Pakistan Closer to a Sharif Government After PM Consensus

(Bloomberg) -- Pakistan moved a step closer to getting a new government after Shehbaz Sharif was named as the country’s next prime minister candidate, a breakthrough after no political party achieved an outright majority but one that could lead to a weak and unstable administration.

Nawaz Sharif, who heads the Pakistan Muslim League-N party, nominated his younger sibling Shehbaz on Tuesday for the post after his main rival Bilawal Bhutto Zardari dropped out of the race for the top job, party spokeswoman Marriyum Aurangzeb said in an X post. Bhutto Zardari said earlier in the day his party would support Sharif’s candidate and the new government, but it will not join the cabinet. 

“Revolutionary steps are needed to take Pakistan out of the economic crisis and they can’t be possible without mutual understanding and consensus,” said Shehbaz Sharif in a press conference earlier today. “I invite everybody to a charter of economy.” 

Sharif’s first task will be to lead negotiations with the International Monetary Fund for a new loan program. Sharif said the nation will need to secure a program quickly, indicating the new administration will have to hurry to tackle the country’s economic crisis.

Pakistan’s current $3 billion IMF program is set to end in April, and the nation faces $25 billion of external debt payments in the fiscal year starting July, about three times its foreign-exchange reserves. Sharif, who was prime minister from 2022 until last year, was crucial in breaking the deadlock and securing the current IMF program after the country came close to bankruptcy last summer. 

Three-time former Prime Minister Nawaz Sharif returned from exile late last year to galvanize his party before the election but decided against taking the position himself. 

Shehbaz is “more well-versed to deal with the matters of coalition than anyone else,” Ahsan Iqbal, a senior leader of the party, said by phone. “It will involve everyday negotiations, keeping coalition partners happy.” 

Shehbaz led a coalition of more than a dozen political parties to topple Imran Khan in a parliament vote to become the prime minister in 2022. Now with Bhutto opting out, the Sharif clan is expected to continue negotiations to bring them on board to avoid a weak government.

“This is just the beginning. They will go for more talks. There will be give-and-take,” said Umbareen Javed, a professor at Lahore School of Economics. “If Bhutto’s PPP is out of the game, there will be more political instability.”

The development is seen as an upset for Imran Khan’s candidates, who ran as independents and defied the odds by taking the most seats in the election but fell short of a majority. Khan’s party has decided not to engage with its main political opponents and is still contemplating how it can form a government.

The party decided to form a coalition with a smaller party called Majlis Wahdat-e-Muslimeen Pakistan, said a statement after party members met with Khan in prison. The decision will make them eligible for reserved seats in the lower house.

The next government will likely be very weak, said Uzair Younus, a non-resident fellow at the Atlantic Council. “When the tide turns, the next prime minister will find that they are unable to maintain a majority in parliament, leading to yet another political crisis in Pakistan.”

(Updates with Shehbaz Sharif nomination)

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