(Bloomberg) — Pakistan’s two old-guard political parties agreed to form a government, a move that breaks an almost two-week deadlock and likely keeps jailed former premier Imran Khan’s party out of government even though it won the most seats in the country’s contentious election.
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Bilawal Bhutto Zardari’s Pakistan Peoples Party will join in a coalition with the Sharif clan’s Pakistan Muslim League-Nawaz, Bhutto Zardari said at a joint news conference in Islamabad close to midnight on Tuesday. Shehbaz Sharif will be prime minister while Bhutto Zardari’s father, Asif Ali Zardari, will be president.
“Both the parties have the numbers to form a government,” Bhutto Zardari, 35, the son of slain former premier Benazir Bhutto, said, with Sharif next to him.
The announcement will probably end days of uncertainty after the inconclusive Feb. 8 election, in which Khan’s candidates, running as independents, defied the odds by winning the most seats but fell short of clinching an outright majority. Rounds of negotiations followed, culminating in the announcement Tuesday night.
Investors will be watching what this means for Pakistan’s markets, which have been rocked after the polls. The benchmark stock index has fallen for six of eight trading days since Feb. 8.
Questions also remain about how Khan’s supporters will respond. His Pakistan Tehreek-e-Insaf party held protests across Pakistan over the weekend against alleged vote-rigging. Credence was added to their claims when a Pakistani official said he had manipulated the vote count and the Election Commission of Pakistan was also involved. The ECP, which oversaw the polls, and the interim government of Prime Minister Anwaar-ul-Haq Kakar, deny allegations of rigging.
Khan’s Party Seeks Probe After Pakistan Vote-Rigging Revelation
Social media platform X, formerly Twitter, remained inaccessible for a third day across Pakistan Tuesday, according to internet watchdog NetBlocks, as authorities blocked to thwart the protesters.
A new administration will have to shore up an economy battered by Asia’s fastest inflation, running at 28%, and negotiate a new loan with the International Monetary Fund after the current program expires in April. Shehbaz Sharif has said that will be one of his first priorities if he becomes prime minister.
This isn’t the first time the two old-guard family-controlled parties have come together. They spearheaded a coalition after Khan was ousted in April 2022 and ruled the country for about 16 months. Shehbaz was prime minister, while Bhutto Zardari was his foreign minister.
During that period, Bhutto Zardari’s party appeared to distance itself from the economic reforms carried out by the Sharif government, including raising fuel prices.
For this year’s election, the two parties contested as rivals but later agreed to hold talks to “save the country from political instability,” according to Sharif.
The deadline for holding a parliament session for forming the new government is Feb. 29, Murtaza Solangi, the country’s interim information minister, has said.
–With assistance from Khalid Qayum.
(Updates throughout)
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