Jean-Jacques Rousseau wrote, “Man was naturally good but becomes corrupted by the pernicious influence of human society and institutions.” The historic treatise The Social Contract became a motivation of change, of the rise of nation states and the end of colonialism. But social revolutionaries were eclipsed by the drive for economic exploitation and the failure of communism. Rousseau favoured democracy, but preferred egalitarianism.

Even today, third world countries with natural resources and geostrategic importance are forcibly enslaved through economic manipulation perpetuated by the ‘Dogs of War.’ Liberalism, trans-nationalism, globalisation and speculators have replaced the mighty armadas that conquered and colonised. These “dogs” have moved beyond traditional slave craft. Now, home grown elements perpetuate an exploitative political culture. The only party in the world that adopted this slogan was Pakistan Tehreek-e-Insaf, which most western commentators viewed as overtaking the social contract dynamics of New Europe.

As events prove, Pakistan is no exception and its leaders will continue to fall prey to pernicious influences of human society and institutions. Like polyandry, Pakistani politicians and the establishment have many beholders. Each must be kept happy in the Meena Bazar of the loot sale.

Over the past few years, Pakistani politicians, greedy bureaucrats and businessmen have understood and mastered this exploitation. They speculate within the gaps created by the international system. The fluctuations in the Pakistani currency are directly related to these forces of neo colonialism. This tip of the iceberg is interconnected with geo strategy and politics. Pakistan’s core interests are secondary. This has been a subject of many articles written by me on these pages. As the dirty game unfolds in all its dimensions, it will bring more misery and insecurity for a common Pakistani and aggravate Pakistan’s security.

Inward remittances are always a boon for cheaper imports and a cause for the appreciation of local currency. Since 2002, this is a case study to the contrary. The boon was used for speculation of a windfall that finally resulted in the economic collapse of 2007-8. These windfalls ultimately deposited in offshore accounts continue to build. Export led sustainable growth is not a priority.

In 1998, before the seizure of foreign currency accounts, huge amounts were withdrawn and transferred to hedge the interests of influential business houses. Put into deposits, circulation and property, this amount soon swelled to billions of dollars owned by Pakistanis in Europe and the Middle East. With egalitarianism as its principal motivation, PTI often talked of bringing back the looted wealth and overhauling Pakistan’s economy.

My hypothesis is that other than the linkage between growing Pakistani assets abroad and devaluation at home, there is also an intrinsic link between inward remittances and the local money market. It has now become a vicious cycle that shall soon give full control of consumer sectors and state owned enterprises to monopolies that hope to control Pakistani politics forever. Even military interventions will not be able to circumvent them. This is how it works.

Exports, direct remittances through formal and informal channels, loans, treasury bills, grants, donations, payments by international financial institutions and countries form the sources of inward remittances.

The IMF is scheduled to help Pakistani balance of payments through an incremental release of US$ 6.64 Billion by September 2015. In the same period, Pakistan will have to pay back over 3 billion as debts grow. World Bank and Asian Development Bank are scheduled to release 1.5 billion during the same period. Department for International Development UK (DfID) is likely to pump in over 2 billion by September 2015. It has already remitted over one billion to date. Friends of Pakistan and Pakistan Development Fund are likely to add 2 billion by 2015. Efforts are also at hand to get additional funding from USAID headed by Rajiv Shah with strong connections with the Indian government.

In sum, Pakistan will get inward remittance through these donors to a tune of 11 billion dollars by September 2015. Coalition support fund from the US is besides this. This is over and above the exports and inward remittances by overseas Pakistanis and speculators using the hundi/hawala and legal banking channels.

Once inward remittances arrive, the Pakistani rupee records a sudden appreciation and speculators buy more dollars, stash them abroad or in local foreign currency accounts.  Easy money transfer protocols in UK, India and Dubai facilitate. Since 2007, more than 1,000 Pakistani politicians, bureaucrats and businessmen have purchased properties in the UK worth more than $8 billion. Hence each billion dollar brought in the system becomes Rs. 111 billion used to buy 1.1443 US $ in the local market. Over a year, if $10 billion are remitted into the system, the profit becomes a mammoth US$ 1.44 Billion. This recycled amount can be used to purchase and create consumer based monopolies and sustain an artificial growth in GDP. The astronomical profits can be exchanged through local money changers and reverted back to dollars.

Through deliberate weakening of the regulatory mechanisms in the country, the SECP, privatisation commission, state bank, local banks, stock exchange and money changers, the government can continue printing paper money (Rs 850 billion between June-July 2013), and buy dollars. Combined with the monthly corruption of over Rs. 8 Billion, the windfall can buy state owned enterprises many times over. 

The recent influx of US$ 750 million in SPD is directly related to Pakistan’s obligations with a friendly country and a small part of the big game (http://www.nation.com.pk/columns/ 01-Mar-2014/the-saudi-shadow). The fund solicits Pakistan’s cooperation in a dirty regional game, provides space to TTP, compensates the Pak-Iran gas pipeline project and relegates the seaport of Gwadar to a shipping harbour. Another spinoff of granting space to the TTP will be their unchecked rise in Kunar Afghanistan. Once the US withdraws, Dir, Bajaur, Chitral and Swat will be under direct threat.

But will such a fiscal policy, one that moves beyond the comprehension of Pakistan’s security and economic gurus bear fruit? No, it will not and Pakistanis will continue to be in chains and anarchy.

The euphoria of Naya Pakistan and Tabdeeli (change) associated with the PTI has been compromised by the recent engagement between PML-N. The only doors to stem the rot lie in a spontaneous street uprising or a military intervention. Both are unlikely and Pakistan will continue to practice political polyandry.

Pragmatism and mutual vulnerabilities can produce strange bedfellows. True to Rousseau, expediencies make slaves of everyone. Egalitarianism like Godot, never comes.

n    The writer is a retired officer of Pakistan Army and a political economist and a television anchorperson.