Pakistan’s Wheat and Sugar Scandal Leaves Imran Khan Exposed

27 May 2020 Phoebe Sleet, Research Analyst, Global Food and Water Crises Research Programme

Background

In May, the Pakistani Government released the findings of the sugar commission inquiry’s report into a scandal that has implicated a number of political and business figures, including the leaders of two political parties, as well as close political allies of Imran Khan. The report found that a “cartel” of 88 sugar mills had exported sugar during a low yield year, underpaid growers, faked records and manipulated prices, which contributed to an ongoing crisis in sugar prices that began in late 2018. The increase in sugar prices generated up to 76 billion Pakistani rupees ($720 million), more than half of which went to corrupt millers.

An investigation also revealed a Rs5.35 billion ($50 million) irregularity in the wheat industry that led to four corruption references against the Sindh Food Department and flour mill owners in a related wheat scandal. A sharp rise in flour prices and flour shortages have also been a recent source of discontent in Pakistan this year.

 

Comment

Adding to the turmoil that a faltering economy and global pandemic have created in Pakistan, the government has also found itself mired in a corruption scandal that has tarnished the reputation of Imran Khan, the Prime Minister who once promised to rid the country of the rampant corruption that has existed since partition. Instead of stamping out corruption, Khan has been forced to acknowledge that he approved export and subsidy proposals that directly enriched several political allies, in a move he claims he thought would benefit farmers. The decisions instead led to alarming increases in the price of wheat and sugar, in a country where food insecurity is a reality for 60 per cent of the population, largely due to the affordability of diets and where wheat makes up half of calories consumed.

All this leaves Imran Khan in a difficult position. For his part, following the preliminary findings of the investigations into the wheat and sugar crisis, Khan removed several ministers related to the scandal, but whether further action will be taken is uncertain. Pakistan’s wealthy sugar barons have links to a number of powerful political families and have influence over the country’s rural voters, an important demographic during election time. If Khan fails to act, however, he risks losing the urban, middle-class demographic that makes up his power base.

As Imran Khan decides how to handle the wheat and sugar scandal, he faces further difficulties as Pakistan’s powerful military begins to have doubts about a Prime Minister it brought to power. Already reportedly irritated with Khan’s style of government, the coronavirus pandemic saw the military sideline the civilian government completely, after Khan opposed implementing lockdown measures. In March, less than 24 hours after Imran Khan announced that a lockdown would weaken an already precarious economy, military spokesperson Major General Babar Iftikhar announced that the army would co-ordinate a lockdown instead. The military has continued to co-ordinate the coronavirus response instead of the civilian government.

While Imran Khan is under significant pressure from the public and the military, his term as Prime Minister is not necessarily over yet, at least for the immediate future. Pakistan’s military will likely be the ultimate arbiters of Khan’s career. While the generals may be disillusioned with him, his position is probably safe for now. He was reputedly made Prime Minister to prevent Pakistan’s two major opposition parties from coming to power, however, the military was reportedly in contact with opposition parties late last year.

No democratically elected Pakistani Prime Minister has ever finished a full five-year term. If Imran Khan hopes to avoid repeating the past, he must think very carefully about how he manages the host of crises currently facing his government.

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