Former prime minister Nawaz Sharif is on his way back into office, promising ‘very bold’ economic reforms following a landslide general election victory. Sharif’s victory in the 3 February vote boosted share prices at the Karachi Stock Exchange and was welcomed by Pakistan’s key neighbours and friends.
The margin of victory by Sharif’s Pakistan Muslim League (PML) was so big it left other parties with a tiny minority of seats in the National Assembly. With 192 results declared for the 217-seat assembly on 5 February, the PML had 134 seats, ousted prime minister Benazir Bhutto’s Pakistan People’s Party (PPP) had 18, the Mohajir National Movement (MQM) had 12, the Awami National Party (ANP) nine, and the Pakistan People’s Party-Shaheed Bhutto (PPP-SB) had one.
The remaining seats went to smaller parties and independents. Former cricket captain Imran Khan’s Tehrik-i-Insaaf (Justice Movement) failed to win any seats.
Benazir Bhutto said on 4 February she rejected the outcome of the elections because of ‘massive rigging’, but added
that PPP leaders would meet the following day to decide on whether successful candidates should take their seats. Foreign election observers say there were some voting irregularities, but say they detected nothing that would have changed the outcome.
The US congratulated Sharif on 4 February and said it hoped to work ‘co- operatively’ with him if he formed a government. India’s Foreign Affairs Ministry said it was hopeful of better ties under a new government.
Sharif’s absolute majority will give him leverage in dealing with several controversial moves by President Leghari, who had dismissed Bhutto’s government in November for alleged corruption and other misdeeds, and set-up a caretaker government. Most controversial was the creation of a Council for Defence & National Security (CDNS), which gives military leaders a formal advisory role in government for the first time. Sharif was cautious
when pressed on whether he would scrap the council, saying that a decision would by taken by the National Assembly.
Sharif said Benazir Bhutto had ‘totally destroyed our economy, so we’ll have to bring in very bold reforms.’ He suggested he would abide by tough economic decisions made by the caretaker government, including conditions for a loan from the IMF. These include reducing the budget deficit to 4 per cent of gross domestic product (GDP) in the 1996/97 financial year from 6.3 per cent the previous year.
Sharif said the reforms he plans include rationalisation of the tax system, drastic spending cuts to help manage the country’s heavy debt burden and creating an investor-friendly environment. ‘We will provide more and more incentives in the shape of tax holidays and tax reforms to investors,’ he said. He also said he wanted to make the rupee fully convertible.
Sharif said he would reveal more details of his ‘fresh agenda’ in three or four days.