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Panama verdict: Behind most discontents lies a legal judgement

PanamaVerdictWhiteStarMohammadAsimMohammed Asim, White Star

By Osama Siddique

It is almost imperative for anyone who wants to be taken seriously these days to comment on the Panama Papers case. So here is my endeavour. But allow me first to provide some context.

Pakistan faces a crisis of justice. That is to say very few criminals are brought to justice and quite a few innocents are unjustly punished. A majority of criminal prosecutions fail due to obsolete evidentiary laws and equally obsolete judicial approaches.

The system also furnishes many legal and procedural loopholes to the mighty and the resourceful and offers few protections for the weak and vulnerable. Meanwhile, civil disputes take years to resolve in our courts, thereby consuming innumerable lives, wasting financial resources and often forcing the desperate or the opportunist to resort to criminal means.

Many people are also forced to settle their claims outside courtrooms — frequently with inequitable outcomes due to the inequality of bargaining power.

Such is the state of affairs at the institution entrusted with the delivery of justice that people have little confidence in the effectiveness of the judiciary. But you will seldom hear this being analysed in any great depth or with necessary seriousness from the ordinary citizens’ point of view. It is a yawn-inducing topic, not exciting and sensational enough to become the stuff of prime-time television.

To make matters worse, instead of frenetic efforts to assert itself, the judiciary appears to be on the retreat. The most recent capitulation is the meek surrendering yet again of the vital task of trying and holding terrorists accountable to military courts. The existence of a parallel and opaque system to punish crime only highlights the inadequacy of the mainstream criminal justice system.

This is quite apart from the separate and serious concerns regarding the military courts’ compliance with due process and human rights safeguards. There is a general tendency to think of such things as first world niceties in a country besieged by brutal terrorism. However, a state without a higher moral ground can eventually become indistinguishable from the violent and the lawless.

I digressed. I meant to discuss the Panama Papers case. But do indulge me a little more as I need to first broadly outline the main players in our system of justice as well as their respective challenges, for that is the milieu in which this case was adjudicated and decided. It is true that this system is fractured at several levels.

The police still searches for a clear post-colonial vision of goals and governance, lacks autonomy, has poor technical skills and faces many 21st century challenges with 20th century equipment and a 19th century mindset. The prosecution is fledgling, under-resourced, under-confident and, therefore, inadequate.

The prisons are unfamiliar with the concept of rehabilitation and probations, and parole services exist largely as concepts on paper. The judiciary often blames all these institutions for the overall failure of the criminal justice system.

There are two important things to note here. First, over the past few years – essentially in Punjab and Khyber Pakhtunkhwa – there are quite a few positives to report in all these departments and there are statistics to back improved performance (more on this at another time).

Second, these institutions are at least open to debate and critique, have mechanisms for political and public accountability and can boast of internal reform dialogues. Their internal state of affairs is not as fossilised as it may appear from the outside — there is some movement.

That cannot really be claimed about their biggest critic – the judiciary – which essentially remains aloof from reformation. Let us briefly examine this vital institution both empirically and sociologically. First, the crucial performance indication numbers – those that show delay and pendency – are not heartening to say the least.

More cases continue to come to courts than is desirable — more than the courts dispose or can ever dispose (the filters are weak; litigation is a convenient weapon to coerce and embroil one’s opponents, and to delay any official and administrative actions; there are also growing disputes in society).

More and more cases also remain stuck in courts despite some past attempts to clear backlog. Consequently, the gaps between case institution on the one hand and case pendency, as well as case disposals on the other, are growing.

While efficiency remains unequivocally a problem, quality of justice is also facing many challenges. Various publicly available surveys, scholarly writings and credible reports as well as any random conversation with citizens anywhere will highlight the huge problems there.

Institutional governance, on the other hand, is unbelievably hierarchical and centralised — all power essentially vests in the chief justices and there is no recourse if they simply dislike change. There is also no institutional pressure on them to change; the growing din of discontent in the streets notwithstanding.

The institutional culture, as a result, is one that promotes unquestioning servility, lack of initiative and embedded mediocrity amongst those occupying the lower rungs of the judiciary.

Administrative and support staff invariably lack the skill set required for tasks entrusted to them. Courts remain staunchly resistant to modern administrative frameworks for smoother operations and just, quick outcomes, such as a Case Flow Management System — something so fundamental and necessary that modern judiciaries have embraced it all across the globe.

As a consequence, there are no time limits for decisions of cases, no real judicial control over the pace of proceedings, increasingly recalcitrant lawyers, no willingness or viable mechanism for thwarting frivolous litigation and delaying tactics, and no overall judicial policy and mission.

Decision-making remains uninformed by data, performance evaluation operates on hearsay, record-keeping is abysmal and the language of justice and its beguiling processes are alien and alienating for the majority of citizens.

Let us now get back to the Panama Papers case — a case, above all, about merit and accountability. But surely it is important to first look at the judiciary’s own established safeguards to uphold the same. The judiciary often holds forth on the value of merit, transparency and accountability in other institutions. Yet it remains the only major institution where recruitment – or elevation as they prefer to call it – to the appellate courts is based on the preferences of a small group of insiders.

A constitutional endeavour to introduce a two-tier system for politically and publicly accountable judicial appointments was paralysed as the judiciary held on strongly to the rather indefensible principle of being answerable to itself alone, despite the risk of collusion and nepotism in any such scenario. The status quo, the judges insisted, ensured vital independence.

The judiciary also remains resolute that it would not agree to anything other than self-accountability. The Supreme Judicial Council and its pitifully small number of cases in the distant – and murky – past is all that there is to show for self-accountability.

Not to forget that if at all a judge finds themselves cornered into a position where they may be held accountable, they can conveniently resign and leave with all post-retirement benefits intact.

All this, of course, pertains to instances of corruption or delinquency — there is really no accountability whatsoever if an appellate judge simply does not work and spends an entire career writing nothing of note, or alternatively, writes judgments so poor that society would have gained if they had remained unwritten.

All the while we have to remember that provincial high courts are also responsible for administration of justice in their respective provinces — the aforementioned inaction or ineptitude for action, thus, adversely impacts hundreds of millions.

I should really now focus on the Panama Papers case but there is also the small matter of history. Legitimation of coups, authentication of dissolutions of elected governments under Article 58(2)(b) of the Constitution, opportunistic use of public interest litigation for holding forth over political contestations, chief justice Iftikhar Chaudhry’s brand of judicialization of politics, use of populism for self-aggrandizement and creation of a political constituency — it is a checkered institutional story indeed.

All constitutional courts are at some level political. However, in our context a combination of political upheavals, ambitious military, constitutional design and some opportunistic individuals have generated a jurisprudence on adjudication of political questions that continues to surprise and at times shock jurists and commentators all over the world. As a result, our judiciary is perhaps more political and politicized than its counterparts elsewhere.

Let us also not forget that there have been other cases like the one on Panama Papers. In the past too, we, as a nation, have spent months following seemingly interminable courtroom dramas that have resulted in judgments that comprise hundreds of pages.

During those injudicious times also, politics was brought to a standstill and desirable ways of ensuring democratic transitions, promoting political governance and resolving disputes within a federation were sidelined and discarded in favor of televised spectacles.

This, even though the challenges faced by politics actually needed more politics to resolve things. Court-administered prescriptions, thus, were unsuitable remedies, if not fatally wrong ones. This, despite many past experiences of the judiciary itself suffering and creating suffering whenever burdened by matters beyond its capacity and jurisdiction.

Add to all this its inherent unaccountability if and when it got it wrong. As if there was not already enough for the judges to do by way of protecting rights, punishing crime and resolving disputes. As if all that was being adequately done.

So when the latest court drama fever engulfed the nation, I found myself unable to offer anything even when everyone and their electrician could. And so everyone rightly suspected that I knew little of such matters. For how could someone not follow something so monumental and not believe that this judgment – this judgment alone and on its very own – will end all systemic corruption in Pakistan, firmly establish a robust system of public accountability and chalk out a clear and comprehensive future roadmap for the nation.

I confess that I remain tongue-tied still. All I can say is that let the citizens do politics. And let the judges do justice — justice for ordinary people, in everyday matters, in mainstream as well as far-flung places and on a daily basis. For that is what really matters to the people. And yet that is what never gets prioritized.

Osama Siddique is an Associate Fellow at the Institute of Development and Economic Alternatives (IDEAS), the inaugural Henry J Steiner Visiting Professor in Human Rights at Harvard Law School, and is the author of ‘Pakistan’s Experience with Formal Law: An Alien Justice’. His debut novel ‘Snuffing Out the Moon’ will be published by Penguin Random House in 2017.

This article originally appeared in The Herald on May 30, 2017.

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Whose voice really counts? Machine politics and citizen voice aggregation in emerging democracies

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By Ali Cheema, Asad Liaqat and Shandana Khan Mohmand

A central feature of democracy is that political parties aggregate citizen voice, and transform it into political mandates and programmatic policies when they form governments. Political parties are thus a central channel for making citizens’ voices count towards policies. The effectiveness with which political parties aggregate voice and how responsive policies are to the preferences expressed by their voter bases are important metrics for the strength of democracy. Recent experiences across the globe have cast doubt on how effectively these two aspects of democracy are working.

In the UK, for example, the Brexit vote revealed how disconnected party elites were from their voter bases. It also showed a widening gap between the policies that parties adopt and the preferences of their voter bases and party members. The resulting crisis of legitimacy of political party elites has emerged as an important point of discussion in western democracy.

In spite of the growing recognition of this issue in established democracies, there is little work on how well voice aggregation and policy responsiveness is working in emerging democracies. At the heart of this are the questions of how parties organize to aggregate voice, and what mechanisms ensure that this voice is reflected in policy formulation. Our research – Politics, Voice and Responsiveness in urban Pakistan – is looking at these questions.

Clientelism and citizen voice aggregation

Data from the Polity IV project shows that over the past thirty years there has been a dramatic spread of elected governments at the national and local levels. Evidence also suggests that national elections are fairly competitive in many emerging democracies. However, many democracies continue to struggle with weak party organizations at the local level. The existing evidence points to the prevalence of personalized machines of dynastic families and ethnic mobilizations, which weaken formal party structures.

How does citizen voice aggregation happen in this context? The standard answer in the literature is clientelism, particularly strong in communities where caste, ethnic and/or kinship networks underpin collective or group voting. Through clientelism, services are delivered as  quid pro quo arrangements between voters and electoral candidates. Voters make specific demands – for cash, or jobs, or a functional health center in the neighborhood – and politicians deliver these as best as they can, but only specifically in exchange for a vote. This provides strong incentives for targeted delivery of public services on a partisan basis rather than programmatic policy formulation that is likely to benefit both party and opposition voters.

Clientelist voter-politician interactions depend on reciprocity – both sides must deliver on their promise for the exchange to be complete – and on the ability of voters to aggregate their preferences. The clientelism literature suggests that it works effectively when voter-politician interactions are embedded in social networks, which are conducive to both reciprocity and aggregation. These networks provide information on whether voters who benefitted from politician delivery actually held to their side of the bargain and cast their vote for the politician in question. They also discipline the politician if the good that is contracted fails to be delivered after the elections.

What does citizen voice aggregation in Lahore look like?

However, little is known about the form actually taken by citizen voice aggregation in the megacities of emerging democracies, or how effectively it works there.

Our research explores these issues in non-elite neighborhoods in the Pakistani mega-city of Lahore, home to around 10 million people. The country made the transition from military rule to democracy in 2008, and Lahore’s politics is dominated by the ruling party, the PML-N. But a new political party – the PTI – has gained ground, and provided competition for the PML-N in 2013.

Many of our findings challenge the typical description of clientelism as citizen voice aggregation. Of those in our representative sample of 2000 adult respondents who voted in the last general election, the majority didn’t vote on the basis of ethnic, kinship or caste-based collective action. Instead, 54 percent of them report taking the voting decision independently or in consultation with their immediate family. Only 14 percent consulted with the forms of networks typically associated with clientelist exchange. In short, the group voting that is hypothesized to underpin clientelist exchange doesn’t appear to be prevalent in Lahore.

So how does the process of citizen voice aggregation work in this context? At the heart of the process are machines of political party constituency leaders that work through large networks of party workers. The evidence from our research suggests that the intensity of political party-citizen contact is much higher at the time of elections than after it. Thirty percent of our respondents reported having been in contact with a party worker at the time of elections, but only 10 percent afterwards. And an even smaller proportion reports having been in contact to express their needs for the purposes of planning public investment.

This presents a picture where party machines do exist at the local level, but do not serve as effective citizen voice aggregators. They function instead simply as the mechanism through which votes are aggregated at the time of elections. The connection between local party workers and citizens is weak after the election when programs and public investment are typically planned and executed.

Local party workers – key to understanding responsiveness?

To understand whether policy formulation and the planning of public investment is responsive to all voices, it is important to understand what determines the motivation and incentives of local party workers.

It is also important to understand which voters they are responsive to, what considerations apart from voter preferences drive their behavior, and how effective they are in influencing the choice of constituency leaders.

We are currently analyzing our data on these questions from our sample, who are located in four out of twenty-five provincial legislative seats of Lahore. We will be sharing all our research results very soon.

Ali Cheema is a research fellow at the Institute of Development and Economic Alternatives (IDEAS).

Asad Liaqat is a PhD candidate at Harvard University.

Shandana Khan Mohmand is a research fellow at the Institute of Development Studies.

This article was originally published on March 28th for Making All Voices Count.

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What we still don’t know about the Lawyers’ Movement

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(Image credit: Wiqi22, CC BY-SA 3.0, Wikimedia Commons)

By Maryam Khan

The Lawyers’ Movement is too fresh in our collective memory to need any introduction. It has attracted ubiquitous media coverage and commentary, invited praise and accolades as well as severe criticism from various quarters, and piqued the curiosity of legal bars and legal thinkers around the world about the potentialities of political lawyering.

It is now almost a trope to state that while the Movement accomplished its most immediate mission of reinstating arbitrarily deposed judges, it fell short of many other expectations. But missions and expectations aside, we are yet to fully comprehend how the Movement happened, who were its protagonists and catalysts, and who were and are its beneficiaries.

These questions are not merely an exercise in intellectual or nostalgic indulgence. They push us to think of fresh optics to analyse the Movement. Looking back at how the Movement was organized and the motivations behind it can tell us a lot about the structural synergies and dependencies between the bar and the bench, and how this nexus between the two generally impacts access to justice in Pakistan.

To begin with, we know very little about how spontaneous the Movement was. The peremptory removal of judges by military dictators is not an uncommon occurrence in Pakistan’s judicial history. The historical record raises questions about why and how the legal bar mobilized, especially in support of Chief Justice Iftikhar Chaudhry.

To be sure, the media played a role in sparking the ire of the legal community, just as the widespread anti-Musharraf sentiment helped in creating cross-party associational coalitions against his regime. However, while one could think of these factors as immediate or enabling triggers for the Movement, they are not sufficient in explaining such an unprecedented legal mobilization.

Three important lines of inquiry may provide the missing pieces of the puzzle. One is the internal organization of the legal bar and its various components. The second is the larger structural relationship between the bar and the bench. The third is the network of linkages between the bar and political parties. The alignments and power dynamics of the legal bar that emerge from the complex interplay of these three factors can give us a fuller picture of the organizational capacity of the bar to mobilize in general, as well as about the specific interests, alliances and motivations that drove the Movement.

Another lingering question is about how widespread or far-reaching the Movement was. How far down did it extend into the internal hierarchy of the bar? What was the relationship between the bar leadership and the rank and file, and how were decisions at the top disseminated and executed across bar organizations? What was the Movement’s spatial spread across different regions? Was it a pervasive Movement or was it limited predominantly to northern and central Punjab as some have claimed? What was the nature of the symbiosis between the bar and the political parties, and to what extent did the political parties advance the interests and objectives of the Movement?It would appear that the Movement was not as “spontaneous” as is commonly believed, and that it was built and sustained on the foundation of important institutional relationships and alliances that preceded the Movement.

A scrutiny of the Movement’s vertical and horizontal reach can help clarify the nature and extent of support for the Movement. This is important as it can provide us with insights about who benefited the most from the Movement, and the degree to which the success and sustainability of the legal mobilization was contingent on the self-serving objectives of these beneficiaries.

Aside from questions about the Movement itself, we are still grappling with its aftermath. How has the Movement affected access to justice, and has it changed our legal and judicial institutions in any positive way? Has it helped institutionalize our rights as citizens? Has it empowered us to hold the state and its institutions accountable? And if it hasn’t really changed anything at all, or if it has in fact led to some detrimental outcomes, why has this happened? Is there something inherent about the way, or the reasons for which lawyers mobilize that makes legal mobilization ill-suited to judicial reform and citizen empowerment?

One would be hard-pressed to deny that the Lawyers’ Movement has achieved some positives. On a very basic level, it has visibly demonstrated that some of the liberal notions of modern constitutionalism like judicial independence, political rights, and the enforcement of those political rights through judicial review, have a formidable constituency in the legal bar. This is good news.

An institutional constituency that has the capacity and motivation to mobilize for the support of judicial empowerment and independence can be an effective check on the kind of overt political meddling to which our judiciary has often succumbed in the past.

On the other hand, the Lawyers’ Movement seems to have had several negative consequences that are likely to persist in the long-term. In empowering the judiciary, the Movement has also enabled the judiciary to insulate itself from legitimate political accountability. Post the Movement, the Supreme Court has repeatedly asserted its internal control over judicial appointments, has insulated itself from political oversight, and has time and again resisted the much-needed reform interventions on the pretext of ‘judicial independence.’

At the same time, however, the Movement appears to have considerably strengthened the bargaining power of the bar vis-à-vis the bench. The fact that the judiciary owes many of its recent gains to the bar’s support for ‘judicial independence’ means that the bar is likely to remain in a position of institutional dominance over the judiciary, ensuring that the tentacles of judicial autonomy do not extend to the disciplining or reform of the bar itself.

This mutually beneficial equilibrium between the bar and the bench does not bode well for litigants or the justice system as a whole. The institutional interests of judges and the institutional and pecuniary incentives of lawyers seem to be the dominant forces determining the discourse on ‘rule of law’ and pushing back against any meaningful reform of the legal system. Of course, there are historical continuities in the institutional relationship between judges and lawyers. But we need to ask whether and to what extent the Movement has amplified this inter-dependence.

From anecdotal observations, it seems that the two institutions are even more resistant to change, even less motivated to empower the acutely neglected district and lower judiciary, and even less responsive to the many hardships of everyday litigants. Asking the tough questions about the Movement’s contribution to the deep inertia of the legal system can push us to design the right interventions for judicial reform.

Ten years on, then, the Lawyers’ Movement, is anything but history. It has raised many more questions than we can even begin to answer with our largely limited focus on its visible, grand, direct, and immediate effects. If we move beyond the obvious and outside the anecdotal, we may find that, criticisms aside, we cannot realistically expect the legal community to mobilize for anything other than the narrow agenda of political liberalism.

We may also find that it may make sense to strategically involve lawyers within larger coalitions than to expect them to willingly ally with other constituencies within their parochial associational domain. Ironically, the Movement seems to have increased our dependence on lawyers and judges to deliver justice, as well as to reform that very system of justice delivery.

Put another way, it has increased our reliance on the legal community to reform itself and disempowered other constituencies, including civil society and political actors, to bring about institutional and social change based on broader coalitions and interests.

Ultimately, looking back at the Movement prompts us to ask, what can we expect going forward if we entrust legal actors and institutions with our social and political interests as citizens?

Maryam Khan is a visiting research fellow at the Institute of Development and Economic Alternatives.

This article originally appeared under the title, “Ten years of a movement”, in the March 12th issue of The News on Sunday.

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Challenges to Pakistan’s fledgling local democracy

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By Asad Liaqat, Ali Cheema and Jacob N. Shapiro

In late 2015, party-based local elections under a democratically elected government were held for the first time in Punjab. The elections saw high voter turnout, with 61 percent of eligible voters casting a ballot. This was an increase from the 58 percent of Punjab voters who turned out in the 2013 national government elections.

This could mark the first of repeated cycles of stable elections and transfers of power, which many argue are enough to strengthen democratic institutions. However, strong local democracies also depend on the stability and coherence of party structures as well as the institutional framework within which parties operate and elections take place. In this regard, local democracy in Pakistan remains weak.

It is important to recognize that local politicians are not only vital conduits for service delivery, but are also important mediators between citizens and higher tier politicians. In Punjab, the provincial government wields considerable authority in the assignment of functions and finances to local governments. This implies that local politicians have tremendous scope to connect people to their government and ensure their needs are represented.

Based on the results and original survey data from the November 2015 elections in the Sargodha district of Punjab, we identify major problems within the democratic process and offer insights into what institutions and political parties can do to strengthen local democracy.[1]

Where opposition is weak, so is democracy

One of the fundamental, constitutive elements of a well-functioning democracy is the existence of meaningful competition between parties for elected positions. If strong opposition parties exist and maintain links with voters, they can keep the incumbent party in check by incentivizing them to perform better through the threat of electoral defeat in subsequent elections.

Local democracy in rural Punjab falls short in this regard, as seen in the opposition’s inability to field candidates. In Sargodha, the main opposition party, Pakistan Tehreek-e-Insaaf (PTI), could only field candidates for the office of union council (UC) chairperson (a directly elected local government office) in 64 out of the 164 rural UCs that comprise the district council. Other opposition parties failed even more miserably: Pakistan People’s Party (PPP) fielded candidates in a mere eight union councils, and the Pakistan Muslim League-Quaid and Jamaat-e-Islami only fielded two candidates each.

Unsurprisingly, this results in lackluster electoral performance for opposition parties. Among the union councils where PTI did field a candidate, it managed a vote share higher than 30 percent in only half of them, winning a total of 12 union council chairman seats. The only other opposition party that won any seats was PPP, which succeeded in four out of the eight seats it contested. In total, opposition parties only won 16 out of the 164 union council chairmen seats in Sargodha. Opposition parties held less than 10 percent of the seats in the district council of Sargodha at the time of these elections.

The real opposition that emerged to fill this vacuum was independent candidates. In a staggering 84 percent of union councils, at least one independent candidate contested. Independents won the chairman position in 68 out of 164 union councils. Put differently, independents won 49 percent of the seats where at least one independent was contesting. This phenomenon is worrying since it represents a corrosion of party-based accountability, weakens the relationship between local and national democracy and reduces political ownership for the system among opposition parties.

Politicians need to be vetted for honesty, competence and motivation

Another key element of a well-functioning democracy is the ability of political parties to select the “right” candidates. Democratic theorists have emphasized the critical role parties play in vetting potentially elected officials. Sargodha’s local government election, with weak opposition parties, presents an ideal setting for analyzing the robustness of candidate selection by the provincial ruling party, Pakistan Muslim League-Nawaz (PMN-N).

PML-N party officials clearly played this gate-keeping role. Field observations suggest that a majority of candidates who ran as independents were jockeying vigorously for endorsement by the ruling party prior to the allocation of tickets.

Evidence suggests that the ruling party’s selection process isn’t very robust. In a third of union councils where there was consensus within PML-N over a candidate’s endorsement, voters rejected the ruling party candidate in favor of an independent. The current process of candidate selection, which is influenced by district-level caucuses, may work for party bosses but it isn’t getting selection right in the eyes of the voters. An important feature of local elections is that they reveal this disconnect.

Solutions

Clearly much work needs be done to strengthen the local democratic project in Pakistan. A good starting point would be a public report on the state of local democracy generated by the Election Commission that rates the strength of democracy on defined metrics across Pakistan’s different rural and urban local councils and governments. The report should point out failures at the level of the ruling and opposition parties in order to create public pressure on these organizations to modernize processes (such as selection) and take actions (fielding candidates) that will help build the foundations of a strong local democracy.

At a legislative level, the issue of independent candidates needs to be seriously debated. It is misleading to call a system party-based if the main opposition party is only able to field candidates in a fraction of constituencies. The current system will be subject to accusations of political capture by opposition parties and is likely to weaken political ownership. There is also a need to create rule-based separation of functions and finances between local and provincial governments that are enforced through bipartisan institutions. The recent action by the Government of Punjab in announcing a rule-based fiscal transfer award for local governments through the Provincial Finance Commission (PFC) Award is a step in the right direction.

Finally, it is important for the provincial government to recognize that weak political accountability at the local level creates real risks for poor service delivery and corruption. These problems are likely to damage its reputation in the 2018 general election. Given weak party-based competition and the resulting weak performance incentives for local politicians, it is critical to enforce the Punjab PFC’s recommendation of instituting administrative accountability mechanisms such as third-party and citizen audits. This is important to ensure that local governments deliver to the voters.

Asad Liaqat is a PhD candidate in public policy at Harvard University.

Ali Cheema is a senior research fellow at the Institute of Development and Economic Alternatives (IDEAS) and Associate Professor of Economics at the Lahore University of Management Sciences (LUMS).

Jacob N. Shaprio is Professor of Politics and International Affairs at Princeton University and an associate fellow at IDEAS.

[1] The larger research project being conducted by the Institute of Development and Economic Alternatives (IDEAS) examines how voters make choices broadly and the relative weight they give to party performance vs. candidates’ political and bureaucratic connections. Along with the authors of this blog, research was conducted by Michael Callen (Assistant Professor of Economics and Strategic Management at the University of California San Diego), Adnan Khan (Research and Policy Director at the International Growth Centre) and Farooq Naseer (Assistant Professor of Economics at the Lahore School of Management Sciences).

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What President Trump means for Pakistan

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By Shehryar Nabi

What does the Trump administration mean for Pakistan? Here are the key issues to watch:

Relations with the United States

The American foreign policy establishment has held an increasingly critical view of Pakistan. Despite being a U.S. ally in fighting terrorism, Pakistan has been accused of distinguishing between “good and bad” terrorists and supporting militant groups that threaten U.S. interests. Former President Barack Obama even questioned why Pakistan should remain an ally. Pakistan currently relies on the U.S. for $850 million worth of economic and military aid, which has declined over the past few years.

At his confirmation hearing, Secretary of Defense James Mattis said he will incentivize Pakistan to eliminate terrorists within its borders. He also said he would encourage collaboration between Pakistan and Afghanistan to combat terrorism. Mattis has in the past stressed the importance of maintaining an alliance with Pakistan despite frustration with its anti-terror efforts.

National Security Advisor Michael Flynn has taken a tougher position. In his recent book, The Field of Fight, he wrote that Pakistan must choose between helping extremists or receiving harsh treatment from the United States. If this translates into less aid or more trade restrictions, sectors of Pakistan’s economy that depend on American money could suffer.

Pakistan’s tightening geopolitical relationship with China may put it in an awkward position if the U.S.-China relationship starts to deteriorate. Trump talked disparagingly about China’s effect on the American economy during the presidential campaign. Trump’s pick for secretary of state said that he would block China’s access to artificial islands it built in the South China Sea. China responded with aggressive statements. But hostilities could be checked by Trump’s pick for ambassador to China, whom the Chinese government has praised as “an old friend”.

Continued expansion of America’s relationship with India could also strain U.S.-Pakistan relations. In August, the U.S. and India signed an agreement that relaxed institutional impediments to military logistics-sharing between the two countries. In December, the U.S. also officially recognized India as a “Major Defense Partner”, guaranteeing future military collaboration. Secretary of Defense Mattis has said he would continue strengthening U.S.-India ties.

These actions are perceived as an attempt by the U.S. to check China’s influence in Asia. If China takes issue with a militarily empowered India, it might find an even stronger ally in Pakistan, which is likely to be alarmed by the situation. This would only add to the awkwardness of Pakistan’s position with the U.S.

Climate change

Rising sea levels and drought induced by climate change threaten to create tens of millions of climate refugees in Pakistan. But Pakistan alone can’t do much about it beyond trying to adapt, because the main contributors to global warming are the United States, Europe and China.

There are clear signs that Donald Trump’s presidency would diminish America’s vital role in upholding global commitments to reduce greenhouse gases. As part of the Paris Agreement, the Obama administration vowed to shut down coal-fired power plants, which would lower U.S. carbon dioxide emissions by up to 28 percent. The Trump administration intends to withdraw the U.S. from the agreement and lift Obama-era regulations that limit the extraction of fossil fuels. He tweeted in the past that climate change was “created by and for the Chinese”, and he picked a climate skeptic to head the U.S. Environmental Protection Agency.

Without America’s cooperation in global pledges to reduce greenhouse gases, the world will move faster towards an atmospheric temperature of 2 degrees Celsius – widely considered the climate “danger zone”.

Remittances

Remittances – money sent by migrants to their countries of origin – make up seven percent of Pakistan’s GDP. 13 percent of those remittances ($1.3 billion) come from the United States. Remittances play a crucial role in making poorer families resilient during natural disasters and periods of economic uncertainty, and they can even spur entrepreneurship.

Pakistan could see a sharp increase in remittances from the United States in the near term if Pakistanis living there fear prejudice and send money back in case they have to return. This is precisely what happened after the September 11th attacks in 2001 led to a rise in in anti-Muslim sentiment. From 2001 to 2002, remittances to Pakistan from the United States nearly tripled.

Why would Pakistanis fear prejudice? Trump’s campaign was marked by controversial statements about Muslims such as his proposed temporary ban on all Muslim travel to the United States, the notion that Islam hates America and the establishment of a Muslim registry. Hate crimes against Muslims also increased by 67 percent from 2014 to 2015, and there is concern that perpetrators of these crimes are empowered by Trump. However, recent polling data showing that overall American favorability of Muslims increased (mainly driven by members of the Democratic and Independent parties) during Trump’s campaign suggests growing prejudice and support for Muslims are parallel trends.

On Friday, Trump signed an executive order barring all immigration from seven Muslim-majority countries, and the White House hinted that Pakistan could be included in the future. However, there is room in the order for exempting immigrants on a case-by-case basis, and the order won’t apply to green card holders.

If these factors combine to foster anxiety among Pakistanis living in the U.S., remittances could rise in the near term. But if more Pakistanis leave the U.S. and fewer choose to migrate there, there will likely be a long-term slump in remittances.

Human capital

Thousands of Pakistanis go to the United States to study and work every year. Many of them stay in America and find employment in high-skilled jobs. This has contributed to a “brain drain”: Pakistan is missing out on the contribution of highly educated citizens who choose to work abroad.

But at the same time, many Pakistanis come back and make a real impact with the advanced knowledge acquired in other countries. This knowledge makes them great “human capital”.

If the Trump administration fosters the hostile environment described above, would Pakistan benefit from a “reverse brain drain” – when highly educated Pakistanis decide to come back? It might, but those Pakistanis may prefer to work in another country with organizations that reward advanced skills and talent. Pakistan lacks enough of those organizations.

If Trump’s presidency marks a longer-term decline in Pakistani access to American institutions, high-achieving Pakistanis who want to bring back global knowledge and experience will have a harder time doing so.

Exports

Exports are a key driver of economic growth in Pakistan. The United States is Pakistan’s top export destination with $3.7 billion worth of exports in 2015.

86 percent of those exports are from textiles, which dominate Pakistan’s manufacturing sector. Invigorating this currently struggling sector will lead to mass job creation that will reduce poverty and help prevent a future unemployment crisis.

Anger over the loss of manufacturing jobs in America was decisive for Trump’s election victory. He touted protectionist trade policies during his campaign to bring outsourced manufacturing jobs back to the United States.

He pledged to withdraw from the North American Free Trade Agreement (NAFTA) if it isn’t renegotiated in America’s favor, he killed the Trans-Pacific Partnership (TPP) and vowed to impose a 45 percent tariff on goods from China. While it’s unclear whether Trump’s top officials on trade would advocate these exact policies, they hold a similar, skeptical outlook on America’s trade deals.

This protectionism, if applied to Pakistan, will make it more expensive for Americans to buy Pakistani goods and may reduce export earnings from the United States.

Multilateral engagement with Pakistan

Pakistan receives billions of dollars from multilateral organizations such as the World Bank and the International Monetary Fund, both of which receive more funding from the United States than any other country.

The Trump administration has drafted, but not yet implemented, two executive orders that could lower U.S. commitment to these and other international organizations.

The first order cuts funding for any United Nations agency or other international body that, among other criteria, grants membership to the Palestinian Authority or Palestine Liberation Organization, funds abortion or receives money from any state that sponsors terror or violates human rights. The order further mandates a minimum 40 percent decrease in spending toward international organizations.

The second order requires a review of America’s current multilateral treaties and withdraws from those that are not directly related to national security, extradition or international trade.

The fact that the order has been delayed could mean it will be amended. But it signals that the Trump administration is serious about rolling back U.S. global engagements in the development sector. Resources for organizations that support healthcare, education, infrastructure development, energy and other sectors will likely be reduced. Indeed, the effectiveness of international donor money for development is subject to debate. But if the orders result in decreased global support for Pakistan’s development goals, achieving them will be a greater challenge.

Shehryar Nabi works in communications for the Consortium for Development Policy Research and the Institute of Development and Economic Alternatives.