovereign credit profile with a large impact on policy making process, economy and finance.The persistent political risks have affected the writ of the government and its capacity to control corruption. The politics of the country revolves around troika, executive, judiciary and military, and general strife within various organs of the government. The case against former Prime Minister Nawaz Sharif started in 2015 and the recent Supreme Court ruling brought it to its logical end.The National Accountability Bureau has been directed to initiate investigations into the financial affairs of Mr Sharif and his children for accumulating and stashing illegal wealth in foreign lands. The business concerns and lifestyle of the former prime minister and his family does not match with renounced sources of their income.
However, the ouster of the prime minister shows the country has continued its tradition of political inconsistency. Despite gaining absolute majority in the National Assembly, the Pakistan Muslim League-Nawaz failed to maintain democratic traditions at minimal level. As a result, Mr Nawaz could not make history to become the first civilian prime minister to complete his five-year tenure in the office. The ouster of Mr Sharif has opened the flood gates of political instability, affecting the country’s ability to resolve the pressing issues. The country is facing economic challenges, low foreign direct investment and heavy burden of loans to its credit.
The general election are due by August next year, but investigations against Sharif and his family on the charges of corruption could slow down the process of policymaking and economic reforms. The issues of domestic security, political instability and lack of vision in the political leadership also pose serious challenges to maintain financial stability. The fears expressed by the rating agency should be taken seriously by the PML-N leadership at all levels. After all, it is still the PML-N government and it has to continue its policies if it wants to participate in the next general elections.
