In the wake of the Panama Papers leaks, Pakistan’s leader faces probing questions about his and his family’s finances. Rahimullah Yusufzai assesses the situation and its potential for long-term damage to Sharif’s premiership.
Prime Minister Nawaz Sharif’s problems have increased following the Panama Papers revelations that his children, including two sons living abroad and a daughter who is now in politics in Pakistan, set up offshore companies to allegedly stack away money and avoid paying taxes.
Though his name or that of his brother, Punjab chief minister Shahbaz Sharif, didn’t figure in the list of about 250 Pakistanis who maintained offshore companies in places like Panama, the Virgin Islands and the Bahamas, the prime minister came under pressure to reveal his assets that may have been tucked away abroad and make public the taxes he and his family have paid to the public exchequer. He quickly made a speech to the nation to clarify his position and recount his family’s struggles against heavy odds to build its businesses, but it didn’t resolve anything as demands grew to set up a judicial commission to probe his assets, offshore companies if any, and tax returns. He finally announced that a judicial commission would be set up with one retired judge, but the opposition parties rejected it and demanded that the serving chief justice of Pakistan should head it so that the commission could work independently.
Former cricketer Imran Khan, leader of the Pakistan Tehreek-e-Insaf (PTI), one of the two major opposition parties along with the Pakistan People’s Party (PPP), was at the forefront of the campaign demanding the prime minister’s resignation. He also announced holding a ‘dharna’ (protest sit-in) outside the PM’s palatial private house in Raiwind near Lahore in a bid to force him to resign. But Nawaz Sharif refused to quit and his party launched a campaign against Khan for putting funds raised through donations to his cancer hospital in Lahore in an offshore company and losing money in the process. Other opposition parties such as the PPP also demanded a proper judicial probe into the issue of involvement of the prime minister’s family in setting up offshore companies to evade taxes, but they didn’t demand his resignation.
Amid speculation about his poor health and the strain on him due to the Panama Papers leaks, Premier Nawaz Sharif left for the United Kingdom for a medical check-up and to meet his sons and aides for consultations away from the hustle and bustle of Pakistan and the prying eyes of the intelligence agencies, media and civil society. It also enabled him, at least temporarily, to deflect the pressure from opposition parties demanding an independent probe into his assets and the taxes that he has paid or avoided.
When Nawaz Sharif returned home after treatment for his reported heart ailment, his aides claimed he had decided to fly back, despite the doctors’ advice, in order to deal with the growing political crisis in Pakistan. He looked visibly fine and confident when he insisted his hands were clean. He reminded people that his family and he had been thoroughly investigated and found innocent in the past, particularly by the military ruler General Pervez Musharraf who ousted him from power in a military coup in October 1999.
Gradually, he came around to the idea advocated by the opposition parties that the country’s chief justice Anwar Zaheer Jamali should be requested to set up a judicial commission to probe the issue.
Finally on April 22, the prime minister wrote to the chief justice, asking him to set up a three-member judicial commission to investigate all aspects of the Panama Papers leaks involving the Pakistanis. The commission would be assisted by banking and tax experts so it could do a proper job. It was obvious the prime minister had finally succumbed to pressure from the opposition by agreeing to let a serving instead of a retired judge head the commission. Such composition of the commission would hopefully make its findings credible.
However, Imran Khan and the PPP’s parliamentary leader in the Senate, Senator Aitzaz Ahsan, rejected the commission and insisted that its terms of reference should be finalised in consultation with the opposition parties. They argued that the prime minister’s role in the whole affair was suspect and he had lost the moral authority to remain in power.
By addressing the nation thrice within a space of three weeks—twice in response to the Panama Papers issue and once after the suicide bombing by a militant in the Gulshan-e-Iqbal Park in Lahore, in which 74 persons were killed—the prime minister betrayed his anxiety and lack of control of the situation. In his latest address to the nation, he was bitter and at times angry with the opposition politicians and also the private television channels for carrying out his media trial even before laying hands on any evidence against him. At one stage, he was overcome with emotion when he remarked that he was a son of the soil and loved Pakistan even more than himself.
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His aides have argued that his two sons, Hasan and Hussain, living abroad for the last almost 20 years, had been doing business there and used their earnings to establish offshore firms. However, Sharif’s critics are claiming that the money was sent from Pakistan to enable the two brothers to do business and set up offshore companies.
This is one of the most serious challenges facing Nawaz Sharif since he won the 2013 general election and became prime minister for the third time. He weathered the agitation jointly launched by Imran Khan and Tahirul Qadri, an influential religious scholar from Punjab province, against his government in Islamabad in August 2014, but his hold on power became weaker and the military began playing its traditionally dominant role in the country’s affairs.
Nawaz Sharif’s is said to be worried more about the likely damage to the political career of his daughter and apparent heir Maryam, married to his former ADC Captain Mohammad Safdar, as records show she is a direct beneficiary of the offshore companies. His sons have not shown any interest in politics. His second daughter, married to finance minister Senator Ishaq Dar’s son, has also stayed away from public life.
There is no immediate danger to the Pakistan Muslim League-Nawaz (PML-N) government as Prime Minister Nawaz Sharif continues to enjoy the loyalty of legislators and a comfortable majority in parliament. His younger brother Shahbaz Sharif, as the chief minister, is holding the fort in Punjab, the biggest province of Pakistan. The party is also the dominant partner in the coalition government in Balochistan. The prime minister has survived quite a few challenges to his rule in the last three years and it appears he will stay in power unless the popular Pakistan army chief General Raheel Sharif decides to take things into his own hands before his retirement from service in November 2016.
However, even if Nawaz Sharif manages to survive this latest challenge to his rule, his weak government would become weaker and vulnerable to pressure from opposition parties, civil society, the media and, more importantly, the powerful military.