Pakistani Prime Minister Nawaz Sharif faces his biggest test since taking office, with stocks extending losses after falling the most in more than five years yesterday on concern protests may unseat his government.
Former cricket star Imran Khan is seeking to rally as many as 1 million people on Aug. 14 to push for a fresh election, prompting speculation that the military may seize power for the fourth time since 1947. The KSE 100 Index slumped 1.6 percent to 27,613.82, the lowest in four months, at 9:56 a.m. local time. Foreigners yesterday bought a net $5.2 million of shares as the index fell 4.5 percent.
“Everybody’s talking about the military alternative,” said Muhammad Waseem, professor of political science at the Lahore University of Management Sciences. “If it is not at this moment ready to take over, then Nawaz Sharif probably will be able to handle the situation on the ground.”
Sharif, 64, has sought to revive Pakistan’s finances while starting a military offensive against the Taliban and pursuing a case against former army chief Pervez Musharraf, the man who ousted him in a 1999 coup. The election that brought him back to office in May 2013 marked the first-ever democratic transfer of power in a country where the army has ruled for more than half of its history.
“Plans for protests will sabotage the peace needed for economic uplift,” Sharif told a gathering in Islamabad yesterday. “I have offered talks: Come and tell us which of our policies are wrong. We should hold talks instead of holding protests.”
Sharif will address the nation today, Ary News reported, without saying where it got the information.
Sharif’s party won 47 percent of seats in the last election. It now controls 55 percent of positions in the 342-member National Assembly after winning the support of independent candidates and receiving allocations reserved for minorities and women.
Khan’s Tehreek-e-Insaf party, which holds about 10 percent of parliamentary seats, plans to block roads in Islamabad, the capital, from Aug. 14 to mark the anniversary of the country’s independence. He says he has no choice to march after authorities dismissed his complaints of fraud in last year’s election.
“This does not mean I am calling the army,” Khan told reporters yesterday. “Otherwise I would’ve said I don’t recognize the elections from Day One. People are being scared that if you come out on the roads, the army will take over.”
In a televised speech to supporters in Lahore late yesterday, Khan said: “We all need to be prepared to remove any hurdles in our way. The police are with us, and the army will not stop us as they are with the people.”
Khan has been a vocal opponent of a military offensive that began in June to flush out Taliban militants in North Waziristan. Sharif ordered the operation after months of negotiations failed.
“Imran Khan is trying to defame the army because he has been against the operation in North Waziristan,” Information Minister Pervaiz Rashid told reporters yesterday. “All the institutions are working and continue to work under the norms of the constitution. And how is Khan going to feed a million people, or arrange for their washrooms, or even their lodging?”
Muhammad Tahir-ul-Qadri, a popular cleric who has no representation in parliament, plans to join Khan’s protest. Qadri led tens of thousands of people in protests before last year’s election to demand changes to the electoral system, and his supporters have clashed violently with police.
In June, five people were killed and another 44 were injured after Qadri’s supporters clashed with police in Lahore, according to the police spokesman Nayab Haider. Following the incident, stocks fell the most in two weeks.
The KSE 100 has risen 11 percent this year on expectations government moves to privatize state-owned companies and lower power subsidies will improve the nation’s economic stability after it received a loan from the International Monetary Fund last year.
Oil & Gas Development Co., the nation’s biggest company by value, had the steepest drop in three years yesterday, while MCB Bank Ltd. fell the most since September.
Sharif’s government risks making things worse by trying to stop the protesters rather than just letting them blow off steam, according to Taimur Rehman, a professor at the Lahore University of Management Sciences.
“Imran Khan’s motive is clearly to come into power,” Rehman said by phone from Lahore. “If the army comes it will be the responsibility of all political parties, and not just Nawaz Sharif.”