• Ratings agency Fitch expects govt to succeed in pushing through IMF fiscal reforms
• Predicts ‘military-backed technocratic set-up’ instead of fresh polls if govt collapses

KARACHI: Incarcerated PTI leader Imran Khan “will remain imprisoned for the foreseeable future” despite his successful legal appeals in April and June, Business Monitor International (BMI), an arm of the Fitch credit ratings agency, said in its latest country risk report for Pakistan.

The comprehensive report includes 10-year forecasts extending to 2033 and covers macroeconomic and political factors to provide insight into emerging trends in the country, according to a Dawn.com report.

Mr Khan’s sentence in the Toshakhana reference was suspended on April 1 while he was acquitted by the Islamabad High Court (IHC) in the cipher case in June. Various courts have also acquitted him in several other cases filed against him since the events of May 9, 2023 — the day when his first arrest had caused riots across the country, following which the state launched a crackdown on him and his party.

An Islamabad district and sessions court had also recently accepted the appeals filed by Mr Khan and his spouse, Bushra Bibi, against their conviction in the Iddat case.

Shortly after the court acquitted him in the Iddat case, however, the National Accountability Bureau (NAB) re-arrested the couple in a new Toshakhana case, leaving Mr Khan’s possible release from prison hanging in the balance.

“Although opposition leader Imran Khan has recently won several legal appeals, we expect that he will remain in prison over the foreseeable future,” the agency said in its country risk report.

The report added that analysts were “surprised when judges — who were expected to side with the government — quashed two legal cases against Mr Khan”.

The agency elaborated that “even in the unlikely event that Pakistan’s usually government-friendly judicial system overturned all of the over 100 charges against Mr Khan, we expect that the government would bring a new case against him rather than allow the popular opposition leader to go free”.

Regarding the International Monetary Fund’s (IMF) programme, the firm said that it expected the Shehbaz Sharif-led coalition government to “remain in power over the coming 18 months and will succeed in pushing through with IMF-mandated fiscal reforms”.

“If, however, we are wrong and the government is forced to resign, then we expect that the army would respond by installing a technocratic administration. Another election would raise the prospect that Mr Khan’s allies would gain a parliamentary majority, an outcome that we do not believe that the army would be willing to accept,” the report said.

BMI stated two key reasons why it expected the alliance to endure over the medium term: the powers that be throwing their “support behind the PML(N)-led government” and Mr Khan’s supporters not being able to organise a large-scale protest movement.

The company also wrote that the government “is only likely to collapse in the event of a sharp increase in violence or a painful economic crisis prompting a widespread protest movement”.

Moreover, it expected political risk to “remain elevated, which will put pressure on the rupee”.

Citing local sources, the agency said that the jailed leader “remained the country’s most popular politician”, which will make it “difficult for the government to push through painful fiscal reforms and makes protests likely”.

“The economic recovery is fragile and another shock would quickly push up the cost of servicing Pakistan’s large government debt burden,” it said.

Published in Dawn, July 19th, 2024