Certain expected things are now taking shape and it appears that the semblance of internal autonomy for Pakistan is fast coming to an end. The sovereignty of a country is dependent on economic independence and recent developments are indicative of total control of the economy of the “Allah given state” by its patrons the US and the UK through IMF. In many ways, it is reminiscent of the situation that Persia was facing during the last quarter of the 19th century.
Pakistan is a heavily indebted country. The total external debt and liabilities of Pakistan are $113.7 billion, and the total national debt is around $283 billion. The running of the state is dependent on donations and loans. International Monetary Fund (IMF) is the main agency giving financial assistance to Pakistan for many decades. In recent years, paying the interests on loan has become a major problem for successive governments in Pakistan.
On March 10, 2021, Pakistani newspapers reported that the State Bank of Pakistan is to be made autonomous in line with IMF terms. In this connection, the cabinet clears three crucial bills freeing state enterprises from ministries’ interference. This was to meet IMF conditions for a revival of its stalled program. The Finance Minister at a news conference after the meeting of the cabinet said the IMF board would soon meet to complete the review and its lending to Pakistan would resume immediately. The future autonomous state bank of Pakistan would be free to define, approve and determine general internal policies and rules of the bank regarding the execution of its functions and approve internal rules and formulate and oversee foreign exchange reserve management, strategic investment, and risk policy. The governing board of the bank will be also empowered to approve the central bank’s budget, annual reports, and financial statements and adopt and monitor SBP’s policies on internal and external audit, compliance, internal controls, and risk management. The governor, deputy governors, directors, members of any board committee and Monetary Policy Committee, officers, and employees of the Bank shall not be liable for any act of commission or omission did in their official capacity in good faith and they would also be exempted from the National Accountability Bureau and Federal Investigation Agency. Experts on financial affairs have observed that bills are to give total control of taxation and budgetary affairs of the fortress of Islam to the International Monetary Fund.
A similar phenomenon occurred during the last quarter of the 19th century in Persia (present Iran). It was the period when Czarist Russia and Imperial Britain were trying to extend their economic and strategic influence in Central Asia. A great game of espionage, political intrigue, and economic manipulation was being exercised by both colonial powers in the region.
Persia ruled by an unpopular Qajar dynasty, was the playground for Russia and Britain for strategic and financial reasons. The government was heavily indebted to Russians and the British. After failing to adopt a neutral policy towards the superpowers, Qajar ruler Nasir al-din Shah came under the total influence of the British Empire. In 1872, he signed an agreement with a British banker and businessman, Baron Julius de Reuter. This became known as the Reuter Concession. The concession gave him control over Persian roads, telegraphs, mills, factories, extraction of resources, and other public works in exchange for a stipulated sum for 5 years and 60% of all the net revenue for 20 years. Even Lord Curzon, the mastermind of the British colonial establishment in India and central Asia was not expecting such an immense concession. He jubilantly termed it as the most complete grant ever made of control of resources by any country to a foreigner. After Russian-sponsored agitation against the concession from the religious elite of that time, later, the concession was slightly modified and the conditions for Persia were softened. Nevertheless, the Imperial Bank of Persia remained under the control of Baron de Reuter. In 1890, Persia was forced to sign another concession granting total control over the growth, sale, and export of tobacco to the British. This was signed by the King of Persia and Major G. F. Talbot on 20 March 1890. With the Persian economy in total control of the British, it was easy to manipulate the Persian governments for political and strategic gains in the region. Until the fall of Reza Shah Pahlavi in 1979, Iran remained a subservient state and its domestic and foreign policies were almost controlled by the British and later by the US.
What will be the consequences of an IMF-controlled Pakistan on the region?
No major changes are expected in the foreign policy of Pakistan as from the very beginning, the Allah-given country has been towing the policies made in London and Washington. However, two things can happen. First, the Chinese dream of controlling the strait of Hormuz through its planned naval base in Gwadar will be shattered. Second, it appears that the US and British planners are believing that with the economy and allocations of military expenditure in their total control through IMF, the Pakistani army can be used according to their wishes in Afghanistan after NATO withdrawal. If things go according to plans made by the British and the Americans for the future of Afghanistan, the control of Afghanistan might be given to the Pakistani military establishment. But, taking into consideration, the track record of the Pakistani military establishment, it cannot be said with surety that it will remain tamed enough or the US the authorities be able to reign their unruly friends. Many observers believe that the ultimate result of such a happening will be the total control of Pakistan, Iran, and Afghanistan by fundamentalist religious groups. With a jihadist mindset and armed with Islamic nuclear bombs and technological know-how, the tamed ones can readily go berserk at any time. The mere thought of this is not only disgusting but also hair-raising as repercussions for the region and the world will be disastrous.