The meteoric rise of Imran Khan to the slot of Prime Minister (PM) — which he desperately craved for decades —has given rise to a wave of euphoria, mainly amongst the petit bourgeois. With the thinly concealed backing of the top brass, the political engineers have crafted a relatively weak government and a split opposition. This will suit an even newer version of their structured political setup. The frenzied petit bourgeois, Khan’s main bastion of support, has gone berserk, going to the extreme of portraying him as a demigod who will solve every problem confronting Pakistan today. Even some of the relatively sane writers and intellectuals have succumbed to this delusion. In the Corporate media’s manic campaign, Imran was eulogised to the skies.

As the Pakistan Tehreek-e-Insaf (PTI) consolidates power, its economic gurus seem vexed about the acutely fragile economic situation. Pakistan is on the verge of a balance-of-payments crisis which threatens the stability of its already tumbling currency and its ability to repay debts or pay for imports. Pakistan’s debt and liabilities have sharply risen to nearly Rs30 trillion, which amounts to 87 percent of the total size of the economy. This is all a consequence of expansionary fiscal policies, mean to raise the growth rates of a country with a debilitated economic base through deficit financing for the massive construction of mega projects such as CPEC.

Our budget deficit has grown from four to 10 percent of GDP.Imports have skyrocketed, mainly due to rising oil prices and CPEC equipment. As a result, the country’s foreign currency reserves have declined to about $10.3 billion.This covers merely two months of imports. The rupee has been devalued four times since December, fuelling inflation.

Pakistan has found itself knocking on the IMF’s door with increasing frequency since the late 1980s. In 2013, Islamabad got a $6.6-billion loan to tackle a similar crisis.Today, the country needs at least $12 billion according to PTI’s economic Czar, Asad Omer. If approved, it would be Pakistan’s largest-ever bailout.But it has not yet completed repayments on its previous loan, which could limit its current leeway with the IMF.

Omar revealed his quixotic economic plan to the Financial Times, “We will have weeks, not months… all options are on the table…all state-owned companies would be transferred into a special wealth fund. The country would have to consider a massive privatisation drive as it seeks to obtain the necessary funds to pull the nation out of the economic crisis.

The creation of this fund may help persuade the IMF to agree to a favourable deal for the country …the creation of this special wealth fund would be the first step towards privatisation when about 200 companies would be effectively removed from government control and placed in this wealth fund, which shall be led by people from the private sector, and managed by the government ‘from an arm’s length’.”

But the terms of any new IMF bailout will be much harsher than in 2013, mainly due to the country’s taut relationship with US imperialism, one of the Fund’s biggest donors.

Paradoxically,Khan has promised to create an “Islamic welfare state” based on pre-medieval Medina. In modern times however,such a plan would require unprecedented public spending. However it will be stillborn as the economy tanks, as is being predicted by serious capitalist experts. There are unconfirmed reports of a recent $2 billion loan from China and another $4.5 billion from Saudi Arabia. In any case, Saudi funds would only be used to buy oil. Chinese loans will go to service these CPEC debts.

With the catastrophic condition of Pakistani capitalism, such promises are naught but vile trickery. The wild euphoria of Imran’s rule will end with a terrible hangover

Imran Khan’s notion that his anti-graft campaign will attract foreign investors is both deceptive and laughable. The world capitalist economy is still in the process of recovering from the crash of 2008. Globally, as evere dearth of new investments persists. Pakistan’s situation is even more precarious because of the corruption in its capitalist system. The World Bank (WB)has ranked Pakistan 147th out of 190 countries last year for its business climate.

Khan also assumes that his government can dramatically boost tax revenues. Butif Pakistan’s corrupt bourgeois pay their full taxes and comply with labour regulations they cannot sustain their profits, and the politico-social clout in state and politics. This very class dominates the top echelons of the PTI. Any serious attempt to squeeze them would trigger an intense political crisis.After all, Imran Khan believes in capitalism and he has inducted these billionaires from the formal and black economy sectors that have financed his party all along.

The IMF’s vicious conditions will include massive privatisation, more labour reforms, expansion of the tax base, increase in the interest rates and further devaluation of the rupee.

These stark measures will further worsen the socioeconomic plight of the ordinary masses. Privatisation of these state enterprises will lead to more redundancies and sharply increase prices of their products. ‘Labour reforms’ will mean an end to permanent employment with pensions and other benefits, shoving the workers into a 19th century contract labour regime with atrocious conditions for the toilers. Whatever new taxes are imposed on private businesses these will be passed-on more cruelly onto the ordinary consumers.The increase in interest rates and further devaluation of the rupee will shoot up inflation and increase prices of oil and other basic necessities.

“People would be in the streets. It would be the end of Imran Khan,” predicts Hafeez Pasha, a former finance minister and renowned economist. Under capitalism’s present crisis and its aggressive nature, the social welfare state is a utopia.

Even in the advanced capitalist countries,the crisis of this system is forcing the ruling classes to dismantle the social welfare state.With the catastrophic condition of Pakistani capitalism, such promises are naught but vile trickery. The wild euphoria of Imran’s rule will end with a terrible hangover. The toiling classes have no option, butto enter the arena of history launching an irreconcilable class struggle to overthrow this inhumane system.

The writer is the editor of Asian Marxist Review and International Secretary of Pakistan Trade Union Defence Campaign. He can be reached at ptudc@hotmail.com

Published in Daily Times, August 20th 2018.